Bali’s Statistics Bureau (BPS-Bali) recorded an economic growth rate of 5.43% (YOY) through the end of Q3 2024. This rate is an improvement over the same 9-month period in 2023, which recorded a growth rate of 5.63%
The performance of Bali’s economy ranked it at # 6 among 34 provinces nationwide.
Bali’s 5.43% growth rate was well above the national average of 4.95% through the end of Q3.
“Bali’s positive growth is an important indicator of the resilience and potential of the region’s economy in facing global and domestic challenges,” said Head of the Bali Provincial Bank Indonesia (BI) Representative Office, Erwin Soeriadimadja, in a written statement, Saturday (11/9/2024).
He explained that from the expenditure side, Bali’s economic growth was driven by consumption. Household consumption increased, driven by a surge in tourism activities and the celebration of the national religious holidays (HBKN) Galungan and Kuningan.
According to Erwin, consumption government and non-profit institutions serving households (LNPRT) also showed positive growth ahead of the 2024 Simultaneous Regional Elections (PILKADA) and religious activities. Investment growth was limited in Bali, especially in the construction sector, and was influenced by the minimal realization of new project investments.
From the business sector, the accommodation, food, and beverage sectors continue to be the main drivers of the Balinese economy, with a growth of 12.25% (yoy).
“The business sector performance is supported by the high number of domestic and foreign tourist visitors, which increased by 11.44% and 16.82% (yoy) respectively, in the third quarter, driven by the peak tourism season,” explained Erwin.
The average occupancy rate of starred hotels reached 68%, increasing from 63% in the previous quarter. According to Erwin, the financial and insurance services and the procurement of electricity and gas also recorded impressive growth of 16.11% and 15.23% yoy.
He said that the growth of the financial services sector was driven by increased banking activity. This growth can be seen from the distribution of credit, which grew by 9.61% yoy.
Meanwhile, electricity and gas consumption increased due to a surge in demand in the household, industry, and business segments. Bali’s agricultural sector grew moderately due to the end of the rice harvest season. The construction sector experienced a slowdown as several strategic projects were approaching the final stage.
Bank Indonesia estimates that the Balinese economy will continue to grow strongly in the fourth quarter of 2024, aided by the Regional Elections (Pilkada) momentum and the Christmas and New Year holidays.
Erwin encouraged the Bali Provincial Government to optimize investment by accelerating investment in new infrastructure projects to increase accessibility to the northern regions of the Island. He also urged Bali to expand exports of Bali’s leading commodities, such as fishery and creative and agricultural products, by accessing new international markets.
“Through ongoing collaboration with the central and regional governments and local economic actors, Bank Indonesia is committed to supporting stable, inclusive, and sustainable economic growth in Bali. Through synergy between sectors, Bali can continue to maintain its economic attractiveness, both nationally and globally,” Erwin added.
In macroeconomic terms, despite the increase in global commodity prices, inflationary pressures in Bali remain under control. Stable food and fuel prices are key factors that help maintain strong purchasing power.
However, Bali’s heavy dependence on the tourism sector remains challenging, given the risks that may arise from various external shocks.
Bali needs to diversify and strengthen other sectors outside of tourism, such as the creative industry, technology, and agriculture, to maintain sustainable economic growth.
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