Indonesia banks on free meals, co-ops to reach economic growth target

Jakarta (ANTARA) - The Indonesian government said that two flagship programs — the Free Nutritious Meal (MBG) initiative and the Red-and-White Village Cooperatives — are expected to become key engines driving the nation toward 8 percent economic growth. 

Coordinating Minister for Economic Affairs Airlangga Hartarto said on Thursday the MBG program is projected to support up to 30,000 kitchens and employ around 1.4 million workers at its peak. 

"As a rule of thumb, every 400,000 jobs contribute about 1 percent to economic growth. So this alone could drive growth by 2 to 3 percent," he said. 

After attending the event "1 Year of Prabowo–Gibran Administration: Optimism on 8 Percent Economic Growth" in Jakarta, Hartarto added that the village cooperatives program could quadruple annual village cash flow from Rp1 billion to Rp4 billion (around US$241,000). 

"These effects will further boost the engines that are already working," he said. 

He also highlighted digitalization as another key growth driver, citing the upcoming Digital Economy Framework Agreement (DEFA), which is projected to double ASEAN’s digital economy value from US$1 trillion to US$2 trillion by 2030. 

"Without DEFA, ASEAN’s economy in 2030 would be US$1 trillion. With DEFA, it could reach US$2 trillion," he said. 

Hartarto further pointed to increasing use of local currency transactions (LCT) between Indonesia and several countries, including Southeast Asian nations, the UAE, and Japan, as another sign of growing economic confidence. 

He also noted that users of the Quick Response Code Indonesia Standard (QRIS) have reached 56 million. 

"This makes us optimistic that the public has started a financial revolution and is adopting digitalization," he added.