ASIATODAY.ID, JAKARTA – Indonesia said the Indo-Pacific region is emerging as a relative anchor of stability amid rising global geopolitical tensions, even as conflicts in the Middle East and broader uncertainty continue to weigh on markets and investment sentiment.
Coordinating Economic Affairs Minister Airlangga Hartarto said geopolitical fragmentation has made global markets more volatile and investor decision-making more cautious, particularly in relation to liquidity and supply chains.
“Peace always brings positive outcomes for the global outlook and the global economy,” Airlangga said on June 24, adding that improved geopolitical conditions would strengthen global supply chains and benefit Indonesia.
He said the Indo-Pacific remained comparatively stable and attractive to investors, supported by steady growth in ASEAN economies and broader regional resilience.
ASEAN is expected to maintain growth above 4%, while major regional economies including China, Japan, South Korea, Australia and New Zealand continue to provide structural support to investor confidence.
Indonesia also pointed to strong performance in its special economic zones, where high occupancy rates and expansion plans are underway as global supply chains continue to realign toward Southeast Asia.
On the domestic front, Airlangga said fiscal and monetary coordination with Bank Indonesia was helping maintain currency stability and manage capital flows, including efforts to sustain the appeal of rupiah-denominated assets.
He said authorities were monitoring banking liquidity, third-party funds and credit growth to ensure financial system stability amid external pressures.
Indonesia is also pushing forward with international economic integration, including its accession process to the Organisation for Economic Co-operation and Development (OECD), which groups 38 countries with a combined market size of about $64 trillion.
The country is simultaneously pursuing trade agreements including the CPTPP and the Indonesia–EU Comprehensive Economic Partnership Agreement (IEU-CEPA), which is expected to reduce tariffs on Indonesian exports to the European Union, a market with a GDP of about $21 trillion.
The government has prepared a 26.34 trillion rupiah ($1.6 billion) stimulus package for the second half of 2026, covering transport, tourism, vocational programmes and food assistance.
Airlangga said Indonesia was also diversifying energy and raw material imports to reduce exposure to single-source supply risks, with Middle Eastern oil imports now accounting for about 20%, supplemented by alternative suppliers including African countries.
Food security measures are also being strengthened to mitigate potential El Niño-related risks, including irrigation support and pumping programmes for agricultural areas.
“The Indonesian economy is fundamentally solid and resilient,” Airlangga said.
“We will continue to strengthen that resilience while ensuring broader prosperity.” (AT Network)
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