👟 Walk the Talk: Indonesia’s Economic Fissures
Half a year before mainstream headlines, Acrostics Asia had pointed out the emerging fault lines in Indonesia’s economy.
Acrostics Asia connected the dots on the ground to infer that Indonesia’s economy was likely weaker than what the official data suggested.
Before Finance Minister Sri Mulyani Indrawati’s exit on 8 September 2025, Acrostics Asia flagged that the former World Bank managing director’s international stature had increasingly diverged from her domestic image.
Key Timeline
Indonesia was facing a wave of layoffs in the manufacturing and startup sectors, posing a risk to its economy that was already growing at the slowest pace in three years.
Acrostics Asia wrote that accelerating layoffs could undermine the Central Bank’s efforts to stimulate growth by cutting interest rates.
Indonesia posted a rare budget deficit as of February due to a double-digit drop in state revenue.
Acrostics Asia wrote that the state revenue was not keeping up with the pace of spending and the tax shortfall could be exacerbated by the mass layoffs.
Indonesians were dipping into their savings as they grappled with the rising costs of living and layoffs in the manufacturing sector.
Acrostics Asia flagged that this may have a domino effect on the availability of low-cost funds for banks.
Acrostics Asia wrote that capital started flowing out of the country partly due to fears of being caught on the wrong side of the power consolidation around the president’s camp.
The defence minister, a trusted ally of the president, is leading a task force that has reportedly confiscated one million hectares of illegal palm plantations.
Acrostics Asia connected the savings rate, layoff numbers, mortgage defaults and banking ratios to show that Indonesia’s economy was weaker than expected.
Indonesian President Prabowo Subianto’s free school lunch program is costly and comes at the expense of other areas such as higher education funding.
Mainstream media reported that economists, think-tanks and consumers were questioning Indonesia’s second-quarter GDP data that showed the fastest growth in two years.
Acrostics Asia flagged that public anger grew against Finance Minister Sri Mulyani Indrawati partly due to the more aggressive tax collection.
However, the problem is bigger than one person as Indonesia’s traditional growth engines are sputtering.
Acrostics Asia wrote that Sri Mulyani’s departure underscored the divergence between her international stature and domestic image.
The protests that culminated in the looting of the former World Bank managing director’s home were likely the tipping point for her exit.
Full Acrostics Asia Coverage
📚 Acrostics Anatomy: Indonesia’s Economic Cracks (7 February - 19 April 2025)
📚 Acrostics Anatomy: Indonesia’s Policy Disconnect (6 May - 13 September 2025)