Jakarta. Indonesia aims to reduce its poverty rate to between 7 and 8 percent in 2025, and further to between 6.5 and 7.5 percent by 2026.

“Fiscal policy continues to effectively support the acceleration of national economic growth and improved welfare, including achieving a lower poverty rate,” Finance Minister Sri Mulyani Indrawati said during a plenary session at the House of Representatives on Tuesday.

The latest data from the Central Statistics Agency (BPS) showed Indonesia’s poverty rate dropped to 8.57 percent in September 2024, down 0.46 percentage points from March and 0.79 points lower than the same period last year.

This is the lowest rate recorded since BPS began publishing poverty data in 1960, marking the first time Indonesia’s poverty rate has fallen below 9 percent.

The total number of people living in poverty stood at 24.06 million in September 2024, a decrease of 1.16 million from March and 1.84 million year-on-year.

To sustain this progress, the government is intensifying rural development programs, empowering local cooperatives, and supporting micro, small, and medium enterprises (MSMEs). These initiatives aim to eradicate poverty, create jobs, strengthen food security, and promote inclusive welfare.

“These goals are being pursued through accelerating independent villages and strengthening village-level cooperatives and MSMEs in regional economic development,” Sri Mulyani added.

Alongside poverty reduction, the government targets a lower open unemployment rate of 4.44 percent to 4.96 percent in 2026, compared to the 2025 target of 4.5 to 5 percent. The Gini ratio, measuring income inequality, is expected to improve to between 0.377 and 0.380, slightly better than the 2025 target of 0.379 to 0.382. The Human Capital Index is forecast to rise to 0.57 from 0.56 in 2025.

Sri Mulyani said the 2026 fiscal strategy aims to enhance Indonesia’s sovereignty in food, energy, and the economy, building a resilient, self-reliant, and prosperous nation.

“Fiscal policy in 2026 will be used selectively and effectively to buffer against shocks while supporting medium-term development goals,” she concluded.