Minister Prabowo Outlines MBG Benefits, References Rockefeller and World Bank

Fitch Ratings has highlighted Indonesia’s Free Nutritious Meals (MBG) programme, which is seen as potentially burdening the country’s fiscal position. Fitch raised its assumption for the 2026 national budget deficit due to higher social spending by the government, including through MBG.

Coordinating Minister for Economic Affairs Airlangga Hartarto said MBG is a long-term investment for Indonesia. A number of international studies, including from the World Bank and the Rockefeller Foundation, indicate MBG’s significant impact on the economy.

With proper implementation, MBG is claimed to yield higher returns. Specifically, Airlangga cited that an investment of US$1 in MBG could generate US$7 for the country.

“MBG, you know, according to several studies from the World Bank and the Rockefeller Foundation, with massive and well-implemented MBG, an investment of US$1 could yield US$7,” Airlangga said at Menara Batavia, Jakarta, on Thursday (5 March 2026). He regards the programme not simply as government spending, but as a long-term investment already undertaken by many countries, including the United States.

“So this is an investment and many countries do it, even the United States does it. Therefore this is a long-term and medium-term challenge that we cannot erase the long term just for the short term,” he explained.

Regarding the assessment following Fitch’s rating, Airlangga said the MBG programme is still in the early stages of rollout, so the government will continue to implement it gradually.

“MBG is just getting underway. So if it proceeds, we will keep rolling it out,” added Airlangga.

Earlier, Fitch Ratings projected the national budget deficit for 2026 to reach 2.9%, as occurred in 2025. The figure is higher than the government’s 2.7% target.

This is due to increased social spending, including through the Free Nutritious Meals (MBG) programme, which is expected to absorb about 1.3% of GDP in 2025-2029. The programme is said to increase the risk of fiscal deviation.

“Efforts to boost GDP growth and ease the social tensions still evident after last year’s protests will drive higher social spending, including the Free Nutritious Meals programme (totaling 1.3% of GDP for 2025-2029),” read the Fitch Ratings report.

(ily/hns)