A year into its term of office, the Prabowo Subianto-Gibran Rakabuming Raka administration is aggressively pursuing its target of 8% economic growth by 2029, one of which is by cutting all barriers to private investment.
A number of experts and entrepreneurs expect the implementation of the removal of all barriers to business to be transparent and comprehensive in order to create a truly friendly and efficient business climate.
Expert Staff for Regional Development and Spokesperson for the Coordinating Ministry for Economic Affairs Haryo Limanseto said reform and deregulation measures will continue to be encouraged so that the economy grows efficiently.
"Through Indonesia's membership in BRICS, IEU-CEPA, and ICA-CEPA, the government is committed to strengthening exports and expanding the market diversification of Indonesian products abroad," he said in a discussion in Jakarta, Monday (20/10/2025).
Meanwhile, domestically, the economic stimulus packages launched in stages, along with the internship program for 20,000 new graduates that began on Monday, October 20, 2025, are expected to help the lower class and support the purchasing power of the middle class so that it can stretch simultaneously.
"We must always maintain optimism and we must also open clear and open communication with the public. Therefore, this forum is organized to listen to the views and ideas of all those present about the achievements and prospects of the economy going forward," Haryo said.
No lies
With a track record of second quarter growth reaching 5.12% and inflation maintained at 2.65% YoY, Indonesia's economic growth, which is supported by domestic consumption and investment of up to 82%, has proven to be resilient in the face of world economic fluctuations throughout 2025.
Although the economic performance that exceeded expectations is a basis for optimism, the business world still cannot turn a blind eye to the facts, ranging from the 32% increase in layoffs from the same period last year, the 9.5% drop in retail motor vehicle sales, and the consumer confidence index dropping to 118.1 in July.
Anne Patricia Sutanto, Vice Chairperson for Trade of the Indonesian Employers Association (Apindo), said that the current challenges for the business world are structural and must be faced together, starting from the availability of formal employment, supporting investment in labor-intensive sectors, to the ease of doing business promised in deregulation.
According to Anne, so far the business world has been encouraged to be ready to contribute to economic growth, even though the business world is more than ready for it. However, readiness also requires an agreement on productivity and efficiency to overcome problems such as loan interest rates that reach 8%-14% and a very high cost of funds , even though upgrading and upskilling require a lot of capital.
Anne launched a number of alarming data. In Apindo's findings, 61.26% of businesses have difficulty obtaining credit. The price of industrial electricity in Indonesia reaches USD 0.099/kWh, much higher than other ASEAN countries. Foreign companies need 65 days to register, while the transfer of property ownership can take up to 90 days. If there is a dispute in court, the waiting time for a decision can be 150 days, whereas the ideal time is less than 7 days.
"In deregulation, please do not lie among us. It is useless if we are supported by liquidity, lower interest rates, and stimulus if there are still lies in deregulation and licensing. Yesterday, with the stipulation of PP 28/2025, we were happy, but it has not been felt until now. In fact, local governments just need to ask what should be done to the central government for its execution," Anne said frankly.
Today, according to Anne, businesses have four prescriptions to contribute to growth: resilience to shocks, relevance that anticipates the future, innovation that revisits ways of creating value, and responsibility to create jobs.
The Vice President Director of Pan Brothers did not deny that over the past 10 years, investment has moved towards capital-intensive sectors, even though two presidents emphasized that the pillars of Indonesia's growth are labor-intensive industries.
Over-regulation of labor, said Anne, is one of the reasons why Indonesia's human resources are not maximally channeled into high value-added industries.
"Over-regulation is not always a good thing. The government must be there for the people, but the people must also work together. We must believe in ourselves, so that the economy does not only 'take off', but if possible also 'fly back and forth'," said Anne.
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Ferry Irawan, Deputy for Coordination of SOE Management and Development at the Coordinating Ministry for Economic Affairs, said that the government's economic policy includes aggregate strategies on both the demand and supply sides. From the supply side, aggregate policies are carried out by increasing liquidity, infrastructure support, deregulation, and tax incentive support for businesses.
Meanwhile, from the demand side, aggregate policies are carried out by unblocking the budget posts of the state budget that are in efficiency, accelerating ministry/agency spending, as well as providing Additional Budget for stimulus programs and year-end transportation discounts for KAI, Pelni, ASDP, and various airlines to facilitate year-end mobility.
"This means that we are not only targeting the lower decile, but also paying attention to the middle class. We are preparing formal employment opportunities, while for entrepreneurs there is a People's Business Credit of Rp282.7 trillion, credit for agricultural tools and machinery of Rp199.42 billion, and labor-intensive credit of Rp754 billion," Ferry said.
Meanwhile, according to senior economist and member of the Assistance Team for the Coordinating Minister for the Economy Raden Pardede, there are achievements that must be appreciated, with clear targets.
The huge potential of commodities is proven to make Indonesia's economy grow faster than other countries, but dependency can make that growth a mirage.
"We must upgrade the economic engine, because if the engine is good, fuel will be more efficient. Learn from other countries that have political commitment, planning continuity, technological progress , and utilize momentum. Consider natural resources as a bonus, not the main engine of our economy," said Pardede.
Sharing a view with Pardede, Chief Economist of The Indonesia Economic Intelligence (IEI) Sunarsip explained that economic sectors that contribute to employment need to be encouraged, even though they have a fairly low recovery ability for the post-pandemic economy. Therefore, debottlenecking efforts must not only be carried out through deregulation, but also technical aspects.
"Why is bank credit not growing? Cost of funds is high, cost of financing is high. The private sector is reluctant to attract credit to banks, partly because our UMKM have experienced bad credit due to Covid-19 so they cannot borrow capital. Technical issues like this must also be included in the debottlenecking framework," Sunarsip explained.
Currently, according to Sunarsip, the government has managed to find a formula to encourage greater economic effectiveness, ranging from liquidity injection to ease of licensing. The global economic situation, which is much better than 3-4 months ago, according to him, is a momentum that must be utilized as well as possible.
"The economy, trade and geopolitics are much better. The room for growth in 2026 is quite large, we just need to improve it by debottlenecking and lowering the ICOR ratio to encourage corporations to bring in more investment," concluded Sunarsip.
