Indonesia's Fiscal Condition Deemed Safe Amid Global Pressures
JAKARTA – Indonesia’s fiscal condition is considered to be on a controlled path, despite facing global economic challenges and the increasing need for development financing. Several macroeconomic indicators suggest that the government’s fiscal space remains well-maintained.
Abdul Rahman Farisi, Secretary of Economic Policy for the Golkar Party, stated that the government’s debt ratio, the state budget deficit, and the stability of the financial sector all remain at relatively healthy levels. Therefore, the national fiscal condition must be viewed holistically based on current data and economic developments.
“Technically, Indonesia’s fiscal condition is still relatively safe. The government’s debt-to-GDP ratio remains below 40 per cent, well below the maximum limit of 60 per cent as regulated by the State Finance Law. In fact, compared to many G20 nations, Indonesia’s position is much healthier,” Abdul Rahman said in a statement on Tuesday (2/6/2026).
According to him, the practice of debt refinancing is a common instrument used in modern fiscal management. Consequently, this mechanism cannot immediately be used as an indicator of problems within the country’s fiscal condition.
Abdul Rahman assessed that what needs to be maintained is the debt ratio, the government’s ability to meet payment obligations, and discipline in managing the state budget. He noted that the government is still able to keep the state budget deficit below the three per cent threshold of Gross Domestic Product (GDP).
He stated that this condition demonstrates that fiscal discipline is being upheld despite the government facing significant global economic challenges.
Regarding the primary balance deficit that drew attention at the beginning of the year, Abdul Rahman explained that the situation was influenced by the accelerated realisation of state expenditure in the first quarter of 2026.
“The target for the primary balance deficit in 2026 is Rp89.7 trillion, while as of March, it has reached Rp95.8 trillion. However, it must be understood that the pattern of state revenue historically increases in the second and third quarters, particularly from tax revenues and domestic economic activities,” he said.
He also assessed that investor confidence in the Indonesian economy remains intact. This is reflected in the demand for Government Securities (SBN), a strong foreign exchange reserve position, and continued positive economic growth.
“Indonesia’s economic fundamentals remain strong. Inflation is relatively controlled, the banking sector is stable, and domestic consumption remains the main pillar of national growth,” he added.
Abdul Rahman expressed hope that discussions regarding the national economic condition are conducted constructively and based on data. He noted that presenting proportional views is essential to maintaining public confidence in the national economy.
“We must not incite public panic with disproportionate narratives. Criticism must be constructive, data-driven, and use the appropriate economic approach so as not to create distrust towards the national economic condition,” he concluded.