Populous Indonesia’s economic growth threatened by COVID-19

The world’s fourth most populous nation, Indonesia is struggling to keep fast-spreading COVID-19 from undermining its economic growth prospects.

Last September, Sean was driving in the Indonesian capital. Alone in the car and feeling safe, he let the anti-COVID mask dangle from his ear. Police took notice.

Sean was pulled over, his license taken, and he was told to join a long queue of others lining up to pay a fine for not wearing a mask. He baulked at going.

“I’d seen someone’s social media that the area where the fine had to be paid was really crowded with no social distancing,” he said.

As it turns out, those early measures to curb the spread of the disease have largely misfired.

Now, nearly a year later, Indonesia has one of the world’s highest COVID-19 infection rates, oxygen is in short supply and hospitals are full. So are cemeteries.

Very few in the world’s 4th most populous nation have been vaccinated against COVID-19.

With its huge population — the world’s fourth largest — thousands of islands, modest economy and weak healthcare, Indonesia was always going to have a harder time of it than most to cope with the pandemic.

But for its many critics, the government has made the task a lot harder.

At the start of the pandemic, some senior Indonesian officials casually dismissed the threat of the new flu in a warm tropical country. The health minister suggested prayer and plenty of natural sunlight would keep it at bay. He eventually lost his job, but the government’s foot-dragging over COVID-19 continued, nervous of further damage to the economy.

By this month, every province in the nation had infection rates higher than the level at which the World Health Organisation considers the disease out of control.

In early July, the government announced a tough, two-week lockdown of the heavily populated islands of Java and Bali. But that still only covers just over half of the country’s population. The pandemic had already shoved the economy into recession last year.

The tremendous spike now in infections is blamed in large part on the Eid al-Fitr holidays, when millions of Indonesians ignored a loosely policed ban on returning to their villages. The highly infectious Delta variant seems to be the main culprit.

By this month, barely 5% of Indonesia’s 270 million people have been vaccinated against COVID-19, although the government has been speeding up the process. Daily infection rates have been reaching new records throughout July.

Many villagers in Indonesia remain suspicious of vaccines.

In a village where I spend time in West Java, the country’s most populous province, a number of people are afraid of catching COVID-19. But they are also afraid of the vaccine.

In the early stages of the disease’s spread, the wife of a senior regional official arrived at the village unannounced to offer the vaccine. Villagers disappeared into the woods or locked their doors until she and her entourage left.

That suspicion remains. One villager, Azizah, who is the mother of two small boys, said she wants to be vaccinated but is too frightened. And even if she did, she would have to stand in a crowded queue outside the local health clinic. She had heard that one person had died after getting a jab and another had lost the use of his arm.

“I shouldn’t get one because I have a stomach ulcer,” said another villager, Ijah. How did she know? She heard from a work colleague who had heard it from someone else.

The latest lockdown is set to end on July 20. But the government has already added more parts of the country with infection rates still climbing. By the end of last week, the daily infection rate was six times higher than a month earlier.

COVID-19 infections threaten economic growth.

In its first recession since the Asian financial crisis just over 20 years ago, the latest burst of COVID-19 infections threatens what had been an expected recovery in Indonesia’s economy later this year.

Already, one measure of its growing economic status — its per capita income — has been cut. That, in turn, threatens the attempts by Indonesian President Joko Widodo to pull his country out of the so-called middle-income trap, where an economy rises but then just gets stuck.

In Indonesia’s case, that is an especially frightening prospect.

About 65 million of its population is under 25, and they are flooding an already limited job market. The state education level is seen as inadequate to raise Indonesia’s economic competitiveness to match some of its equally ambitious neighbours in Asia,.

In other words, Indonesia risks being left behind the rest of the pack and becoming a vast source of cheap, poorly educated labour.

Three questions to consider:

1. Why was Indonesia almost bound to have difficulty controlling the spread of COVID-19?
2. At what level does the World Health Organization consider COVID-19 to be out of control in a country?
3. To what extent has COVID-19 affected economic growth in your country?