Antara News·Indonesia·Tuesday, September 15, 2026 at 03:50 AM

Minister Nazara's task is to make policy predictable: Economist

Translate

Bayu, Kenzu

Jakarta (ANTARA) - A chief economist of Trimegah Sekuritas Indonesia, Fakhrul Fulvian, said the new Indonesia's Finance Minister Suahasil Nazara has to make fiscal policy easier for the market to read and predict as his key task.

"The market does not only read the size of the deficit. The market reads where a policy is heading, who carries it out, when it is done, and what happens afterward. Credibility, in the end, is the ability to make the future a little easier to read," Fulvian said here on Tuesday.

He noted Minister Nazara has a number of issues to tackle. First, Fulvian said, Nazara needs to ensure that every state economic instrument performs its function optimally.

"We already have many tools. The next thing to do is determining who does what, when, and to achieve what target. A good policy that comes in the wrong sequence can still produce a bad outcome," he said.

For example, it applies to the placement of the Budget Surplus Balance (SAL), which needs to take into account Bank Indonesia's (BI) liquidity operations.

Second, every policy needs a clear target. Fulvian said the government needs to distinguish between the instrument, the target, and the ultimate goal of a policy.

"Economic policy needs an entry point and an exit point. We often talk very seriously about how a policy begins, but talk much less about how it ends," he explained.

Third, the minister needs to strengthen coordination with the central bank, the banking sector, investors, the business community, state-owned enterprises, sovereign wealth fund Danantara, and other government institutions.

Fourth, the finance minister needs to maintain fiscal discipline and the credibility of the deficit limit. However, the quality of the state budget cannot be judged solely by how small the deficit figure is.

"What matters more is what happens behind that figure, the quality of revenue, the productivity of spending, the financing structure, as well as obligations that might shift outside the state budget," Fulvian said.

Fifth, he continued, tax strategy needs to align with economic formalisation.

"We often treat the low tax ratio as a tax problem. In fact, part of the problem lies in the economic structure. The tax base is hard to expand if the formal economic base itself is not growing fast enough," he noted.

View the original on Antara News →

KioskNews shows a cleaned-up reading view extracted from the publisher’s page — the original always lives on their site, not ours.