A rising star in Southeast Asia, Indonesia is often referred to as a “tiger” because of its young population, demographic dividend and tech-savvy citizens.

In the past decade alone, Indonesia has boosted its growth engine through strengthened macro-fiscal and public sector management that has ensured greater economic stability and investment. These in turn have helped improve the quality of human capital and deliver more infrastructure.

Indonesia made significant progress in achieving income convergence to achieve upper middle-income country (UMIC) status in 2023. Its growth has been inclusive, with the proportion of people living in poverty dropping from 12 percent in 2012 to 9.36 percent in March 2023.

The country also has demonstrated exceptional fiscal stewardship, maintaining an impressively low average budget deficit of 2.3 percent of GDP since 2014 and achieving a historic low of 1.65 percent in 2023. This disciplined approach has kept public debt at a manageable 39 percent of GDP, significantly below UMICs’ average of over 50 percent.

As a result, Indonesia has attained investment grade rating for sovereign credit.

Landmark reforms in taxation, subsidies and national services have yielded promising outcomes. For instance, the proportion of individual tax filers surged from 29 to 43 percent of the workforce in 2016-2021, driving steady increases in tax revenues.