The economic crisis of 1998 dealt a heavy blow to Indonesia’s national economy, pushing up the number of people living in poverty to 49.50 million people (or around 24.23 percent of the total population), from only 34.01 million (17.47 percent) in 1996. In response, the Government of Indonesia (GoI) committed poverty reduction as its top development priorities and established measures towards alleviating it.
Since 1998, poverty alleviation programmes have successfully helped lift millions out of poverty, with the levels standing falling to lows of 28.07 million (11.37 percent) in March 2013. According to the World Factbook, BPS and World Bank, the rate at which Indonesia’s poor population contracted was among the fastest globally – equivalent to 0.8 percent per year (2005-2009), much higher compared to other countries, including Cambodia, Thailand, China and Brazil (at 0.1 percent per year).
At present, the government has a number of integrated poverty alleviation programmes, including social assistance-based programmes, community development-based programmes and programmes to empower small enterprises. These are being carried out by several government agencies, at both the central level and regional level.
To improve effectiveness of measures to alleviate poverty, the president issued Presidential Regulation Number 15 of 2010 on the Acceleration of Poverty Reduction, which aims to cut the poverty rate to between 8 and 10 percent by the end of 2014.
Efforts to alleviate poverty centre around four fundamental strategies:
In regard to the above strategies, the GoI established instruments for the alleviation of poverty. They are divided into three working groups: