Indonesia Roundup: 2026 economic growth set to 5.8%, military appointments, drivers strike
Indonesia targets 5.8% growth in 2026
Finance Minister Sri Mulyani Indrawati announced a 2026 growth target of 5.2% to 5.8%, higher than this year’s goal and forming a base for President Prabowo’s 8% long-term target.
Key forecasts in the KEM-PPKF include:
- Oil price: US$60–80/barrel
- Oil lifting: 600,000–605,000 barrels/day
- Gas lifting: 953,000–1,017,000 BOE/day
- Rupiah: Rp16,500–16,900/USD
- Budget deficit: 2.48%–2.53% of GDP
- 10-year bond rate: 6.6%–7.2%
- Inflation: 1.5%–3.5%
She emphasised the need to navigate global uncertainties while maintaining purchasing power and price stability.
Ride-hailing drivers in Indonesia hold protests to demand better pay
Hundreds of taxi and delivery drivers protested across Indonesia on Tuesday, demanding higher wages and opposing a potential merger between GoTo and Grab. In Jakarta, drivers in green jackets rallied near government offices, accusing companies of exploitative practices. Many earn just 100,000–150,000 rupiah ($6–$9) for 10–12 work hours. GoTo, which operates Gojek, welcomed driver feedback, but lowering fare commissions wasn't the answer. It confirmed receiving merger proposals but stressed no decision had been made.
6 military figures enter strategic economic positions in Prabowo era
President Prabowo Subianto continues placing military figures in strategic economic roles, most recently naming Lt. Gen. TNI Djaka Budi Utama as the new Director General of Customs and Excise, replacing Askolani. Djaka previously served as Main Secretary of the State Intelligence Agency (BIN) and is a former member of the Mawar Team. The move adds to a growing list of military appointments in ministries and SOEs under Prabowo’s administration. Earlier, Maj. Gen. TNI Novi Helmy was made President Director of Perum Bulog, replacing Wahyu Suparyono. Novi is expected to resign from active duty following his appointment.
Indonesia projects weaker rupiah at Rp16,900/USD in 2026
The government has submitted its 2026 Macroeconomic Framework (KEM-PPKF) to Parliament, projecting the rupiah to weaken to Rp16,500–Rp16,900 per USD, compared to Rp16,000 in the 2025 State Budget. Finance Minister Sri Mulyani and Fiscal Policy Chief Febrio Kacaribu cited global uncertainty and recent market volatility as key reasons for the conservative forecast. The range remains subject to review before the final 2026 State Budget Draft (RAPBN) is prepared.
Indonesia backs Thailand’s bid for full BRICS membership
Foreign Minister Sugiono confirmed Indonesia’s full support for Thailand’s bid to join BRICS, noting the request predates Indonesia’s membership. "We will make every effort to help Thailand be accepted," he said on May 20.BRICS—formed in 2006 and expanded in 2024 to include five new members—welcomed Indonesia in early 2025. Thailand’s entry, backed by Jakarta, is expected to strengthen Southeast Asian economic ties within the bloc.
