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Indonesia gets richer but inequality remains wide
Indonesia's poverty rate only decreased 1.74 percent between 2014 and 2019, the slowest rate in the last 40 years.
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Valeria Panu, 65, carries a plate of rice for her child in Pong Ruan village, East Manggarai, East Nusa Tenggara, on Nov. 8. (JP/Markus Makur)
“The rich get richer and the poor get poorer” is an age-old adage that has become more relevant than ever as Indonesia becomes wealthier, multiple recent reports have shown.
According to a list compiled by Forbes last year, the country’s 50 richest added US$5.6 billion to their combined wealth, which reached a record $134.6 billion last year despite global trade turbulence slowing down the country’s economy. The total figure was about 12 percent of the country’s gross domestic product (GDP) in 2019.
Prominent businessmen Robert Budi and Michael Hartono, also known as the Hartono brothers, topped the list with a net worth of US$37.3 billion through various businesses ranging from tobacco and banking to startups and media outlets.
However, the 2019 Global Wealth Report published in October by Swiss multinational investment bank and financial services company Credit Suisse painted a bleak picture of the country’s wealth distribution.
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“Despite the rising wealth levels, wealth inequality is also greater than average,” the report reads.
The report shows that wealth per adult in Indonesia has risen by a factor of four since the year 2000 and currently stands at $10,545. However, 82 percent of the adult population has wealth of less than $10,000 – well above the global figure of 58 percent. Only 1.1 percent of adults have wealth above $100,000, compared to 10.6 percent globally.
