Indonesia Kopdes Merah Putih program funding

Indonesia has announced plans to utilize the state budget (APBN) to repay Rp240 trillion in debt incurred for the Kopdes Merah Putih village-cooperative program. The Ministry of Finance intends to allocate approximately Rp40 trillion of the principal annually over a six-year period, with the first payment expected in September 2026. The program involves roughly 80,000 cooperatives.

Following the debt repayment announcement, the Finance Minister addressed rumors regarding high compensation for program managers. The Ministry denied reports that managers would receive monthly salaries of Rp16 million, stating that proposed figures might be lower than the regional minimum wage. To support the program's start, the government is developing a scheme where the APBN will cover cooperative managers' salaries for the first two years, with formal governance details expected in a forthcoming Presidential Regulation.

As of August 2026, the government is accelerating the development of the Koperasi Desa/Kelurahan Merah Putih (KDMP) program, targeting 30,000 operational units by August 16, 2026, to coincide with the 81st Independence Day. Coordinating Minister for Food Zulkifli Hasan reported that approximately 9,294 units are physically complete, with construction progressing at a rate of 150 to 200 units per day. These cooperatives are intended to serve as economic hubs for distributing subsidized fertilizers, social assistance, and local products.

In Papua, the government is collaborating with universities and the LPDB Koperasi to provide management training and incubation. The state is also recruiting 30,000 cooperative managers to support this expansion.