The cancellation of such a large volume of debt is a bold move by the Indonesian government, but it also carries risks, particularly for the state-owned banks that are involved. While the banks will not lose revenue directly through this scheme, the write-offs will affect their long-term profitability. Nevertheless, government officials argue that the short-term financial sacrifice is necessary for the long-term benefits of a more sustainable and resilient agricultural and fishing sector.

The policy begins to take effect, stakeholders in the agriculture and fisheries sectors are hopeful that it will serve as a model for future economic recovery strategies. The success of this program could lead to further initiatives designed to support other vulnerable sectors in the Indonesian economy. (Uki Ruknuddin)

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