Global Crises Call on Indonesia to Take Action

By Kusnandar & Co.,  Attorneys At Law – Jakarta, Indonesia

 

The recent meeting between President Prabowo Subianto and the Chief of the National Economic Council, Luhut Binsar Pandjaitan, underscores that global geopolitical uncertainty is no longer a distant issue for Indonesia’s economy. With the escalation of conflict in the Middle East causing energy price volatility and instability in global markets, Indonesia now faces tangible risks affecting energy security, fiscal stability, and government budgets.

That this meeting was called directly by the President is significant. It signals recognition that foreign conflicts—which may seem remote—can have immediate consequences for Indonesia, including surges in oil prices, disruptions to global supply chains, and pressures on the balance of payments and national budgets.

However, this meeting also raises a broader question: Is Indonesia truly prepared to withstand increasingly frequent global shocks? Heavy reliance on imported energy, limited strategic reserves, and vulnerability to international market fluctuations remain structural challenges that have been repeatedly noted but not fully resolved. Statements from President Prabowo assuring that domestic fuel and gas supplies are sufficient may provide short-term reassurance, but they do not change the reality that major geopolitical crises demand accelerated reforms in energy resilience and economic stability.

The focus on energy stability, oil pricing, and budget preparedness is pragmatic. Yet, it should also be a catalyst for Indonesia to reduce its dependence on global energy markets, boost domestic production, expand strategic reserves, and accelerate the transition to renewable energy. Dependence on imported oil not only weakens economic leverage but also exposes the country to heightened vulnerability amid escalating global geopolitical tensions.

Moreover, macroeconomic and fiscal policies must be designed to withstand external shocks. As other nations implement measures such as energy efficiency programs, demand management, and responsive monetary policies, Indonesia cannot afford to lag. Current geopolitical challenges should be viewed not merely as threats, but as a call to strengthen national resilience comprehensively.

Ultimately, the meeting between President Prabowo and Luhut is an important first step. But if responses remain limited to short-term preparedness, Indonesia will continue to react to crises rather than anticipate them. Strengthening energy resilience, diversifying the economy, and implementing bold fiscal reforms must be a long-term priority. Only with a comprehensive strategy can Indonesia ensure that global conflicts, like the ongoing turmoil in the Middle East, no longer shake the foundations of its national economy.

By : K&Co - March 16, 2026