Jakarta: Trade Minister Enggartiasto Lukita has said that he don't see any indication that Indonesia will fall into the middle income trap in the future.
"I don't think we will fall into the middle income trap. I think we should study the economic parameters," he told journalists on Tuesday.
"Some countries have higher growth. But they also have higher inflation," he added.
Quoting a report from the Central Statistics Agency (BPS), Indonesia's gross domestic product grew by 5.17 percent in 2018. It was Indonesia's highest annual growth in five years.
The country's economy was measured by GDP on the basis of the current price reaching Rp14,837.4 trillion and GDP per capita reaching Rp56 Million or US$3,927.
In terms of production, the highest growth was achieved by Other Service Business Fields at 8.99 percent. From expenditure side, the highest growth was achieved by the Non-Profit Institution Consumption Component Serving Households (PK-LNPRT) at 9.08 percent.
Java Island contributed the most to GDP which amounted to 58.48 percent, followed by Sumatra Island at 21.58 percent, and Kalimantan Island 8.20 percent.
In the meantime, Consumer Price Index (CPI) inflation was kept under control throughout 2018 within the 3.5±1 percent target range. Headline inflation was recorded at 3.13 percent (yoy) in December 2018, lower than the 3.61 percent (yoy) posted in 2017 and the 3.33 percent (yoy) average for the past three years.
Annually, contained core and volatile food inflation as well as lower inflationary pressures on administered prices contributed to control CPI inflation in 2018. Core inflation stood at the low rate of 3.07 percent (yoy) in line with policy consistency by Bank Indonesia in terms of maintaining exchange rate stability and anchoring rational inflation expectations.
Price pressures on volatile foods (VF) were recorded at 3.39 percent (yoy), eased by a stable food supply and sliding international food prices. Furthermore, inflationary pressures on administered prices (AP) were low at 3.36 percent (yoy) in accordance with Government reluctance to adjust prices.