Indonesia, according to the World Bank, is still considered as a developing country. Recently, the bank also estimates that 7 million Indonesians join the middle-income group every year, showing that Indonesia’s economy has improved significantly in the past few years.
The World Economic Forum’s 2010-2011 Global Competitiveness Report showed a two-rank decline in the United States’ economic performance, falling to the fourth position behind Switzerland, Sweden, and Singapore. Due to its high fertility rate, the U.S. is still the most prominent industrialized nation that is expected to grow throughout the next generations, filling in an adequate replacement level in the workforce.
However, when population is imbalanced, fewer youth population can work and help a nation’s economy to thrive, and more elderly people need social support. “There will be an unprecedented number of people who will be the old old. That’s more people to be cared for but fewer people to fill jobs,” explained Carl Haub, senior demographer of the Population Reference Bureau to USA Today.
Out of the 139 countries listed, Indonesia was ranked 44th, 10 places ahead from the previous year, thanks to better education and a healthier macroeconomic environment. Due to Indonesia’s huge population growth and the expansion of the middle class population, we are increasingly showing that we’re competitive as a developing nation.
“Indonesia now compares favorably with the BRICs, with the notable exception of China (27th). Indonesia precedes India (51st), South Africa (54th), Brazil (59th), and Russia (63rd)”, cites the report. Measured with the Global Competitiveness Index (GCI), the annual report is based on twelve pillars of competitiveness: institutions, infrastructure, macroeconomic environment, health and primary education are the basic indicators for economies to grow. Higher education and training, goods market efficiency, labour market efficiency, financial market development, technological readiness, and market size are economic measures of a nation’s capacity to thrive. Business sophistication and innovation are two transitional elements required for any nation to cultivate new ways to expand its economy.
Currently, more than 3 billion people reside in the BRIC nations, covering about 45% of the world’s total population. Early this month, the United Nations Population Fund (UNFPA) said that Indonesia ranked 5th in population growth rate after India, China, Nigeria, and Pakistan, with 4 million babies born every year and roughly 700,000 deaths per year. By 2060, Indonesia’s population could exceed that of America if the population control programs remain ineffective, said National Demographic Family Planning Agency (BKKBN) chairman Sugiri Syarief toThe Jakarta Post.
“We already have the fourth largest population in the world, but in terms of the quality of life for all citizens we are in 108th place out of 188 countries,” Sugiri told The Jakarta Globe. Despite the vast array of indicators reported on the nation’s economic health in support of its bigger population and larger workforce, Indonesia ranked poorly on its quality of infrastructure and public health. Nationwide, tuberculosis and malaria are increasingly threatening the Indonesian households, while infant mortality rates are still among the highest in the world.
According to the Central Statistics Agency (BPS), Indonesia’s annual population growth rate has averaged 1.49%, well passed the government’s predictions. “The population boom will burden the central and regional governments in terms of having to provide more food, health care, education, jobs, transportation, and other services for a far bigger population,” said Sugiri. This reactive pattern follows Malthius’ Iron Law we visited earlier in Learn to Make Yourself Useful. True, increasing population makes for a competitive advantage in economic performance as we’ve seen today, but with the nation still dealing with a host of other problems, combatting corruption and such, what are the odds of Indonesia to stand as an economic powerhouse fifty years from now?
Infested with poverty, Indonesia’s population will reach 475 million to 500 million people by 2060, or double the country’s current population number if there are no family planning efforts to control the population, said Sugiri.
This means that one in every 20 people in the world would be Indonesian.
In retrospect, as our economy is blooming, our cheap, numerous human labor and consumer market is becoming a huge asset for our country. In fact, the Master Plan for the Acceleration and Expansion of Indonesia’s Economic Development (MP3EI) was outlined just last May. President Susilo Bambang Yudhoyono has set ambitious goals for the nation to become one of the world’s top ten largest economies by 2025. These goals include raising an average annual growth to 8-9 per cent between 2015 and 2025, reducing inflation from 6 to 3 per cent by the middle of the next decade, and investing US$468.5 billion over the next fourteen years, including the improvements in infrastructure.
“We can never meet these needs if we cannot control the population,” said University of Indonesia’s Demographic Institute director Sonny Harmadi to the Jakarta Globe. While not many of our nation’s leaders understand his warning, he addressed that many of the nation’s problems emerge out of a fast-growing population due to increasing demand in public services, especially problems with transportation and fuel subsidies.
The government should contribute their efforts to increase awareness of our rapid population expansion and access to family planning services. It’s good to note that BKKBN has announced early this year that they will be working together with the Indonesian military (TNI) for the Acceleration of Development in Underdeveloped Regions, a commitment to revitalize government’s efforts in family planning and contraceptive campaigns since its fallout after President Suharto stepped down from the office.
Without plenty of investment in education and higher training for the youth population, we are inevitably heading toward a double population burden ahead. Last year alone, the Indonesian population older than 60 years old accounted for 21.4 million people, and is expected to reach 73.5 million in 40 years.
With facilities such as new infrastructure and better living conditions, extra people can benefit in the long run. Industry’s public and private sectors can profit in creating more high-paying jobs to continue improving the economy in the long run. Through high-quality education, Indonesia would remain competitive in its economic performance, improve its competency for innovation to bridge new ways for stretching its global productivity and, hopefully, meeting the President’s goals by 2025.
“BKKBN Expects Heavy Burden As Population Continues To Grow“. The Jakarta Globe. February 22, 2011.
“Indonesia May Outnumber US Population“. February 11, 2011. The Jakarta Post.
“Indonesia: The Next Economic Superpower?“. June 20, 2011. EconomyWatch.
Osman, Nurfika. “Boost Family Planning or Face a Population Explosion: Experts“. July 7, 2011. The Jakarta Globe.
El Nasser, Haya & Overberg, Paul. “U.S. Population Growth Slowed, Still Envied“. January 27 2011. USA Today.
Sala-i-Martin, Xavier. “The Global Competitiveness Report 2010-2011: Highlights“. World Economic Forum. 2010.