Despite having a small overall trade exposure to the US and a modest portion of exports in its output, Indonesia’s financial market is among the hardest hit by the threat that Trump’s protectionism poses to the world economy. This reveals a much deeper problem within the Indonesian economy. Investors are growing uneasy not just due to global uncertainty, but also because the Prabowo administration's policy choices are straying away from macro and fiscal prudence, a principle that has supported Indonesia's stable growth for the past two decades.

The Prabowo Subianto administration begins 2025 with a massive Rp 306 trillion fiscal spending cut, representing over 8% of this year’s state budget, delivered by Presidential instruction 1/2025.

Given Indonesia’s current gloomy political and economic landscape, the appointment of capable technocrats within the inner circle of national leadership is a breath of fresh air.