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NEWS UPDATES Asean Affairs        9  June 2011

Report looks at Indonesia's poor health

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For all the talk of poor infrastructure and rampant corruption holding Indonesia back from its full potential, experts said, health is an equally important and largely overlooked area of concern.

In a global competitiveness index report released on Wednesday, the World Economic Forum said health care could become a major pitfall in Indonesia's push for economic development.

"A high infant mortality rate, the burden of communicable diseases and the prevalence of malnutrition highlight the worrisome situation," the WEF's executive summary said. The report ranked Indonesia 99th in health out of 139 countries assessed by the Switzerland-based international organization.

Hasbullah Thabrany, a health expert and professor at University of Indonesia, said a decrease in people's health was looming as the government only spent 1.1 percent of estimated gross domestic product for this year on public health care. That compares to spending 2.8 percent of GDP on subsidies, which stood at Rp 187.62 trillion (US$21.9 billion) in this year's state budget.

The 2011 state budget estimates the nominal value of Indonesia's GDP at Rp 7,019.9 trillion.

"How can they work hard and be productive when they are not fit and healthy?" he said, adding that with the country's current economic condition, ideal health care spending should be at least 4 percent of the GDP.

He also pointed to poor awareness of the need to pay attention to one's health. Indonesians only spend $52 per capita annually on health care, he said, well behind the $300 per capita spending in neighboring Malaysia.

"It's more about ignorance of health problems. The government should also provide a budget to educate the people that taking good care of their health is a big investment for the future," Hasbullah said.

Indonesia came in 44th overall in the WEF report, moving up 10 places since 2005, the best progress among G-20 nations.

However, Sofyan Wanandi, the chairman of the Indonesian Employers Association (Apindo), said he did not see any major improvement in the country's competitiveness during the past decade. Rather, he said the situation was getting worse.

"I am more skeptical about our condition. Natural resource-based industries may feel an improvement, but the manufacturing sector is struggling," he said.

Indonesia came in above Brazil, Russia, India, South Africa, Vietnam and the Philippines but behind Singapore, Malaysia and Thailand.

"I don't quite agree that we are more competitive than India and Vietnam. They are two of our biggest competitors, along with China and Malaysia," Sofyan said.

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