Akmalal Hamdhi, Jakarta – Indonesia's government and parliament have agreed on a 2026 economic growth target of between 5.2 and 5.8 percent, according to the preliminary 2026 draft state budget and national development plan endorsed in a plenary session on Thursday.

The macroeconomic assumptions include an inflation target of 1.5 to 3.5 percent and an exchange rate range of Rp 16,500 to Rp 16,900 per US dollar. The budget is designed to support Indonesia's efforts to strengthen food and energy sovereignty while promoting economic resilience and long-term prosperity.

"These policies aim to build a resilient, self-reliant, and prosperous Indonesia, particularly in terms of food and energy security," said House Budget Committee Deputy Chair Jazilul Fawaid.

The government also projects Indonesia's crude oil price to average between $60 and $80 per barrel, with daily production set at 605,000 to 620,000 barrels in 2026.

On the social development front, the plan targets a poverty rate of 6.5 to 7.5 percent, with extreme poverty reduced to between 0 and 0.5 percent. The open unemployment rate is expected to fall within the 4.44 to 4.96 percent range.

Under the proposed budget, state revenue is forecast to reach 11.71 to 12.31 percent of gross domestic product (GDP), while government spending is projected at 14.19 to 14.83 percent of GDP. This places the projected fiscal deficit at 2.48 to 2.53 percent of GDP.

Finance Minister Sri Mulyani Indrawati and National Development Planning Minister Rachmat Pambudy attended the session. The 2026 budget deliberations began in early July, and the final proposals will be officially presented by President Prabowo Subianto in his state address to parliament on August 15.

Source: https://jakartaglobe.id/business/indonesia-targets-58-gdp-growth-in-2026-deficit-capped-at-25