JAKARTA, Sept. 7 (Xinhua) -- Gross domestic product in Indonesia is forecast to expand 5.17 percent this year, slightly lower than the previous projection of 5.2 percent, Finance Minister Sri Mulyani Indrawati said here on Thursday.
"We have seen upside and downside factors. The optimistic (forecast) by year end is that our economy can grow close to 5.17 percent," she said at the parliament building.
Although Indonesia has secured a credit rating upgrade to investment grade from S & P Global rating in May and the central bank has applied loosening policy, loan growth target of 10 to 12 percent this year is difficult to achieve, she said.
The central bank governor Agus Martowardojo has stated that the lender has revised downward banking credit target to 8 to 10 percent for 2017.
Mulyani said that investment had to grow 5.2 percent to support the 5.17 percent growth target.
The consumption, which accounts for over half of the GDP growth, will be in check at 5 percent this year, said Mulyani.
Export is expected to expand 5.4 percent in 2017 while import growth will be 1.9 percent, said Mulyani.
The central bank has forecast that the country's consumer price index will be 4 percent or lower this year, allowing further applying of easing policy as hawkish prospect U.S. Fed. Reserve policy has weakened.
The Southeast Asia's biggest economy expanded 5.01 percent at the first half of this year, according to the national statistics bureau.
Last year, Indonesian economy grew 5.02 percent amid contractions in some emerging economies.
