Indonesian Stocks and Rupiah Drop Amid Protests Over Affan Tragedy
Key Takeaways
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JAKARTA, Investortrust.id — Indonesian stocks and the rupiah fall on Friday, Aug 29, 2025, as protests erupted following the death of Affan Kurniawan, an online motorcycle driver who was run over by a police tactical vehicle during a labor demonstration in Jakarta.
The Jakarta Composite Index dropped 180.8 points, or 2.27%, to 7,771.28 in the first trading session, according to RTI data. The rupiah also weakened 138 points, or 0.84%, to Rp 16,490 per US dollar at 13:55 local time.
Suwijono Moegiarso, Secretary of the Coordinating Ministry for Economic Affairs, expressed hope that the demonstrations would remain under control, stressing that the government aims to boost third-quarter growth. “This is already the end of August, the opportunity is only in September,” Suwijono said in Jakarta.
He explained that the government had prepared economic stimulus measures, both by evaluating existing policies and designing new mechanisms to manage demand and supply. “We may consider creating an effective mechanism similar to inflation control,” he added.
Investor Confidence at Risk
Syafruddin Karimi, economist at Andalas University, said the protests could pose a significant risk to the national economy. He noted that the unrest added to global uncertainties such as trade tensions, China’s slowdown, and Middle East conflicts, raising concerns among investors about Indonesia’s political stability.
“Repeated mass protests suppress domestic consumption, which accounts for more than half of GDP, while rupiah depreciation increases import costs, fuels inflation, and reduces purchasing power. These internal factors could undermine Indonesia’s ability to benefit from positive global economic signals,” Syafruddin told Investortrust.
He urged the government to immediately break the cycle of social unrest and economic pressure by ensuring transparent law enforcement, consistent public communication, and concrete solutions to labor disputes.
Warning on Policy Credibility
Bhima Yudhistira Adhinegara, Executive Director of the Center of Economic and Law Studies, said the greater risk lies not in the protests themselves but in the government’s weak response to public demands, including tax reform and budget efficiency.
“Investors see the protests as the tip of the iceberg. The real problem is unresolved economic fundamentals,” Bhima said.
He warned that President Prabowo Subianto’s administration risked losing momentum if weak purchasing power combined with public anger. Indonesia could also miss opportunities such as factory relocations from abroad seeking to avoid higher US tariffs.
“It will be very difficult for growth to exceed 5% this year. We are entering the ultimate storm,” Bhima added.
He recommended halting budget reallocations for populist programs such as free nutritious meals and the Red and White cooperative schemes, while urging cabinet reshuffles, debt renegotiation, and stronger anti-corruption measures.
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