Lying with Statistics

August 25, 2025 | 01:01 pm

TEMPO.CO, Jakarta - The government claims that the economy is booming despite indicators showing the opposite. The ambition is for 8 percent economic growth.

THE government’s contortions in manipulating statistical data risk causing disaster. As well as undermining market trust, fudging the data could mislead the government itself in its policymaking. It is only a matter of time before these manipulated statistics bring about economic chaos and put an end to this growth target that has been much bragged about.

According to Statistics Indonesia (BPS), the Indonesian economy grew by 5.12 percent year-on-year in the second quarter of 2025, an increase over the 4.87 percent in the first quarter. This data pleased President Prabowo Subianto and his supporters. But for many, this statistic smells fishy.

Figure jumped amidst a weak economy. This is proved by the fact that a number of key economic indicators are moving in the opposite direction to the BPS growth figure. The activity of the manufacturing sector, as measured by the Purchasing Managers’ Index, is experiencing a contraction. This means that there is no economic expansion. This data is in line with the increase in unemployment last quarter.

Also strange is that household consumption in the second quarter grew by only 4.97 percent. Compare this with the figure of 4.89 percent for the first quarter of this year—higher than the economic growth figure of 4.87 percent. However, household consumption is the main driver of economic growth. A number of other macroeconomic indicators, from tax revenues to the consumer confidence index, are also anomalous.

By claiming rapid economic growth when the markets are weak, the government is going against the global consensus. This magazine has learned that the economic growth figure was obtained by the BPS after the government adjusted a number of variables. For example, it included imports of weapons under capital goods, while new investments in special economic zones, which for years had not been included because they do not immediately lead to production of goods, were included while the growth was being calculated.

Thanks to this manipulation, the economic growth data is ahistorical. As a result, it will be difficult to use it as the basis for decision making. Public policy will be misdirected because the data do not reflect the real situation.

Market players who doubt the accuracy of data from the government will view Indonesia as a high-risk nation. But the government has been trying to tempt investors with high interest rates. This will have many consequences, from increasing the burden on the government to increasing bank interest rates, which will in turn slow down the economy.

If the government is proved to have fiddled the data, it will be difficult to avoid economic turmoil. This is what happened in Greece and Argentina.

In 2009, Greece underreported its budget deficit and debt in order to remain in the Eurozone. After the deception became known, Greece suffered a multi-year economic crisis. In Argentina, manipulation of the inflation data from 2007 to 2014 led to financial collapse, from which the country has yet to recover.

In Greece and Argentina, lies about statistics were followed by other lies, until all was finally revealed. In Indonesia, as well as covering up the manipulation of the data, the manipulation of the variables could continue because of the government’s strong desire to achieve high economic growth.

In 2029, on paper, Indonesia could see Prabowo’s ambition of 8 percent growth achieved. But this figure will stand on weak foundations: data that is manipulated—changed, selected, interpreted—in line with the government’s wishes.

Listening to Prabowo’s state address on August 15, 2025, this phenomenon became even more apparent. He used bombastic figures to claim the success of his administration. Prabowo and his aides understand that figures can convince the masses, even if they are inaccurate.

More than two centuries ago, British Prime Minister Benjamin Disraeli warned that statistics were an effective way of manipulating data. He said there were three kinds of lies: lies, damned lies, and statistics.

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