Regarding Presidential Regulation on Broadening APBN Deficit, Purbaya: Not Yet, Budget Remains Safe

Jakarta — Finance Minister Purbaya Yudhi Sadewa has affirmed that the government has no plans to issue a Presidential Regulation in Lieu of Law (Perppu) to broaden the deficit ceiling for the 2026 fiscal budget.

Speaking following a Limited Coordination Meeting at the office of the Coordinating Ministry for Economic Affairs in Jakarta, Purbaya confirmed that fiscal budgets currently remain in a safe position.

He stated that the decision on budget design adjustments would continue to monitor developments in global oil prices in the coming period.

“We haven’t seen any need for (a Perppu) until now, because the budget is still safe,” Purbaya said on Monday, 16 March 2026.

According to him, President Prabowo has opened the possibility of adjusting the APBN deficit should the country face a crisis. However, the government currently assesses that Indonesia’s economy remains at a reasonable level.

“In my view, indicators of crisis would be if the economy enters recession, and globally everything is also in recession. There would be no other way to improve the economy or all measures to improve it could not reverse the direction towards economic growth,” he explained.

Purbaya stated that the government would continue measuring the impact of rising oil prices on budget burdens, including the knock-on effects on other energy commodities such as coal and nickel.

However, he noted that thus far, no adjustment to the APBN deficit threshold has been necessary.

“We’re not in crisis, the economy is still good, there is still spending capacity. But we must prepare thoroughly considered steps so that when needed, we can execute them correctly,” he said.

Previously, the Coordinating Minister for Economic Affairs, Airlangga Hartarto, outlined a worst-case scenario of the impact of conflicts in the West Asian region on state finances, particularly the APBN deficit, which could reach 4.06 percent.

The APBN deficit threshold is set at 3 percent of GDP as stipulated in Law Number 17 of 2003 on State Finances.

Indonesia previously suspended the 3 percent deficit limit during the COVID-19 pandemic, regulated through Presidential Regulation in Lieu of Law (Perppu) Number 1 of 2020. At that time, the APBN deficit widened to exceed 6 percent of GDP, which was subsequently reduced gradually over several subsequent fiscal years.