Indonesia's Gross Domestic Product (GDP) in the second quarter of 2023 grew 5.17% compared to the same quarter last year, Indonesia’s Statistics Agency (BPS) reported on Monday, August 7. 

The increase is surprising since some analysts think that Indonesia's economic activity will stall in the second half of the year, with exports likely to continue decreasing due to lower global demand and businesses perhaps deferring investments ahead of the February 2024 parliamentary elections. 

"In the midst of an estimated slowing global economy and declining prices for leading export commodities, Indonesia's economy grew by 5.17% year over year," deputy head of BPS Mr. Moh. Edy Mahmud said during Monday’s press conference. 

Mr. Mahmud noted that the upward trend in the second quarter was driven by increased public mobility, sustained production growth, and rising customer spending power, especially during the Muslim holy month of Ramadan and subsequent public holidays. 

Companies in Indonesia, which has the world's largest Muslim population, are required to give bonuses to their employees no later than seven days before a religious holiday, most notably Eid al-Fitr. 

The transportation and warehousing sector contributed the fastest share of the growth at 15.28%. It was followed by the other services sector with 11.89% and then the accommodation and food and beverages sector with 9.89%. 

Meanwhile, in terms of expenditure, the government's consumption experienced the highest growth of 10.62%. Non-profit institutions that serve households ranked second with 8.62%. 

Geographically, the characteristic of Indonesia’s economy in the second quarter of 2023 remains as it has been for the past several years, with the island of Java dominating the national economy with a share of 57.27%. The second on this list is the island of Sumatra, with 21.94%. 

Notably, in terms of growth, the island of Sulawesi, as well as the islands of Maluku and Papua, are ahead of the other regions, with the former posting a growth of 6.64% in the second quarter of 2023, while the latter saw a growth of 6.35%.