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Under Jokowi, Indonesia’s middle-class the winner of economic growth

27 21 30
20.02.2019
WHEN Joko Widodo (Jokowi) took over the Indonesian presidency in 2014, he faced a stagnating poverty reduction effort and stubbornly high inequality levels.

To address these problems, Jokowi has mainly relied on two social policy initiatives: expanding the coverage of social assistance programs and distributing Village Fund (Dana Desa) grants, which are put to purposes decided by villagers themselves.

Despite these schemes, the benefits of economic growth under the Jokowi administration are being reaped by the middle class more than the poorest segments of Indonesia’s population.

The social assistance programs are mainly continuations from the previous government. Recipients of the Indonesian Smart Card for Education (KIP) — some 19.7 million students in 2016 — receive Rp 450,000 (US$32) per year for elementary school, Rp 750,000 (US$54) for junior high school and Rp 1 million (US$72) for senior high school.

And under the Indonesian Health Card (KIS) program, which reached over 90 million people in 2017, the government pays a premium of Rp 23,000 (US$2) per person each month.

SEE ALSO: Can Jokowi bring the dynamism Indonesia’s economy so badly needs?

The government also furthered the Subsidised Rice for the Poor (Rastra) program, where each household is entitled to buy 10–20 kilograms of rice per month at a heavily subsidised price of Rp 1600 (US$0.1) per kilogram (compared to the market price of around Rp 12,000 (US$0.9) per kilogram). This program reached 15.8 million households in 2017.

With the aim of reducing the impact of a fuel price........

© Asian Correspondent