Antara News·Indonesia·Friday, November 6, 2026 at 03:53 AM UTC

Gov't consumption supports Indonesia's Q3 2026 economic growth

Translate

Fauzul Azhim Bin Fakhrurazi

Jakarta (ANTARA) - Coordinating Minister for Economic Affairs Airlangga Hartarto said government consumption grew 8.95 percent and was one of the main drivers of Indonesia’s economic growth in the third quarter of 2026.

“In these two quarters, the second and third quarters, government spending was increased. This spending is part of consumption through the government’s flagship programs, including MBG and KDKMP,” Airlangga Hartarto said at a press conference in Jakarta on Thursday.

Government consumption growth was higher than in the same period last year, when 5.66 percent was recorded.

In addition to government consumption, economic growth was supported by household consumption, which grew 5.04 percent.

Household consumption contributed 51.97 percent of national gross domestic product (GDP), making it the main component sustaining economic activity.

Overall, the Indonesian economy grew 5.47 percent in the third quarter of 2026, up from 5.29 percent in the second quarter of 2026.

By business sector, manufacturing, the largest contributor to GDP at 19.22 percent, grew 5.87 percent.

The industry’s growth was supported by several subsectors, including food and beverages, which grew 7.09 percent; chemicals and pharmaceuticals, 8.10 percent; basic metals, 9.94 percent; and transport equipment and automotive, 6.14 percent.

Hartarto said the government’s priority projects also drove economic activity in the construction sector, which grew 6.42 percent. The development of the Red and White Village Cooperatives (KDKMP) and Sekolah Rakyat (People's School) are among the activities supporting the sector’s growth.

Looking ahead, the government expects economic growth momentum to be sustained in the fourth quarter of 2026.

This optimism is supported by several economic indicators, including Indonesia’s manufacturing Purchasing Managers’ Index (PMI) of 54.0 in October 2026, up from 52.4 in September 2026.

Hartarto explained that the manufacturing PMI indicates industrial activity is in an expansionary phase and has reached its highest level since March 2026.

“In addition, the Industrial Confidence Index compiled by the Ministry of Industry stood at 53.77. Electricity sales also rose 9.21 percent, while the Consumer Confidence Index (IKK) remained at an optimistic level of 118.1,” he said.

Nevertheless, Airlangga continues to monitor several risks that could affect public purchasing power, particularly pressures on food and energy prices and the dynamics of the rupiah exchange rate.

“This growth achievement of 5.47 percent shows that the policies adopted by the government, led by President Prabowo, are on the right track, with strong fundamentals and continually increasing investment. Targeted policy support will continue to be implemented, although various challenges remain to be addressed,” Hartarto said.

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.