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SInyal Ekonomi Lesu, Masyarakat Kini Makan Utang

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News and Commentary

Indonesia’s Economic Outlook: “Eating Debt” and Rising Risks

Indonesia’s economic outlook is described as increasingly fragile. Commentary argues that households are “eating debt”—using borrowing to cover needs instead of relying on savings—raising risks to consumption-driven growth.

Key Indicators of Economic Weakness (Kompas Bisnis / Bank Indonesia Survey)

  • Job availability index fell 1.6 points in June to 94.1, entering a pessimistic zone—the worst since March 2022.
  • Public savings ratio dropped 0.8 percentage points to 14.1%.
  • Economists interpret the declining savings rate as evidence that people are running out of money and turning to borrowing to survive.
  • Installment burden is cited as rising: household installment allocation is reported at nearly 11% (based on income group open data).

Debt-Based Household Survival Signals

Households are portrayed as becoming more dependent on:

  • Pawnshops (Pegadaian/pawn lending)
  • Online lending / pinjol, including “pay-later” type facilities

Additional claims cited in the coverage include:

  • Loan demand is described as increasingly normalized (contrasting earlier “30–40 per day” with “almost 100 per day”).
  • A core warning is emphasized: Indonesia’s growth depends heavily on household consumption, so weaker consumption reduces overall momentum.

Financial Sector Data Cited (OJK)

  • Licensed online lending (pinjol) reportedly rose 27.9% to Rp82.59 trillion.
  • Non-performing loans (bad credit) increased from 2.9% to 3% (reported as rising in May).
  • Pawn industry activity is said to surge: May’s figure reportedly rose over 32% (confirmed via OJK data).

Debate: Are Indonesians “Eating Debt”?

  • OJK’s position, as presented, is more cautious: it urges the public to maintain installment ratios.
  • Commentators argue that the risk is growing and that households are increasingly forced to borrow for necessities, not just to manage finances.

Macro Context Behind the Debt Trend (Prof. Rahma / Prof. Rahma Gafmi)

Contributing pressures mentioned include:

  • Geoeconomic fragmentation
  • Geopolitical intensity
  • Commodity price volatility
  • Climate change
  • Global economic uncertainty

The script connects these pressures to slowing growth and weaker demand:

  • Indonesia’s Q1 2025 contraction: -0.98% (q/q), with growth cited around 4.87% (noted as lower than earlier/higher rates).
  • Manufacturing PMI weakening across consecutive months (three months below/around 50), interpreted as softening demand from both domestic and global sources.

Consequences Argued

  • Job opportunities narrow, reducing incomes and purchasing power.
  • Government job-creation efforts are judged too weak, or not absorbing displaced/current workers fast enough.

Policy Recommendations Proposed

  • Strengthen investment and job creation, particularly by:
    • expanding foreign direct investment (FDI)
    • improving investment certainty (permits, property rights, law enforcement)
    • improving infrastructure readiness (e.g., roads) to support investors
  • Evaluate and redesign large spending programs:
    • replace expensive rollouts with targeted, measurable pilot projects
  • Create policy for “decent work”, including:
    • diversifying economic sectors
    • encouraging investments in job-rich areas (examples cited: technology and renewable energy)
    • expanding training programs to match worker skills with available jobs
    • supporting entrepreneurship, innovation incentives, and MSME/cooperative-related support
      • (MSMEs are cited as employing most workers and contributing substantially to GDP)
  • Increase supervision on pinjol to prevent uncontrolled borrowing that threatens household welfare.

Who Is Most Vulnerable (Distribution of Risk)

The script argues that the middle class is most vulnerable to debt reliance because:

  • they tend to have higher spending on items considered “unnecessary”
  • their ability to self-control financially is said to be diminishing

Even if poverty or unemployment indicators improve (citing BPS), the commentary claims this may reflect:

  • job-skill mismatch
  • movement into informal or volatile gig work (including references to the social media/influencer economy)

Overall Conclusion

The coverage frames the debt-and-consumption pattern as a warning sign: when consumption becomes debt-funded, it can lead to rising bad credit and financial instability, making growth harder to sustain. The proposed solution emphasizes faster, more effective job creation and tighter control of high-risk lending.

Presenters / Contributors

  • Kompas Bisnis / Kompas TV coverage team (presenting and confirming data)
  • Prof. Rahma Gafmi (Economics professor, Airlangga University)
  • Prof. Rahma GMI (repeated naming in the script; same contributor implied)
  • Okta (interviewer/host mentioned as “Ms. Okta”)
  • OJK (Financial Services Authority) (data authority referenced)
  • Bank Indonesia (data source referenced)

Original video