Indonesia is set to unveil a comprehensive economic stimulus package on June 5 aimed at reviving economic activity and strengthening consumer purchasing power, according to the Coordinating Ministry of Economic Affairs. The move comes as the Southeast Asian powerhouse seeks to accelerate growth to around 5% this quarter amid signs of slowing momentum.
Chief Economic Minister Airlangga Hartarto emphasized that the stimulus measures are specifically designed to spur domestic consumption, which is a critical driver of Indonesia’s economic growth. He noted that launching the program just before the school holiday period in late June would create momentum and help boost purchasing power among households.
Indonesia’s economy expanded by 4.87% year-on-year in the first quarter, marking the slowest pace in over three years. In response to this slowdown, the central bank revised its 2025 growth forecast slightly downward to a range of 4.6% to 5.4%, from the previous estimate of 4.7% to 5.5%. The government’s new stimulus package is expected to shore up growth in the second and third quarters, although the final size of the package is still being determined.
Among the key incentives planned, the government will offer a 50% discount on electricity bills for approximately 79.3 million households. Additionally, food handouts will be distributed to 18.3 million lower-income families throughout June and July. These measures aim to ease the cost of living for vulnerable segments of the population, thereby stimulating spending.
To support workers, especially in labor-intensive sectors, the government intends to provide cash transfers for low-income workers and introduce discounts on work accident insurance premiums.
Tourism, a vital sector for the Indonesian economy, will also benefit from targeted relief. The government plans discounts on airfare, train, and sea transportation fares during the school holidays, which run through mid-July. Highway tolls will be discounted for around 110 million users in June and July, encouraging domestic travel and tourism activity.
Overall, this stimulus package reflects Indonesia’s strategic focus on consumption-led growth to navigate current economic challenges and boost momentum for the rest of 2025.
