Jan. 28 (Bloomberg) -- Indonesian President Susilo Bambang Yudhoyono wants families to stop at two children to prevent a burgeoning population overwhelming schools and services. Asih, a cleaner in Tangerang, near Jakarta, is stopping at seven.
“In my family, we always had a lot of children, and as long as we still had something to eat, why do family planning?” said Asih, 35. “Now I have two children in primary school and more that will have to go in the next few years and I have no money to pay school fees. Seven kids are enough.”
Facing slower investment and one of the highest youth unemployment rates in the Asia-Pacific region, the government is concerned the demographic dividend that attracts companies seeking a young, cheap workforce will become an economic time bomb. As Indonesia’s growth slows, the world’s fourth-most-populous nation isn’t generating enough quality jobs to keep up with the population, the International Labour Organization said.
That prospect has brought the revival of a birth-control program begun 46 years ago by former President Suharto, who managed to halve the fertility rate to about 2.6, where it’s been stuck ever since. The government wants to cut the rate to the replacement level of 2.1 within two years to prevent the 250 million population doubling by 2060.
“We have to go back to the policies of the Suharto era, to make strong campaigns and bring the fertility rate down,” said M Sairi Hasbullah, head of Indonesia’s statistics bureau for East Java province. “It’s not going to be easy to provide food, education, health facilities and infrastructure for 500 million people. It’s a big danger for Indonesia.”
The government increased the budget for family planning programs almost fourfold since 2006, to 2.6 trillion rupiah ($214 million) in 2013, funding everything from training rural midwives via text messages, to persuading Muslim clerics to encourage vasectomies. The measures extend efforts dating back to 1968, when Suharto set up the National Family Planning Institute to provide advice and contraceptives.
While Southeast Asia’s largest economy is trying to slow population growth, other countries in the region are trying to increase it. Singapore offers cash handouts and extended maternity leave to encourage its citizens to have more kids, while China has loosened its 34-year-old one-child policy that has saddled the nation with an aging labor force.
“Indonesia is seen by other countries as an opportunity because of its population,” said Aris Ananta, who has published books on Indonesian demographics and is currently a senior research fellow at the Institute of Southeast Asian Studies in Singapore. “It’s an asset. The government is shifting its responsibilities if it’s blaming population growth” for a failure to provide enough infrastructure or jobs, he said.
About 19.6 percent of Indonesian youths between the ages of 15 and 24 were jobless in 2012, compared with about 16 percent in the Philippines, according to the ILO. Unemployment, inflation and the so-called youth bulge, a phenomenon where a large share of the population is comprised of children and young adults, contributed to the Arab Spring protests that ousted leaders in Tunisia, Libya and Egypt in 2011.
Indonesia’s labor force will grow 11.2 percent this decade through 2020, while its population will increase about 11.5 percent, according to Bank of America Corp. The high proportion of young adults -- about 50 percent of Indonesians are aged below 30 -- has attracted companies such as L’Oreal SA, the world’s largest cosmetics maker, which opened its biggest factory globally in West Java in 2012 to supply products to Southeast Asia.
Bayerische Motoren Werke AG, the world’s biggest maker of luxury vehicles, invested 8 million euros ($11 million) in 2011 to expand its capacity in Indonesia, where it assembles models such as the 5-series and 3-series.
“The advantages of operating in Indonesia include its current economic growth and investment potential,” said Jodie O’tania, head of corporate communications at BMW’s Indonesian unit. “Its middle class has grown, and continues to grow, substantially.”
Indonesians are using a bigger percentage of their paychecks on non-food items, government data showed. Average non-food household expenditure was 52.3 percent in September 2012, from 37.1 percent in 1999.
“The demographic dividend is a positive thing for countries, it’s a question of what you do with that population,” Rajat Nag, former managing director-general of the Asian Development Bank, said in an interview on Nov. 22.
Indonesia’s population growth rate remained at 1.49 percent for the decade ending 2010, according to the latest figures published by its statistics office. At that rate, the nation would overtake the U.S. as the world’s third-most-populous country by 2043, based on predictions by the U.S. Census Bureau and Bloomberg calculations. China and India have the biggest populations.
While the rising supply of factory workers appeals to investors, it means the government has to direct more of its resources on education. Public spending on education as a percentage of government expenditure rose to about 17 percent in 2010 from 11.5 percent in 2001, according to the United Nations.
The government, which rolled out a national health insurance program on Jan. 1, is extending free family planning nationwide in 2014 from seven of 33 provinces previously. About half of Indonesian women of reproductive age use contraception and 90 percent of those said they paid for it, according to official data.
Asih, the mother of seven, is among them. After her third child she tried injections -- the most common form of female contraception in the country -- because the pill made her sick. At 15,000 rupiah a shot, she couldn’t afford to keep taking them and in the following years, she had four more children.
“The government’s goal is to try to shift the mix away from short-term methods to longer-term ones,” said Todd Callahan, Indonesian country director of DKT International, one of the largest private providers of contraceptives and family planning services in the developing world. “To change the trends in usage is going to need a few years.”
The government must also overcome cultural and religious barriers. The National Family Planning Coordination Board, which has a campaign with the slogan “Two Children Are Enough,” said in July it’s working with Muhammadiyah, one of Indonesia’s largest Muslim groups, to open centers in high schools and colleges that will discuss family planning and sexual reproductive health.
“In some circles, the thinking remains that if couples follow family planning, they aren’t being grateful to God,” said Emi Nurjasmi, head of the Indonesian Midwives Association, which has more than 250,000 members. She said the midwives try to change people’s attitude as well as administering injections and inserting intrauterine devices.
In a religious school, or madrasah, in Lamongan in East Java province, Ainul Fahri, 17, says sex education was non-existent until a non-government organization for women’s rights persuaded four local schools to introduce the subject.
“Even though this is a madrasah there are cases of early pregnancies,” Fahri said. “People here are completely in the dark about sex education.”
Plans to slow population growth may see most resistance in rural areas where bigger families mean more farmhands and support for parents in their old age.
“There was family planning back in Suharto’s time and some of my neighbors took part, but I thought that having more children is better,” said Ikrar, a father of 11 who grows organic vegetables in Cibuntu village in Sukabumi, one of the two least-developed regencies in West Java.
That view is changing as more Indonesians leave plantations to work in the towns and cities and rising prices sap their ability to raise and school large families. Ikrar’s seventh child, 28-year-old Wahyu, has only one kid. With an income of 15,000 rupiah a day from cutting flowers for shops in Jakarta, he eats mostly rice and dried fish and saves what little he can for his dream of opening a shop selling motorcycle parts.
“With only 15,000 rupiah a day, it’s hardly enough to raise one child,” said Wahyu. “Life is harder now.”
Indonesia’s inflation has remained above 8 percent for the past six months as the government cut fuel subsidies that account for about one-tenth of its expenditure. The central bank predicts economic growth this year will be at the lower end of its target range of 5.8 percent to 6.2 percent.
“There is a saying in Indonesia: ‘Many children, many blessings,’” said DKT’s Callahan. “In Jakarta, it’s ‘many children, many expenses.’”
Heru Purnomo, who works at a courier service in the capital, said he doesn’t plan to have more than two.
“Competition is tight,” said Purnomo, 25. “Now, people have to have a high level of education to get a job. If you have too many children, you get left behind.”
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