The number of poor people in Indonesia rose. According to the latest data from Statistics Indonesia (BPS), released today (15/09), there were 28.59 million poor people in Indonesia in March 2015, equivalent to 11.22 percent of the total Indonesian population. In September 2014 Indonesia’s poverty rate stood at 10.96 percent of the Indonesian population, or 27.73 million people. Thus within a time-span of six months, the number of poor Indonesians rose by around 860,000 people. BPS releases data on the country’s poverty level twice per year covering the months March and September.
BPS mentioned several reasons that explain rising poverty in Indonesia, Southeast Asia’s largest economy. Inflation has been high over the past two years (particularly due to several adjustments made in Indonesia’s subsidized fuel policy over the past two years). Between September 2014 and March 2015 Indonesia’s inflation rate accumulated to 4.03 percent. Over this period, the average rice price rose 14.5 percent. This is problematic as Indonesia’s poor people use a significant portion of their disposable income to purchase rice. As such, higher rice prices can have a severe negative impact and push part of the large group of Indonesians who live just above the poverty line into full poverty. Per March 2015, Indonesia’s national poverty line was set at IDR 330,776 (approx. USD $23) per person, per month.
Meanwhile, in real terms, farm workers’ wages declined by 1.34 percent to IDR 39,045 per day in March 2015 compared to September 2014 (IDR 38,522 per day).
Traditionally, the regions in eastern Indonesia (located further away from the main economic centers) continue to have a higher poverty rate, in relative terms. The relative poverty rate is highest in Maluku & Papua at 22.04 percent of the local population. Meanwhile, in absolute terms, poverty is highest on Java, Indonesia’s most populous island, with 15.5 million poor people. It is also interesting to note that both relative and absolute poverty is nearly twice as high in rural regions than in the urban regions.
Indonesian Poverty and Inequality Statistics:
(% of population)
Source: Statistics Indonesia