Govt to Launch Digital Aid Distribution System in October

The government plans to launch a nationwide digital social assistance system in October, advancing a years-long government technology initiative that officials say will sharpen social assistance targeting, cut wasteful spending and streamline public services.

President Prabowo Subianto is expected to review the project’s readiness during visits to pilot regions in July before approving a national launch, National Economic Council (DEN) head Luhut Pandjaitan said on Wednesday.

“We have agreed to propose that the president visit between July 6 and July 9 to review the program, whether in Surabaya, Banyuwangi or Bali, depending on which location he chooses,” Luhut said, as quoted by Kompas.com.

The platform, known as Perlinsos Digital, is currently being tested in 42 cities and regencies before expanding to all 541 districts and municipalities nationwide.

“We plan to launch it nationally in October or November across all 541 districts and cities. We hope 80% to 90% of the system will already be in place by then, with the remaining work completed as we move forward, so that by year-end the program is fully operational,” he added.

The welfare platform is part of the country’s broader government technology program, or also known as GovTech, an effort to consolidate fragmented state databases and deliver public services through a single digital infrastructure. 

Luhut, who also chairs the government’s digital transformation task force, said the platform would use biometric authentication and artificial intelligence to determine eligibility and process applications.

The system will allow citizens to apply for social assistance, verify their eligibility and challenge decisions they believe are inaccurate. 

The country is also preparing to introduce a national digital identity system, while around 80% of the GovTech platform has already been integrated, according to Luhut. 

“This could become President Prabowo's success story and one of his defining legacies,” he said.

The digitalization program itself will not rely on state budget funding, Luhut said. For now, the government will continue using the national data center managed by the Communications and Digital Ministry to support the program's data needs.

“The system has been designed in a way that allows Telkom to operate it, meaning the digitalization program will not require funding from the state budget,” he said.

The GovTech initiative was first launched as INA Digital under former president Joko “Jokowi” Widodo in 2024, with officials promoting it as a way to modernize public services, integrate government databases and reduce leakages in state spending.

Social Affairs Minister Saifullah Yusuf has estimated that a fully digital social assistance system could generate savings of up to IDR 14 trillion (USD 860 million) annually by improving targeting and reducing inefficiencies.

The Social Affairs Ministry also partnered with homegrown tech giant GoTo to test liveness detection technology for beneficiary verification and explore the use of GoPay, the company’s fintech arm, for aid distribution, according to the ministry’s release.
 

Source: The Jakarta Post

MSCI Retains Indonesia as Emerging Market, Warns on Market Transparency

Indonesia retained its status as an emerging market in MSCI's 2026 Global Market Accessibility Review, easing concerns that the country could be downgraded to frontier market status amid ongoing scrutiny over market transparency and accessibility.

While keeping Indonesia in the Emerging Markets category, MSCI lowered its assessment of the country's information flow to negative from positive, citing persistent concerns over opaque share ownership structures and indications of coordinated trading that could undermine fair price discovery.

"Concerns around market accessibility stem from unclear ownership structures and indications of coordinated trading behavior that weaken the process of fair price formation," MSCI said in its report released on Friday.

The review ends months of uncertainty that had weighed on Indonesia's capital market since MSCI first raised concerns in January over transparency in share ownership and the effectiveness of price formation mechanisms. The warnings triggered foreign selling pressure and contributed to volatility in the Jakarta Composite Index throughout the year.

MSCI said limited transparency in ownership data and market activity continued to hamper investors' ability to accurately assess free-float shares.

"A lack of transparency in ownership data and market activity undermines proper price formation and limits global investors' ability to assess the actual amount of freely tradable shares," MSCI said.

The index provider also reiterated concerns over Indonesia's foreign exchange market, noting the absence of an efficient offshore market and constraints in the domestic currency market that continue to hinder international investors.

"There is no efficient offshore foreign exchange market, and constraints remain in Indonesia's domestic foreign exchange market," MSCI said.

Despite these concerns, MSCI acknowledged measures introduced by Indonesian authorities in recent months to improve market accessibility.

In a research note citing MSCI's review, Indo Premier Sekuritas said Indonesia continued to score highly on several market accessibility indicators, including investor qualification requirements, foreign ownership limits, foreign ownership availability, investor registration, account opening, market regulations, custody services, and trading infrastructure.

However, MSCI assigned lower scores to Indonesia's foreign exchange market liberalization and information flow, while equal rights for foreign investors, clearing and settlement, stock lending, short selling, and institutional stability received moderate assessments.

Kiwoom Sekuritas said the main risk following MSCI's latest review is not the loss of Indonesia's emerging market status, but the possibility of a prolonged valuation discount.

"Until there are significant improvements in transparency, free-float quality, and market integrity, foreign investors may continue to maintain an underweight position on Indonesia," Kiwoom Sekuritas said.

Source: Jakarta Globe

Indonesia Secures USD 17 Billion AIIB Funding for Development

Indonesia has secured USD 17 billion in funding from the Asian Infrastructure Investment Bank (AIIB) to support national development projects during the 2025-2029 period.

The funding commitment was one of the main outcomes of a bilateral meeting between Indonesian Finance Minister Purbaya Yudhi Sadewa and AIIB leaders in Beijing, China, on Wednesday.

"It is a very significant contribution to the financing of development projects in Indonesia," Purbaya said in a statement issued on Thursday.

The financing forms part of the Multi-Year Rolling Pipeline framework agreed upon with AIIB.

Apart from the financing commitment, AIIB also expressed interest in expanding its presence in Indonesia.

The multilateral lender is considering opening a representative office in Jakarta to strengthen cooperation and improve coordination in implementing AIIB-supported projects.

"AIIB is also interested in establishing a representative office in Jakarta. We certainly welcome the initiative, and I hope the office can be operational by June next year," Purbaya said.

He said AIIB continues to show strong confidence in Indonesia's fiscal condition.

According to the minister, the institution has no concerns about Indonesia's fiscal management or future economic prospects.

"They are confident in our credibility and fiscal creativity," he said.

Purbaya noted that the outcome of the meeting reflects continued confidence among international financial institutions in Indonesia's economic prospects and the sustainability of the government's fiscal policies.

Source: Antara News