Indonesia's Businesses Are Losing Their Compass — And Government Must Help Find It
In this podcast with Farid Subhan on Masuk Akal, Mulya Amri unpacks the latest Kadin Business Pulse survey: nearly half of Indonesian entrepreneurs (47%) say business conditions worsened in Q2 2026, up from 40% in Q1, while optimism keeps declining.
The middle is being squeezed. It's not the smallest or largest firms feeling the most pain — it's small and medium enterprises, over 50% of whom report worsening conditions, caught between shrinking government-linked projects and a purchasing power slump.
A world without a "peace dividend." Rising global distrust, tariff wars, and the disruptive pace of AI mean the old economic playbook no longer applies — businesses need retraining, and sometimes unlearning, to survive the transition.
Rupiah weakness cuts both ways. A weaker rupiah should favor exporters, but because Indonesia's economy runs more on imports and non-labor-intensive exports (nickel, palm oil), the pain is widely felt while the gains stay concentrated.
What government must get right. Faster deregulation, legal certainty, and policies that "crowd in" private investment rather than crowd it out — with smoother transition management so no one is left stranded when programs shift.
It's not a crisis to panic over — but it is a transition Indonesia can't afford to sit out.
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