Govt moves to curb economic leakage, save budget: Prabowo
Speaking at the 28th anniversary event of the National Awakening Party (PKB) in Jakarta on Thursday (July 23), Prabowo cited independent economic analyses pointing to Indonesia’s high Incremental Capital Output Ratio (ICOR)—an indicator measuring investment efficiency.
“What does inefficient mean? It means a lot of wealth is leaking,” Prabowo told attendees, noting Indonesia’s ICOR score sat at 6.50 in 2024 before nudging slightly to 6.24 in 2025.
Explaining the figures, the President noted that spending US$6.24 to generate US$1 of economic growth puts Indonesia roughly US$2 behind several neighboring nations—translating to a massive loss of national productivity.
“This means 30 percent of our wealth is leaking. The state budget is US$270 billion, roughly Rp3,700 trillion. So, if 30 percent is leaking, that means more than Rp1,000 trillion (US$60 billion) is leaking,” Prabowo calculated.
“I am stopping this. I want to close this,” the President pledged.
He attributed a significant portion of this fiscal drain to markups and price gouging practices across various entities, including public institutions.
By cracking down on inflated costs during the opening months of his administration, Prabowo reported that the government successfully saved approximately Rp300 trillion (US$18 billion).
The President detailed that these recouped funds are being redirected to high-priority public programs, including national free nutritious meal initiatives and widespread infrastructure development, such as the construction of 5,000 bridges nationwide by December 2026.
During the event, Prabowo expressed appreciation for PKB’s support and accepted the recommendations of the PKB Ulama Conference (Ijtima).
The religious council endorsed strategic national policies aimed at boosting economic independence, industrial downstreaming and food security—in alignment with Article 33 of the 1945 Constitution.
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Translator: Prisca Triferna Violleta, Yashinta Difa