Workers produce mask in Tangerang, Indonesia on April 7, 2020. (Photo: AFP/VNA)
Jakarta (VNA) – Millions of Indonesians may fallinto poverty and unemployment as the COVID-19 pandemic batters the Indonesianeconomy, according to Indonesia’s Finance Minister Sri Mulyani Indrawati.
Under the “bad” scenario, the Southeast Asian country wouldsee more 1.1 million poor and 2.9 million unemployed people. The worst-casescenario projected 3.78 million people would fall into poverty and 5.2 million wouldlose their jobs.
Statistics Indonesia (BPS) data showed that the country’sunemployment stood at 7.05 million out of the workforce of 133.56 million lastyear. Meanwhile, 24.79 million people lived in poverty – 9.22 percent of thepopulation – a decline of about 880,000 compared to the year before.
In a severe situation, it is possible that Indonesia’sgrowth will fall to a negative level, hereby affecting its social anddevelopment conditions, Sri Mulyani said during a livestreamed briefing after aCabinet meeting on April 14.
The government has projected that Indonesia’s GDP growthwill shrink to a 21-year low of 2.3 percent this year under the baselinescenario, and the economy could even contract 0.4 percent under the worst-casescenario.
The World Bank recently slashed Indonesia’s economic growthprojection from 5.1 percent to 2.1 percent this year as a result of thepandemic. It also projected more than 11 million people could fall into povertyin the East Asia-Pacific region, a stark contrast to its earlier forecast thateconomic growth would be enough to lift 35 million people out of poverty thisyear.
As many as 2.8 million Indonesian people had lost their jobsas of April 13, according to data from the Manpower Ministry and the WorkersSocial Security Agency. More than half were furloughed and placed on paid orunpaid leave.
In addition, about 70 million informal workers were at risk,as they had lost their incomes as a result of social distancing rules.
Indonesia has earmarked 436.1 trillion IDR (26.36 billionUSD) in funding, equivalent to 2.5 percent of the country’s GDP, for stimuluspackages focusing on health care, social protection and economicrecovery programmes./.
