Gov’t Pushes 5 Percent Economic Growth in 2024

Coordinating Minister for the Economy Airlangga Hartarto delivers press statement after joining a plenary cabinet meeting, at the Garuda Palace, New Capital of Nusantara (IKN), Friday (09/13). (Photo by: PR of Cabinet Secretariat/Ibrahim)

Coordinating Minister for the Economy Airlangga Hartarto has outlined several achievements and strategic plans to maintain Indonesia’s economic growth. Following a plenary cabinet meeting in New Capital of Nusantara (IKN), East Kalimantan, Airlangga revealed that Indonesia’s economy remains stable, with growth reaching 5% and inflation dropping to 2.5%.

“Economic growth is relatively safe at 5%, and inflation is at 2.5%. I also mentioned that core inflation remains high; the decrease in inflation is due to volatile food commodities,” explained Airlangga.

Furthermore, he stated that the Government will boost ministries and institutions spending to achieve a 5% economic growth target by the end of 2024. He also emphasized the importance of policies targeting the middle class, such as the Government-borne Value Added Tax (PPn DTP) for property and automotive sectors. This policy is expected to increase people’s purchasing power in the fourth quarter of this year.

On the same occasion, Airlangga also mentioned plans to revise the job loss guarantee policy through the Employment Social Security Agency (BPJS Ketenagakerjaan). This revision will expand the coverage of beneficiaries, including contract workers (PKWT), by increasing job training assistance from Rp1 million to Rp2.4 million, equivalent to the Pre-Employment Card program. Additionally, unemployed workers will receive benefits of 45% of their salary, without a decrease in percentage in the following months.

“The Government will revise the job loss guarantee policy so it can cover the contract workers as well. This revision will be prepared in the form of Government Regulation and Ministry of Manpower Regulation,” he said.

Regarding the development of Special Economic Zones (KEKs), Airlangga emphasized that legal certainty and transparency are the keys to the success of these zones. Asian countries like China and Vietnam have successfully utilized KEKs as economic drivers, and Indonesia is now striving to accelerate the development of similar zones.

“One key factor is trust, especially in law and transparency. This is what other countries offer to attract investment: legal certainty, trust, and transparency. Therefore, what we need is to ensure that the regulations we have implemented are not interpreted differently by different people,” he explained.

When responding to questions about budget absorption, Airlangga expressed hope that government spending could reach a target of 95% by the end of the year.

“What we want to push is government spending, and usually by the end of the year, the realization is around 95%,” he remarked. (KS/DNS) (EST/RAS/LW)