T

he Asia-Pacific region is home to more than 4 billion people and some of the world’s most dynamic economies. Yet, not everyone has a decent place to call home. In Indonesia, more than 13.6 million people need a place to live, according to the Central Statistics Agency (BPS).

This housing crisis will only intensify as Asia-Pacific’s population is projected to increase from the current 4 billion to 5 billion by 2050, according to the Asian Development Bank. The expanding housing backlog will need solutions beyond just government interventions.

In fact, Indonesia’s government has openly stated that the country’s housing need will increase at a rate of 800,000 a year but that they only have capacity to provide 300,000 new homes annually.

The Public Housing Ministry, for example, has reached an agreement with publicly owned bank BTN on the expansion of its credit business by focusing on the so-called housing loan liquidity facility (FLPP), a government-subsidized mortgage program for citizens who have never owned a house and earn less than
Rp 3.5 million (US$365) per month. The cooperation will help the bank to expand the credit target from 16,000 houses this year to 50,000.

Basic provisions such as housing and sanitation have not kept pace with economic growth in large parts of the region where emerging economies are located.

Natural disasters, such as the recent series of typhoons and flooding in the region, have further exposed shortcomings. The lack of investment in decent homes, infrastructure and preparedness is exposing people living in substandard housing in disaster-prone areas to the full force of natural calamities.

Today, on World Habitat Day, it is important to recognize that the housing deficit in Indonesia, and across the Asia-Pacific region, needs to be addressed fast. Housing is the critical foundation for breaking the cycle of poverty.

Families living in safe and decent homes see improvements in health, education and employment opportunities. A World Bank research project shows that the simple act of changing from an earth to cement floor can lead to a dramatic decrease in parasitic infections and huge improvements in children’s cognitive development.

The traditional approach to tackling poverty housing by simply building more homes is one dimensional and limiting. Solving the problem requires addressing land rights inequality, infrastructure planning, basic services provision, employment creation and giving low-income families access to micro-loan and micro-saving products.

These solutions must be bold and also draw participation by key actors from the business world and civil society.

The private sector has much to gain from a region of better educated, healthier, wealthier people living in decent shelters — they are prospective customers.

Headway is being made and examples of great public-private sector innovations and business models are evident across the region, but the scale and pace need to be intensified.

The decisions and strategies taken in the next decade will determine what the human development landscape looks like come 2050.

Hard-working, low-income Indonesian families have helped bring the nation to where it is today. They deserve to have their basic needs met. Shelter is one of them.