Government Strengthens Governance to Promote Inclusive Economy

JAKARTA - The government reiterates its commitment to continue to prioritize the principle of good governance and strengthen the internal control system to improve institutional performance and ensure transparent and accountable budget management.

Coordinating Minister for the Economy Airlangga Hartarto said that the role of the Financial Supervisory Board (BPK) as an external auditor is highly expected in encouraging inclusive and sustainable economic growth.

He added that these efforts were carried out through improving the quality of state financial management, optimizing state revenue, the effectiveness of spending and expenditure, and strengthening the prevention and detection of state financial irregularities.

On the same occasion, Airlangga also explained the latest macroeconomic indicator developments, namely in the midst of high global uncertainty, the Indonesian economy is projected to remain strong with a relatively low recession risk rate compared to other countries.

Until the end of 2025, the national economic fundamentals are considered solid and resilient, reflected by the consistent economic growth maintained at around 5 percent over the past seven years.

Throughout 2025, the Government actively distributes fiscal stimulus with a total value of IDR 110.7 trillion to maintain the momentum of economic growth.

The distribution of the stimulus is carried out gradually in each quarter and strengthened with various non-APBN programs, including National Online Shopping Day (Harbolnas), Shopping in Indonesia Only (BINA), and Every Purchase is Cheap (EPIC Sale).

Entering 2026, the Government targets economic growth of 5.4 percent by relying on a number of priority sectors.

The sectors include food security with a budget of Rp164.4 trillion, energy security of Rp402.4 trillion, the Free Nutritious Meal program of Rp335 trillion, education of Rp757.8 trillion, health of Rp244 trillion, MSMEs and villages of Rp181.8 trillion, defense of Rp424.8 trillion, and investment and trade of Rp57.7 trillion. In addition, the strengthening of the industrial and SME sectors continues to be encouraged through the distribution of People's Business Loans (KUR).

In facing the development of the digital economy, Airlangga said the government had prepared an Artificial Intelligence (AI) Roadmap, initiated the ASEAN Digital Economic Framework Agreement, and strengthened international cooperation, including the OECD accession process and trade negotiations with the European Union through EU-CEPA.

He added that the Government also encourages the expansion of the use of QRIS as a game changer, the development of Special Economic Zones (KEK), as well as improving the climate and investment process through the Government Strategic Program Acceleration Task Force (P2SP).

Airlangga revealed that in the meeting in Hambalang, President Prabowo Subianto emphasized the importance of maintaining the sustainability of the national textile industry, considering that the sector is very open to the impact of global trade wars.

"Therefore, the President asks that special steps be taken and we have conducted a study to maintain the textile industry in Indonesia and from the results of the study, Indonesia has the potential to become the world's 5 largest textile players because in terms of growth, this textile sector will always be needed," said Airlangga in his statement. Monday, January 12.

Furthermore, Airlangga explained that President Prabowo had approved the initial phase of the establishment of an incentive funding scheme for the textile industry to strengthen the value chain of the sector, with a funding requirement of around 6 billion US dollars.

He added that President Prabowo also approved the plan to restructure SOEs or Danantara, which will specifically handle the textile industry.

According to him, through this policy, the Government targets an increase in the value of textile exports from around 4 billion US dollars to 40 billion US dollars in 10 years, as well as an increase in labor absorption from 4 million to 6 million people or an increase of around 2 million workers in the textile sector.

Airlangga said that in addition to the textile sector, the electronics industry was also a focus of the Government's attention due to global dynamics.

He added that the government plans to encourage the development of the semiconductor industry again and the Coordinating Ministry for Economic Affairs has communicated with a global semiconductor company from the UK who expressed interest in becoming an Indonesian strategic partner.

Airlangga said that in line with President Prabowo's instructions, the government would also establish a special SOE in the semiconductor sector and the development of this sector would focus on strengthening human resources, considering that the semiconductor industry is highly dependent on the quality of human resources.

He added that the national semiconductor industry is directed to meet future needs, especially for the automotive sector, the internet of things (IoT), personal computers, data centers, and cloud computing services.

Airlangga said Indonesia has a competitive advantage thanks to the size of the domestic market and its position as the largest digital economy in the ASEAN region.