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Glaring gulf: Indonesian tycoons resilient as economy suffers
The collective wealth of Indonesia's 50 richest people slipped just 1.2 percent to US$133 billion this year, according to Forbes.
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The wealth of Indonesia’s 50 richest people has dropped only slightly this year despite the economic paralysis of the COVID-19 crisis, which has brought the country into its first recession since 1998 and has dragged millions into unemployment and poverty. (REUTERS/Alexey Pavlishak/File Photo)
T
he wealth of Indonesia’s 50 richest people has dropped only slightly this year despite the economic paralysis of the COVID-19 crisis, which has brought the country into its first recession since 1998 and has dragged millions into unemployment and poverty.
The collective wealth of the 50 tycoons slipped to US$133 billion from $134.6 billion the year before, according to Forbes. This year’s figure is more than 48 percent of the country’s gross domestic product and about 72 percent of the state budget spending for next year.
“More than half of the tycoons saw their fortunes decline from a year ago amid the pandemic,” Forbes wrote in a statement on Dec. 10, noting that their collective wealth was down only 1.2 percent from last year’s figure.
Two consecutive contractions in the second and third quarters, 5.32 percent and 3.49 percent respectively, have pulled Indonesia into recession.
Read also: ADB downgrades Indonesia’s economic prospects as slowdown persists
As of August, 2.67 million people had lost their jobs, bringing the unemployment rate to 7.07 percent, the highest level since 2011, Statistics Indonesia (BPS) data shows. Some 1.63 million Indonesians fell into poverty in March, raising the poverty rate to 9.78 percent – 26.4 million people – from 9.22 percent in September 2019. This number is expected to increase as the pandemic wears on.
The situation has exacerbated the wealth gap between the rich and the rest of society. The country’s Gini coefficient, a measure of wealth inequality, was 0.381 in March, up from 0.380 last year.
