Chatib Basri Summoned to Palace, DEN Highlights MBG Efficiency

The National Economic Council (DEN) has highlighted the efficiency of the free nutritious meal programme (MBG) as one of the recommendations it has delivered to President Prabowo Subianto. DEN member and former finance minister M. Chatib Basri attended the meeting held at the State Palace on Tuesday (9/6/2026). Chatib stated that a key issue the government needs to address is the risk of rising prices for goods and products due to the rupiah’s depreciation. “This will certainly impact the lower-middle class, and something must be done, including fostering confidence or trust in the government. One way is through budget efficiency measures, including in relation to the MBG,” Chatib said during a press conference at the Palace. Meanwhile, DEN member Mochammad Firman Hidayat explained that Indonesia’s economic fundamentals remain sound. He compared the current state of Indonesia’s economy favourably to the conditions during the 1998 monetary crisis, citing macroeconomic indicators such as relatively high economic growth and stable inflation. “One highlight is that corporate balance sheets remain very healthy. For instance, corporate debt in US dollars is far lower than in 1998,” Firman stated. He noted that corporate cash positions are also relatively high, enabling them to mitigate uncertainty. From the banking side, Firman assessed that the capital adequacy ratio (CAR) remains above 25 percent, indicating the banking system is also quite robust. However, Firman cautioned that Indonesia must remain vigilant regarding global economic uncertainty, including the impact of protracted wars and the weakening rupiah. “The impact of war on global energy prices and the rupiah’s depreciation could drive up production and distribution costs,” he explained. According to Firman, the Consumer Price Index (CPI) inflation stands around 3 percent, whereas the Wholesale Price Index (WPI) is in the range of 5 to 7 percent, a situation requiring anticipation in the second half of 2026. Amid global uncertainty, Firman emphasised the need to strengthen confidence in Indonesia, noting President Prabowo has affirmed his commitment to maintaining the fiscal deficit target and will provide further details to the public. This commitment, Firman said, also covers budget efficiency, including the priority MBG programme. “The savings from MBG efficiency could be substantial. There are also measures that can be taken to increase revenue,” he added. Firman stressed that the rupiah’s depreciation must be viewed comprehensively. From a balance of payments perspective, several concrete steps can be taken to bolster foreign exchange reserves, including enhancing secondary income by increasing remittances from Indonesian workers abroad. “Compared to the Philippines, our remittance figures are far lower. This means the President’s programme to enhance skilled and quality workers such as nurses, electricians, and other professionals can help boost foreign exchange,” Firman said. He also pointed to tourism as a source of foreign exchange and encouraged policies to increase the number of foreign tourist visits.