Indonesia Overview: Development news, research, data | World Bank

Through the COVID-19 emergency response financing disbursed in May 2020 and additional financing in June 2021, the World Bank and its partners, including the Asian Infrastructure Investment Bank, KfW, and the government of Australia, are supporting Indonesia’s health sector to tackle the COVID-19 pandemic.  Key achievements through this financing include the rollout of a national free vaccination program for adults, the securing of multiple sources of vaccine supplies since December 2020, and expanding the PCR network from 49 to 964 testing labs between March 2020 and February 2022.

Other achievements include an increase in hospital capacity for isolation and critical care beds (the latter increased from fewer than 4,000 beds in September 2020 to 11,124 beds in September 2021), as well as the government’s continued commitment to cover COVID-related treatment costs for all its citizens. Indonesia now hosts the fifth largest COVID-19 vaccination program in the world, and by March 7th, 2022, had already vaccinated 70 percent of its targeted population with at least one dose, and 53.5 percent of the population being fully vaccinated.

Promoting human capital is an important priority for Indonesia. The National Strategy to Accelerate Stunting Prevention, which was informed by advice from the World Bank and supported by the Investing in Nutrition and Early Years (INEY) Program, has reduced the national stunting rate by 6.4 percentage points in its three years of implementation since 2018. In 2022, the National Strategy has been rolled out to 514 districts in Indonesia. This achievement involved collaboration among a range of ministries and government institutions, development partners, civil society, academia, professional organizations, and the private sector – all working together to bring nutrition services to millions of pregnant women and children under two across the country.

The World Bank supports the government’s Family Hope Program or Program Keluarga Harapan (PKH), which strives to end the cycle of poverty among the poorest. The PKH provides cash benefits to encourage beneficiary families to use maternal and child-related health and nutrition services and to send their children to school. In addition, the program also provides family development sessions and learning materials to beneficiary mothers so that they can gain better understanding of health and nutrition, good parenting practices, child protection, and financial management. The program has assisted families to improve their children’s education and health as shown by several impact evaluations. A recent study shows that the cumulative impacts of PKH can reduce stunting by around 9 percentage points. Another study found that families that graduated from PKH with improved socioeconomic conditions maintained previously incentivized behaviors in education and health amid the COVID-19 pandemic.

On education outcomes, the PKH has helped to solve the last-mile enrollment problem for children aged 7 to 15, and eliminated more than half of nonenrolments. Since 2017, the government has expanded the program significantly in both coverage and benefit levels. In 2020, the program reached 10 million poor and vulnerable families. Most recently, the Bank provided US$98 million for the government’s COVID-19 response to poor households under the Additional Financing for Indonesia’s Social Assistance Reform Program for top-up of cash transfers to existing PKH beneficiaries under a new temporary emergency scheme.

The World Bank is helping to improve education quality in Indonesia’s remote areas. Initiated in late 2016, the KIAT Guru pilot program has empowered communities and tied allowance payment to teachers’ performance. Impact evaluations of the KIAT Guru pilot program, which included the end line and follow-up reports as well as a qualitative study, found that the pilot program had significantly improved learning outcomes and parental engagements compared to non-pilot schools. The World Bank supported the Ministry of Education and Culture in implementing and independently maintaining the pilot in over 400 schools. In 2020, the Ministry issued affirmative regulations on school operating funds for 55,115 schools serving remote and disadvantaged communities and adapted the pilot’s digital diagnostic learning assessment nationwide.

Given the dire impact of climate change, the World Bank supports integrated landscape management to reduce deforestation and improve livelihoods. Through the Program to Accelerate Agrarian Reform and Sustainable Landscape Management Multi-Donor Trust Funds, the World Bank supports Indonesia in providing clarity on land rights and land use in the non-forest areas of Sumatra and Kalimantan. By 2021, the project has registered more than one million land parcels in non-forest areas. Further, through Strengthening of Social Forestry and the Strengthening Rights and Economies of Indigenous and Local Communities projects, 63 indigenous communities partners have received support to gain stronger recognition of tenure rights. Through Dedicated Grant Mechanism for Indigenous Peoples and local communities, an Adat community received recognition within Perhutani area, a jurisdiction under a state-owned forestry company for the first time. Given the critical role mangroves play for carbon storage and coastal resilience, the World Bank supports the Government’s National Mangrove Program by preparing a Mangrove for Coastal Resilience through mangrove rehabilitation, conservation and promotion of coastal communities’ livelihood. The World Bank’s Program aims to contribute to 75,000 hectares of mangroves rehabilitation and 400,000 hectares of mangroves conservation, or almost 80 percent of the government’s 600,000 hectares of mangroves rehabilitation target.

In the oceans sector, the World Bank supports the government of Indonesia in transitioning to a blue economy through the Indonesia Sustainable Oceans Program (ISOP). The World Bank develops knowledge, builds capacity, and finances on-ground investments to support sustainable fisheries, develop coastal livelihoods, build healthy ecosystems, reduce marine pollution, and strengthen policy and institutions. At the national level, the World Bank supported the development of the Presidential Regulation on Indonesia Maritime Policy Action Plan. Enacted in March 2022, the regulation provides guidelines for oceans policies in Indonesia and how these policies will be implemented by ministries/agencies in the marine sector. In East Nusa Tenggara (NTT), the program has improved the effectiveness of Marine Protected Area management. Further, in Raja Ampat, West Papua, and the Sawu Sea, NTT, the World Bank is helping communities protect critical ecosystems that underpin tourism and livelihoods in the islands. 

Finally, to strengthen the country’s efforts to increase the financing for climate actions in Indonesia, the World Bank supports the government’s carbon pricing instruments. Similarly, to support reduction of emissions from deforestation, the World Bank has committed to providing results-based payment related to this agenda in East Kalimantan Province.

Last Updated: Apr 05, 2022

Leave a Comment

Your email address will not be published. Required fields are marked *

%d bloggers like this: