Minister Airlangga Claims Indonesia's Economic Fundamentals Are Solid

September 1, 2025 | 04:44 pm

TEMPO.CO, Jakarta - Coordinating Minister for the Economy Airlangga Hartarto claims that Indonesia's economic fundamentals remain solid despite the protests. Airlangga revealed several indicators demonstrating the strength of the country's economy.

First, he mentioned that the second quarter's economic growth was recorded at 5.12 percent year over year. Secondly, the Purchasing Managers' Index (PMI) for manufacturing expanded to 51.5 in August 2025 after four consecutive months of contraction. Airlangga stated, "This is supported by the expansion of output and new demand," during a press conference at the Indonesia Stock Exchange in Jakarta, on Monday, September 1, 2025.

Airlangga also mentioned that the Indonesia Composite Index (IHSG) strengthened during the past week, with a decline only occurring during the protest on Friday, August 29, 2025. On August 25, the IHSG was recorded at 7,926, which is an increase of 0.87 percent. It also increased by 0.2 percent to 7,942 on August 28, 2025. However, on August 29, the IHSG weakened by 1.53 percent to 7,830.

Another indicator is the exchange rate stability of the rupiah at Rp16,490 per U.S. dollar on August 29, 2025. Airlangga also believes that the inflation data and trade balance released by the Central Statistics Agency (BPS) today will show positive conditions.

BPS announced a 2.31 percent annual inflation in August, while the trade balance in July 2025 recorded a surplus of US$4.17 billion.

Airlangga stated that domestic consumption remains strong due to increased community mobility and retail shopping activities, both online and in-person. "The government is confident that the social and political impacts on the economy are expected to be short-term, and the government continues to promote optimism for the medium and long term," said Airlangga.

Meanwhile, the Center of Economic and Law Studies (Celios) Executive Director, Bhima Yudhistira, believes that the casualties and repression by authorities during the protests have caused foreign capital to flee the country. According to Bhima, the net selling actions by foreign investors in the stock market have reached Rp1.12 trillion today.

Bhima notes that the series of events during the protests in Indonesia indicates an increase in security risks for investors. "The impact is certainly on economic growth because foreign investment plays a significant role and has a double impact on job creation," said Bhima to Tempo on Monday, September 1, 2025.

Editor's Choice: Bank Indonesia Intervenes to Stabilize Rupiah Following Mass Protests

Click here to get the latest news updates from Tempo on Google News

Police Ensure No Firearms Used in Jakarta Protest Security

12 menit lalu

When Was Martial Law Last Enforced in Indonesia?

25 menit lalu

Deputy Indonesian Military Commander Refutes Martial Law Scenario

1 jam lalu

Propam Polri Finds Criminal Elements in Case of Police Vehicle Running Over Ojol Driver

1 jam lalu

Bank Indonesia Intervenes to Stabilize Rupiah Following Mass Protests

2 jam lalu

Losses from Jakarta Protests Estimated at Rp55 Billion

2 jam lalu

Civil Society Coalition Says Prabowo Fails to Grasp Public Aspirations

6 jam lalu

Mall Visitors Plummet Due to Protests in Indonesia, Hippindo Calls for Security Assurance

6 jam lalu

Foreigners Hand Out Meals to Ojol Drivers in Indonesia

7 jam lalu

Grab Indonesia Implements WFH Policy, Launches Quick Response Feature for Its Drivers

7 jam lalu