- Investments in agriculture modernization, fisheries infrastructure, irrigation systems, renewable energy, and village-based industries are essential. A nation that can feed and power itself is less vulnerable to global currency fluctuations.
- Indonesia, under the visionary leadership of Prabowo Subianto and with its strong national unity, will certainly be able to overcome this difficult situation.
By Muhammad Burhanuddin | Chairman of the Central Executive Board of Garuda Asta Cita Nusantara
MARITIMEPOSTS.COM – The strengthening of the United States dollar against emerging market currencies, including the Indonesian rupiah, has once again become a serious challenge for Indonesia’s economy.
In periods of global uncertainty, geopolitical tensions, high interest rates in the United States, and weakening global demand, the dollar often becomes the world’s “safe haven.”
As a result, many developing countries experience capital outflows, rising import costs, inflationary pressure, and fiscal instability.
Indonesia is not immune to this turbulence. A stronger dollar affects fuel imports, food prices, industrial raw materials, foreign debt obligations, and the purchasing power of ordinary citizens.
Yet history and economic theory show that crises can also become turning points for structural transformation. The question is not merely how Indonesia survives the dollar crisis, but how Indonesia can build long-term economic sovereignty.
According to Nobel Prize-winning economist Joseph Stiglitz, developing countries should not rely excessively on volatile global financial flows because speculative capital can destabilize domestic economies.
Stiglitz emphasizes the importance of strengthening domestic production, protecting strategic sectors, and building resilient national institutions. This advice is highly relevant for Indonesia today.
The Way Out
The first way out is strengthening domestic production and reducing import dependency. Indonesia still imports many strategic commodities, including fuel, soybeans, wheat, pharmaceutical materials, and industrial machinery.
When the dollar rises, import costs immediately increase, pushing inflation higher.
Therefore, Indonesia must accelerate industrial downstreaming and domestic manufacturing.
The downstreaming strategy initiated in recent years is a good start, especially in nickel and mineral processing. However, the policy should not stop at mining.
Indonesia must also develop food processing industries, fisheries, agriculture, renewable energy technology, and pharmaceutical manufacturing.
Economic expert Dani Rodrik from Harvard University argues that sustainable growth in developing countries is impossible without industrialization and productive diversification. In other words, Indonesia cannot depend solely on exporting raw materials while importing finished goods.
Second, Indonesia must strengthen food and energy sovereignty.
Former World Bank Chief Economist Justin Yifu Lin explains that countries with strong domestic production capacity are more resilient during external shocks. Rising dollar exchange rates become dangerous when a country depends too heavily on imported necessities.
Indonesia possesses extraordinary natural wealth: fertile agricultural land, vast oceans, geothermal reserves, and sunlight throughout the year.
Yet these resources have not been optimized systematically.
Investments in agriculture modernization, fisheries infrastructure, irrigation systems, renewable energy, and village-based industries are essential. A nation that can feed and power itself is less vulnerable to global currency fluctuations.
Third, Bank Indonesia and the government must maintain public confidence through prudent macroeconomic policies.
Economist John Maynard Keynes emphasized that expectations and psychological confidence play a major role in economic stability. Panic can worsen currency depreciation faster than actual economic fundamentals.
Therefore, maintaining foreign exchange reserves, controlling inflation, and ensuring fiscal discipline remain critical.
Bank Indonesia’s intervention in the foreign exchange market, while important, should be accompanied by clear communication to markets and citizens. Transparency builds trust, and trust stabilizes economies.
At the same time, Indonesia should continue promoting local currency settlement (LCS) agreements with trading partners such as China, Japan, Malaysia, Thailand, and other ASEAN countries.
Reducing excessive dependence on the US dollar in international trade can gradually strengthen regional financial resilience.
Fourth, Indonesia must empower the domestic economy through MSMEs and people-centered development.
Nobel laureate Muhammad Yunus repeatedly emphasized that grassroots economies create real resilience because they are directly connected to communities rather than speculative global markets.
Micro, small, and medium enterprises (MSMEs) are the backbone of Indonesia’s economy. During previous crises, MSMEs often proved more resilient than large corporations.
Supporting them through digitalization, affordable credit, tax incentives, and market access is crucial. A strong domestic market can become Indonesia’s shield when global markets weaken.
Fifth, Indonesia must strengthen law enforcement and eliminate economic leakages. This aspect is often overlooked, yet it is one of the most decisive factors in maintaining the strength of the rupiah and national economic resilience.
Economist Hernando de Soto argues that weak legal systems create “dead capital,” where economic potential cannot fully contribute to national prosperity because corruption, illegal practices, and weak institutions undermine productivity.
In Indonesia, illegal exports, smuggling, tax evasion, corruption, illegal mining, illegal fishing, and illicit capital outflows continue to drain national wealth.
Indonesia needs visionary leadership and national unity. Economic crises are never solved by monetary tools alone. They require collective confidence, social solidarity, and political stability.
Indonesia, under the visionary leadership of Prabowo Subianto and with its strong national unity, will certainly be able to overcome this difficult situation.
Economist Amartya Sen argues that development is ultimately about expanding human capability and social freedom. This means education, healthcare, social protection, and public trust are equally important components of economic resilience.
In difficult times, the government must avoid policies that burden lower-income groups disproportionately.
Social safety nets, employment programs, and affordable public services are essential to maintain national cohesion. A divided society weakens economic recovery, while a united society accelerates it.
Indonesia has faced major crises before — from the Asian Financial Crisis of 1998 to the global pandemic. Each time, the nation endured because of its resilience, social strength, and abundant resources.
The current rise of the dollar should not merely be seen as a threat, but as a wake-up call to build a more independent economic structure.
The true solution lies not in fear of the dollar, but in strengthening Indonesia itself: producing more domestically, empowering local industries, protecting food and energy security, supporting MSMEs, and building long-term national confidence.
If Indonesia can transform this difficult period into an opportunity for reform, then the country will not only survive the storm — it will emerge stronger, more sovereign, and more respected in the global economic order.
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Jakarta, 26 May 2026
