Indonesia Aims for Rp 16,800-17,500 Rupiah in 2027 Budget
Indonesia Aims for Rp 16,800-17,500 Rupiah in 2027 Budget
Jakarta. Indonesia’s parliament and government agreed on key macroeconomic assumptions for the 2027 state budget on Thursday, targeting inflation at 1.5% to 3.5%, the 10-year government bond yield at 6.5% to 7.3%, and the rupiah exchange rate in a range of Rp 16,800 to Rp 17,500 per US dollar.
The agreement was reached during a working meeting between the House of Representatives’ Finance Commission and the Finance Ministry, National Development Planning Ministry, Bank Indonesia, and the Financial Services Authority.
Finance Minister Purbaya Yudhi Sadewa said the government and lawmakers had concluded discussions on the 2027 Macroeconomic Framework and Fiscal Policy Principles (KEM-PPKF) after what he described as constructive and dynamic deliberations.
“All views raised during the discussions will receive serious attention and be followed up to improve policy formulation,” Purbaya said at the parliament complex in Jakarta on Thursday.
Under the agreement, Indonesia targets economic growth of 5.8% to 6.5% in 2027 and achieve 8% growth by 2029.
To support growth, the government pledged to maintain policy coordination between fiscal authorities, monetary policymakers, the financial sector, and sovereign investment agency Danantara Indonesia. The administration also plans to improve the investment climate through deregulation and efforts to remove business bottlenecks.
Lawmakers and the government also agreed on a state revenue target equivalent to 12.01% to 12.40% of gross domestic product in 2027.
The revenue strategy includes improving tax compliance and expanding the tax base through the implementation of the Coretax system, aligning taxation with global and digital economy standards, optimizing natural resource revenues, strengthening law enforcement, and offering targeted fiscal incentives to encourage investment.
Meanwhile, the budget deficit for 2027 is projected at 1.8% to 2.4% of GDP. The government said financing would be managed prudently and sustainably to support economic growth and public welfare.
Purbaya said the government remained committed to maintaining fiscal discipline by keeping the deficit below the legal ceiling of 3% of GDP and public debt below 60% of GDP.
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