Father: Happy New Year
Mother: What's your resolution for the New Year?
Cat: Delusions are easier than resolutions.
The administration of President Prabowo Subianto is making grand promises for 2026 while downplaying its failure to achieve the same promises made last year.
Early last year, top presidential advisor Hashim Djojohadikusumo – who is also Prabowo's younger brother and financed his successful presidential bid in 2024 – expressed confidence that Indonesia would achieve at least 8 percent year-on-year (yoy) economic growth in the fourth quarter of 2025, thanks to the government's food and housing programs.
While the figures are not in yet, very few believe it will be anywhere near 8 percent, and most economic observers say the country will be lucky to maintain the previously year's figure of just under 5 percent. While positive statements and public convictions have their merits, they don't translate into building an economy.
The Prabowo administration appears to have overestimated its capacity to generate economic activity strictly through food and housing programs, which have had little or no impact in terms of creating quality and well paid jobs in the formal sector.
In fact the very opposite appears to have occurred over the last year, with the country witnessing a wave of mass layoffs in the manufacturing sector and most employment growth occurring in the informal sector or short-term or contractual positions offering low wages and little job security.
Likewise with Prabowo's much touted sovereign wealth fund Danantara – promoted as a tool to get things done like tackling the waste crisis, reducing malnutrition, addressing the housing shortage and the like – which has achieved little other than capital injections into struggling state-owned enterprises such as Garuda Airlines and Krakatau Steel.
All this has done little to build investor confidence with investment in 2025 was well below the amount targeted in the National Medium-Term Development Plan (RPJMN) for 2025-2029. The latest official investment report for the third quarter of last year shows a year-on-year decline in foreign direct investment (FDI), marking the second consecutive decline.
To be fair, last year was hardly favourable to Indonesia's ambitions, with world trade in disarray and protectionism on the rise globally, but it feels like the only economic goals pursued with vigour last year were the free nutritious meal (MBG), the 3-million-homes programs and Danantara.
Meanwhile the MBG program has been beset by widely reported hygiene problems and questions about quality and effectiveness, the second has fallen well behind target and the purpose of the third remains vague to many.
As we enter the new year, the government might want to take a healthy dose of realism in its resolutions for 2026.
[Based on a Jakarta Post editorial titled "We can do better in 2026".]
