Poverty in Indonesia

The government expected the poverty rate to reach 10.60% (28 million) by the end of the year as the pandemic continued to take its toll on the poor across Indonesia.

[5] In 2024, Indonesia's Finance Minister, Sri Mulyani Indrawati, reported a significant decline in the national poverty rate.

Additionally, income inequality, measured by the Gini ratio, improved from 0.388 in 2023 to 0.379 in 2024, reflecting progress in the country's efforts to reduce economic disparities.

[7] The Indonesian government began to address the issue of poverty in 1994 due to the migration of rural residents into urban areas hoping for better opportunities in the 1970s and 1980s.

[8] This existing social inequality then made Muslim economists design a more modern way of collecting alms run by private organizations in accordance with Islamic values.

The existence of the FBOs play an important role in providing welfare services, but do not always have a good impact on certain community groups.

[8] In addition, the existence of anti-Christian tensions in Indonesia also makes it increasingly difficult to establish cooperation between interfaith FBOs in alleviating poverty.