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Prabowo’s zero-deficit delusion

Without deeper tax reform, spending restraint or realistic dividend expectations, a balanced Budget is mathematically unattainable

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    • Indonesian President Prabowo Subianto's optimism rests on three assumptions: that waste (corruption) can be eliminated, that tax revenues can grow without burdening the economy, and that state-owned enterprises can deliver unprecedented profits to the treasury.
    • Indonesian President Prabowo Subianto's optimism rests on three assumptions: that waste (corruption) can be eliminated, that tax revenues can grow without burdening the economy, and that state-owned enterprises can deliver unprecedented profits to the treasury. PHOTO: AFP

    Ronny P Sasmita

    Published Wed, Oct 15, 2025 · 11:36 AM

    WHEN President Prabowo Subianto addressed Indonesia’s parliament on Aug 15, 2025, to present his draft 2026 state Budget, his confidence was unmistakable.

    He proposed a total spending of 3,786.5 trillion rupiah (S$300 billion) and revenues of 3,147.7 trillion rupiah, which would have resulted in a deficit of 638.8 trillion rupiah or around 2.5 per cent of projected gross domestic product. He described these figures as proof of “prudent and sustainable” fiscal management.

    Then came his boldest claim: By 2027 or 2028, Indonesia could achieve a balanced Budget, a fiscal year with zero deficit.

    IndonesiaIndonesia BudgetAseanAsean Business

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