Prabowo Maintains 3 Per Cent Budget Deficit Limit Unless Emergency Situation Emerges

JAKARTA — President Prabowo Subianto has stated that Indonesia will maintain fiscal discipline by upholding the budget deficit limit at 3 per cent of gross domestic product (GDP).

“The deficit limit is a good tool for disciplining ourselves. We have no plans to change it except in the event of a very large emergency situation like Covid-19,” Prabowo said in a statement from the Government Communications Agency (Bakom) on Monday, 16 March 2026.

Prabowo stressed that the deficit limit is an important instrument for ensuring disciplined management of state finances.

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

The provision has long been one of the pillars of fiscal discipline that is closely monitored by investors.

Prabowo also assessed that Indonesia is more fortunate than many other countries because it possesses relatively affordable natural resources that can guarantee national resilience. Such resources include palm oil and coal.

At the same time, the government will continue to develop geothermal, solar, hydropower, and biofuel as alternative energy sources.

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

He noted that Indonesia previously sought to emulate European Union regulations that limit fiscal deficit to a maximum of 3 per cent of GDP. However, many countries in the region no longer comply with this rule.

Prabowo rejected suggestions from several economists pushing for growth through massive debt accumulation.