Indonesia’s Economy Remains Resilient, Set to Sustain Growth Above 5% Amid Global Uncertainty

Jakarta, The Gulf Observer: Coordinating Minister for Economic Affairs Airlangga Hartarto has reaffirmed the resilience of Indonesia’s economy, expressing confidence that it will maintain growth above five percent this year despite mounting global uncertainties.

Speaking at the headquarters of Bank Indonesia on Monday, Hartarto highlighted the country’s strong economic fundamentals, noting that Indonesia recorded growth of 5.11 percent last year and is targeting 5.4 percent in 2026.

“Our economic fundamentals remain solid,” he stated, pointing to stable inflation, robust domestic consumption, and sound financing conditions as key supporting factors.

Hartarto projected that the economy would expand by at least 5.5 percent in the first quarter, with inflation recorded at 3.48 percent and the consumer confidence index standing at 122.9. He emphasized that household consumption continues to play a central role, contributing approximately 54 percent to the country’s gross domestic product (GDP).

The minister further noted that Indonesia has maintained a trade surplus for 70 consecutive months, with total surplus reaching 148.2 billion U.S. dollars. He added that the country’s debt-to-GDP ratio remains relatively low at 29.9 percent, while domestic investors hold 87.4 percent of government securities, underscoring financial stability.

Citing international assessments, Hartarto said institutions such as the International Monetary Fund have described Indonesia as a “bright spot” in Asia, while the Asian Development Bank has projected economic growth of around 5.2 percent in 2026.

He also pointed out that Indonesia’s probability of recession is estimated at below five percent—lower than that of major economies including the United States, Japan, and Canada—reflecting continued global confidence in the country’s economic outlook.

Addressing external risks, Hartarto noted that Indonesia remains relatively resilient to global energy supply disruptions linked to rising security tensions in the Middle East, due to its lower dependence on energy imports from the region compared to other Asian economies.

He stressed that the government would continue to strengthen cross-sector coordination to safeguard economic stability and sustain growth momentum in the coming years.