Bank Indonesia Assesses Flood Impact on Economic Growth

Economic Consequences of Natural Disasters

Bank Indonesia (BI) has conducted a preliminary assessment of the economic impact of recent flooding in three major regions: Sumatra Barat, Sumatra Utara, and Aceh. According to BI Deputy Governor Aida S. Budiman, the floods have resulted in an estimated reduction of 0.017% in national economic growth.

Methodology and Findings

The assessment was based on the loss of economic activity during the 32 days when various sectors were affected by the flooding. "The method used involves calculating the loss of economic activity during these 32 days and its impact on the overall economy. While the impact is somewhat negative, as this is still a preliminary calculation, the effect on this year's GDP is estimated to be around minus 0.017%," Budiman explained during a press conference.

Economic Resilience and Future Implications

While the overall impact on Indonesia's economic growth appears to be relatively contained, this incident underscores the country's vulnerability to natural disasters and their potential economic consequences. The assessment highlights the need for continued efforts in disaster mitigation and economic resilience strategies.