section_path: Economy
section_name: Economy
paragraph_text: Economy
  
  Indonesia operates a mixed economy where the private sector and the government play significant roles. As the only G20 member state in Southeast Asia, it has the region's largest economy and is classified as a newly industrialised country. In 2024, its nominal GDP was US$ 1.402 trillion, ranking 16th globally, while its GDP at purchasing power parity (PPP) was US$ 4.658 trillion, ranking 7th. Per capita GDP in PPP is US$ 16,542, while nominal per capita GDP is US$ 4,980. In 2021, services dominate the economy in terms of employment (49.2%), followed by agriculture (28.9%) and industry (21.7%), while in terms of share of GDP in 2022, both services and industry dominate (roughly 41% each), followed by manufacturing (18.3%) and agriculture (12.4%).
  
  The economic structure has shifted significantly over time, transitioning from agriculture in the 1950s and 1960s to gradual industrialisation and urbanisation from the late 1960s to the 1980s. Falling oil prices in the 1980s prompted diversification into manufactured exports, resulting in substantial economic growth (the GDP rose at an average rate of 7.1%) and poverty reduction from 40% to 11%. However, the economy took a severe hit during the Asian economic crisis in the late 1990s, when the GDP fell by 13%, inflation reached 78%, and GDP grew by only 0.8% in 1999. Recovery began in the early 2000s, with prudent banking regulations, better monetary and fiscal policies and flexible exchange rates, resulting in growth rates between 4% and 6% since 2004. These factors, coupled with strong domestic consumption, helped Indonesia weather the 2008 financial crisis. The COVID-19 pandemic in the early 2020s caused a recession, but the economy rebounded within just a year.
  
  Indonesia's abundant natural resources, including nickel, coal, and petroleum, dominate its export portfolio. It imports refined and crude petroleum and vehicle parts, with major trade partners including China, the United States, Japan, Singapore, India, Malaysia, South Korea, and Thailand. Owing to plentiful rainfall, sunshine and fertile soil, Indonesia is a major agricultural country, ranking among the leading producers of palm oil, rubber, coffee, tea, cassava, rice, wheat, coconut oil, and tobacco. Despite these resources and decades of development, disparities in wealth, employment and economic opportunities persist between densely populated and economically advantaged regions in the western islands like Java and Sumatra and sparsely populated, underdeveloped areas in the east like Maluku and Papua.