Reviving a City’s Economic Engine: The COVID-19 Pandemic Impact and the Private Sector’s Engagement in Bandung City

Abstract

The COVID-19 pandemic has not only affected public health but has also significantly impacted the economy. Bandung, a bustling city in Indonesia serving as a satellite to the capital, has been hit hard due to its high population density, mobility, and reliance on the tourism, trade, and transportation sectors. Using a Computable General Equilibrium (CGE) model developed at the interregional level of Indonesia, this study investigates the microeconomic indicators of several economic activities in Bandung, namely, the transportation, accommodation and food–beverage, water supply, and trade (MSMEs) sectors, to assess the impact of the pandemic. Additionally, the study examines the role of private sector actors in contributing to the sustainable recovery efforts toward achieving the Sustainable Development Goals (SDGs) amidst the pandemic. The findings reveal that Bandung’s transportation, accommodation, food and beverage, water supply, and trade sectors experienced a significant decline in economic activity. However, there was a gradual recovery, with increased economic activity between 2019 and 2021. Private sector actors and the health sector were the main drivers of economic recovery, with other sectors also contributing to the effort.