Indonesia's Economic Dilemma: Free Lunches Amid Rising Unemployment

With unemployment surging in Indonesia, President Prabowo Subianto's commitment to free meals for students sparks debate over economic priorities, as experts warn of misplaced government focus amidst rising joblessness.

In Jakarta, Indonesia, the landscape is shifting as citizens grapple with an unsettling economic reality. Since losing her marketing job during a downturn, Nina Megayanti embodies the struggles faced by millions. Once thriving in a vibrant metropolis, she now finds herself navigating a precarious situation, having depleted her savings and lost her housing security.

The International Monetary Fund (IMF) forecasts that Indonesia's unemployment rate may escalate this year, placing it among the highest in Asia, surpassed only by China. Yet, the government asserts a different narrative, citing a 5% annual growth rate. President Prabowo Subianto, who took office in October, remains steadfast in executing his campaign promises, which include a generous nationwide free school lunch initiative designed to benefit children across the country, alongside a commitment to affordable housing.

To fund these ambitious projects, the administration has reallocated significant sums from the national budget, cutting back on essential services and enacting a wave of austerity measures across various ministries, notably in public works, health, and education. The move has also culminated in mass layoffs of government contractors. Critics, including Awalil Rizky from the Bright Institute, argue that this approach reflects a troubling disconnect from the realities of economic distress, insisting that state spending is critical for recovery and growth.

The IMF's latest report indicates that Indonesia's unemployment rate is projected to rise from 4.9% in 2024 to 5% this year, while the government has recently adjusted its growth predictions down to 5% from 5.2% for 2025. As citizens like Megayanti continue to navigate their uncertain futures, the efficacy and sustainability of the government's initiatives remain subjects of rigorous debate.