Indonesia currently has 65 million people between the ages of 10 to 24 — the largest generation that the country has ever seen. (Antara Photo/Nova Wahyudi)

Commentary: Harnessing Indonesia’s Demographic Dividend


MAY 25, 2015

Today Indonesia’s population is composed of more working-age people than ever before, both in absolute numbers (157 million potential workers) and as a proportion of the total population: accounting for more than half of all Indonesians. With these trends, there is huge potential for social and economic gain.

But Indonesia stands on the threshold. It  needs to accelerate efforts to reap a demographic dividend to expand economic growth and development. While the world’s fourth-most populous country is making steady progress, it should further invest in young people to take advantage of its demographic window of opportunity.

In order for Indonesia to capitalize on its demographic dividend, investments must be made in empowering, educating and employing young people.

Indonesia currently has 65 million people between the ages of 10 to 24 — the largest generation that the country has ever seen. The nation’s youthful demographic structure means that more than two million people will join the working-age population each year over the next decade. If these youth have access to quality education, health services and job opportunities, this trillion-dollar economy — which Indonesia is set to enter — will grow much larger.

Some countries in the region, such as Singapore, South Korea and Thailand, have already tapped into their demographic dividend and have done well. They invested in quality education and the health of their young people and workers, and ensured inclusive economic growth.

A critical foundation for the demographic dividend is ensuring that people have the rights and freedoms to define their lives, pursue education and employment, and accrue savings. These rights and freedoms include reproductive rights, freedom from early or forced marriage, and the right to choose the number and the spacing of their children. Families should be able to balance work and family life, and ensure the well-being of their children.

By promoting gender equality, girls stay in school, the labor force expands, and young people carry forward values of mutual trust and respect to the next generation. Providing access to health services, including reproductive health information and services, is critical.

Today women in Indonesia are having fewer babies than ever before, 2.4 births on average. Given the evident desire for smaller families, the nation should ensure that every woman who wants to plan her family has access to information, counseling and services.

By strengthening and increasing funding to the National Family Planning Coordinating Board (BKKBN), Indonesia can provide women, men and young people throughout the nation with access to high-quality family planning choices. This is a human right and it is also an important part of reaping the demographic dividend.

In additional to sexual and reproductive health, the nation is facing changing patterns of health and disease, including the “double burden” of emerging non-communicable diseases and road accidents, while many of Indonesia’s poor continue to suffer from under-nutrition, diarrhea and infectious diseases.

Comprehensive efforts are needed to strengthen the health system, and promote healthy lifestyles and a prosperous future.

Another critical investment is education and training. A demographic dividend depends on people, generating and capitalizing on new opportunities and new information-based economies. National policies that ensure lifelong access to education — universal and of high quality — are essential to give workers the skills and expertise to work productively in the 21st-century economy.

But a demographic dividend can only be realized if healthy, educated young people can find decent jobs and are gainfully employed. Promoting high rates of employment that match evolving skills and resources, through public and private partnerships, can spur the growth of high-skilled training, entrepreneurship and industry.

Indonesia has the right analytics and political commitment to reap a valuable demographic dividend. And UNFPA, the United Nations Population Fund, stands ready to support the nation in capitalizing on this exciting opportunity.

By rapidly empowering, educating and employing young and working-age people throughout the country, Indonesia will reap an economic and social dividend that will benefit current and future generations.

Babatunde Osotimehin is the executive director of UNFPA, the United Nations Population Fund, and chair of the World Economic Forum’s Global Agenda Council on the Demographic Dividend.