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Behind the inequality of income and poverty within provinces
Java remains the biggest economy contributing 56.5 percent of the country’s GDP thanks to its strong manufacturing base.
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Remote delivery: Papuan people who were displaced by a landslide collect food aid on Oct. 26, 2023 in Amuma. The National Disaster Mitigation Agency (BNPB) delivered the aid packages to the remote district in the highland regency of Yahukimo. (AFP/BNPB)
W
ith a strong recovery in economic growth in 2022, Indonesia regained its status as an upper-middle income country. And with a nominal gross domestic product (GDP) of US$1.3 trillion the country was the biggest economy in Southeast Asia, ranked 16th in the world and seventh largest in term of GDP based on purchasing power parity.
But the data of 34 (out of 38) provinces reveal widely uneven economic performances among provinces in terms of growth, per capita income and poverty incidence.
The national economy grew 5.3 percent in 2022, but there were 21 provinces with growth below 5.3 percent. Seven provinces exceeded the national growth rate, including Central Sulawesi, North Maluku and Papua, which booked gross regional domestic product (GRDP) growth of 15.2 percent, 23 percent and 9 percent, respectively.
This highly uneven GRDP growth among provinces affected the distribution of regional per capita GRDP of each province. The wide differences in per capita GRDP among provinces not only occurred nationally but occurred within the same island, and among districts in the same province.
Jakarta had the highest per capita GRDP in the country with Rp 298 million (US$19,000) annually, while East Nusa Tenggara had the lowest GRDP at only Rp 22 million. Jakarta’s per capita GRDP was seven times that of Central Java.
On Sumatra Island, Riau had the highest per capita GRDP with Rp 150 million compared with Aceh the lowest-income province with Rp 39 million. Sharp differences in per capita GRDP were also recorded between East Kalimantan and West Kalimantan and between Central Sulawesi and West Sulawesi. The per capita GRDP of North Maluku was twice the per capita GRDP of Maluku, its neighbor.
There were also wide variations in the per capita GRDP between regencies within the same province. The regency of Morowali in Central Sulawesi had per capita GRDP of Rp 832 million, the highest among districts in the country, compared with other districts in the province with average per capita GRDP of Rp 40 million.
