Jakarta (ANTARA News) - Indonesia’s economy is expected to grow slightly faster next year after posting its sharpest growth in 11 years this year, helped by lower interest rates, steady exports and higher investment, a Reuters poll showed.

Analysts see Indonesia’s economy growing 6.4 percent next year, slightly faster than the 6.3 percent forecast for 2007.

In a similar poll conducted in September, analysts forecast the economy would grow 6.45 percent next year and 6.1 percent this year.

The government expects the economy to grow 6.3 percent this year and 6.8 percent next year.

“Investment is likely to play catch-up with consumption growth to support growth next year,” said Singapore-based economist Gundy Cahyadi of IDEAglobal.

“Non-oil exports of commodities will also remain supportive although there is a threat from high global oil price,” added Cahyadi, pointing to potential inflationary pressures that could dent consumption.

Strong global demand for commodities such as gold, tin, nickel, palm oil and rubber have been boosting Indonesian exports.

Inflation is expected to stay relatively stable at 6.4 percent this year and 6.4 percent in 2008, despite risks linked to higher energy costs, the poll showed.

But soaring oil prices have raised concerns that the Indonesian government might have to cut fuel subsidies that would feed through into higher inflation and hold back consumption.

The telecommunication and transportation sectors are expected to lead growth in the industrial sectors in Indonesia, helped by lower interest rates and strong local demand.

The survey also showed that Indonesia’s trade surplus is forecast to reach $40 billion this year, but is predicted to fall slightly to $39.4 billion next year from $39.6 billion in 2006. (*)

Sourc: ANTARA News