Purbaya: Public Spending is the Greatest Engine of National Economic Growth

Jakarta – Finance Minister Purbaya Yudhi Sadewa stated that various global uncertainties, such as geopolitical conflicts in the Middle East, high US interest rates, and slowing world economy, have seriously impacted Indonesia’s economy.

In the National Dialogue at Sespimti Polri held in Lembang, Bandung, West Java, on Tuesday, 28 April 2026, Purbaya explained that these impacts are felt by Indonesia through pressure on the rupiah exchange rate, financial market volatility, and inflation risks.

However, Purbaya assured that the Indonesian government has endeavoured to mitigate these risks by strengthening domestic consumption, investment, and policy synergies to maintain growth.

“Public spending is the greatest engine of national economic growth,” said Purbaya in his statement on Wednesday, 29 April 2026.

Purbaya added that in reality, Indonesia’s economy is indeed supported by consumption, investment, and trade factors.

“Therefore, we will continue to safeguard the private sector to keep growing, one of which is through the P2SP task force or debottlenecking,” said Purbaya.

Therefore, to maintain public purchasing power and consumption as well as to foster investment, particularly in the private sector, Purbaya promised not to raise tax rates or impose new taxes in the near term before economic conditions and public purchasing power improve.

He also assured consistency since taking office as Finance Minister that his side would not raise tax rates before the economy is strong enough or grows around ±6 percent.

“The government’s current focus is on increasing compliance and closing tax leakages, not raising rates,” he said.