Jakarta. Chief Economic Affairs Minister Airlangga Hartarto announced a series of programs and incentives aimed at sustaining economic growth, including a Rp 20 trillion ($1.3 billion) credit facility for labor-intensive industries.

“To strengthen the competitiveness of labor-intensive industries, the government is providing Rp 20 trillion in credit. This is a concrete initiative under the Prabowo Subianto-Gibran Rakabuming Raka administration’s flagship economic program,” Airlangga told reporters on Tuesday.

Industries eligible for the labor-intensive credit program include textiles, garments, footwear, furniture, food and beverages, and children’s toys. Companies must employ a minimum of 50 workers to qualify for the program.

The government has also introduced an economic package for labor-intensive sectors, offering people’s microloans (KUR) ranging from Rp 500 million to Rp 10 billion. The credit, classified as investment loans, has a maximum tenure of eight years and can be combined with working capital loans capped at Rp 20 trillion.

In addition, tax incentives have been implemented for employees earning between Rp 4.8 million and Rp 10 million per month. Companies will also receive a 50 percent subsidy on workplace accident insurance premiums for six months.

These measures are part of the Prabowo-Gibran administration’s key economic policies, which have been in place for the past two months. Airlangga said additional programs are being developed to build on previous pro-people initiatives.

In the micro, small, and medium enterprises (MSME) sector, the government has issued a regulation to write off bad debts. So far, 67,000 MSMEs have benefited from debt write-offs totaling Rp 2.4 trillion. Airlangga said there is potential to forgive loans for over one million MSMEs, amounting to Rp 15 trillion.

“Some adjustments are needed, including regulations from the Financial Services Authority (OJK) and alignment between the MSME Ministry and banks to implement this policy effectively,” Airlangga said regarding the credit programs.

The government has also succeeded in lowering airline ticket prices by 10 percent as the year-end approaches. Additionally, the recent National Online Shopping Day (Harbolnas) and extended store hours with discounts of 50–70 percent have boosted retail sales. The government aims to record Rp 15 trillion in sales through initiatives such as the “Epic Sale,” involving 80,000 retail outlets across the country.

Another highlight is the increase in education aid for laid-off workers, which has been raised from Rp 1 million to Rp 2.4 million for six months.

These initiatives coincide with the government’s plan to raise the value-added tax (VAT) rate from 11 percent to 12 percent starting January 1, 2025. Airlangga assured that fiscal support measures would counter potential economic slowdowns, particularly in household spending.

Among the fiscal aid is rice assistance for 16 million households, with each receiving 10 kilograms of rice for two months. The government will also absorb the VAT increase on essential goods, such as flour, industrial sugar, and MinyaKita-branded cooking oil.

“Additionally, there will be a 50 percent electricity discount for 81.4 million customers with power usage below 2,200 VA for two months. This is expected to provide an economic boost,” Airlangga said.