The largest economy in Southeast Asia, Indonesia—a diverse archipelagic nation with more than 300 ethnic groups—has charted impressive economic growth since overcoming the Asian financial crisis in the late 1990s.

Today, Indonesia is the fourth most populous country in the world, the 10th largest economy globally in terms of purchasing power parity, and a member of the G-20. In addition, Indonesia has achieved remarkable results in poverty alleviation, reducing the poverty rate by more than half since 1999, reaching 9.78% in 2020. Prior to the COVID-19 crisis, Indonesia had maintained consistent economic growth and had recently qualified to achieve upper-middle-income status.

Indonesia's economic planning follows a 20-year development plan, spanning from 2005 to 2025. This is divided into 5-year medium-term plans, called RPJMN (National Medium-Term Development Plans), each with different development priorities. The current medium-term development plan—the final phase of the long-term plan—covers the period from 2020 to 2024. It aims to further strengthen Indonesia’s economy by improving human resources and the country’s competitiveness in the global market. Significant challenges remain in achieving Indonesia’s goals. Additionally, the global crisis caused by the COVID-19 pandemic has brought unprecedented complications for Indonesia in reaching its development targets.

Out of a population of approximately 270.2 million people, around 26.42 million Indonesians still live below the poverty line. Without significant expansion of social assistance, between 5.5 and 8 million Indonesians could fall into poverty due to the shocks from COVID-19.

Furthermore, although Indonesia managed to reduce the stunting rate to 27.6% in 2017, much work remains to be done. These efforts are crucial to ensure a strong and productive Indonesian human capital. Currently, according to the World Bank’s Human Capital Index, the next generation of Indonesians is expected to be only 54% as productive as they could be with full health and education.