Poverty Reduction Amid Slowing Economy Is Considered Strange

JAKARTA The reduction in the poverty rate that has just been announced by the Central Statistics Agency (BPS) has drawn the spotlight from economists.

Paramadina University economist, Wijayanto Samirin finds this number strange. The reason is, various economic indicators actually show weakening, one of which is the increasing unemployment rate.

"The reduction in the poverty rate occurs when people's purchasing power decreases, the unemployment rate increases, VAT acceptance weakens, and economic growth slows down; this is very strange," Wijayanto told VOI, Friday, July 25.

According to Wijayanto, the only explanation that makes sense for the reduction in poverty amid the economic downturn is the increasing role of social assistance (bansos) and the economic stimulus that has been disbursed by the government since the beginning of the year.

"The most likely answer is the increasing role of social assistance and economic incentives in January 2025 of IDR 33 trillion," he said.

However, he believes that this improvement is temporary and does not reflect structural improvements in the national economy.

"This improvement is artificial and unsustainable. When the stimulus is stopped or reduced, the risk of a spike in poverty can occur again," said Wijayanto.

He also encouraged the government not only to rely on social assistance as a short-term solution, but to start reorganizing more inclusive and productive economic growth strategies.

BPS noted that the number of poor people in Indonesia decreased in March 2025. The total number of poor people was recorded at 23.85 million people, down 210,000 people compared to September 2024 which amounted to 24.06 million people.

"The number of poor people in Indonesia is 23.85 million people, down 0.2 million people compared to the conditions in September 2024. In terms of percentage, the poor reach 8.47 percent of the total population, down 0.10 percentage points," said BPS Deputy for Social Statistics, Ateng Hartono, in a press conference, Friday.

This decline has strengthened the positive trend in the last five years, although fluctuations have occurred amid the dynamics of the national and global economy.