Sluggish manufacturing industry triggers W Sumatra economy only grew 3.92 percent in 2020 first quarter

Padang (ANTARA) - Sluggish economy in the manufacturing industry sector triggered the economy of W Sumatra in the first quarter of 2020 to only grow 3.92 percent, according to the W Sumatra BPS.

"That number is lower than the same period in 2019 which recorded 4.85 percent or contracted 2.26 percent," Head of W Sumatrea BPS Pitono said in Padang on Tuesday.

According to him the sluggish economy in the manufacturing industry sector, triggered by the decline in palm oil production and reduced global demand for Crude Palm Oil (CPO).

In addition, from the expenditure side, it was pushed by a significant decline in the performance component of government consumption by minus 47.20 percent, he added.

Then food crops experienced negative growth due to the decline in crop production.

"Air transport also contracted above one percent due to a decrease in passenger numbers and flight cancellations due to the Corona Virus Disease (COVID-19) outbreak," he said.

Otherwise, the work from home program has increased internet usage and internet network installation by more than 100 percent so that the communication and information sector grew significantly.

While the realization of investment during the first quarter of 2020 was only Rp366 billion.

The trade sector also grew positively due to an increase in exports, car and motorbike sales and the growth of the agricultural sector.

In terms of household consumption, distribution of government social assistance and distribution of consumer loans grew high compared to the same quarter in 2019.

Previously, Bank Indonesia (BI) of W Sumatra estimates that W Sumatra's economic growth is in the range of two percent this year as the impact of the outbreak of COVID-19.

"In normal conditions the economy of W Sumatra is able to grow five percent, but since the outbreak of COVID-19 the economy down to two percent," said the Head of Bank Indonesia of W Sumatra, Wahyu Purnama.

According to him the two percent figure is assuming COVID-19 will subside in June and July 2020, but if it continues it will make the economy of W Sumatra increasingly down.

As one of the tourist destinations, there are many sectors affected from transportation, hotels, restaurants, trade to culinary.

In addition, all small and medium businesses related to tourism are also affected and cannot operate.

"There are even SMEs who turn their businesses become PPE producers to survive," he said.

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