Kadin Reveals Economic Challenges For Indonesia In 2025, High Interest Rates And Weakening Rupiah

The Indonesian Chamber of Commerce and Industry (Kadin) has highlighted several challenges that Indonesia's economy will face by 2025. This was stated by Aviliani, the Deputy Chairperson for Macro-Micro Economic Policy Analysis at Kadin Indonesia. She believes that interest rates will still pose a challenge, even if they only decrease by 50 basis points. "On the other hand, the rupiah may weaken due to external incentives from the United States and China, which could lead to capital outflow. Therefore, high interest rates will continue to be a challenge, and businesses need to be smart about their options. Should they pay off debts? Can they go for an IPO? This is a challenge for entrepreneurs," Aviliani said in a written statement on Wednesday (January 1, 2025).

In addition to interest rates, another challenge is the exchange rate, which is expected to fluctuate significantly between Rp 16,000 and Rp 16,500 per US dollar. This will impact inflation. “So, how do we tackle inflation? Entrepreneurs need to start discussing what actions to take," Aviliani added.

She also expressed hope that the free nutritious food program (MBG), which requires a high supply of food, will not lead to increased inflation. "We must ensure that inflation does not rise due to supply shortages. Therefore, it is essential to plan for supply now so that government policies can be implemented without causing inflation to spike. Inflation can decrease if we can meet the demand," she explained.

Tag: Aviliani Kadin Nutritious Food Program