Indonesia plans to identify up to 80 trillion rupiah ($4.7 billion) in savings to shield its economy from potential shocks stemming from conflict in the Middle East, the presidency confirmed. The measures are a response to surging global oil prices following recent hostilities in the Gulf region.
As Southeast Asia’s largest economy, Indonesia is evaluating several cost-reduction strategies. These include implementing a weekly remote work day for government and select public-sector employees to conserve fuel. The initiative aims to curb energy consumption and accelerate renewable energy production, particularly solar power.
Presidential spokesman Prasetyo Hadi, speaking on behalf of President Prabowo Subianto, confirmed the savings target but did not specify the sources. The government has reiterated that Prabowo’s flagship free meal program, budgeted at $19.7 billion for 2026, will not be affected. Additionally, the long-standing fuel subsidy—covering 30-40% of consumer costs and accounting for approximately 15% of the national budget—remains firmly in place.
These efforts are part of Prabowo’s broader strategy to elevate Indonesia’s economic growth from 5.1% recorded last year to 8% by 2029, largely driven by public spending. Although global oil prices have spiked, Indonesia has so far avoided the severe fuel shortages and long queues seen in some neighboring nations.
“There are still many other cost-saving measures that we can implement,” President Prabowo stated in a weekend interview. The work-from-home policy details will be finalized and announced to the public “as soon possible,” Prasetyo added.
The move highlights Indonesia’s proactive fiscal management amid external volatility. By pursuing efficiency in state operations while protecting major social and subsidy programs, the administration aims to maintain economic stability without derailing its ambitious growth targets or compromising popular support mechanisms.
Reporting by AFP. First published on Channels Television.
