Jakarta. Deputy Finance Minister Juda Agung responded to concerns raised by international rating agencies Moody’s and S&P Global regarding Indonesia’s fiscal risks, reaffirming the government’s commitment to keeping the state budget deficit below 3% of gross domestic product (GDP).

“Yes, we will maintain the 3% limit as non-negotiable. It will not exceed that,” Juda told reporters at the Kempinski Hotel Indonesia in Jakarta on Tuesday.

He also assured that the government debt ratio would remain at a safe level, even though it had reached 40.08% of GDP by the end of 2025. “The law sets the ceiling at 60%, but we will keep it around 40%,” he said.

Juda described the statement as the government’s initial response to Moody’s and S&P’s assessment of Indonesia’s fiscal management risks. He added that the scrutiny would serve as a lesson to strengthen fiscal policy credibility in the eyes of investors.

“This is a lesson learned from Moody’s. We must improve everything, including governance, policies, and other risk factors,” he said.

To maintain market confidence while supporting economic performance, the government plans to accelerate state spending realization in early 2026 to bolster first-quarter growth. “Our baseline growth is 5.5%. We aim to push it to 5.6% through several government expenditures that can be executed in the first quarter of 2026,” Juda said.

He added that the accelerated spending would include social protection programs.

“Yes, those will continue. Several social assistance programs can be implemented in the first quarter, and we will carry them out immediately,” he said.

For reference, the 2025 state budget deficit stood at 2.92% of GDP, equivalent to Rp 695.1 trillion ($41.35 billion), exceeding the statutory target of 2.53%. For 2026, the government has set the deficit at 2.68% of GDP.

Meanwhile, the government debt ratio reached 40.08% of GDP at the end of 2025, close to the government’s psychological threshold of around 40%, yet still well below the legal maximum of 60% stipulated in the State Finance Law.

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