The Indonesian Employers\u2019 Association (Apindo) has stated that\nincreasing economic uncertainty, driven by both global pressures and\ndomestic challenges, is prompting businesses to hold back on expansion.\nThis condition has the potential to suppress job creation and slow\nnational economic growth.<\/p>\n
Apindo Chairwoman Shinta W. Kamdani said the business sector is\ncurrently facing heavier economic pressures compared to the first\nquarter of 2026. According to her, the escalation of geopolitical\ntensions has had a tangible impact on financial markets and the\nperformance of the real sector in Indonesia.<\/p>\n
\u201cBusinesses are concerned about the current economic pressures and\nchallenges, both at the national and international levels,\u201d Shinta told\nBisnis on Sunday (28\/6\/2026).<\/p>\n
She added that the government is still facing challenges in\nmaintaining macroeconomic stability, particularly regarding the exchange\nrate, which has increased the burden on businesses. On the other hand,\nthe projection of cost-of-living inflation remaining at the upper limit\nof the government\u2019s target continues to weigh on people\u2019s purchasing\npower.<\/p>\n
Apindo also highlighted the limited certainty and predictability of\ngovernment policies, ranging from fiscal governance to various policies\naffecting the business and investment climate. As a result, this\nsituation has increased pressure on financial markets and added to the\nburden of maintaining economic stability.<\/p>\n
Overall, Shinta assessed that the current conditions do not yet\nreflect an ideal business and investment climate for businesses or\npotential investors to expand aggressively, at least in the short to\nmedium term. With the real sector\u2019s economic growth prospects tending to\nslow, the business world will increasingly depend on the effectiveness\nof government intervention, whether through market stimulus or policies\nthat can boost business productivity, exports, and investment.<\/p>\n
Consequently, businesses are tending to act defensively by\nprioritising business continuity over expansion. \u201cBecause of this\noutlook, businesses tend to be defensive or prefer to focus on\nmaintaining existing business performance rather than expanding,\u201d she\nsaid.<\/p>\n
This condition also impacts job creation, as companies are reluctant\nto take the risk of hiring additional workers. As a result, employment\ngrowth is expected to stagnate or even contract, which in turn will\nfurther burden domestic market performance and national economic\ngrowth.<\/p>\n
Apindo is therefore urging the government to strengthen macroeconomic\nrisk management, especially by maintaining exchange rate stability and\ninflation, while simultaneously increasing the certainty and\npredictability of policies affecting the business climate. The\ngovernment is also encouraged to prioritise policies that can enhance\nbusiness productivity, exports, and investment without sacrificing\npublic purchasing power.<\/p>\n
Shinta acknowledged that the economic challenges facing the\ngovernment are not easy. However, she stressed that the government needs\nto remain responsive, agile, and timely in formulating policies to\nmitigate external pressures while restoring the confidence of businesses\nand investors.<\/p>\n
She estimates that external pressures will persist for the next two\nto three months. According to her, transparency, open dialogue with\neconomic stakeholders, and flexibility in adjusting policies to meet the\nneeds of increasing productivity and strengthening the domestic market\nare crucial factors for sustaining economic growth through to the end of\nthe year.<\/p>\n
\u201cThis transparency, open dialogue, and flexibility will mean much\nmore for businesses or investors in creating trust and confidence to\nexpand their businesses in Indonesia in the short to medium term,\ndespite persistent external pressures,\u201d she concluded.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/businesses-hold-back-expansion-admitting-q2-2026-pressures-are-heavier-1782674412", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }