By: Mahmud Sutramitajaya)*
The government has shown its seriousness in maintaining national economic stability, especially increasing people’s purchasing power amidst increasing global challenges. Through the Ministry of Finance, the fiscal stimulus package for the second semester of 2025 is certain to be realized as a quick response to the currently heating up geopolitical dynamics, especially the military conflict between Iran and Israel which has had an impact on the global economy.
This tactical step is the result of a strategic decision in a limited meeting led directly by President Prabowo Subianto at the Merdeka Palace. In the meeting, it was agreed to provide five economic stimulus packages that target increasing people’s purchasing power while maintaining the rate of national economic growth.
One form of stimulus that has received widespread attention is the policy of reducing transportation fares. With a budget of Rp940 billion from the State Budget, the public will experience a 30 percent discount on train fares, a 6 percent discount on plane tickets through a VAT exemption, and a 50 percent discount on sea transportation fares. This incentive is expected to encourage more equitable mobility, especially during the school holidays in July.
In addition, the stimulus policy also includes a 20 percent toll tariff discount given without using the APBN funds, with a budget of IDR 650 billion. The target covers 110 million drivers during the holiday period. The transportation sector is believed to be an important driver in the movement of the regional and national economy, so this step is a smart strategy to accelerate the circulation of money in the community.
In terms of social protection, the government is distributing a social assistance thickening program worth IDR 11.93 trillion. In its implementation, beneficiary communities will receive assistance in the form of basic food cards worth IDR 200,000 per month and 10 kilograms of rice every month for two consecutive months. This stimulus provides certainty for the basic needs of the community, especially vulnerable groups affected by the pressure of basic food prices.
Not only that, the Director General of Economic and Fiscal Strategy of the Ministry of Finance, Febrio Kacaribu, said that the government has allocated a budget of IDR 10.72 trillion for the wage subsidy assistance (BSU) program. This program is given to 17.3 million workers with incomes below IDR 3.5 million, including 288,000 teachers under the auspices of the Ministry of Primary and Secondary Education and 277,000 teachers under the Ministry of Religious Affairs. Each recipient will receive assistance of IDR 300,000 per month for two months, which will be distributed at once.
The next step targets the labor-intensive employment sector, through the extension of the Work Accident Insurance (JKK) contribution discount by 50 percent for six months. With a budget of IDR 200 billion, this policy is believed to provide a breath of fresh air for the industrial sector which has so far been the mainstay of job creation.
The fiscal policy designed based on consumption is believed to be able to respond to the weakening economic growth in the first quarter of 2025, which only recorded 4.87 percent annually. This figure is the lowest in more than three years and is a signal of a slowdown in household consumption as the main component of economic growth.
Meanwhile, from the business side, the Chairperson of the Indonesian Employers Association (Apindo), Shinta Kamdani, gave her appreciation for the government’s steps which were considered fast and relevant. According to her, the government’s courage in launching stimulus for the past two months has been able to maintain the momentum of national economic recovery, especially in terms of domestic consumption. Her party also considered that the fiscal response that is directly targeted at the community is the foundation needed to keep the national economic circulation moving amidst global uncertainty.
However, Shinta also emphasized that the success of the stimulus is highly dependent on the speed, accuracy of targeting, and coordination of its implementation. The second and third quarters of this year are crucial, and any technical obstacles in implementation could reduce the driving force of the carefully formulated policy.
Furthermore, Apindo also encourages the expansion of stimulus to the productive sector through tax relief, deregulation, acceleration of licensing, and opening up access to cheaper and more affordable financing. All of this is important to ensure that the business sector can survive and continue to grow in challenging situations.
In the long-term context, the economic stimulus that is being implemented should be part of a comprehensive policy that combines consumption recovery strategies, increasing investment and exports, providing production incentives, and guaranteeing policy stability. Cross-sector synergy and policy consistency will strengthen the foundation of the national economy to grow sustainably.
Shinta Kamdani said that strong economic recovery can only be achieved if there is close collaboration between the government, business actors, and all stakeholders. Her commitment is to continue to provide concrete input and be an active partner in ensuring that all incentive policies are effective and on target.
With the stimulus that has been designed and immediately implemented, the government has demonstrated its capacity and readiness to face global economic pressures. The combination of social protection and support for the real sector is believed to be a new driving force to bring the Indonesian economy back to an inclusive and highly resilient growth path.
With targeted implementation and strong coordination, the economic stimulus package is expected to significantly increase people’s purchasing power while maintaining the momentum of national economic growth. The synergy between government policies and the active participation of the community and business actors is key so that this stimulus not only reduces short-term impacts but also strengthens the foundation of sustainable economic recovery amidst global challenges.
)* The author is an economic observer