Indonesia's economy grows slower at 4.71%

Indonesia's gross domestic product (GDP) of the first quarter grew at the slowest pace since 2011 as consumption and export fell amid implementation of fuel price hike.

The national statistic bureau announced on Tuesday that the economy expanded by 4.71 percent at three months ended in March, compared with 5.01 percent at the previous quarter.

That is lower than 4.8 percent of the median forecast of some analysts surveyed by Xinhua.

The growth of household consumption, the main trigger of the growth at the country home to over 250 million people, scaled down to 5.01 percent at the first three months compared with 5.35 percent at the same period last year, Head of the Bureau named only Suryamin said.

The weakening on the consumption occurred as the Southeast Asia 's largest economy witnesses high inflation, weaker rupiah against the U.S. dollars and interest rate amid rising fuel prices,

"Low consumption, weakening rupiah, lower export and the impact of fuel price hike policy, contributed to the growth contraction," Andry Asmoro, analyst from Bankmandiri told Xinhua by phone after the announcement.

Weakening rupiah did not help spur the growth as most of component of exports were imported, which pushes import product prices up.

It is proven as the country's export growth fell by 0.53 percent at the first quarter compared with the growth of 3.16 percent at the same period last year, and import expansion was also down by 2.20 percent at the first quarter compared with 5.04 percent growth at the same period last year, said Suryamin. "Distribution of trade slowed because of the decline on supply of imported products," he revealed.

Besides, the weakening growth in Asia, the main export market for products of Indonesia's big companies, has weakened demand on products manufactured by big firms in the biggest economy in the Southeast Asia that impacted on the corporate performance, Finance Minister Bambang Brodjonegoro said last week.

Indonesia is the world's top exporter of palm oil, thermal coal and refined tin. The country is also among the world's top exporter of cocoa and rubber, and the world's top producer of copper.

Late of spending on the development budget also factored on the fall of the growth.

This impacted on the government spending which slowed to 2.21 percent at the first quarter compared with 6.12 percent at the same period last year, said Suryamin.

President Joko Widodo, who has freed up budget for infrastructure by slashing fuel subsidies and, travel and meeting budget of official, has said that the spending of the development budget will kick off in April and be more in May.

"For the next quarters, it is seems hard to boost export (but) the government has to boost spending of the (development) budget through the infrastructure projects, along with boost in investment," said Asmoro.