IMF Executive Board Concludes 2025 Article IV Consultation with Indonesia
IMF News, January 21, 2026
Source details
- Canonical URL
- IMF Executive Board Concludes 2025 Article IV Consultation with Indonesia
Other formats
Bibliographic details
- Published: January 21, 2026
Overview and Executive Board Assessment
- On January 14, 2026, the Executive Board of the International Monetary Fund (IMF) completed the Article IV Consultation for Indonesia. The authorities have consented to the publication of the Staff Report prepared for this consultation.
- Executive Directors welcomed Indonesia’s economic resilience and track record of prudent policies despite external challenges.
- Directors emphasized:
- Preserving longstanding policy credibility and protecting policy space amid global uncertainty.
- Accelerating structural reforms to ensure strong, sustainable and inclusive growth.
- The importance of prudent fiscal policies anchored by credible fiscal rules.
- Limiting below‑the‑line and quasi‑fiscal activities to clarify the fiscal footprint and strengthen fiscal rules.
- Robust governance and accountability frameworks for Danantara to prevent contingent liabilities and quasi‑fiscal activities.
- Maintaining a data‑dependent, well‑calibrated monetary policy stance aligned with fiscal policy.
- Letting the exchange rate function as a shock absorber, with forex interventions under limited shocks while preserving reserve buffers.
- Deepening financial markets and strengthening monetary policy transmission; gradually lowering Bank Indonesia’s presence in the government debt market over the medium term to enhance private sector participation and market liquidity and depth.
- An accommodative macroprudential stance amid a negative credit gap, with a gradual shift towards neutral as credit growth recovers.
- Implementing ambitious structural reforms (deregulation, education, digital infrastructure, transition away from non‑tariff trade measures) and progress on the climate agenda to achieve high‑income status by 2045 in an inclusive manner.
Economic Outlook
- Growth projections:
- Growth is expected to remain steady at 5.0 percent in 2025 and 5.1 percent in 2026, reflecting support from fiscal and monetary policies.
- Overall projection table (Real GDP, percent change): 2023: 5.0; 2024: 5.1; 2025: 5.2; 2026: (value appears blank in table for projection column—see table structure).
- Inflation:
- Headline inflation is well anchored and projected to converge towards the midpoint of the target range.
- Consumer prices (end period): 2023: 2.8; 2024: 1.6; 2025: 2.6; 2026: 2.5.
- Consumer prices (period average): 2023: 3.7; 2024: 2.3; 2025: 1.9.
- Current account and reserves:
- The current account deficit would remain well contained in 2025-26, with comfortable reserves.
- Current account balance (in billions of U.S. dollars): 2023: -2.0; 2024: -8.7; 2025: -6.8; 2026: -15.4; 2027: -14.6; 2028: -14.8.
- Gross reserves (end period, in billions of U.S. dollars): 2023: 146.4; 2024: 155.7; 2025: 150.4; 2026: 157.9; 2027: 168.6; 2028: 188.6.
- Gross reserves (in months of prospective imports of goods and services): 5.7 (year not explicitly labeled in table).
- Gross reserves (As a percent of short-term debt): 2023: 209; 2024: 188; 2025: 197; 2026: 193; 2027: 196; 2028: 202.
Fiscal and Public Finance Indicators
- General government (in percent of GDP):
- Revenue: 2023: 15.0; 2024: 14.5; 2025: 13.7; 2026: 13.8; 2027: 13.9.
- Expenditure: 2023: 16.6; 2024: 16.8; 2025: 16.5; 2026: 16.7.
- Energy subsidies (of which): 0.8 (year not explicitly labeled).
- General government balance: 2023: -1.6; 2024: -2.3; 2025: -2.8; 2026: -2.9.
- Primary balance: -0.5 (year not explicitly labeled).
- General government debt 4/: 2023: 39.6; 2024: 40.2; 2025: 41.0; 2026: 41.3; 2027: 41.6; 2028: 41.7.
Financial Sector and Monetary Policy
- Monetary indicators (12‑month percent change; end of period):
- Rupiah M2: 2023: 3.5; 2024: 4.8; 2025: 8.3; 2026: 8.6; 2027: 8.0; 2028: 8.1.
- Base money 5/: 2023: -1.5; 2024: 7.4; 2025: 7.6; 2026: 7.2; 2027: 7.1.
- Claims on private sector: 2023: 9.2; 2024: 7.7; 2025: 9.5; 2026: 9.3.
- One‑month interbank rate (period average): 2023: 6.4; 2024: 6.7; 2025: … (ellipsis as in source).
- Directors welcomed the continuing resilience of the financial sector and efforts to enhance regulatory and supervisory frameworks and financial sector development.
- Directors supported ongoing efforts to deepen financial markets and strengthen monetary policy transmission and endorsed a gradual reduction of Bank Indonesia’s presence in the government debt market over the medium term to enhance private sector participation.
Risks and Scenarios
- Downside risks (tilted to the downside):
- Escalating trade tensions.
- Prolonged uncertainty.
- Global financial market volatility.
- Large domestic policy shifts without sufficiently robust guardrails that could build up vulnerabilities.
- Upside risks:
- Bolder structural reforms, including faster‑than‑anticipated trade liberalization.
- Positive spillovers from stronger growth among trading partners.
Structural Reforms and Policy Recommendations
- Fiscal policy:
- Maintain prudent fiscal policies anchored by credible fiscal rules.
- Ensure careful public spending execution and enhanced revenue mobilization to preserve buffers and achieve social and developmental objectives.
- Limit below‑the‑line and quasi‑fiscal activities to clarify the fiscal footprint.
- Implement robust governance and accountability frameworks for Danantara to contain contingent liabilities and quasi‑fiscal risks.
- Monetary and exchange rate policy:
- Continue data‑dependent, well‑calibrated monetary policy aligned with fiscal policy.
- Allow the exchange rate to function as a shock absorber; deploy forex interventions under certain limited shocks and circumstances while preserving reserve buffers.
- Continue deepening financial markets and strengthening monetary policy transmission.
- Structural reforms to boost growth and inclusion:
- Accelerate deregulation, improvements in education, and digital infrastructure.
- Foster trade openness and transition away from non‑tariff trade measures to enhance global economic integration.
- Target industrial policies to address market failures while minimizing trade and investment distortions.
- Continue progress on the climate agenda.
- Emphasize reforms that support durable and dynamic private sector‑led growth to reach high‑income status by 2045.
Key Statistics and Memoranda
- Nominal GDP (2024): Rp 22,139 trillion or US$1,396 billion
- Population (2025): 284 million
- Main exports (percent of total, 2024): base metal (18), coal (14), palm oil (8), oil and gas (8), textile and products (4)
- GDP per capita (2024): US$4,909
- Unemployment rate (2025): 4.9 percent
- Poverty headcount ratio at national poverty line (2024): 9.0 percent of population
- Selected additional indicators:
- Trade balance (in billions of U.S. dollars): 2023: 46.3; 2024: 39.8; 2025: 44.7; 2026: 38.2; 2027: 42.6; 2028: 44.9.
- Of which: Oil and gas (net) (in billions of U.S. dollars): 2023: -19.9; 2024: -19.6; 2025: -18.1; 2026: -17.2; 2027: -18.0; 2028: -19.7.
- Inward direct investment (in billions of U.S. dollars): 2023: 21.5; 2024: 24.8; 2025: 18.5; 2026: 22.6; 2027: 27.0; 2028: 31.8.
- Overall balance (in billions of U.S. dollars): 2023: 6.3; 2024: -5.3; 2025: 10.7; 2026: 20.0.
- Terms of trade, percent change (excluding oil): 2023: -12.7; 2024: 1.4; 2025: 0.4.
- Total external debt (in billions of U.S. dollars): 2023: 408.5; 2024: 426.1; 2025: 429.3; 2026: 455.4; 2027: 478.4; 2028: 511.1.
- Total external debt (in percent of GDP): 2023: 29.8; 2024: 30.5; 2025: 29.9; 2026: 29.7; 2027: 29.0; 2028: 28.7.
- Exchange rate, Rupiah per U.S. dollar (period average): 2023: 15,237; 2024: 15,855.
- Exchange rate, Rupiah per U.S. dollar (end of period): 2023: 15,399; 2024: 16,132.
- Jakarta Stock Exchange (12-month percentage change, composite index): 2023: 6.2; 2024: -2.7.
- Oil production (thousands of barrels per day): 2023: 797; 2024: 794; 2025: 791; 2026: 788; 2027: 785; 2028: 782.
- Nominal GDP (in trillions of rupiah): 2023: 20,892; 2024: 22,139; 2025: 23,696; 2026: 25,647; 2027: 27,625; 2028: 29,780.
Source: IMF Executive Board press release and Table 1 data from the Article IV Consultation with Indonesia (completed January 14, 2026).