Last minute decision from President Prabowo to scale back the VAT rise from 11% to 12% is only one of few erratic decisions made in the first 100 days of the new administration. While giving a short-term relief to consumers, nature of a populist approach, it raises concern on consistency of public policy. 

Rosan P Roeslani, minister of investment & downstream, said yesterday that the government and Apple Inc will announce an investment plan next Tuesday after a scheduled meeting with Apple leaders and ministry of industry. Rosan yet to confirm size of the investment and type of products to be locally manufactured. 

President Prabowo issued a populist policy recently in reducing ticket price during the year end holidays. The policy, however, might not be sustainable because the government keens to see further recovery of airline industry after a relatively weak 2024.

Indonesia welcomed 1.09 million foreign tourists in November 2024, an increase of 17.27% year-on-year. While looks good, Vietnam was stronger with 38.8% year-on-year growth to 1.7 million in the same month. 

The Business Competition Supervisory Commission (KPPU) began the hearing on alleged violations related to the notification obligation of corporate actions in the form of the acquisition of PT Aset Digital Berkat (Tokocrypto) by Singapore-based Toko Alpha Pte Ltd in November 2024. Toko Alpha is an entity controlled by Binance Capital Management Co Ltd, part of Binance Holdings Ltd, a global company that operates the largest cryptocurrency exchange. Knowing that Binance has faced legal problems since its incorporation, what is happening is no longer surprising. Towards the end of 2024, within one month of the start of the examination, the KPPU finally decided that Toko Alpha is guilty.

Back in June 2014, then president candidate Prabowo (the first defeat from Jokowi) set an ambitious growth target of 10% (double digit). Ten years later, he campaigned (this time winning the election) for 8% growth. Prabowo’s brother Hashim Djojohadikusumo was lot more ‘optimistic’ on 9% to 9.5% in the second or third year of the regime.

Will the State Budget 2025 be revised to allow the government raising more debts (widening the budget deficit) to support Prabowo’s signature programs: free meal, three million homes per annum, and food estate projects in Sulawesi, Kalimantan, and Papua?

Some analysts from JP Morgan and BRI Danareksa were so confident that composite index of Indonesia Stock Exchange (IHSG) will end the year close to or crossing 8,000, pointing to positive impact from the Fed’s rate cuts and appreciation of rupiah. This morning, the index declined 0.43% to 7,065. These analysts have few more trading days to expect IHSG meeting their bullish target. 

External trade (export-import) is the third largest component of Indonesian GDP. Heavily relying on commodities, the country might encounter a more difficult next year due to slowdown of China, the largest importer of products like coal, palm oil, nickel and alumina from Indonesia.