Jakarta: The latest Business Survey conducted by Bank Indonesia (BI) pointed to faster business expansion in the second quarter of 2021, as indicated by a significant increase in the weighted net balance (WNB) to 18.98% compared with 4.50% in the first quarter of 2021.
Recent gains were driven by expansion recorded in most economic sectors, including Mining and Quarrying; Trade, Accommodation and Food Service Activities; as well as Agriculture, Plantations, Livestock, Forestry and Fishing.
Respondents stated that mining sector gains were driven by strong domestic demand, supported by higher production, while a seasonal spike in demand during the Ramadan and Eid-ul-Fitr festive period boosted trade, accommodation and food service activities.
Similarly, agricultural performance was underpinned by seasonal factors and a successful food crop harvest.
Consistent with increasing business activity, production capacity utilisation soared to 75.33% in the second quarter of 2021 from 73.38% in the previous period, while labour utilisation increased despite remaining in a contractionary phase, accompanied by improving corporate financial conditions and access to credit.
"Bank Indonesia will carefully monitor the impact of emergency public activity restrictions (PPKM) introduced by the government that could severely impede business performance in the third quarter of 2021," BI Communication Department Head Erwin Haryono said in a press release issued on Wednesday.
Respondents predicted broad-based business moderation In the third quarter of 2021, despite a positive WNB of 9.77%, across most economic sectors, especially Trade, Accommodation and Food Service Activities as well as Financial, Real Estate and Corporate Services.
On the other hand, respondents expected agricultural and manufacturing industry performance to decline.
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