Jakarta – The World Bank updated its global poverty and inequality standards in June 2025. This update uses the 2021 Purchasing Power Parities (PPP), replacing the 2017 PPP that was previously used.
In the June 2025 edition of the Update to the Poverty and Inequality Platform (PIP) document, the World Bank stated that the use of the 2021 PPP resulted in a revision to the global poverty line.
Mentioned in the document, the World Bank revised three poverty lines, namely for global poverty or what is usually a measure of extreme poverty levels from USD2.15 in 2017 PPP to USD3.00 in 2021 PPP.
Then for the poverty line of lower middle-income countries, it was revised to USD4.20 from the previous USD3.65. Then for the poverty line of upper middle-income countries, including Indonesia, it became USD8.30 from the previous USD6.85.
So that from these changes, the World Bank noted, the number of poor people in various countries and regions has increased. For example, in the East Asia and Pacific region, based on the PPP calculation, extreme poverty will be 54 million people as of June 2025, compared to the September 2024 data of 20.3 million people with the 2017 PPP calculation standard of USD2.15.
Then for the poverty line of lower middle-income countries of USD4.20 based on PPP 202, the number of poor people in the East Asia and Pacific Region was 143.0 million as of June 2025, compared to 115.2 million in September 2024.
Furthermore, if the poverty line for upper-middle-income countries is calculated using the PPP 2021 standard of USD8.30, the number of poor people in the East Asia and Pacific Region will be 679.2 million in June 2025, compared to 584.2 million in September 2024.
Impact to Indonesia: Poverty Spike Due to New Standards
As for Indonesia, which has been categorized as an upper middle-income country since 2023 by the World Bank, with the change in calculation to use PPP 202, the number of poor Indonesians has increased.
Based on data from the World Bank’s Poverty and Inequality Platform, if using the 2021 PPP calculation with the standard poverty line of an upper middle-income country of USD8.30, the percentage of poor people in Indonesia will increase to 68.25 percent of the total population of 285.1 million based on the 2024 National Socio-Economic Survey (Susenas) of the Central Statistics Agency (BPS).
Previously, in the April 2025 edition of the Poverty & Equity Brief report, the World Bank noted that the percentage of poor people in Indonesia reached 60.3 percent of the total population in 2024.
Thus, the poverty rate would be around 194.6 million people, or an increase compared to the previous use of the upper middle-income country poverty line of USD6.85 referring to the 2017 PPP, where Indonesia’s poverty rate was 60.3 percent of the total population in 2024 or around 171.8 million people in 2024.
Difference between World Bank and BPS Data
Meanwhile, BPS previously revealed that Indonesia’s poverty rate as of September 2024 was 8.57 percent or around 24.06 million people. BPS said that the difference in poverty rates did look quite large, but the difference arose due to differences in the calculation of the poverty line standards used and for different purposes.
Although Indonesia is currently classified as an upper-middle income country (UMIC) with a Gross National Income (GNI) per capita of USD4,870 in 2023, it should be noted that Indonesia has just moved up to the UMIC category and is only slightly above the lower limit of the UMIC category, whose value range is quite wide, namely between USD4,516- USD14,005.
“Thus, if the World Bank’s global poverty standard is applied, it will result in a fairly high number of poor people,” explained BPS.
BPS measures poverty in Indonesia using the Cost of Basic Needs (CBN) approach. The minimum amount of rupiah needed to fulfill these basic needs is expressed in the Poverty Line.
“The poverty line is calculated based on minimum expenditure to fulfill basic food and non-food needs,” said BPS.
BPS explained that the poverty line is calculated based on the results of the Susenas data collection, which captures or collects data on community expenditure and consumption patterns. Susenas is conducted twice a year.
In 2024, Susenas was conducted in March with a coverage of 345,000 households throughout Indonesia, and in September with a coverage of 76,310 households. Measurements are made at the household level, not the individual, because spending and consumption in real life generally occur collectively.
“Therefore, the poverty line calculated by BPS can reflect the real needs of the Indonesian people. The calculation and release of the BPS poverty line is done in detail by region, both provincial and district/city, by distinguishing between urban and rural areas,” said BPS.
National and Provincial Poverty Lines
In September 2024, the national poverty line per capita was recorded at IDR 595,242 per month. However, it should be noted that consumption occurs in the context of a household, not per person. The average poor household consists of 4.71 household members, so the poverty line for one household on a national average is IDR 2,803,590 per month.
The poverty line is different for each province, because the poverty line and the average number of poor household members for each province are different. For example, the household poverty line in DKI Jakarta is Rp4,238,886, in East Nusa Tenggara (NTT) it is Rp3,102,215, and in Lampung it is Rp2,821,375. This difference reflects differences in price levels, living standards, and consumption patterns in each region. (*)
Editor: Yulian Saputra
New World Bank Calculations, Indonesia’s Poor Jump to 194.6 Million People
Jakarta – The World Bank updated its global poverty and inequality standards in June 2025. This update uses the 2021 Purchasing Power Parities (PPP), replacing the 2017 PPP that was previously used.
In the June 2025 edition of the Update to the Poverty and Inequality Platform (PIP) document, the World Bank stated that the use of the 2021 PPP resulted in a revision to the global poverty line.
Mentioned in the document, the World Bank revised three poverty lines, namely for global poverty or what is usually a measure of extreme poverty levels from USD2.15 in 2017 PPP to USD3.00 in 2021 PPP.
Then for the poverty line of lower middle-income countries, it was revised to USD4.20 from the previous USD3.65. Then for the poverty line of upper middle-income countries, including Indonesia, it became USD8.30 from the previous USD6.85.
So that from these changes, the World Bank noted, the number of poor people in various countries and regions has increased. For example, in the East Asia and Pacific region, based on the PPP calculation, extreme poverty will be 54 million people as of June 2025, compared to the September 2024 data of 20.3 million people with the 2017 PPP calculation standard of USD2.15.
Then for the poverty line of lower middle-income countries of USD4.20 based on PPP 202, the number of poor people in the East Asia and Pacific Region was 143.0 million as of June 2025, compared to 115.2 million in September 2024.
Furthermore, if the poverty line for upper-middle-income countries is calculated using the PPP 2021 standard of USD8.30, the number of poor people in the East Asia and Pacific Region will be 679.2 million in June 2025, compared to 584.2 million in September 2024.
Impact to Indonesia: Poverty Spike Due to New Standards
As for Indonesia, which has been categorized as an upper middle-income country since 2023 by the World Bank, with the change in calculation to use PPP 202, the number of poor Indonesians has increased.
Based on data from the World Bank’s Poverty and Inequality Platform, if using the 2021 PPP calculation with the standard poverty line of an upper middle-income country of USD8.30, the percentage of poor people in Indonesia will increase to 68.25 percent of the total population of 285.1 million based on the 2024 National Socio-Economic Survey (Susenas) of the Central Statistics Agency (BPS).
Previously, in the April 2025 edition of the Poverty & Equity Brief report, the World Bank noted that the percentage of poor people in Indonesia reached 60.3 percent of the total population in 2024.
Thus, the poverty rate would be around 194.6 million people, or an increase compared to the previous use of the upper middle-income country poverty line of USD6.85 referring to the 2017 PPP, where Indonesia’s poverty rate was 60.3 percent of the total population in 2024 or around 171.8 million people in 2024.
Difference between World Bank and BPS Data
Meanwhile, BPS previously revealed that Indonesia’s poverty rate as of September 2024 was 8.57 percent or around 24.06 million people. BPS said that the difference in poverty rates did look quite large, but the difference arose due to differences in the calculation of the poverty line standards used and for different purposes.
Although Indonesia is currently classified as an upper-middle income country (UMIC) with a Gross National Income (GNI) per capita of USD4,870 in 2023, it should be noted that Indonesia has just moved up to the UMIC category and is only slightly above the lower limit of the UMIC category, whose value range is quite wide, namely between USD4,516- USD14,005.
“Thus, if the World Bank’s global poverty standard is applied, it will result in a fairly high number of poor people,” explained BPS.
BPS measures poverty in Indonesia using the Cost of Basic Needs (CBN) approach. The minimum amount of rupiah needed to fulfill these basic needs is expressed in the Poverty Line.
“The poverty line is calculated based on minimum expenditure to fulfill basic food and non-food needs,” said BPS.
BPS explained that the poverty line is calculated based on the results of the Susenas data collection, which captures or collects data on community expenditure and consumption patterns. Susenas is conducted twice a year.
In 2024, Susenas was conducted in March with a coverage of 345,000 households throughout Indonesia, and in September with a coverage of 76,310 households. Measurements are made at the household level, not the individual, because spending and consumption in real life generally occur collectively.
“Therefore, the poverty line calculated by BPS can reflect the real needs of the Indonesian people. The calculation and release of the BPS poverty line is done in detail by region, both provincial and district/city, by distinguishing between urban and rural areas,” said BPS.
National and Provincial Poverty Lines
In September 2024, the national poverty line per capita was recorded at IDR 595,242 per month. However, it should be noted that consumption occurs in the context of a household, not per person. The average poor household consists of 4.71 household members, so the poverty line for one household on a national average is IDR 2,803,590 per month.
The poverty line is different for each province, because the poverty line and the average number of poor household members for each province are different. For example, the household poverty line in DKI Jakarta is Rp4,238,886, in East Nusa Tenggara (NTT) it is Rp3,102,215, and in Lampung it is Rp2,821,375. This difference reflects differences in price levels, living standards, and consumption patterns in each region. (*)
Editor: Yulian Saputra
