The economy has performed reasonably well over the last year, as is evident in the most prominent macroeconomic indicators. Much recent commentary has emphasised that this has been achieved at the same time that Indonesia has been undergoing radical political change. In particular, with President Megawati's position under threat, fiscal responsibility could easily have been forgotten, and any number of populist but counterproductive economic policies could have been introduced. Seen from this perspective, macroeconomic performance has indeed been commendable. On the other hand, there has also been a good deal of commentary that is considerably more pessimistic, suggesting that the glass is half empty rather than half full. Observers in this category tend to focus on the things that are not going well, or not as well as they should be, viewed from a more absolutist perspective of economic performance and policy evaluation that abstracts from the political and social context.

GROWTH OF OUTPUT AND PER CAPITA INCOME

Termination of the International Monetary Fund (IMF) program at the end of 2003 has had no noticeable impact on Indonesia's economic performance. For the last two years, output of the economy has been growing at about 4.8 per cent per annum; this compares with an average of 7.5 per cent for the four years just before the crisis (June 1993 to June 1997). Indonesia's recession was so severe that it took about five years for GDP to return to the level it had attained prior to the downturn. By 2004 it was about 10 per cent higher, but in 2003 national income per capita was still more than 4 per cent less than in 1997, as a result of population growth; in this important sense, the economy has yet to return to pre-crisis levels of prosperity.