The economic growth of Papua is still dominated by the mining and quarrying sector, despite a decrease in gold and copper production due to rainfall and landslides. Due to natural disasters, the mining and quarrying sector experienced a contraction of 11.64% according to the Head of the Regional Office of the Directorate General of Treasury (DJPb) in Papua. It was also stated that the economy of Papua is expected to rebound in terms of both production and consumption in the second quarter of this year. The state budget (APBN) is working hard to protect the purchasing power of the community and support the economic recovery in Papua. In addition, vigilance and mitigation efforts are being carried out to anticipate uncertainties throughout 2023. The regional economy of Papua is expected to strengthen, as indicated by improvements in both production and consumption, supported in part by the demand during the Eid al-Fitr holiday.
On the production side, the growth in electricity consumption reached 74.72% (YoY), reflecting increased productivity of the community and the business world due to the expansion of electrification in Papua. Furthermore, the domestic cement sales in May 2023 showed a significant surge, with a growth of 16.7% (YoY). This increase in cement sales was driven by the acceleration of development projects, particularly by the government in several regions. In terms of consumption, motor vehicle sales continue to increase each month, reaching IDR 1.09 million. Regarding hotel occupancy rates, the activities of the Papua community have increased, as evidenced by a 34.83 percent growth (YoY) in hotel occupancy. It is projected that hotel occupancy will further increase in June and July due to the school holiday period. Regarding the trade balance in May, there was a surplus of USD 587.39 million, with exports amounting to USD 620.17 million and imports amounting to USD 32.78 million. Exports in May rebounded and grew positively by 33.86% (YoY), after experiencing a contraction in the first three months. The outlook for Papua's economic growth in 2023 is relatively stable, driven by increased domestic demand, both household consumption and investment, despite global uncertainties.
