Jakarta. Indonesia’s external debt edged higher at the start of 2026, though growth slowed slightly as government borrowing rose while private-sector debt declined, according to Bank Indonesia data released on Monday.

The country’s external debt stood at $434.7 billion in January 2026, expanding 1.7% year-on-year, slightly slower than the 1.8% growth recorded in December 2025.

Bank Indonesia said the development was largely driven by the public sector, particularly government borrowing tied to financing programs and development projects.

Government external debt reached $216.3 billion in January, growing 5.6% year-on-year, slightly faster than the 5.5% growth recorded in the previous month. The central bank said the increase reflected foreign loan withdrawals to support government programs as well as capital inflows into international government securities.

“Capital inflows into Indonesia’s international government bonds signal sustained investor confidence in the country’s economic outlook despite growing uncertainty in global financial markets,” Bank Indonesia said, noting that government external debt is managed prudently to finance priority programs and safeguard fiscal sustainability.

The central bank noted that the funds are largely directed toward priority sectors that support economic development.

The largest share of government external debt was allocated to health and social services, accounting for 22.0% of the total, followed by public administration, defense, and mandatory social security (20.3%), education services (16.2%), construction (11.6%), and transportation and warehousing (8.5%).

Government borrowing remains overwhelmingly long-term, representing 99.98% of total government external debt, which Bank Indonesia said helps reduce refinancing risks.

Meanwhile, private external debt declined, reaching $193.0 billion in January, down from $194.0 billion in December 2025.

On an annual basis, private external debt contracted 0.7% year-on-year, deeper than the 0.2% contraction recorded a month earlier. The central bank said the decline was mainly driven by reduced borrowing by nonfinancial corporations.

Private-sector external debt is concentrated in several key industries, particularly manufacturing, financial and insurance services, electricity and gas supply, and mining and quarrying, which together account for 80.1% of total private external debt.

Similar to the government sector, private borrowing is dominated by long-term debt, which represents 76.2% of total private external debt.

Overall, Bank Indonesia said the country’s external debt structure remains healthy.

The external debt-to-GDP ratio fell to 29.6% in January, down from 29.9% in December, while long-term debt accounts for 85.6% of total external debt.

“Prudent debt management continues to support a sound external debt structure,” the central bank said.