Topic
Indonesian political developments
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Thousands protest in Jakarta for stronger anti-corruption measures
On August 27, 2026, thousands of protesters from groups including the Gerakan Rakyat Menggugat (GERAM) and the United Pati Community Alliance (AMPB) gathered outside Indonesia’s parliament in Jakarta to demand anti-corruption measures and political reforms. Demonstrators called for the passage of the Asset Forfeiture Bill, the implementation of the death penalty for corruption convicts, and raised concerns regarding the policies of President Prabowo Subianto and Vice President Gibran Rakabuming Raka. Authorities deployed 18,504 security personnel across the capital, detaining 65 individuals as a preventive measure while managing sporadic incidents such as protesters climbing the parliament fence.
Sole Bank Indonesia governor candidate outlines pro-growth policies
Destry Damayanti, the sole candidate for governor of Bank Indonesia, underwent a parliamentary "fit and proper" hearing on August 26, 2026. During the session, she outlined proposed "pro-growth" policies and stated her intention to increase synergy with the government and parliament. She simultaneously emphasized that she would maintain the central bank's independence while pursuing these objectives.
Indonesia investigates forest fires and sanctions six companies
On August 26, 2026, the Indonesian government intensified efforts to combat forest fires as 4,508 hotspots were detected nationwide, with 78% located in Kalimantan. Forestry Minister Raja Juli Antoni reported that 42 cases of fire-related legal proceedings were underway, following the police arrest of 72 suspects across nine provinces. The Ministry of Forestry also imposed administrative sanctions on six Forest Utilisation Business Licence (PBPH) concession holders found responsible for fires spanning 1,511.55 hectares, resulting in one license suspension and five orders for corrective measures. The fires, triggered by an intensifying El Nino pattern and a prolonged dry season, have generated haze across western and central Indonesia as well as Malaysia.
Economists question feasibility of Indonesia's economic growth targets
Economists, including representatives from the Institute of International Finance, Capital Economics, and the Bright Institute, have questioned President Prabowo Subianto’s 2027 goal to accelerate Indonesia's economic growth to 6% while maintaining a fiscal deficit of 2.4%. Critics labeled these targets overly ambitious, noting that the country has averaged 5% growth over the past decade and faces headwinds including a slowing Chinese economy, weakened domestic purchasing power, and a 25.88% year-on-year rise in online lending. Concerns regarding the feasibility of these goals were compounded by the extended MSCI review of Indonesia’s market status, the departure of Finance Minister Sri Mulyani, and questions surrounding central bank independence following the appointment of Thomas Djiwandono.
Indonesia's Prabowo launches 100 GW solar power program
On August 25, 2026, Indonesian President Prabowo Subianto launched an ambitious program to develop 100 gigawatts (GW) of solar power capacity over a three-year period. This initiative aimed to expand the country's current installed solar capacity of 1.5 GW to meet the target. The program was driven by the government's desire to decrease its dependence on fossil fuels and lower rising import bills in Southeast Asia's largest economy. The project carried an estimated total cost of $73 billion.
Concerns persist over role of intermediaries in Indonesia's commodity exports
On August 25, 2026, Indonesia formally launched Danantara Sumberdaya, a state entity tasked with overseeing and managing the country's $70 billion in annual coal, palm oil, and ferroalloy exports. The launch occurred nearly three months after the entity began operations and followed a memorandum of understanding signed on August 24 by CEO Luke Mahony and local industry associations. The development represented an increase in state control over the nation's key commodity exports.
Prabowo orders revocation of permits for firms linked to Indonesian forest fires
On Monday, August 24, Indonesian President Prabowo Subianto ordered the revocation of business permits for any corporations suspected of ordering forest and land burning. This directive followed the spread of haze from Indonesian fires into neighboring Malaysia and Singapore. During a coordination meeting in Riau and a visit to Palembang, Prabowo mandated that authorities immediately address hotspots, construct boreholes for water access, and assist local communities with government-organized land clearing.
Indonesian President pledges action against corporations responsible for forest fires
Indonesian President Prabowo Subianto visited West and Central Kalimantan to assess land and forest fires that burned over 202,000 hectares between January and July. During his trip, the President vowed to penalize corporations found responsible for the blazes in accordance with the law. The fires have forced school closures and created a haze that reached neighboring Malaysia, specifically impacting the Sarawak area. Authorities designated six provinces as priority zones for the emergency response.
Indonesia plans $28 billion investment for Jakarta and Bali financial centers
Indonesia announced plans for a $28 billion investment directed toward the development of financial centers in Jakarta and Bali. The initiative involved the commitment of these funds to bolster economic infrastructure in both locations.
Indonesia to launch commodities exchange for palm oil, nickel, and coal
On August 14, Indonesian President Prabowo Subianto announced the creation of the Strategic Mineral and Commodity Exchange (BMKS) to trade palm oil, nickel, and coal starting January 1. This initiative aimed to shift Indonesia from a primary global producer to a price setter, seeking to challenge the established dominance of Malaysia in pricing palm oil. The Financial Services Authority appointed Henry Rialdi on August 19 to oversee the regulation of this new exchange. The project was part of a broader government effort to increase state oversight regarding export prices, volumes, and revenue.
Indonesia arrests 72 people suspected of starting forest fires
Indonesian authorities arrested 72 suspects linked to 89 forest and land fire cases across five provinces in Borneo and four in Sumatra. The fires, intensified by an El Nino pattern and a prolonged dry season, produced dense smoke that affected neighboring Malaysia. According to Mohammad Irhamni of the National Police’s Criminal Investigation Agency, the arrests focused on individuals accused of intentionally burning land to clear areas for plantations at a lower cost.
Residents contest land ownership claims on Indonesia's Pari Island
Residents of Pari Island, led by the Pari Island Women’s Group founded by Asmania in 2017, contested land ownership claims made by the property development firm PT Bumi Pari Asri. The company claimed ownership of approximately 90 percent of the 43-hectare island, citing 62 freehold certificates and 14 right-to-build permits obtained from the North Jakarta National Land Agency. Islanders challenged the legitimacy of these permits, while the company maintained the acquisitions were legal and asserted that the residents' ecological activities, such as mangrove planting, were conducted on private property without authorization. This dispute occurred alongside a separate legal case filed by residents against the cement firm Holcim regarding climate-related damages, as the island remains vulnerable to rising sea levels.
Indonesian workers allege forced labor and salary cuts
Indonesian technicians recruited by Singapore-based labor agency Sheffield Green for renewable energy projects in Taiwan alleged they were subjected to forced labor and significant wage theft. While workers were initially promised a monthly salary of approximately NT$50,000, they reported being paid NT$100 per hour upon arrival, with employers citing an exemption from the Labor Standards Act for short-term work permits. Legislator Lin Yueh-chin and advocacy groups alleged that companies, including building contractors for offshore wind farms and CPC Corp, Taiwan, utilized Article 51 of the Employment Service Act to exploit labor loopholes. In response to these claims, the Ministry of Labor initiated an investigation in collaboration with local governments into the companies involved.
Indonesia to remove 50 rupiah minimum price for listed stocks
The Indonesia Stock Exchange announced plans to remove the 50 rupiah (0.3 U.S. cents) minimum share price requirement for listed stocks. IDX President Director Jeffrey Hendrik stated the exchange held discussions with the Association of Indonesian Securities Companies, the Indonesian Investment Managers Association, and global investors regarding the change. The move was intended to improve market liquidity and allow share prices to better reflect market valuations. The exchange is currently assessing the readiness of its trading systems and gathering further feedback from market participants before implementation.
Batik Air pilots fall asleep during flight
On January 25, 2024, both pilots of a Batik Air Airbus A320 carrying 153 passengers fell asleep simultaneously for approximately 28 minutes during a flight from Kendari to Jakarta. The co-pilot fell asleep due to sleep deprivation from caring for his newborn twins, and the captain fell asleep after requesting a rest period, leaving the aircraft to drift off its intended flight path. Although the aircraft landed safely without injuries or damage, the incident highlighted a critical failure in cockpit monitoring. Both pilots, aged 32 and 28, passed routine pre-flight medical screenings, but these checks failed to account for the impact of poor-quality sleep on pilot alertness.
Swiss tourist sentenced to one year in jail for violating Bali's Day of Silence
On August 20, 2026, the Denpasar District Court sentenced 26-year-old Swiss tourist Luzian Andrin Zgraggen to one year in prison for violating Bali's sacred Day of Silence, or Nyepi. Zgraggen was convicted under Indonesia's new criminal code after he posted social media content showing him defying mandated restrictions by walking to a beach, despite being warned by villa staff. The presiding judge stated the actions offended the local population and provoked public outrage, noting that the restrictions on movement and internet usage apply to all individuals on the island regardless of nationality or faith.
Indonesia considers resuming macaque exports amid conservation concerns
Indonesia established a 2026 export quota of 1,920 long-tailed macaques and inaugurated a breeding facility in Lampung province to supply the species for international biomedical research. The government, supported by local officials in Mesuji regency, cited the need to manage primate overpopulation and resolve conflicts involving attacks on humans and crop destruction as primary justifications. While the IUCN classifies the long-tailed macaque as endangered, Indonesia’s 2024 national assessment categorized the species as of “least concern,” citing stable or growing populations in surveyed areas.
Indonesian authorities seize 2.6 tonnes of methamphetamine
Indonesian authorities seized 2.6 tonnes of liquid methamphetamine and 1.5 million illegal cigarettes from a Tanzanian-flagged vessel, the MV Rain Maker, near Bengkalis in Riau province on August 17, 2026. The National Narcotics Agency, acting on intelligence that a vessel from Sarawak, Malaysia, was transporting narcotics, conducted the interception alongside customs officials and arrested 10 Myanmar nationals. This operation follows a series of recent maritime seizures in the region, including 1.3 tonnes of ketamine intercepted on August 8, 2026. The volume of the seizure marks one of the largest drug busts in Indonesian history.
Indonesia faces challenges in meeting economic growth targets
Indonesian President Prabowo Subianto announced ambitious macroeconomic targets and fiscal assumptions during his annual state of the nation and budget speeches on August 14, 2026. Following these addresses, business leaders and economists expressed concerns regarding the feasibility of these goals. These groups warned that policy uncertainty and fiscal risks currently threaten the president's economic objectives.
Police arrest 21 student protesters in Jakarta
On August 18, 2026, hundreds of university students protested against Indonesian government policies in Jakarta. The demonstrations occurred one day after the country celebrated its 81st Independence Day. During the event, police clashed with the protesters and arrested at least 21 students.
Indonesia evaluates strategies to develop domestic electric vehicle manufacturing
President Prabowo Subianto initiated a national electric-motorcycle ecosystem on August 13 by visiting the ALVA factory in Cikarang, West Java, where he called for production to scale from 20,000 units to 2 million. The government supported this push with incentives including lower installment rates and zero down payments, while also setting a goal for mass production of domestic electric cars by 2028. This move forced an evaluation of whether Indonesia can successfully transition from a resource provider to a manufacturer or if it will remain a destination for imported and locally assembled vehicles. An upcoming stimulus package is expected to establish specific rules regarding local-content requirements, battery types, and which producers qualify for state support.
Indonesia expands domestic credit card network
On Monday, Bank Indonesia expanded its domestic credit card payment system, the KKI, to individual users in partnership with major local lenders. The initiative was designed to support consumer loans as an increasing number of young Indonesians utilize credit for payments. By moving transaction processing onshore, the central bank challenged the long-standing market dominance of international providers Visa and Mastercard in Southeast Asia's largest economy.
Indonesia marks 81st independence anniversary with Jakarta ceremony and parade
President Prabowo Subianto presided over Indonesia’s 81st independence anniversary celebrations in Jakarta. The event included a flag-raising ceremony at the presidential palace followed by a military parade.
Death toll from Indonesian earthquake rises to 40
On August 15, 2026, a 7.7-magnitude earthquake struck off the coast of Flores island in Indonesia, resulting in at least 40 deaths and 50 injuries. The disaster caused significant infrastructure damage, prompting the evacuation of approximately 2,000 residents and leaving people trapped in collapsed buildings across the region. A second, separate earthquake occurred 12 hours later on Sumatra island, though authorities reported no immediate damage or casualties from that event. European Union chief Ursula von der Leyen offered satellite support for rescue operations as Indonesian agencies deployed teams and aircraft to respond to the crisis.
Prabowo proposes US$230 billion 2027 budget and dual citizenship law revision
On August 14, 2026, Indonesian President Prabowo Subianto proposed a US$230 billion budget for 2027, setting a fiscal deficit target of 2.4% of GDP to support an economic growth goal of 6%. The proposal prioritizes food and energy self-sufficiency and the expansion of domestic industrial sectors, while also announcing a revision to citizenship laws to permit dual nationality. Additionally, Prabowo introduced plans for a state-backed commodity exchange and a new arm of the sovereign wealth fund, Danantara, to finance non-commercially viable development projects like the Java sea wall.
Indonesia's Prabowo targets 6% economic growth by 2026
On August 14, 2026, Indonesian President Prabowo Subianto announced a target of 6% economic growth for the country. To achieve this, the government planned to leverage an $11 billion dividend from state-owned enterprises to fund a "downstreaming" strategy and the acquisition of foreign companies. President Prabowo also cited the expansion of programs such as village cooperatives and food self-sufficiency as primary drivers for this economic trajectory.
Indonesia Plans to Consolidate State-Owned Enterprises
President Prabowo Subianto initiated a major restructuring of Indonesia’s state-owned enterprise (SOE) sector, aiming to reduce the number of entities from over 1,000 to approximately 250 within two years. By mid-2026, the government had already closed, merged, or consolidated between 240 and 250 firms. The state asset fund Danantara is coordinating the initiative, which seeks to eliminate corporate waste and overhead costs. With SOE assets totaling roughly US$572 billion—equivalent to 42 percent of Indonesia's GDP—the consolidation represents a significant shift in how the state manages its substantial economic footprint.
Indonesian President Prabowo addresses economy and policy in Independence Day speech
Indonesian President Prabowo Subianto delivered an Independence Day speech to parliament in which he acknowledged ongoing national challenges while expressing confidence that the country could achieve 6 percent economic growth this year. The president addressed concerns regarding his administration's performance, including a depreciating rupiah, a struggling stock market, and issues surrounding his flagship free meals program. These remarks followed his October 2024 inauguration, which was built on campaign promises to increase economic growth to 8 percent and implement widespread social support policies.
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