Thelandofpapua.com– Bank Indonesia’s (BI) Representative Office for West Papua Province forecasts robust economic growth for the region in 2024, projecting a year-on-year increase of 4.40 to 5.20 percent. This optimistic outlook was announced during a monetary-fiscal dissemination event held on May 30, 2024, at the Manokwari State Finance Building.

Setian, Head of BI’s West Papua Representative Office, emphasized the need to diversify the province’s economy beyond its heavy reliance on the oil and gas sector. “The dominance of the oil and gas sector in West Papua needs to be balanced with the development of new economic sectors to avoid continued dependence,” Setian stated during the event. The dissemination, themed “Monetary-Fiscal Strategies to Promote Inclusive and Sustainable Economic Growth in West Papua Province,” gathered key regional stakeholders, including Acting Secretary of West Papua Province Yacob Fonataba, DJPb West Papua Representative Head Purwadhi Adhiputranto, and various business leaders.

Reviewing recent economic performance, Setian reported that West Papua’s economy grew by 2.27 percent year-on-year in the first quarter of 2024, a deceleration from the 5.89 percent growth recorded in the fourth quarter of 2023. This slowdown was attributed to a high growth rate in the government administration sector during the first quarter.

Despite the slowdown, Setian highlighted positive indicators for economic stability, particularly in financial intermediation. He noted a 3.51 percent year-on-year increase in third-party funds (DPK) in April 2024, which points to rising savings post-Eid al-Fitr and increased economic activity. Credit disbursement trends showed a focus on wholesale and retail trade sectors, although investment credit in the region remained relatively small.

Inflation in West Papua is expected to remain within the national target range of 2.5 ±1 percent for 2024-2025. As of April 2024, inflation stood at 0.17 percent month-to-month, 1.43 percent year-to-date, and 3.59 percent year-on-year.

Supporting the province’s economic framework, Purwadhi Adhiputranto of DJPb West Papua praised the solid and credible performance of the regional state budget (APBN) as of March 2024. He reported that state revenue had reached Rp498.87 billion, 14.07 percent of the 2024 target, while state expenditure hit Rp4,318.48 billion, or 15.04 percent of the budget allocation.

Purwadhi stressed the importance of adhering to the Master Plan for the Acceleration of Papua Development, particularly when planning programs with Special Autonomy Funds. For 2024, West Papua has been allocated Rp17.25 trillion from the State Budget (APBN), including Rp11.35 trillion for Regional Transfer Funds (TKD) and Rp5.9 trillion for ministry and institution spending. The TKD allocation comprises Rp3.24 trillion in revenue-sharing funds (DBH), Rp4.32 trillion in general allocation funds (DAU), and significant amounts for both physical and non-physical special allocation funds (DAK), among other fiscal incentives.

This comprehensive fiscal support and strategic monetary policies aim to foster inclusive and sustainable economic growth in West Papua, ensuring the region’s resilience and prosperity amidst evolving economic landscapes