Prabowo Highlights Indonesian Economy's Inefficiency, Cites ICOR of 6.5 as '30% of Wealth Leaking'

President Prabowo Subianto has highlighted the Incremental Capital Output Ratio (ICOR) of Indonesia, which he stated remains high at approximately 6.5, indicating an inefficient national economy. Speaking at the 28th anniversary event of the National Awakening Party (PKB) broadcast online on Thursday (23/7/2026), Prabowo remarked, "All experts, when discussing the Indonesian economy, say that Indonesia's economy is inefficient. What does inefficient mean? It means a lot of wealth is leaking." He elaborated on the ICOR, explaining, "They calculate our economy, our ICOR, at 6.5. ICOR means, in their language, Incremental Capital Output Ratio. It means if we want to increase wealth by one dollar or one rupiah, to get one rupiah, we have to spend six and a half rupiah. To get one dollar, we have to spend six and a half dollars." Prabowo contrasted this with neighboring countries, whose economies he deemed more effective, citing their ICORs in the range of 3 or 4. "If other countries can get one dollar, they only spend four dollars. The difference is two dollars with several of our neighboring countries. Two out of six, one-third, this means 30% of our wealth is leaking," he explained. In this context, Prabowo pointed to bureaucratic 'trickery' and the practice of inflating prices for goods and services purchased by various ministries and institutions as the primary culprits. He stated that the government is currently working to rectify these issues. "The state budget is US$270 billion, roughly Rp 3,700 trillion. So if 30% leaks, it means more than Rp 1,000 trillion leaks. I am stopping this, I want to close this trickery from many parties. Yes, we must introspect," he stated. He further alleged, "Everyone already knows what's happening. Right? Correct? Every purchase from government institutions so far has definitely had its price inflated. Correct? Correct? Mothers know, whatever it is, sometimes the inflation is crazy. We are stopping this," Prabowo added. Based on this, the president mentioned that since taking office, his administration has implemented large-scale budget efficiencies. The funds saved are being utilized for programs deemed more impactful, such as nutritious meals for children and bridge construction. "In the first few months of the government I lead, we were able to save more than three hundred trillion rupiah. This is what we are using for nutritious meals. This is what we are using for the bridge mentioned earlier, we are building 5,000 bridges by December 2026. If necessary, we will build more next year. People in the villages cannot wait, they don't want to wait anymore," he asserted.