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Indonesia could be 7th biggest economy by 2030: McKinsey report

Sept 18, 2012


 Indonesia could overtake Britain to become the world's 7th largest economy by 2030 - if it raises its growth rate to take advantage of a rapidly expanding consumer class, the McKinsey Global Institute said on Tuesday.
The Institute, linked to management consultant McKinsey & Co, said Indonesia's young population, ongoing urbanization and growing middle class incomes favoured its growth prospects.
Indonesia has sustained GDP growth over 5 per cent per year but it had to grow at 6 per cent annually to achieve the target the report said was possible.
The economy grew at a stronger-than-expected 6.4 per cent last quarter, defying a global downturn, in part because of domestic consumption by the expanding middle class and also investment.
Indonesia, a secular state, is the world's fourth biggest by population and has the world's 16th largest economy. It is the biggest economy in Southeast Asia and in December and January was awarded investment grade debt status by two ratings agencies.
"We will need to add 60 million skilled and semi-skilled workers over the next two decades. This is a big amount. We need to get the number in addition to the quality of workers," Arief Budiman, president-director of PT McKinsey Indonesia told Reuters.
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