Indonesia forms task force to optimize village cooperative distribution

Koperasi Desa Merah Putih subsidized goods distribution national logistics system Indonesian state budget village cooperatives

The Indonesian government has agreed to form a task force to optimize the Koperasi Desa/Kelurahan Merah Putih (KDKMP) program. This initiative, involving the Ministry of Finance, the Ministry of Cooperatives, and the State-Owned Enterprises Regulatory Agency, aims to utilize the village cooperative network as a strategic channel for distributing subsidized goods and strengthening the national logistics system.

Finance Minister Purbaya Yudhi Sadewa stated that the government will cover the salaries of KDKMP managers for the first two years to ensure operational stability. The program is expected to reduce subsidy leakages and improve targeting through a single data system. Furthermore, the government has allocated Rp40 trillion to ensure the timely payment of construction installments and interest to state-owned banks (Himbara) due in late September 2026.

In a separate economic development, Minister Purbaya expressed concern regarding rising global oil prices, which could impact the state budget and energy subsidies. While the government aims to keep the budget deficit below three percent, officials are monitoring geopolitical tensions that may drive oil prices above the current $75 per barrel assumption used in the 2027 draft state budget.