Indonesia’s President Prabowo Subianto entered office with a bold vision for dynamic economic growth and sweeping social change. However, his first year has been largely defined by significant challenges that have tested his administration’s ability to deliver on these promises.
Public Discontent and Protests
The youth of Indonesia, increasingly concerned about the rising cost of living, corruption, and inequality, have taken to the streets. In late August, protests erupted, forcing the government to reconsider perks for politicians that had inflamed public anger. These demonstrations followed earlier protests earlier in the year that targeted budget cuts impacting essential services like healthcare and education.
The Free School Meals Program Under Scrutiny
Adding to the pressure is the government’s costly free school meals program, an initiative costing $28 billion annually. Touted as a key policy to combat child malnutrition, improve educational outcomes, and stimulate the economy, it has faced severe criticism in recent months. Images have surfaced showing young children, some as young as seven, suffering from food poisoning after consuming the provided lunches. With over 9,000 children falling ill since the program’s January rollout, questions are being raised about its effectiveness, public resource strain, and the mounting national debt.
Economic Headwinds and Investment Challenges
Economically, Indonesia is navigating a complex landscape. While it has maintained steady growth of around 5% in recent years, it’s facing global economic slowdowns, rising living costs, and stiff competition from regional rivals like Vietnam and Malaysia, which are successfully attracting foreign investment. US trade tariffs have also impacted Indonesian exports, although a recently signed trade deal with the European Union offers potential growth.
Despite Indonesia’s rich resources like nickel and copper, crucial for green technologies, the country struggles to create jobs on the scale seen in manufacturing-heavy economies. Foreign companies continue to cite bureaucratic hurdles and the cost of doing business as significant challenges.
The abrupt dismissal of the respected former finance minister, Sri Mulyani Indrawati, has also unsettled investors. Her replacement, Purbaya Yudhi Sadewa, faces the daunting task of achieving President Subianto’s ambitious 8% growth target by 2029 – a level not seen since the 1990s. While government officials remain optimistic, citing deregulation and economic potential, economists point to signs of economic weakening, including falling car sales and manufacturing contraction.
Ultimately, President Prabowo Subianto faces a critical period, needing to balance ambitious policy goals with the practical realities of governing a vast and diverse nation, all while managing public expectations and economic stability.
Related News:
- How the death of a delivery driver ignited Indonesia
- Mass food poisonings cast shadow over Indonesia’s free school meals
- An ‘impossible’ country tests its hard-won democracy
More from the BBC:
- Is this island the new Bali? Some think so – but not everyone’s impressed
- Indonesian MPs get extra allowance weeks after angry protests over perks
- Strong 7.4 magnitude quake hits southern Philippines
- Death toll from Indonesia school collapse rises to 54
- Dozens feared dead in Indonesia school collapse, officials say