National and International Poverty Line

JOINT STATEMENT

BPS-STATISTICS INDONESIA

WORLD BANK

National and International Poverty Line

Jakarta (10/9) -- BPS’s August 5 release reported a national poverty rate of 8.07% in March 2026. On the other hand, the World Bank estimates that 64.1% of Indonesians live below its Upper-Middle-Income Country (UMIC) poverty line of US$8.30 PPP per person per day, roughly Rp51,087 per day. An explanation of the BPS and World Bank’s poverty figures is detailed below.

Why do the BPS and World Bank poverty rates differ?

Both BPS and the World Bank use Indonesia's National Socioeconomic Survey (SUSENAS) as their data source, but they measure poverty differently because these measures serve different purposes.

BPS measures poverty based on the cost of living in Indonesia. It calculates the minimum amount a person needs to spend on food and basic essentials — like housing, clothing, and transport — across 75 urban and rural areas in every province, and updates these figures twice a year to keep up with changing prices. In March 2026, that threshold stood at IDR 669,235 per person per month, or about US$3.60 per day. The national poverty line is designed to provide a more accurate picture of poverty by reflecting Indonesians' living standards and conditions.

The World Bank uses an international poverty line to compare living standards across countries. This requires a common standard, rather than poverty lines based on each country’s own prices and consumption patterns. The World Bank uses three international poverty benchmarks aligned with three country income groups: US$3.00 per day (equivalent to Rp18,465 per day) for low-income countries, US$4.20 (Rp25,851 per day) for lower-middle-income countries, and US$8.30 (Rp51,087 per day) for upper-middle-income countries. These benchmarks are anchored in the typical poverty lines of countries within each income group and adjusted so that the same amount of money buys a comparable basket of goods across countries. World Bank poverty estimates account for three types of price dynamics: changes over time using the CPI, differences across districts (kabupaten/kota), and differences in prices between countries using PPP-based adjustments.

Which poverty rate should guide Indonesia’s policymaking and track progress?

National and international poverty definitions are intentionally different because they serve distinct purposes, and both are appropriate for their intended uses. National poverty lines are established by governments and are specific to each country and its context. They are used to inform national policy and to monitor progress in reducing poverty.

For tracking Indonesia's own progress and shaping national economic and development policy, the BPS measure is what matters most. By that yardstick, poverty fell from 8.47% in March 2025 to 8.07% in March 2026.

For a global snapshot, the World Bank's 2025 estimates place 3.7% of Indonesians in extreme poverty, 15.5% below the lower-middle-income line, and 64.1% below the upper-middle-income line.

What explains the large gap?

The large difference is mainly about the poverty line, not worsening living conditions. When Indonesia became an upper-middle-income country in 2023, the World Bank raised the poverty benchmark it uses, from US$4.20 to US$8.30 per person per day. Raising the bar naturally puts more people below it; it does not mean they have become poorer.

The US$8.30 line also reflects living standards in a broad group of upper-middle-income countries, including countries with incomes per person up to almost three times Indonesia’s. It therefore sets a standard higher than the prevailing living standards in Indonesia.

The two measures also treat prices differently over time. BPS adjusts its poverty line as consumption patterns and living standards evolve, while the World Bank applies a fixed international standard and adjusts it for inflation. As a result, the two measures can show different trends in poverty reduction.

What the poverty rates really tell us?

The BPS and World Bank poverty estimates use the same underlying data, but answer different questions. BPS measures poverty in the Indonesian context, making it useful for domestic policy and tracking progress. The World Bank uses international poverty lines to compare living standards across countries.

Neither measure is more “correct”; they serve different purposes and provide complementary perspectives on eradicating poverty in Indonesia.

Media Contact

Favten Ari Pujiastuti

Head of the Bureau of General Affairs and Public Relations

BPS - Statistics Indonesia

[email protected]

Lestari Boediono

Senior External Affairs Officer

World Bank Group Indonesia and Timor Leste

[email protected]