JAKARTA, May 20 — Indonesian President Prabowo Subianto said the country’s economy is expected to grow between 5.8 per cent and 6.5 per cent in 2027, supported by prudent fiscal policies and economic strategies focused on human capital, agriculture, and job creation.
The targeted growth must translate into tangible improvements in public welfare, with lower poverty and unemployment rates, as the government aims to reduce poverty to between 6.0 and 6.5 per cent, down from the previous target range of 6.5 to 7.5 per cent.
“With the right economic strategy and prudent and sustainable fiscal policies, I am confident that Indonesia’s economy can grow within the range of 5.8 to 6.5 per cent in 2027 and towards achieving eight per cent economic growth in 2029,” he said.
Prabowo was delivering the 2027 State Budget Macroeconomic Framework and Fiscal Policy Principles at the House of Representatives today.
He added that fiscal and monetary strategies must be able to maintain rupiah stability amid global economic uncertainties.
“Inflation will be maintained within a range of 1.5 to 3.5 per cent, while the rupiah exchange rate against the United States dollar will be kept within a range of Rp16,800 to Rp17,500.
“From the financing side of our deficit in 2027, we will maintain the state budget deficit within the range of 1.80 to a maximum of 2.40 per cent of gross domestic product, and we will continue striving to reduce and narrow this deficit,” said Prabowo.
The interest rate of 10-year government securities will be maintained within a range of 6.5 to 7.3 per cent.
The President noted that the government is also targeting a decline in the open unemployment rate to between 4.30 and 4.87 per cent, down from the previous target range of 4.4 to 4.96 per cent, while the human capital index is expected to improve to 0.575 from 0.570 through various priority programmes in the human resources sector.
He also pledged to create jobs on a massive scale, with the proportion of formal employment targeted to rise to 40.81 per cent in 2027 from 35 per cent in 2026.
The government also aims to improve income distribution, with the country’s Gini ratio projected to fall between 0.362 and 0.367, down from the previous target range of 0.37 to 0.380, to ensure the gap between the richest and the poorest does not widen further.
