Indonesia's demographic statistics and social diversity | Invest Islands


Indonesia is a vibrant, democratic nation that is continually strengthening its political structures and deepening the enfranchisement of the population.

“Unity in Diversity”

As of 2020, Indonesia has an estimated population of 270 million, of which around 55 percent live on Java. These gargantuan numbers explain why there the country boasts such significant cultural, ethnic, religious and linguistic diversity. From the daily Hindu rituals practiced on the southeastern island of Bali to the prevalence of Sharia law in northwestern Aceh or even the semi-nomadic hunter-gatherer lifestyles of the Mentawai people off the coast of Sumatra.

Indonesia has more than 300 distinct ethnic and linguistic groups. The largest and most dominant in terms of politics is Javanese, but most Indonesians are actually descendants of Austronesian-speaking families while Melanesians populate much of the eastern part of the country. It is also the world’s most populous Muslim-majority country, with a little more than 87 percent identifying as Muslim.

Moreover, before a national framework was laid upon them, the various regions experienced separate political and economic histories, many of which are still evident in the current regional dynamics. Indonesia’s national motto “Bhinekka Tunggal Ika” (Unity in Diversity) refers to the variety in the country’s internal composition, but also indicates that despite all differences in its multicultural society, there is a true sense of unity among the people of Indonesia.



Social Infrastructure


As is common the world over, remote areas of Indonesia have less access to healthcare than urban areas. A 2014 study suggested 40 percent of Indonesians do not have access to proper sanitation facilities. Improving this as well as educating on safe hygiene practices is a vital part of achieving better basic health outcomes.

President Jokowi has sought to improve access to healthcare within Indonesia since his election in 2014. As Governor of Jakarta, he implemented the Jakarta Health Card (KJS) and a nationwide programme was rolled out shortly after he took office. The Indonesia Health Card (Kartu Indonesia Sehat or KIS) offers free health insurance to the poor at an affordable monthly premium.



The Indonesian education system is behind those of other regional states. It is no surprise it trails behind wealthy Singapore, but it is also rated below Vietnam, a country with a per capita GDP two-fifths lower than that of Indonesia. Tellingly, at the end of their school careers, only 25% of Indonesia students meet minimum standards in literacy and numeracy. That is one of the key reasons the Invest Islands Foundation is involved in building schools, improving infrastructure, and providing educational materials to local children.

In an attempt to improve education standards, President Jokowi launched the Indonesia Smart Card (Kartu Indonesia Pintar, or KIP) in November 2014. The card provides school fees and stipends for 12 years of education to 24 million poor students. The programme also provides free tertiary education to disadvantaged students who pass university entrance examinations. His government has also committed to spend 20 percent of the annual budget to improve the education sector. Whether this will overcome the high levels of corruption within the sector and actually make a difference remains to be seen.



Currently, close to two million Indonesians enter the labour force for the first time each year. It is estimated that, for each one percent increase in gross domestic product, an additional 200,000 to 300,000 new jobs are created. Based on this assumption, the economy will need to grow by an average of roughly seven percent to ensure enough jobs exist for new entrants to the labour force. Unemployment has, however, been on a downward trend in recent years.In 2006, more than 10 percent of the population was unemployed, but by 2018 that figure had fallen to 5.5 percent. At Invest Islands, we are committed to ensuring at least 80 percent of our staff are Indonesian.

The changing demographics of Indonesia have the potential to contribute to a variety of social issues. Some of these, such as an ageing population, will not be experienced until after 2050, while other social issues relating to education, employment, the distribution of wealth and urbanisation, will likely manifest sooner. The current administration will need to ensure that it has the correct policy settings to address them.


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