The World Bank estimates that Indonesia's economic growth slowed and only reached 5.3 percent in 2014 .
" The World Bank predicts growth of Indonesia's GDP fell from 5.6 percent in 2013 to 5.3 percent in 2014," said World Bank Country Director for Indonesia , Rodrigo Chaves , the exposure
in the latest quarterly report on Monday .
Rodrigo explains the World Bank estimates that Indonesia's economic growth slowed , among others, by a decrease in investment growth .
Indonesian investment only grew by 4.5 percent in the third quarter of 2013, especially for the heavy equipment and industrial machinery .
In addition , there is a risk impact stimulus plan for the elimination of the Federal Reserve ( U.S. Central Bank ) is expected to make the world capital market remains volatile and hampers Indonesia's access to external funds .
" The growth of domestic consumption which is quite tough also expected to weaken . 's Financial projections also look vulnerable due to fuel subsidies , " said Rodrigo .
He said the Indonesian government has taken various measures to strengthen the short -term macroeconomic stability , especially through the adjustment of monetary policy and the exchange rate .
However , further Rodrigo , to increase trade and stimulate long-term growth rate , what is needed is a broader structural reforms .
"Indonesia has gone through a challenging year with the collapse of export demand and commodity prices , in addition to the volatile capital markets and the difficulty of obtaining external funding . However , monetary policy has supported economic adjustment , " he said .
He added that Indonesia will receive the benefits if the government focused on long- term investment because Indonesia needs more investment .
" Step-by- step improvement of the business climate is essential to attract investment . Creating rules simpler trade and logistics can also help increase exports , " he said .
In its report , the World Bank estimates that Indonesia's current account deficit will shrink from 3.5 percent of GDP ( 31 billion dollars ) in 2013 to 2.6 percent of GDP ( 23 billion dollars ) in 2014 , due to weak import growth and moderate increase in export demand .
According to the World Bank , the effort required to address the current account deficit in the long run not depress the value of imports , but by increasing exports and securing the availability of external funding , mainly through foreign direct investment .
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