Indonesia’s manufacturing sector continued to record expansionary performance in December 2025, although growth momentum eased. S&P Global reported Indonesia’s Manufacturing PMI at 51.2, down from 53.3 in November, but still above the neutral threshold of 50, marking five consecutive months of expansion.
The improvement was mainly driven by higher new orders from the domestic market, while export orders remained in contraction. Heading into 2026, business optimism has strengthened, although the industry continues to face challenges such as raw material shortages, supply delays, and rising input cost pressures.
— Bisnis Indonesia, 2 January 2026
BI to Discontinue JIBOR in 2026, Indonia Becomes Official Rupiah Benchmark Rate
Bank Indonesia has officially discontinued the publication of the Jakarta Interbank Offered Rate (JIBOR) effective 1 January 2026 and is promoting the use of the Indonesia Overnight Index Average (Indonia) as the national rupiah benchmark interest rate.
Indonia is considered more credible as it is based on actual interbank transactions, better reflecting real market liquidity conditions. The transition has been prepared since 2018 and publicly announced since September 2024, with most financial contracts gradually shifting away from JIBOR. Bank Indonesia expects Indonia to strengthen transparency, deepen financial markets, and enhance the global competitiveness of Indonesia’s financial system.
— Kontan, 31 December 2025
Prabowo Adviser Drafts National Economic System Bill
Economic adviser to President Prabowo Subianto, Burhanuddin Abdullah, revealed that the Prasasti Center for Policy Studies is preparing a draft bill on Indonesia’s national economic system.
The bill is rooted in the mandate of Article 33 paragraph (5) of the 1945 Constitution, which calls for further regulation of the national economic system and state control over natural resources. Burhanuddin stated that the academic paper has been completed, jointly prepared with Hashim Djojohadikusumo, and involved the Ministry of National Development Planning (Bappenas) and related ministries. He assessed that the Prabowo administration has been the most consistent in implementing the national economic system’s direction and aims to finalize the bill in the near term.
— Bisnis Indonesia, 31 December 2025
2026 Tax Policy: No Rate Hikes, Focus on System Reform and Global Standards
The government has confirmed that there will be no new taxes or tax rate increases in 2026. The Ministry of Finance emphasized that any future rate hikes would only be considered if economic growth exceeds 6%, with policy direction focused on system reform, improved compliance, and alignment with global standards.
Starting in 2026, the Directorate General of Taxes will expand the Automatic Exchange of Information (AEOI) to include e-money and central bank digital currencies (CBDC), in line with the OECD’s Amended CRS, with effective data exchange beginning in 2027. The government is also preparing a new domicile-based revenue-sharing scheme for employee income tax (Article 21), full implementation of the Global Minimum Tax (BEPS 2.0 Pillar Two, including UTPR), and full digitalization of tax administration through Coretax.
In addition, marketplace taxation has been regulated and is planned for implementation, with execution aligned to national economic growth targets.
— Kontan, 29 December 2025
President Prabowo Pushes for Establishment of a Housing Acceleration Agency
Deputy Minister of Public Housing and Settlement Areas Fahri Hamzah stated that President Prabowo Subianto is pushing for large-scale acceleration of housing construction and renovation through the establishment of a dedicated agency. The agency will oversee land acquisition, permitting, financing, and management of social housing.
Under the 2026 State Budget, the government targets the renovation of 400,000 housing units, with potential expansion to up to 2 million units. The main challenges are concentrated in urban areas due to limited land availability, prompting the government to prepare new regulations (Presidential or Government Regulations) to accelerate implementation.
— Bisnis Indonesia, 30 December 2025
OJK Encourages Expansion of Pension Coverage for Informal Workers
The Financial Services Authority (OJK) is encouraging broader participation in pension programs, particularly for informal workers who currently lack adequate old-age protection. OJK has prepared a more inclusive regulatory framework and is urging Financial Institution Pension Funds (DPLK) to strengthen service digitalization to improve product accessibility.
Collaboration with banks, capital markets, and fintech companies is also being promoted to expand distribution and enhance product attractiveness. These efforts will be complemented by stronger financial literacy initiatives, including the planned launch of a National Pension Month starting in 2026 to raise public awareness and participation.
— Kontan, 1 January 2026
OJK Revokes Licenses of 7 Rural Banks in 2025, Accelerates Industry Consolidation
Throughout 2025, the Financial Services Authority revoked the business licenses of seven rural banks (BPR/BPRS) due to capital and liquidity issues, with the most recent case being PT BPR Bumi Pendawa Raharja in Cianjur, West Java. License revocations were carried out after recovery efforts failed, in accordance with decisions of the OJK Board of Commissioners.
Beyond closures, OJK has accelerated consolidation in the BPR/BPRS industry. As of 10 December 2025, OJK approved the merger of 130 entities into 45 BPR/BPRS, and is currently processing the consolidation of 226 BPR/BPRS into 79 entities. These measures aim to strengthen capital, governance, and industry resilience, while enhancing the capacity of rural banks to support MSME financing at the regional level.
— Bisnis Indonesia, 30 December 2025
Ministry of Transportation Prepares 197 Pioneer and PSO Sea Routes for 2026
The Ministry of Transportation, through the Directorate General of Sea Transportation, has prepared 197 sea transport routes for 2026, consisting of 107 pioneer passenger routes, 41 Sea Toll routes, 6 livestock vessels, 18 rede vessels, and 25 economy-class passenger PSO routes.
The program will be implemented through assignments to SOEs and national operators to ensure connectivity across underdeveloped, frontier, and outermost regions (3TP), reduce price disparities, and safeguard logistics and livestock distribution. The government also reaffirmed PSO subsidies to keep fares affordable while maintaining high safety standards, and to ensure no service disruptions during strategic periods such as the 2025/2026 year-end holiday season.
— Republika, 2 January 2026