Indonesian business sector urged to remain vigilant over Middle East conflict impact
Jakarta—The Chairman of the Indonesian Chamber of Commerce and Industry (Kadin), Anindya Bakrie, has stated that the business sector must heighten vigilance following the escalation of conflict between the United States, Israel, and Iran, which could potentially strain the national economy.
“We cannot afford to be complacent. All sectors must be cautious. Some companies have already invoked force majeure because supply chains are unavailable,” Anindya said after a Kadin networking event in Jakarta on Friday.
He did not identify the affected companies but emphasised that oil price increases above the government budget assumption of $70 per barrel represent a key factor requiring anticipation.
“The impact may only be felt one to two months from now,” he said.
According to Anindya, the business sector must implement efficiency measures given that certain costs cannot be controlled. He also stressed the need for close cooperation with the government to determine priority programmes capable of accelerating multiplier effects for the economy.
“Global economic outlook has changed. And geopolitics cannot be regarded merely as a temporary matter. Consequently, we must always be thoughtful about how this geopolitical situation could impact Indonesia’s economy and what must be strengthened,” he said.
Although no specific reports of export declines have yet emerged, Anindya acknowledged that logistics disruptions and a wait-and-see attitude among business operators are already becoming apparent.
“This disruption is not merely a logistical matter, but also a waiting mentality. That certainly exists,” he said.
He added that Kadin would conduct an evaluation after Ramadhan to adjust the business sector’s strategy in line with global geopolitical developments.
Earlier, Finance Minister Purbaya Yudhi Sadewa stated that the escalation of Middle East conflict could potentially trigger commodity price spikes, particularly for oil, especially if the Strait of Hormuz were to be closed.
He noted that higher oil prices could increase Indonesia’s oil and gas import burden, compress the trade balance surplus, and affect the balance of payments. Purbaya added that global uncertainty could also trigger capital outflows, impacting the stock market, bonds, and the rupiah exchange rate, whilst simultaneously raising financing costs.
“The government continues to monitor these developments closely, ensuring that the state budget instruments work responsively and maintaining fiscal prudence so that policies remain measured to preserve economic stability and public purchasing power,” he said during a state budget press conference in Jakarta on Wednesday, 11 March.