Role of Local Governments in Supporting Economic Growth Key to Maintaining Stability
Local governments (Pemda) play an important role in supporting national economic growth and activities. These contributions are key to maintaining stability and promoting sustainable economic progress.
Home Affairs Minister (Mendagri) Muhammad Tito Karnavian explained that the Ministry of Home Affairs has undertaken various efforts to strengthen regional economic growth and productivity. This is achieved by urging local governments to implement efficiency and optimisation in spending so that budget utilisation is more targeted.
Tito explained that one effort to strengthen regional economic growth is controlling regional inflation. The Ministry of Home Affairs, along with related ministries and institutions, consistently holds weekly meetings with all local governments to monitor inflation and discuss control measures.
“The Home Affairs Minister has been appointed by Presidential Regulation as the coordinator of the regional inflation control team, and we have been conducting [meetings] consistently for nearly three years,” he clarified in a written statement on Tuesday (21/4/2026).
In addition, Tito also urged local governments to innovate in developing sources of Regional Original Revenue (PAD) that do not burden small communities. Efforts to optimise regional revenue can also be carried out through the digitalisation of existing tax and levy collections.
These steps are believed to ensure that all taxes and levies truly enter the regional treasury.
Appreciation for Local Governments and the National Accelerator Forum
In line with these efforts, the government is also preparing measures to encourage regional performance through the provision of appreciation for local governments that demonstrate the best achievements.
The Ministry of Home Affairs will award provinces, regencies, and cities in four main areas: inflation control, reduction in unemployment rates, reduction in poverty and stunting, and creative financing.
Furthermore, the event will also feature the National Accelerator Forum as a national collaborative platform. This forum is designed to bring together the central government, local governments, business actors, investors, MSMEs, academics, and the public in one ecosystem of dialogue and action.
The series of activities will be filled with interactive talk shows and panel discussions between the Home Affairs Minister and regional heads across Sumatra. The event will take place on Saturday, 25 February 2026, at 4:00 PM WIB at Wyndham Opi Hotel, Palembang, and can be watched via streaming on the detikcom platform.
With stronger collaboration and shared commitment between the central and local governments, these strategic steps are expected to accelerate inclusive and sustainable economic growth throughout Indonesia.