Economic Growth Must Go Hand in Hand with Poverty Reduction

The Chairman of the Budget Agency of the Indonesian House of Representatives (DPR RI), M H Said Abdullah, has reminded the government to make maximum use of the demographic bonus to drive inclusive and sustainable economic growth. He stressed that Indonesia must not lose the momentum of its demographic bonus and enter an ageing society era while still lagging behind in education and welfare. “We must not let this nation grow older yet remain poor and with low levels of education,” Said Abdullah emphasised during a Budget Agency working meeting with the government on the Macro-Economic Framework and Fiscal Policy Principles (KEM PPKF) for the 2027 Draft State Budget on Tuesday. During the meeting, Said praised President Prabowo Subianto for directly presenting the introduction to the KEM PPKF 2027 at a DPR RI plenary session. He considered it a positive new tradition in the institutional relationship between the government and parliament. The government has proposed basic macro-economic assumptions for 2027, including economic growth of 5.8–6.5 percent, inflation of 1.5–3.5 percent, an exchange rate of Rp16,800–Rp17,500 per US dollar, a Government Securities yield of 6.5–7.3 percent, an Indonesian Crude Price of 70–95 US dollars per barrel, oil lifting of 602–615 thousand barrels per day, and gas lifting of 934–977 thousand barrels of oil equivalent. According to Said, the high economic growth target must go hand in hand with efforts to reduce poverty, unemployment, and social inequality. “In executing economic growth strategies, it must be extremely inclusive. The logic of fiscal policy must encapsulate a policy orchestration between the targets of economic growth, poverty reduction, unemployment, and social inequality that are all equally accelerative,” he stated. Said also highlighted the pressures currently facing the national economy, ranging from the weakening of the rupiah exchange rate and high Government Securities yields to the downward trend in the Composite Stock Price Index.