Prabowo, National Economic Council Discuss Rupiah Weakness, Budget Cuts

President Prabowo Subianto convened a meeting with the National Economic Council (DEN), including figures like Luhut Binsar Pandjaitan and Chatib Basri, to review the nation's macroeconomic landscape. A key focus of the discussion was the recent depreciation of the Indonesian rupiah, which had fallen to Rp 18,201 against the US dollar as of June 8, 2026. Chatib Basri highlighted the potential impact of this currency weakness on lower and middle-income segments of the population, warning of possible price increases.

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We conveyed that one of the important issues that must be considered is the possibility of price increases due to the rupiah's weakening.

During the meeting, DEN recommended that the government explore budget efficiencies, particularly by trimming expenditures on large-scale projects. The council specifically pointed to the "free nutritious meals" (MBG) program as an area where cost savings could be realized. Basri suggested that such fiscal prudence could help restore public confidence in the government's management.

Luhut Binsar Pandjaitan, Chairman of DEN, further elaborated that the council presented an evaluation of the MBG program's governance and discussed the ongoing digitalization of public services through government technology (govtech). He noted that by June 1, approximately 80% of govtech initiatives had been integrated across eight ministries and agencies, with data consolidation leveraging artificial intelligence.

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What must be done, including to foster confidence and trust in the government, is through efficiency measures in the budget, one of which is related to MBG.

DEN member Septian Hario Seto shared findings from an independent survey on the MBG program's supply chain, revealing that 86.9% of operational "School Meal Providers" (SPPG) work with only one small supplier, and on average, engage three micro, small, and medium enterprises (MSMEs). The meeting did not address any potential cabinet reshuffles, according to Deputy Speaker of the House Sufmi Dasco Ahmad.

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In President Prabowo's administration, govtech will be an important part because all data will be collected properly.