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| Coordinating Minister for Economic Affairs Airlangga Hartarto delivering a press statement on Indonesia’s economic growth at the Presidential Palace, Jakarta, August 6, 2025. |
The Indonesian government is keeping the nation’s economic momentum on track. Coordinating Minister for Economic Affairs Airlangga Hartarto announced that Indonesia’s economy grew by 5.12% in the first half of 2025, placing it among the highest performers in both the G20 and ASEAN. The statement was made after attending a Cabinet Plenary Meeting led by President Prabowo Subianto at the Presidential Palace in Jakarta, Wednesday (Aug 6, 2025).
According to Airlangga, this achievement was driven by the government’s commitment to accelerating investment, easing business licensing, and boosting household consumption. On the employment front, labor absorption also recorded strong results, with 97.73% of the working-age population employed—equivalent to 3.59 million new jobs in the past year.
President Prabowo, Airlangga added, stressed the importance of strengthening global competitiveness and called for faster business licensing reforms. The government has issued a regulation adopting a “positive list” method to simplify the business permit process. The system is integrated through the Online Single Submission (OSS) platform to help businesses—especially MSMEs—obtain permits more quickly and transparently.
Entering the second half of 2025, the government is also focusing on maintaining household purchasing power through flagship programs. In the housing sector, the Public Housing Savings Fund (FLPP) and the Housing People’s Business Credit (KUR) scheme will continue. The revolving KUR housing scheme allows up to IDR 20 billion in financing, exclusively for MSME contractors. In addition, the 100% government-borne Value Added Tax (VAT DTP) incentive for home purchases up to IDR 2 billion will remain in effect until the end of the year.
Looking ahead, the government is preparing special strategies for the Christmas and New Year period. Meanwhile, discussions on the 2026 State Budget (APBN) will be a key agenda for President Prabowo on August 15. “Investment will be the key to future economic growth, so all non-budget programs that support the investment climate must remain a priority,” Airlangga emphasized.
