Indonesia’s new finance minister, Suahasil Nazara, affirmed policy continuity by maintaining the government’s budget deficit target for 2026 in his first public remarks since his appointment. Speaking at a press conference on Friday, Suahasil sought to restore investor confidence amid concerns over fiscal discipline and political interference under President Prabowo Subianto’s administration.

Suahasil was named finance minister earlier this week following the dismissal of his predecessor, Purbaya Yudhi Sadewa, making him the third person to hold the position in less than two years. The leadership changes have attracted close attention from market participants and credit rating agencies, as Prabowo’s election campaign included costly spending promises in an environment of limited fiscal space.

Despite efforts by Purbaya to manage the budget deficit, uncertainty around policy implementation, perceived meddling in the central bank’s autonomy, and transparency issues at the stock exchange contributed to market volatility and prompted recent downgrades of Indonesia’s credit outlook by Fitch and Moody’s. Suahasil committed to respecting the statutory fiscal deficit ceiling of 3% of GDP and encouraged constructive parliamentary dialogue regarding any potential adjustments to fiscal frameworks currently under review.

“We must ensure the state budget remains credible,” Suahasil said, stressing the importance of strengthening revenue collection, enhancing the effectiveness and productivity of expenditures, and maintaining sound and controlled deficit management. He also highlighted the resilience of Indonesia’s economy despite rising global interest rates.

According to the finance minister, the country recorded a budget deficit of 240.1 trillion rupiah (approximately $13.55 billion) from January through August, representing 0.93% of GDP. The baseline projection for the full year 2026 remains a deficit of 2.85% of GDP. Revenue collection reached 2,055.6 trillion rupiah during the same period, marking a 25.4% increase year-on-year, while government spending totaled 2,295.7 trillion rupiah, up 17.1% compared to last year.

Subsidy payments, driven largely by rising imports of subsidized fuel, climbed 52.1% to 331.4 trillion rupiah. Expenditures related to Prabowo’s social programs, including feeding initiatives for students and pregnant women, stood at 134.2 trillion rupiah through August against a planned budget of 229 trillion rupiah for the entire year.

Suahasil further pledged to expedite tax refund processes for taxpayers who had overpaid, addressing delays attributed to increased audit procedures under the previous minister. As of the end of August, Indonesia had refunded 191.82 trillion rupiah in tax returns, down 37% from the same period a year earlier, according to tax office data.

The new finance minister’s remarks aim to reassure investors and stakeholders by signaling steady fiscal management despite political shifts and challenges inherent in implementing the government’s ambitious agenda.