AGP Executive Report

Volcanic Disruption: Mount Anak Krakatau erupted again, sending ash over western Indonesia and forcing Soekarno-Hatta Airport to suspend flights temporarily, with schools and fishing activities also disrupted as residents in Banten reported eye irritation. Regional Cooperation on Haze: Indonesia’s Foreign Ministry said it’s coordinating with ASEAN partners to manage cross-border impacts from forest and land fires, aiming to keep relations stable. Elections & State Neutrality: Democratic Party chair AHY urged the military, police, intelligence and civil servants to stay neutral during elections, saying state facilities must serve public interests, not political ones. Leadership & Peace: Former President Jokowi called for people-centred leadership and mutual understanding as the basis for lasting peace. Education Integrity: Indonesia’s graft watchdog KPK warned that weak oversight in “independent” university admissions could enable wealthy applicants to buy spots, after arrests tied to Jenderal Soedirman University. Manufacturing & AI Demand: Surveys point to stronger factory activity across parts of Asia as AI hardware demand lifts semiconductor-linked production, even amid broader uncertainty. Food Safety Alarm: Reports say nearly 2,000 people fell ill in suspected food poisoning linked to Indonesia’s free school meals program.

Food & Safety: Nearly 2,000 people—mostly students and teachers—fell ill in suspected food poisoning linked to Indonesia’s Free Nutritious Meals program between Sept 1–3, with cases reported across Central Java, East Java, West Sumatra, Aceh and South Sulawesi; no deaths were reported, but the incidents add pressure to the flagship scheme that has affected 50,000+ people in hundreds of cases since launch. Social Aid Tech: Coordinating Minister Luhut says GovTech data integration could cut misdirected social assistance from 77.6% to below 10%, with a near-complete system targeted for launch in October 2026 and a single digital ID by end-2026. Forest Fires & Haze: South Kalimantan is testing a locally developed peatland-cooling liquid to fight underground smoldering fires, while Singapore’s air quality improved to the moderate range after earlier unhealthy readings tied to regional haze. Energy/Industry: A new market focus emerges for Indonesia’s nickel as tighter ore approvals shift the question from building refineries to securing compliant feedstock. Regional Security: Indonesia and Singapore air forces held their 20th Annual Staff Meeting in Manado to reinforce bilateral defense cooperation. Justice Diplomacy: India’s CJI Surya Kant urged BRICS to become a “living Nalanda University” for healthy judicial disagreement and faster, predictable justice. Business/Health Research: BPOM calls for pharma firms to collaborate on a stronger clinical trial ecosystem to boost Indonesia’s medicines and medical devices self-reliance. Sports: India’s junior men’s hockey team started the AHF Junior Asia Cup title defense with a 14-0 win over Indonesia.

Haze Emergency in Malaysia: Malaysia declared a state of emergency in Serian, Sarawak, after haze from Indonesia pushed air pollution to “hazardous” levels, closing 647 schools and suspending non-essential work while cloud-seeding operations run. Regional Health Fallout: In the Philippines, Metro Cebu kept suspending in-person classes as haze lingered, with air quality still in the “very unhealthy” range, blamed on Indonesian wildfire smoke. Indonesia Fire Response: Indonesia stepped up firefighting across Kalimantan as ISPU readings hit hazardous levels, using ground operations, water bombing, drones and peatland moisture measures where aerial efforts were hampered. EV Battery Waste Planning: Indonesia’s Environment Ministry is building an EV battery waste management ecosystem, warning used-battery waste could peak around 2040 and aiming for a full rollout by next year. Energy Deal with Russia: Indonesia invited Russian investors to bid on 138 oil and gas exploration blocks to deepen bilateral energy cooperation. Jakarta Mobility & Air Quality: Jakarta is considering a major hike in parking fees to curb car use and improve air quality, with proposed rates far above current levels. Meaningful AI Push: Indonesia’s communications ministry urged “Meaningful AI” focused on public benefits, digital inclusion and resilience against cyber and climate threats.

Wildfire Crisis: Indonesia’s haze emergency deepened as ISPU readings in Kalimantan surged to hazardous levels, with aerial firefighting hampered by poor visibility and cloud conditions; authorities kept ground operations going and used thermal drones and peatland moisture measures. Regional Air Impact: Malaysia declared an emergency in Sarawak’s Serian as haze linked to Indonesian fires pushed air pollution into emergency territory, while Singapore also saw unhealthy PSI levels and businesses prepared to adjust activities. Disaster Recovery: Vice President Gibran apologized to North Sumatra disaster victims and said permanent housing construction for flood and landslide survivors will start this month. Food Safety Alarm: Indonesia’s rights body Komnas HAM urged police to investigate new outbreaks of food poisoning tied to the free school meals program, after more than 2,000 students and teachers fell ill. Health & Science: Health Minister Budi Gunadi showcased Indonesia’s genomic advances to Sweden’s Crown Princess Victoria, highlighting precision medicine and epidemic preparedness. Digital Economy Push: The government launched efforts to make Indonesia a global content powerhouse, aiming to boost financing and co-production for creators.

Eurasian Trade Push: President Prabowo urged EAEU members to complete ratification of the Indonesia-EAEU FTA, saying it would open five markets to Indonesian producers and give Eurasian firms access to Indonesia’s 290 million consumers. Russia Link-Up: At the Eastern Economic Forum in Vladivostok, Prabowo pitched Indonesia as Russia’s “gateway” to ASEAN, calling for faster cooperation in trade, connectivity, payment systems and joint projects. Malaysia Border & Investment: Indonesia and Malaysia agreed to boost Entikong–Tebedu border trade and strengthen the MIIC-WG under the JTIC framework to improve investment climate and trade facilitation. Wildfire Fallout: Analysis warns unchecked business concessions are behind recurring Indonesian wildfires, worsening haze across the region. Free Meal Crisis: Indonesia reported another wave of food poisoning from government free meals, with more than 1,700 sick in three days. Energy & Climate Risk: UN/WMO warned El Niño is set to become “very strong” into February, raising risks of drought, floods and extreme heat. Urban Transit Gap: Jakarta’s MRT/LRT/TransJakarta ridership rose, but Greater Jakarta remains disconnected from mass transit.

El Niño Alert: The UN weather agency says El Niño is “very strong” and likely to persist through February, raising risks of floods, drought and extreme heat across the region. Haze Crisis in Cebu: Metro Cebu faced a long power-grid red alert while “acutely unhealthy” haze from Indonesian wildfires pushed students and teachers to shift online. Free Meals Fallout: Indonesia reported another wave of suspected food poisoning tied to the government’s free school-meals program, with hundreds hospitalized in East Java and other provinces over the past days. STEM Push for Kids: Indonesia launched a national STEM learning drive for early childhood, using hands-on activities and updated digital materials to curb gadget addiction. Bank Indonesia Leadership: Destry Damayanti was sworn in as Bank Indonesia’s first female governor, pledging stability and tighter coordination as the rupiah faces global volatility. Indonesia-Russia Trade: President Prabowo urged Russian investment in 138 new energy blocks and highlighted deeper ties under the I-EAEU free trade plan. Court Upholds TaniHub Case: The Jakarta High Court upheld former BRI Ventures chief Nicko Widjaja’s three-year sentence in the TaniHub investment case. Digital Child Safety: UNICEF warns 1 in 5 youths are targeted by online sexual abuse, with social media playing a major role.

Central Banking & Investment Climate: Bank Indonesia told G20 Finance Ministers and central bank governors that policy certainty, anchored inflation expectations, and clear communications are key to attracting investment and supporting jobs. Forest Fires Crackdown: Indonesia’s Environment Ministry launched enforcement against 21 firms after fires scorched about 11,400 hectares across Kalimantan and Sumatra, with investigators verifying sites and installing monitoring markers. Illegal Mining Probe: Indonesia charged two Chinese nationals over alleged illegal gold mining in North Sulawesi, with roles traced from field supervision to operation coordination; suspects face up to 10 years in prison. Visa Policy Shift: Thailand moves to tighten visa-free access for Americans and Europeans, cutting stays to 30 days from Sept. 15, while some ASEAN countries keep longer allowances. Energy & Climate Pressure: As El Niño intensifies, Indonesia ramps up wildfire response including cloud-seeding and aircraft, warning the heat and dryness are accelerating fire spread. Geopolitics: President Prabowo is in Russia for the Eastern Economic Forum, with Putin calling Indonesia a key Southeast Asia partner. Education Links: Indonesia and Saudi Arabia agreed on student/lecturer exchanges, joint degrees, research, and expanded scholarships. Digital Infrastructure & Finance: BI and regional partners highlight AI-ready systems and payments upgrades, including VTB expanding QR payments in Indonesia and the Philippines.

Jobs & Skills Push: Indonesia’s Manpower Minister Yassierli says the government targets 3.49 million new jobs in 2027, using National Internship and National Vocational Training to close the skills mismatch with industry needs. AI for Trade: Indonesia and Singapore are rolling out an AI-powered trade advisory platform to help Indonesian SMEs spot export markets, with a wider launch planned for 2027. Energy Transition Drive: The Energy Ministry is accelerating new and renewable energy under the Astacita program to protect supply and reduce risks from global shocks. Biodiesel Planning: Indonesia is assessing crude palm oil supply and biodiesel capacity ahead of the B60 mandate in 2027, including FAME and possible HVO blending. Wildfire Haze Fallout: Toxic haze from Indonesian fires has hit Metro Cebu, suspending in-person classes as air quality worsens. Security Probe: Jakarta police are investigating “intellectual actors” behind the Aug 27 unrest, naming dozens of suspects and focusing on alleged mobilisers. Central Banking Milestone: Destry Damayanti has been sworn in as Indonesia’s first female central bank governor, with parliament backing her leadership.

Floating Solar Push: Central Java has started building the 134.2 MWp Gajah Mungkur floating solar farm in Wonogiri, a Rp 1.6 trillion project aimed to run by end-2027 and produce about 218 GWh a year. Rights & Policing: Komnas HAM is probing how Jakarta police handled the Aug. 27 protest after clashes left one person dead, including whether arrests and investigations involved torture or violence. Volcano Disruptions: Mount Sinabung’s eruption temporarily shut Kualanamu Airport’s aerodrome in North Sumatra, cancelling 21 flights and causing delays as ash risk fluctuated. Fire Crisis Response: President Prabowo summoned military and police chiefs to coordinate efforts against forest and land fires in Sumatra and Kalimantan, warning of wider spread. Central Bank Leadership: Indonesia’s parliament backed Destry Damayanti as the first female central bank governor, with a focus on stability. Tourism Rules: Mount Rinjani reopened only for limited nature tourism and activities, while eRinjani bookings were paused during heightened wildfire risk. Energy & Industry: Indonesia is expanding aluminum output using coal-fired smelters as the Iran war tightens global supply. Sports & Culture: ITDC launched integrated travel packages for the 2026 Mandalika MotoGP to boost Lombok tourism spending.

Wildfire Haze Impact: Indonesia’s forest-fire smoke is reaching the Philippines, with Metro Manila cities posting very unhealthy PM2.5 levels and officials urging masks and limiting outdoor exposure. El Niño Fire Warning: Indonesia’s forestry minister says September is the “real battleground” as El Niño peaks, despite fewer hotspots, and highlights continued patrols, water bombing, enforcement, and public awareness. Local Fire Preparedness: The home affairs ministry urges regions to fund fire mitigation through local budgets and planning, stressing readiness across Bali, Nusa Tenggara, Maluku and Papua. Vocational Skills Push: Indonesia is strengthening vocational education to match skills-based hiring trends driven by AI, automation, and the green economy. Indigenous Peoples Bill: A minister urges the House to fast-track the Indigenous Peoples Bill for legal certainty and protection. Transport & Trade: A new cold-storage JV brings Peregrine into Indonesia, while Indonesia posts a small July trade surplus. Infrastructure Safety: A newly opened West Java suspension bridge buckled during an event after reports of exceeding weight limits, injuring several people.

Central Banking: Indonesia’s parliament approved Destry Damayanti as the next governor of Bank Indonesia, paving the way for the first woman to lead the central bank after Perry Warjiyo’s surprise resignation. Inflation Watch: Annual inflation in August edged up to 3.19% from 2.88% in July, broadly matching economist expectations. Wildfire & Health: Wildfires and haze in Kalimantan have driven 165,727 acute respiratory infection cases by Aug 22, with air pollution worsening breathing problems across the province. Energy Transition: A new analysis urges Indonesia to fold its 100 GW solar push into the national least-cost electricity plan (RUPTL) so generation, grid, and storage investments line up. Payments & Credit: Bank Indonesia and ASPI launched Kartu Kredit Indonesia (KKI), enabling deferred QRIS credit payments via the domestic payment gateway—raising both convenience and household risk questions. Economy Signals: Indonesia’s manufacturing PMI slipped to 49.8 in August, showing contraction as output and employment eased. Policy & Governance: Indonesia also moved to close hiking routes in nine national parks due to wildfire risk.

Indonesia–Saudi Trade: West Bandung facilitated the first export of Mount Tangkuban Parahu Arabica coffee to Saudi Arabia, with an initial four-ton shipment worth about Rp800 million and plans to expand to Japan next year. Commodity Oversight: Danantara’s export monitoring platform goes live Sep 1, bringing over US$70 billion of annual coal, palm oil and ferro-alloys exports under closer government scrutiny to flag under-invoicing and transfer pricing. Energy Targets: Energy Minister Bahlil set Indonesia’s 2027 crude oil lifting target at 612,500 bpd, up from 610,000 bpd, citing new wells and EOR—while noting current output still lags the 2026 goal. Wildfire Response: Defense Minister Sjafrie urged public and businesses to help tackle Karhutla, including mobilizing heavy equipment and water-bombing helicopters via BNPB. Environment Watch: Walhi says illegal gold miners have breached Aceh’s Jantho orangutan reintroduction forest, damaging over 14 hectares. Culture & Education: The Culture Ministry launched five volumes of a new 11-volume national history series, stressing author freedom and critical thinking. Regional Diplomacy: Indonesia’s Deputy FM Muhammad Anis Matta met Serbia officials in Belgrade, reaffirming ties and discussing economic cooperation. Sports & Youth: Indonesia’s U20s face Australia in AFC U20 Asian Cup qualifiers in Laos, with matches streamed free on Laos FA’s YouTube.

Wildfire & haze risk: Indonesia’s wildfire season is intensifying as El Niño conditions worsen, with authorities deploying cloud-seeding and aircraft to curb blazes in Borneo peat hotspots, while smoke already forces school closures and raises regional ASEAN escalation fears. Budget & land conflict: A new state budget framing puts land, forests and minerals first for revenue and growth, critics say it lacks a credible way to share benefits fairly and sustainably—highlighting how governance choices fuel ecological disputes. Central bank leadership: Bank Indonesia’s new governor Destry Damayanti and board are set to steer monetary policy with tighter coordination with fiscal authorities, after House confirmation. Labor law deadline: Indonesia targets completing a new Manpower Law by October 2026, aiming to update rules for AI, outsourcing, wages and worker welfare. Digital finance & standards: Indonesia pushes to strengthen sustainable finance frameworks for sectors like the blue economy, using the Indonesia Taxonomy for Sustainable Finance as a base. Public order & civic space: A Jakarta protest-linked bank account freeze sparked backlash over legal basis and freedom-of-expression concerns, after which the bank apologized. Tourism safety: Mount Sinabung activity has led to closures of Sumatra tourism sites.

Applied Research Push: Indonesia’s Higher Education minister Brian Yuliarto urged universities to move beyond classroom research and partner with villages on practical solutions like energy, waste and water access, with training so locals can run and maintain new tech. Rupiah Watch: Bank Indonesia data points to a record current account deficit of US$12.5b in Q2 (3.3% of GDP), raising concerns that a sustained gap could pressure the rupiah and push borrowing costs higher. Wildfire Readiness: The Indonesian military deployed 583 wildfire prevention educators across East Kalimantan to start community awareness early, not just fight fires after they spread. Energy & Industry: Inpex said costs for its Abadi LNG project could rise 30–40% from 2019 levels, with a final investment decision targeted around mid-2027. Local Economy: Central Java’s Dieng Coffee Festival generated about Rp15b in transactions, highlighting coffee as a high-value driver for rural growth. Youth & Reform: Environment Minister Moh Jumhur Hidayat called on young people to back President Prabowo’s reform agenda, especially anti-corruption efforts.

Markets & Finance: The Indonesia Stock Exchange (IDX) has begun trials with exchange members to cut the minimum stock price floor from Rp 50 to just Rp 1, aiming to improve liquidity and price discovery, with further steps set to follow member readiness. Food Security: A USDA report flags Indonesia as having the highest number of food-insecure people in Southeast Asia this year, with 32.1 million affected, underscoring ongoing pressure on food availability and demand. Environment & Conservation: Conservationists in Jakarta say orangutan protection must go beyond forest protection by restoring habitat connectivity, including using canopy bridges to link fragmented populations. Forestry & Palm Oil: A new study warns Indonesia’s palm oil enforcement push is failing forests and small farmers, arguing current approaches may deepen insecurity rather than solve the dilemma. Climate Risk: Coverage highlights El Niño intensifying and raising the odds of stronger global heating, with knock-on effects for agriculture and commodity markets. Business & Retail: Lotte Mart reopened its renovated Kelapa Gading store in Jakarta with expanded K-food offerings, betting on dense, upper-middle-income demand.

Investment Climate: Indonesia’s Investment Ministry/BKPM says it’s streamlining licensing, boosting legal certainty, and debottlenecking projects to attract next-gen investors, with Jakarta leading 2026 investment realization at Rp173.6T (17.2% of the national total). Healthcare Expansion: The Higher Education ministry says scaling healthcare needs more than buildings—focus should be on accessibility, affordability, and diagnostic accuracy, linking research, private investment, and public infrastructure. Sports Economy Push: Indonesia targets a US$521B sports industry boost, with Youth and Sports and Investment ministries coordinating risk-based licensing to speed permits and unlock investment. AI for Workers: The Communication ministry urges workers to understand AI tied to their jobs, warning generative AI could reshape employment and state revenue—so upskilling civil servants becomes urgent. Stem Cell Safety: The Health Ministry stresses stem cell therapy must be governed by clinical oversight, accurate public info, and licensed processing labs to avoid risky claims. Trade & Exports: Indonesia eyes stronger exports to Morocco (palm oil, frozen shrimp, ammonia, and steel inputs) as trade talks restart toward a 2027 agreement. Environment & Conservation: Indonesia released 82 aquarium-bred Indo-Pacific leopard sharks into protected seas in Raja Ampat as part of a rewilding recovery effort. Disaster & Transport: Repairs to quake-damaged transport hubs in NTT are being expedited in stages, with sea routes used where landslides block roads. Haze Cooperation: Indonesia calls for stronger regional fire prevention as haze threatens to cross borders, urging Malaysia and Singapore to help on the ground. Jakarta Unrest: Police report Jakarta’s situation has returned to normal after protest-related unrest and transport disruptions.