Finance Minister Purbaya Warns Ministries and Agencies That Fail to Meet Spending Targets

Jakarta, CNBC Indonesia - Finance Minister Purbaya Yudhi Sadewa has assured that the State Budget (APBN) remains strong enough to withstand the impact of energy price volatility on fuel and LPG subsidies, ensuring that subsidised fuel prices will not rise and purchasing power will not be disrupted, thereby having no negative effect on the Indonesian economy.

Regarding the weakening of the Rupiah exchange rate, which briefly touched its lowest level at Rp 18,200 per US dollar, creating negative sentiment for the Indonesian economy, Purbaya confirmed that economic fundamentals remain solid, supported by the Prabowo administration’s targeted and leak-free economic strategy. The Ministry of Finance, together with Bank Indonesia, is cooperating to manage sentiment towards the Rupiah exchange rate and ensure its impact on the economy remains limited.

On another front, Purbaya affirmed the government’s commitment to overcoming various investment barriers through the establishment of a ‘Bottlenecking’ Task Force. This task force has already succeeded in resolving several investment obstacles thanks to cooperation between the Ministry of Finance and relevant ministries and agencies, citing the example of a waste-to-energy plant in Sulawesi that was successfully unblocked.

Purbaya also urged ministries and agencies to maximise spending as a pillar of the Indonesian economy, warning that those which are slow or fail to meet targets will have their budgets rearranged in the coming year. He also confirmed that oversight of ministry and agency spending will be tightened to ensure it has a tangible impact on the economy and development.

Regarding incentives for the second half of 2026, Purbaya is considering providing incentives for electric vehicles. Additionally, there will be subsidies for the elderly who have not yet received them, though this is still awaiting the President’s decision.