By: Bagus Pratama*
The ongoing global economic downturn has impacted various domestic sectors. However, the Indonesian government has not allowed this situation to persist without a response. A range of proactive strategies has been prepared to maintain stability and stimulate sustainable national economic growth.
One of the main strategies has been the implementation of flexible fiscal policies. State spending has been directed toward sectors with high multiplier effects, such as infrastructure, food security, and social protection programs. This approach aims to preserve public purchasing power and maintain economic activity, especially in regions most affected by the slowdown.
Coordinating Minister for Economic Affairs, Airlangga Hartarto, highlighted that support from the U.S. government, business associations, and industry toward Indonesia’s trade negotiation efforts is a constructive achievement in economic diplomacy. In an increasingly competitive and uncertain global landscape, Indonesia’s success in gaining support from key stakeholders in the United States represents a strategic milestone. It underscores the government’s clarity of policy direction and its ability to engage in cross-border communication effectively.
High-level meetings with prominent U.S. figures such as the Secretary of the Treasury, the United States Trade Representative (USTR), the Secretary of Commerce, and the National Economic Council demonstrate Indonesia’s active role and its recognition as a credible dialogue partner by the world’s largest economy. This is a significant development for safeguarding strategic national interests, including market access, fairer tariffs, and the protection of domestic businesses.
Tax incentives have also been granted to business actors, especially micro, small, and medium enterprises (MSMEs), which form the backbone of the national economy. Business burdens have been reduced through relaxed tax administration and expanded access to the People’s Business Credit (KUR) scheme. These measures ensure that small and medium enterprises can continue operating despite global economic headwinds.
According to Fathi, a member of Indonesia’s House of Representatives (DPR) Commission XI, institutional collaboration and acceleration of budget absorption are essential strategies in sustaining economic stability and growth. Amid ongoing global economic pressure, strengthening internal coordination and leveraging domestic capacity are of paramount importance.
Interagency collaboration is no longer optional—it is imperative. The current economic complexities require integrated responses. All branches of government, including the executive, legislative, and monetary and fiscal authorities, must align their visions and actions to ensure that policies are not implemented in isolation. Without strong coordination, program effectiveness could suffer, and there may be a disconnect between planning and execution.
Investment in strategic sectors continues to be encouraged. Major infrastructure and industrial projects are proceeding to prevent job creation from stalling. Renewable energy, downstream industries, and digital transformation have been identified as top priorities to ensure Indonesia remains globally competitive. Through cross-agency collaboration and pro-investment regulatory support, both domestic and foreign investment realization has been accelerating.
The agriculture and fisheries sectors have also received attention. National food production is being supported not only through subsidies but also by improving technology and distribution efficiency. Farmers and fishers are being given access to financing and technical assistance to enhance productivity despite external challenges.
Finance Minister Sri Mulyani has emphasized the importance of building fair, balanced, and sustainable long-term partnerships, such as that between Indonesia and Freeport. This reflects Indonesia’s maturing and sovereign economic policy direction. In dealings with multinational corporations—especially in strategic sectors like mining—Indonesia must assert its bargaining power to ensure that national interests are not sidelined.
One-sided partnerships, particularly in the management of natural resources, are no longer acceptable in the context of sustainable development. Therefore, the government’s determination to pursue balanced, equitable cooperation, as articulated by Minister Sri Mulyani, is a positive step toward strengthening Indonesia’s rightful position as the legitimate owner of its natural wealth.
The government’s balanced approach also demonstrates that Indonesia is not anti-investment but seeks to place business cooperation within a fair and healthy framework. Freeport, as a foreign partner, is given space to continue operations and earn profits—on the condition that it commits to supporting local development, technology transfer, and contributing to national revenue.
In the field of labor, vocational training and labor-intensive programs have been rolled out on a wide scale. These initiatives aim to absorb workers across regions while also enhancing the skills of the population. Through such mechanisms, the risk of rising unemployment due to the economic slowdown can be mitigated.
With the range of policies being prepared and implemented, optimism about Indonesia’s economic recovery remains intact. The government’s efforts are not limited to short-term crisis response but are also focused on building a more resilient and robust economic foundation for the future.
While challenges persist, the productive measures taken clearly demonstrate the government’s seriousness in protecting the economy and society. Broad support will be essential to sustain the recovery momentum and ensure that public welfare remains a top priority. Indonesia thus holds a strong position not only to endure the current turbulence but to grow in a more inclusive and sustainable manner.
*) The author is a Researcher in Economics and Development at the Indonesian Prosperous Economy Forum
