Greater effort needed to overcome poverty in RI, says World Bank

The Jakarta Post , Jakarta | Fri, 12/08/2006 1:21 PM | Business

Urip Hudiono, The Jakarta Post, Jakarta

Poverty, philosophically-speaking, may just be a state of mind, but it remains pretty much a reality of life here, affecting nearly half of the country's population.

Despite the progress achieved in reducing poverty since the Asian financial crisis, close to 42 percent of Indonesia's 220 million people earn between just US$1 and $2 a day, a report from the World Bank says, leaving them vulnerable to sinking into abject destitution.

Officially, the government categorizes people who earn less than $1.55 a day as living in poverty.

Many of the country's impoverished are at risk of remaining trapped in this vicious cycle of poverty, World Bank country director for Indonesia Andrew Steer said during the launching of the report Thursday, with the poor having severely restricted access to assets that would enable them to participate in economic growth.

In addition, some 40 percent of the poor cannot afford to give their children a secondary education, thus perpetuating poverty from one generation to the next.

Indonesia's vast geographic spread has also created wide regional disparities in income, with people in some regions having attained developed world standards while others are still at the lower range for developing countries.

Poverty alleviation, therefore, remains one of the most pressing issues for Indonesia, the Washington-based lender said in the report, titled Making the New Indonesia Work for the Poor.

""The secret to reducing poverty is to help these people participate in Indonesia's rising economic growth,"" Steer said.

""We need to give them direct income-earning opportunities. This is where agriculture can play a vital role, and why it is important for the government to succeed in its program of revitalizing the agricultural sector.""

The need to breath new life into Indonesia's farm sector -- by improving infrastructure, access to fertilizers and seeds, and farming techniques so as to increase productivity -- was highlighted in the report, as well as the need to build a network of rural roads to give the poor access to markets, and the promoting of microfinance schemes.

Encouraging community-driven development projects -- particularly those related to education, health, water and sanitation so as to overcome other aspects of poverty -- was also essential.

The report urged Indonesia to end its practice of banning rice imports, arguing that recent rises in rice prices largely accounted for the recent increase in poverty levels.

The report was jointly compiled with the Coordinating Ministries for the Economy and for People's Welfare, the National Development Planning Board (Bappenas), and a number of universities and non-governmental organizations.

Coordinating Minister for People's Welfare Aburizal Bakrie welcomed the report, saying it provided a comprehensive assessment of the poverty problem in Indonesia and how it could be better addressed.

""The government will continue to position poverty reduction at the center of our development planning, putting human development at the core,"" he said.

""Our alternative energy development program, for example, will be used to reduce poverty and create more jobs, apart from providing much-needed energy. We will also convert our existing unconditional cash-payment welfare program into a conditional one, linking it with education,"" Aburizal explained.

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