Finance Minister Urges Regions to Invest Local Funds in Industry

Finance Minister Purbaya Yudhi Sadewa, together with Home Minister Tito Karnavian, held a coordination meeting with all regional heads on 20 October 2025 in Jakarta. Purbaya stressed that local government cash should not sit idle in treasury or deposits but be directed toward productive investment and human‑resource development (HRD).

He noted that Java still accounts for 56.9 % of Indonesia’s Gross Domestic Product (GDP) with a 5.2 % growth rate, while regions outside Java rely heavily on commodities; Sulawesi, for example, posted over 7 % growth thanks to industrial downstreaming (hilirisasi). Regional Own‑Source Revenue (PAD) fell 10.86 % to 253.36 trillion rupiah, with local taxes down 10.24 % and retributions up 4.6 %.

If funds are not spent promptly, Purbaya advised placing them in regional banks for lending to local businesses and called for stronger coordination between Regional Inflation Control Teams (TPID) and the Central Inflation Control Team (TPIP) to keep prices stable. The measures aim to accelerate regional economic activity, narrow inter‑regional gaps, and boost public confidence and investment climate.