Prabowo: 3% Budget Deficit Ceiling Will Not Change Except in Major Crisis

Jakarta—President Prabowo Subianto has reaffirmed his commitment to maintaining the budget deficit ceiling at 3% of gross domestic product (GDP). This year’s state budget deficit has been set at 2.68% of GDP.

“The deficit ceiling is a good tool for disciplining ourselves. We have no plans to change it unless there is a very large emergency situation like COVID-19,” Prabowo said, according to a press release on Monday (16 March 2026).

“I hope we do not need to change it,” he added.

The budget deficit ceiling has been in place since 2000. The government changed it once through the issuance of a Government Regulation in Lieu of Law (Perppu) during the COVID-19 pandemic. Policy on this matter will attract investor attention as it represents a form of fiscal discipline.

According to Prabowo, many other countries have abandoned strict budget deficit targets. He noted that Indonesia previously followed European Union rules limiting fiscal deficit to a maximum of 3% of GDP, although many countries in that region no longer comply with them.

Nevertheless, Prabowo rejected proposals from several economists advocating for growth through massive debt increases. He stated that from childhood he was taught by his parents to believe that spending should be adjusted to ability.

“Do not spend more than what we produce,” Prabowo said. “That is the basic principle of life in order to survive.”

Prabowo also noted that Indonesia is more fortunate than many other countries because it possesses natural resources such as palm oil and coal that remain relatively affordable and can guarantee national resilience. At the same time, the government will continue to develop geothermal, solar, hydroelectric, and biofuel as alternative energy sources.

“If we can get through this, in two years we will become very efficient,” Prabowo said. “We will be very, very independent from external sources.”