Mini research

“ECONOMIC GROWTH IN INDONESIA 2017-2018”

Lecturer : Andri Zonal,SE.,M.Si.,Ak.,Ph.D & Choms Gary Gt

Sibarani,S.pd,M.Si
Courses : English Economic

Arranged by :
Group 4
Nurika Faqhna Hidayah Manik (7181240004)
Siti Patimah Harahap (7181240008)
Widya Astuti Malemna Barus (7183540008)

ECONOMICS SCIENCE - B
2019
UNIVERSITY STATE OF MEDAN
 TABLE OF CONTENTS

FOREWORD….....................................................................................1
TABLE OF CONTENTS…..................................................................2
CHAPTER I : INTRODUCTION.......................................................3
A.Background...................................................................................3
B.Formulation Of The Problem........................................................3
C.Purpose.....................................................................................3
CHAPTER II :DISCUSSION..............................................................4
CHAPTER III : CLOSING.................................................................9
A.Conclusion....................................................................................9
BIBLIOGRAPHY................................................................................12

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 FOREWORD
Thank you, we pray to God the Almighty for the blessings and mercy of the author, to
complete the issue of Economic Growth in Indonesia 2017-2018.The author of this
preparation is the writer realizes that the smooth writing of Miniriset is thanks to the help and
motivation of various parties.
Therefore the author would like to express his gratitude to the parties who have
helped in the smooth writing of this miniriset. In writing this minriset, the author has tried to
present the best.
The author hopes that this Miniriset can provide information and have value benefits
for all parties.

Medan, Mei 2019

Author

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 CHAPTER I

INTRODUCTION

A. Background

Many developing countries in the world have succeeded in showing economic

growth in the country itself, but there are still many problems in the country itself, such as:
unemployment, a very high birth rate, the lack of experts, and the difficulty of getting a place
to work. This situation was also highlighted by economists with problem"Development is not
the meaning of development"Economic growth and economic development are often linked
to the same thing by some economists, but on the basis of these two things differ in
understanding.
With the existence of economic growth there will be economic development itself
where economic growth itself will emerge economic development development. These
changes in various economic sectors will result in economic growth, which is marked by
rising national production, national income, and per capita income. Such a situation will take
place continuously. B.

B. Formulation Of The Problem

Based On The Background Of The Problem Above,The Author Formulates a

Background Problem,”Economic Growth”

C. Purpose
In Line With The Formulation Of The Problem Above,The Author Formulates a
Paper Writing Objective,’’To Get Laters Results From Economic Growth In Indonesia”.

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 CHAPTER II
THEORITICAL BASIS

A.WHAT IS ECONOMIC GROWTH

Economic growth is the process of changing state conditions towards better
sustainability for a certain period. The higher the level of economic growth, the faster the
process of increasing regional output so that the prospects for regional development are
getting better. Knowing the sources of economic growth can determine the priority
development sector.

B. ECONOMIC GROWTH ACCORDING TO EXPERTS

1. Adam Smith
According to Adam Smith, economic growth is a change in the level of the
economy in a country that relies on the increase in population. With the increase in
population, the output or yield of a country will increase.

2. Sadono Sukimo
According to Sadono Sukimo, the notion of economic growth is a change in the
level of economic activity that applies from year to year. To find out its growth, it must be
compared the national income from year to year, which we are familiar with the rate of
economic growth.

3. Budiono
According to Budiono, the notion of eknomoi growth is a process of long-term per
capita output growth that occurs when there is an increase in output originating from the
internal process of the economy itself and its temporary nature.

C. FACTORS OF ECONOMIC GROWTH

The factors that influence economic growth are:

• Human Resource Factors
As with the development process, economic growth was also developed by HR.
Human resources are the main factor in the development process, the slow pace of the
development process depends on which human resources as the subject of development have
sufficient competence to carry out the development process by building infrastructure in the
regions.
• Factors of Natural Resources
Most developing countries rely on natural resources in carrying out the
development process. However, natural resources alone do not support the process of
economic development, it is agreed not to be supported by the ability of human resources in
the management of available natural resources. Approved natural resources include soil
fertility, mineral wealth, wealth of forest products and marine wealth.
• Factors in Science and Technology

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 The development of science and technology that enhances the process of
accelerating development, changing the pattern of work that originally used human hands
was replaced by machines developed for aspects of efficiency, quality and complication of
economic development carried out and at the time of accelerating the pace of growth of
progress.
• Cultural factors
Cultural factors give priority to the economic development carried out, these factors
can carry out development or drive the development process but can also be an obstacle to
development. Culture that can encourage the development of freedom of hard work and
smart, honest, resilient and so on. Whereas a culture that can hinder the development process
is anarchic, selfish, wasteful, KKN (Corruption, Collusion and Nepotism), and so on.
• Capital Resources
Capital resources needed by humans to process natural resources and improve the
quality of science and technology. Capital resources consisting of capital goods are very
important for the development and smoothness of economic development because capital
goods can also increase productivity

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 CHAPTER III

DISCUSSION

A.Global Economy Increases to 3.1 percent in 2018

The World Bank estimates that global economic growth will increase to 3.1 percent
in 2018 after economic growth in 2017 is far stronger than expected, due to the continued
recovery in investment, manufacturing and trade, and also developing countries that export
commodities to benefit from a stronger commodity prices.
However, this is largely seen as short-term progress. In the long run, the slowing of
growth potential, namely a measure of how quickly an economy can develop when labor and
capital are fully employed - puts the risk of progress in efforts to improve living standards
and reduce poverty throughout the world, the World Bank reminds in the January 2018 report
Global Economic Prospects.
Developed country growth is expected to fall slightly to 2.2 percent in 2018,
because central banks in various countries are gradually removing post-crisis accommodation
and when investment level increases do not occur. Growth in the market and developing
countries as a whole is projected to strengthen to 4.5 percent in 2018, as commodity exporters
continue to recover.
2018 is on track to be the first year since the financial crisis where the global
economy will operate close to or at full capacity. Economic downturn is expected to
disappear. Policy makers need to look beyond fiscal and monetary policy tools to stimulate
short-term growth and consider initiatives that might increase long-term potential.
Slowing growth potential is a result of slow productivity growth, weak investment,
and aging of the global workforce for years. The slowdown is widespread, affecting the
economy in countries that account for more than 65 percent of global GDP. If there is no
effort to revitalize potential growth, the decline can continue into the next decade, and can
slow global growth by an average of a quarter percentage point and half the percentage point
for average growth in markets and developing countries during that period.
Risks to prospects remain leaning towards the negative side. The sudden tightening
of the condition of global financing could derail the expansion. Increased trade restrictions
and geopolitical tensions can reduce trust and activity. On the other hand, stronger than
expected growth can also occur in some major countries, which further broadens global
progress.
"With unemployment returning to pre-crisis levels and a brighter economic picture
in developed and developing countries, policymakers need to consider new approaches to
maintain growth momentum," said World Bank Development Economic Prospect Director
AyhanKose. "In particular, reforms to increasing productivity are very urgent because the
pressure on the potential for aging population growth is increasing."
In addition to exploring developments at the global and regional levels, the Global
Economic Prospects report in January 2018 also looks closely at potential growth prospects
in each of the six global regions; lesson from the fall of oil prices from 2014-2016; and the
relationship between higher skill levels and education and lower levels of inequality in
markets and developing countries.

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Regional Summary:

-East and Pacific Asia: Growth in the region is expected to decline to 6.2 percent in 2018
from around 6.4 percent in 2017. The structural slowdown in China seems to offset modest
cyclical increases in other regions. Risks to prospects are more balanced. Stronger-than-
expected growth among developed countries can lead to faster-than-expected growth in the
region. On the negative side, rising geopolitical pressure, rising global protectionism, a
sudden tightening of global financial conditions, and a sharper-than-expected slowdown in
major countries, including China, pose downside risks to regional prospects. Growth in China
is expected to reach 6.4 percent in 2018 from 6.8 percent in 2017. Indonesia is expected to
increase to 5.3 percent in 2018 from 5.1 percent in 2017.
-Europe and Central Asia: Growth in the region is expected to subside to 2.9 percent in 2018
from around 3.7 percent in 2017. The expected recovery to continue in the East, driven by the
commodity export economy, is offset by a gradual decline in the West as a result of moderate
economic activity in the Euro Area. Increased policy uncertainty and a decline in new oil
prices indicate below-expected growth risks. Russia is expected to increase 1.7 percent in
2018, unchanged from the estimated growth rate in 2017. Turkey is projected to moderate to
3.5 percent this year from 6.7 percent in the year just ended.

-Latin America and the Caribbean: Growth in this region is projected to increase to 2 percent
in 2018, from around 0.9 percent in 2017. The growth momentum is expected to occur as
private consumption and investment strengthen, especially among commodity exporting
economies. Additional policy uncertainty, natural disasters, increased trade protectionism in
the United States, or further deterioration in domestic fiscal conditions can reduce the pace of
growth. Brazil is expected to rise to 2 percent in 2018, from around 1 percent in 2017.
Mexico is expected to increase to 2.1 percent this year, from around 1.9 percent last year.

-Middle East and North Africa: Growth in the region is expected to increase to 3 percent in
2018 from 1.8 percent in 2017. Reforms in all regions are expected to gain momentum, fiscal
constraints are expected to decrease as oil prices are maintained, and increases tourism is
anticipated to support growth among economies that are not dependent on oil exports.
Continuing geopolitical conflict and weakening oil prices could reduce economic growth.
Growth in Saudi Arabia is expected to increase to 1.2 percent in 2018 from 0.3 percent in
2017, while growth is expected to reach 4.5 percent in Egypt in fiscal 2018 from 4.2 percent last
year.

-South Asia: Growth in the region is expected to increase to 6.9 percent in 2018 from around
6.5 percent in 2017. Consumption is expected to remain strong, exports are anticipated to
recover, and investment is on track to revive as a result of policy reform, and infrastructure
improvements. Setbacks in reform efforts, natural disasters, or increased global financial
volatility can slow growth. India is expected to reach 7.3 percent in the 2018/19 fiscal year,
which starts on April 1, from 6.7 percent in the 2017/18 fiscal year. Pakistan is expected to
increase to 5.8 percent in the 2018/19 fiscal year, which starts July 1, from 5.5 percent in the
2017/18 fiscal year.
-Sub-Saharan Africa: Growth in the region is expected to increase to 3.2 percent in 2018 from
2.4 percent in 2017. Strong growth will depend on strengthening commodity prices and
implementing reforms. Declines in commodity prices, a rise in global interest rates that are

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far above forecasts, and inadequate efforts to improve debt dynamics can reduce economic
growth. South Africa is expected to reach 1.1 percent growth in 2018 from 0.8 percent in
2017. Nigeria is expected to accelerate expansion by 2.5 percent this year from 1 percent in
the year just ended.

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 CHAPTER III
CLOSING
A.Conclusion
Slowing growth potential is a result of slow productivity growth, weak investment,
and aging of the global workforce for years. The slowdown is widespread, affecting the
economy in countries that account for more than 65 percent of global GDP. If there is no
effort to revitalize potential growth, the decline can continue into the next decade, and can
slow global growth by an average of a quarter percentage point and half the percentage point
for average growth in markets and developing countries during that period.
Risks to prospects remain leaning towards the negative side. The sudden tightening
of the condition of global financing could derail the expansion. Increased trade restrictions
and geopolitical tensions can reduce trust and activity. On the other hand, stronger than
expected growth can also occur in some major countries, which further broadens global
progress.

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 BIBIOGRAPHY

https://www.maxmanroe.com/vid/bisnis/pertumbuhan-ekonomi.html

Adam Smith, Economic Growth Theory of Planning and Development PT. Raja
Grafindo Pustaka. Jakarta.

J. Suprapto, 2000. Statistics, Theory and Applications, Erlangga, Jakarta.

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