Jakarta. The Indonesian government is preparing to extend its economic stimulus policies into the third quarter of 2025 as it seeks to maintain momentum toward its full-year growth target of 5.2 percent.

“A new policy package is being prepared and may be finalized this week,” said Haryo Limanseto, spokesperson for the Coordinating Ministry for Economic Affairs, during a press briefing on Wednesday.

Haryo said relevant ministries and agencies have been tasked with drafting the package, which will continue the stimulus measures implemented in the second quarter to boost economic activity.

“The incentives rolled out in Q2 will continue,” he added.

During the second quarter, the government launched a stimulus package focused on maintaining household purchasing power and stabilizing the economy. The measures included discounts on public transportation (train, plane, and ferry tickets) with a budget allocation of Rp 940 billion ($57.7 million); toll road fee discounts with Rp 650 billion; expanded social assistance and wage subsidy support totaling Rp 110.72 trillion; and an extension of discounts on workplace accident insurance premiums with Rp 200 billion allocated. The total stimulus package for the school holiday period reached Rp 24.44 trillion, sourced from the state budget (Rp 23.59 trillion) and non-state budget funding (Rp 850 billion).

Yusuf Rendy Manilet, a researcher at the Center of Reform on Economics (CORE) Indonesia, said that while household consumption could help cushion economic slowdowns, it would not provide a strong push for growth if exports remained weak.

“Consumption-driven growth fueled by stimulus may create the appearance of momentum, but it tends to be uneven and does not fully reflect structural economic strength,” Yusuf said.

He said that Indonesia’s growth continues to rely heavily on domestic consumption, while weakening global demand has pressured exports and impacted sectors dependent on international markets.

Yusuf added that the decline in consumption is partly due to the government’s budget efficiency measures implemented since early 2025. Although the government has gradually released budget allocations, the impact was not immediately visible in the second quarter.

Globally, reciprocal tariff policies by the United States on several countries, including Indonesia, have heightened uncertainty, disrupting global supply chains and slowing the global economy.

“My projection for Indonesia’s economic growth in the second quarter of 2025 is moderate and likely still below 5 percent,” Yusuf said.

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