ON Saturday afternoon 2nd June 2007, an undergraduate student name Dinda asked to me by send a short message: Pak Aan, what exactly the relation between poverty and investment? How is the mechanism?
Actually it is not an easy question. I have to look what the theory said. I remember any book that discuss about it. On my mind, that’s “Economic Development” by Michael P. Todaro on chapter 2-5. I thing I am gonna right. I reply by sms that the mechanism is concluded by “investment-employment-income-growth”. Investment is conducive to make employment open to poor people. The poor get some money so they can save dollars to achieve growth for their economy. A few minutes later the student replied, “Ok thank You”.
Ladies and gentleman, to enhance the discussion above, another condition that must be fulfilled to make ‘investment for poverty’ is break the relation between poverty and ignorance.
Poverty in Indonesia
IT is quiet understand that population of Indonesia’s Poverty: 39.05 million people. The proportion is 17.75 % of total population (data March 2006). About 19.2 million families received Cash Transfer program. Unemployment is about 10.24% of 103 million labor force. The quantity pf slum area is 56,000 hectare in 110 city (urban poor). The number of rural poverty is 42,000 village (‘desa’) is catagorized as rural poor area -from totally 66,000 village. The data copyed from TKPK Coordinating Ministry of Peoples Welfare.
It is very urgent and important to break the relation between poverty, ignorance (no high education) and unhealthyness. Besides, there’s a vast gap between rich and poor exist today, tomorrow, even past. Look at history –return to the very recent period of human history when its divide emerged. The past two centuries since around 1899 constitute a unique era in economic history, a period that Simon Kusnetz (see Jeffrey Sachs “The End of Poverty”, page 27) termed by the period of modern economic growth. Before then, indeed for thousand of years, there had been virtually no sustained economic growth in the world and only gradual increases in the human population. According to Sachs, the world population had risen gradually from around 230 million people at the start of the first millenium in AD 1, to perhaps 270 million by AD 1000, and 900 million people by AD 1800. Real living standards were even slower to change. According to Madison, there was no discernible rise in living standards on global scale during the 1st millenium, and perhaps a 50 percent increase in per capita income in the eight-hundred-year period from AD 1000 to AD 1800. Indonesia population growth is 1,26 percent and predicted on 2050 become number seventh big population in the world (after China, India, US, European Community, Pakistan, and Nigeria).
In addition, the poor people are disproportionately women –some researches have shown that the poverty of women affects children health and development more than poverty of men. They who called ‘poor women’ all is suffer more than men because in most societies women are also subject to socially imposed values that constrain them from improving their economic conditions or enjoying equal access to public services.
Several macro economic studies confirm that better educated women contributed to the welfare of the next generation by reducing infant and child mortality, lowering fertility, and improving the nutritional status of children. At the macro economic level, any study shows that a 1 percentage point increase in the share of women in seccondary school education is associated with a 0.3 percentage point increase in per capita income (Dollar and Gatti 1999 in Michael bamberger et.al page 341, inherently with “Gender and Poverty” 2004, ILO for Indonesia:Working Out of Poverty).
Access to get work is the surest way out of poverty. It is precisely understood that employment creation is the key success for poverty alleviation. It holds solid, progressive and long lasting attempt to reduction of poverty. By a get job, then wealth is created, distributed, and accumulated. It is through work so peopele can find a dignified way out of poverty.
In Indonesia it is widely acknoledged that the vast majority of women and men derive their livelihood and incomes from Micro, Small, and Medium Enterprises. In Indonesia, agriculture sector dominates the national employment scene with 41 million workers, of whom 80 percent are attached to the informal economy. Furthermore, poverty is very much a rural pehenomena, as about 75 percent of the total poor household reside in the rural areas and depend on agricultural for their main livelihood.
In Indonesia about 60 percent of working poor youth earn their living in the informal economy.
The rural poor are often confronted with disadvantages stemming from remoteness, lack of education and healthcare, insecure and unproductive jobs, high fertility and discrimation for women or etnic minorities.
Thus, povertyreduction policies and programmes must give strategic focus on rural development and must create more opportunites for women and men to find work in the rural areas. Such policies not only promote economic grow but also help alleviate urban poverty through reducing out migration from rual areas to densely populated urban centers.
The government of Indonesia (GoI) has declared Triple-track strategy for 2004-2009. That’s growth, employment, and poor. Growth means pro-growth, to achieve sustainable higher economic growth through a combination of strong exports and increased investments –both domestic and foreign. From 5.5% in 2005 become 7.6% in 2009 economic growth.
Pro employment: to stimulate the performance of the real sectors to create employment. From 9.5% in 2003 become 5.1% open unemployment rate. Pro-poor means anti poverty, to promote the development of the rural economy and agriculture to alleviate poverty. From 16.6% in 2004 become 8.2% poverty incidence.
Finally
ACTUALLY there’s a growing awareness of the need to address the problem of youth employment in Indonesia –both to provide decent work opportunites for young people and to allow Indonesia to get the full benefit in its economic and social development of their contribution.
The time to combat poverty has arrived, sure that hard work lies a head. We have to commit to ending poverty. The first step is commitment to the task: focus to halving poverty by 2015 and struggle to ending poverty by 2025. Better that we did not wait for the rich and powerfull to come to rescue. We have to asserted our call to justice and made our stand in the face of official arrogance and neglect. The poor cannot wait for the rich to issue the call to justice.
OK guys, let the future say of our generation that we sent any mighty currents of hope, and that we worked together to heal the world.
Actually it is not an easy question. I have to look what the theory said. I remember any book that discuss about it. On my mind, that’s “Economic Development” by Michael P. Todaro on chapter 2-5. I thing I am gonna right. I reply by sms that the mechanism is concluded by “investment-employment-income-growth”. Investment is conducive to make employment open to poor people. The poor get some money so they can save dollars to achieve growth for their economy. A few minutes later the student replied, “Ok thank You”.
Ladies and gentleman, to enhance the discussion above, another condition that must be fulfilled to make ‘investment for poverty’ is break the relation between poverty and ignorance.
Poverty in Indonesia
IT is quiet understand that population of Indonesia’s Poverty: 39.05 million people. The proportion is 17.75 % of total population (data March 2006). About 19.2 million families received Cash Transfer program. Unemployment is about 10.24% of 103 million labor force. The quantity pf slum area is 56,000 hectare in 110 city (urban poor). The number of rural poverty is 42,000 village (‘desa’) is catagorized as rural poor area -from totally 66,000 village. The data copyed from TKPK Coordinating Ministry of Peoples Welfare.
It is very urgent and important to break the relation between poverty, ignorance (no high education) and unhealthyness. Besides, there’s a vast gap between rich and poor exist today, tomorrow, even past. Look at history –return to the very recent period of human history when its divide emerged. The past two centuries since around 1899 constitute a unique era in economic history, a period that Simon Kusnetz (see Jeffrey Sachs “The End of Poverty”, page 27) termed by the period of modern economic growth. Before then, indeed for thousand of years, there had been virtually no sustained economic growth in the world and only gradual increases in the human population. According to Sachs, the world population had risen gradually from around 230 million people at the start of the first millenium in AD 1, to perhaps 270 million by AD 1000, and 900 million people by AD 1800. Real living standards were even slower to change. According to Madison, there was no discernible rise in living standards on global scale during the 1st millenium, and perhaps a 50 percent increase in per capita income in the eight-hundred-year period from AD 1000 to AD 1800. Indonesia population growth is 1,26 percent and predicted on 2050 become number seventh big population in the world (after China, India, US, European Community, Pakistan, and Nigeria).
In addition, the poor people are disproportionately women –some researches have shown that the poverty of women affects children health and development more than poverty of men. They who called ‘poor women’ all is suffer more than men because in most societies women are also subject to socially imposed values that constrain them from improving their economic conditions or enjoying equal access to public services.
Several macro economic studies confirm that better educated women contributed to the welfare of the next generation by reducing infant and child mortality, lowering fertility, and improving the nutritional status of children. At the macro economic level, any study shows that a 1 percentage point increase in the share of women in seccondary school education is associated with a 0.3 percentage point increase in per capita income (Dollar and Gatti 1999 in Michael bamberger et.al page 341, inherently with “Gender and Poverty” 2004, ILO for Indonesia:Working Out of Poverty).
Access to get work is the surest way out of poverty. It is precisely understood that employment creation is the key success for poverty alleviation. It holds solid, progressive and long lasting attempt to reduction of poverty. By a get job, then wealth is created, distributed, and accumulated. It is through work so peopele can find a dignified way out of poverty.
In Indonesia it is widely acknoledged that the vast majority of women and men derive their livelihood and incomes from Micro, Small, and Medium Enterprises. In Indonesia, agriculture sector dominates the national employment scene with 41 million workers, of whom 80 percent are attached to the informal economy. Furthermore, poverty is very much a rural pehenomena, as about 75 percent of the total poor household reside in the rural areas and depend on agricultural for their main livelihood.
In Indonesia about 60 percent of working poor youth earn their living in the informal economy.
The rural poor are often confronted with disadvantages stemming from remoteness, lack of education and healthcare, insecure and unproductive jobs, high fertility and discrimation for women or etnic minorities.
Thus, povertyreduction policies and programmes must give strategic focus on rural development and must create more opportunites for women and men to find work in the rural areas. Such policies not only promote economic grow but also help alleviate urban poverty through reducing out migration from rual areas to densely populated urban centers.
The government of Indonesia (GoI) has declared Triple-track strategy for 2004-2009. That’s growth, employment, and poor. Growth means pro-growth, to achieve sustainable higher economic growth through a combination of strong exports and increased investments –both domestic and foreign. From 5.5% in 2005 become 7.6% in 2009 economic growth.
Pro employment: to stimulate the performance of the real sectors to create employment. From 9.5% in 2003 become 5.1% open unemployment rate. Pro-poor means anti poverty, to promote the development of the rural economy and agriculture to alleviate poverty. From 16.6% in 2004 become 8.2% poverty incidence.
Finally
ACTUALLY there’s a growing awareness of the need to address the problem of youth employment in Indonesia –both to provide decent work opportunites for young people and to allow Indonesia to get the full benefit in its economic and social development of their contribution.
The time to combat poverty has arrived, sure that hard work lies a head. We have to commit to ending poverty. The first step is commitment to the task: focus to halving poverty by 2015 and struggle to ending poverty by 2025. Better that we did not wait for the rich and powerfull to come to rescue. We have to asserted our call to justice and made our stand in the face of official arrogance and neglect. The poor cannot wait for the rich to issue the call to justice.
OK guys, let the future say of our generation that we sent any mighty currents of hope, and that we worked together to heal the world.
youknee idontknow
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