HEAD of the Center for Macroeconomics and Finance, Institute for Development of Economics and Finance (Indef), Rizal Taufiqurrahman, assesses that the old faces of a number of ministers who will join Prabowo Subianto‘s government will find it difficult to improve the depressed economic conditions. This is because the performance of ministers who worked during the Jokowi era is considered not much different from when they served in the Prabowo government.
The economic ministers in the Jokowi era who will continue in the next government are Minister of Finance Sri Mulyani, Coordinating Minister for Economic Affairs of the Republic of Indonesia. Airlangga Hartarto, Minister of BUMN Erick Thohir, Minister of Industry Agus Gumiwang Kartasasmita. They were present at Kertanegara, South Jakarta, Prabowo Subianto’s residence on Monday (14/10).
“If these old ministers return to occupy the same positions, it is likely that their performance will not be much different from the previous ones,” said Rizal to Media Indonesia, Tuesday (15/10).
“With so many old ministers, it seems that in the short term or 100 days, economic conditions will not change significantly, especially in dealing with existing problems,” he added.
The economic problem that Jokowi’s aides have not yet addressed is the growing number of the middle class, and the debt problem which is expected to continue to swell. Another problem is the increasingly widespread informal employment opportunities compared to formal ones.
Rizal also encouraged the elected president Prabowo to have the courage to take steps to improve the performance of his cabinet which was incompetent in solving economic problems. This is so that the set economic targets can be realized and existing economic problems can be properly addressed.
“Even though the president has an important role in achieving the vision and mission, his big hope remains in the productivity of the performance of ministers. Prabowo must have the courage to take steps to improve the performance of his ministers in the future,” he said.
Middle Class Challenge
Separately, Director of the Digital Economy at the Center of Economic and Law Studies (Celios) Nailul Huda highlighted the challenges faced by the middle class, including government policies that do not support the growth of the middle class. Currently, the middle class is being squeezed due to increases in value added tax (VAT), fuel oil (BBM) prices and inflation, so that their purchasing power is weakening.
“A 12% VAT increase in 2025 could also make things even more difficult,” he said.
Nailul suggested that the government postpone the increase in VAT rates next year and maintain existing subsidies. This step, according to him, can provide space for the middle class to breathe and recover their financial condition amidst the existing challenges.
“Therefore, the government needs to provide greater economic space by maintaining subsidies and delaying tax increases,” he concluded. (Ins/M-4)
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