Indonesia

Active Grants: 13

GDP (current US$): 1.02 trillion (2017)

Population: 263.99 million (2017)

Major Partners

World Bank 

INFORM Risk Rating: 4.4

Risk data from INFORM, a global open-source risk assessment for humanitarian crises and disasters, uses a scale from 0-10, with 10 as the highest level of risk.

Primary Hazards

Context

Natural Hazard Risk

Indonesia is in one of the world’s most natural disaster-prone areas and is at risk to multiple hazards, including flooding, earthquakes, landslides, tsunami, volcano, and cyclone. Over the last 30 years, there have been an average of 289 significant natural disasters per year and an average annual death toll of approximately 8,000. 

The Government of Indonesia spends $300 to $500 million annually on post-disaster reconstruction. Costs during major disaster years reach 0.3 percent of national GDP and as high as 45 percent of GDP at the provincial level. Following the 2004 Indian Ocean Tsunami, the government allocated more than $7 billion for reconstruction in Aceh and Nias and approximately $2 billion following the 2010 Mount Merapi volcanic eruption. In 2018, Mount Sinabung which lies in the northern part of Sumatra island had a major eruption. There were no fatalities or serious injuries resulting from the eruption but volcanic ash and small rocks fell in at least five districts and destroyed agricultural crops within the affected zones. In 2016, a 6.4 magnitude earthquake struck off Pidie Jaya district in Sumatra Island, killing at least 90 people and damaging more than 200 houses. That same year, floods and flash floods occurred in the provinces of South, West and Central Kalimantan, Bengkulu, and Gorontalo, flooding 3,550 houses for several days.  

Climate change is recognized as a key threat to Indonesia’s development, especially for lower-income groups. Rising sea levels and changing weather patterns may lead to increased uncertainty in water availability, food production, and disruptions to transport, commerce, and urban development.  

Government Priorities

The 2004 tsunami was a major turning point for the Government of Indonesia in addressing disaster risk management (DRM). Following the event, the country enacted a law on disaster management in 2007, and the National Disaster Management Agency (BNBP) was established in 2008. Support for DRM has grown, with BNPB’s budget allocation for disaster management increasing 500 percent from 2010 to 2014. Additionally, the new 2015-2019 development plan outlines the country’s disaster management policy, which aims to reduce risk, increase the resilience of national and local governments, and support communities facing disasters.  

Since 2013, the Government of Indonesia has made extensive efforts to relocate Mount Sinabung residents from within the volcanic exclusion zone. They have done so through the replication and mainstreaming of REKOMPAK (Community-Based Settlements Rehabilitation and Reconstruction) project. To date, the project has supported the relocation of at least 1,510 families and completed the construction of around 500 housing units. 

To further advance its DRM agenda, national priorities include:

  • Improving the understanding and use of disaster risk information; 
  • Enhancing community-driven development; 
  • Strengthening urban resilience; 
  • Developing disaster risk financing and insurance mechanisms; and 
  • Continuing initiatives to strengthen the resilience of school infrastructure. 
GFDRR progress to date

GFDRR has supported disaster recovery, risk reduction, preparedness, and financial resilience activities in Indonesia since 2008.  Engagements have focused on mainstreaming DRM into national policy frameworks and plans; locally integrating DRM and climate adaptation measures; strengthening how funds are channeled in post-disaster contexts; and supporting the establishment of the Indonesia Disaster Relief Training Ground. 

Currently, GFDRR activities helping the Government of Indonesia invest in urban resilience and emergency preparedness. This will be achieved by supporting the preparation of targeted investment strategies and flood risk master plans for reducing and managing flood risk in selected cities; developing the capacity of selected cities to implement DRM investment strategies; and improving preparedness and response planning for dam safety in selected areas.

In addition, GFDRR is supporting the implementation of a comprehensive risk financing framework to provide flexibility for fund recovery programs. It is also supporting the scale-up of a safer schools initiative by institutionalizing standards and procedures and creating a support system for new construction and the retrofitting of existing learning facilities.  

GFDRR continues to help Indonesia better manage disaster and climate risks. It is strengthening the country’s understanding and use of risk information in investment decisions across sectors and levels of government. Activities have focused on key economic sectors and community-driven development programs in urban areas. These GFDRR activities have helped mainstream disaster resilience into World Bank-financed projects, including a $350 million road improvement project in the earthquake and landslide-prone corridor of Western Sumatra, and a $150 million urban community-driven development project. 

As part of its early activities, GFDRR helped integrate earthquake-resistant standards into technical guidelines for school rehabilitation. The guidelines were used by the education sector to repair more than 100,000 heavily damaged classrooms. GFDRR has also supported the development of innovative open-source software, including InaSAFE, a tool that guides decision-making through better natural hazard impact data and communications. 

GFDRR anticipates continued demand to strengthen disaster and climate resilience in the following areas: 

  • Building resilience in the country's rapidly growing urban areas; 
  • Continuing to integrate risk considerations into new and existing educational investments; and 
  • Exploring financial protection strategies. 
 

Grants Awarded by GFDRR 2007 - Present

World Bank Engagements 2012 – Present

Project Description
Jakarta Urgent Flood Mitigation Project
$139.64 million | Start date: 01/2012 (Ongoing)

The project development objective is to contribute to the improvement of operation and maintenance of priority sections of Jakarta’s flood management system.

Disaster Risk Management Program for The Third National Program For Community Empowerment in Urban Areas
$4.98 million | Start date: 04/2012 (Closed)

The objective of the project is to assist the borrower to ensure that the urban poor benefit from improved socio-economic and local governance conditions.

National Community Empowerment Program In Urban Areas For 2012-2015
$266 million | Start date: 11/2012 (Ongoing)

The activities include new pilot initiatives on social component of the program through livelihoods and neighborhood slum upgrading, which is expected to provide significant learning for scaling up across the country.

Village Innovation Program
$650 million | Start date: 12/2012 (Ongoing)

The development objective of the National Program for Community Empowerment in Rural Areas Project for Indonesia is to rural locations to benefit from improved local governance and socio-economic conditions.

Financial Sector Reform and Modernization Development Policy Loan
$500 million | Start date: 07/2014 (Closed)

The project aims to promote the development of a stable, efficient, and inclusive financial sector to help the Government of Indonesia achieve its medium-term economic development and poverty reduction goals. The operation supports policy and institutional reforms in three priority development areas: (i) reinforcing financial system stability; (ii) promoting financial sector diversification; and (iii) enhancing financial inclusion.

Dam Operational Improvement and Safety Project Phase 2
$125 million | Start date: 02/2017 (Ongoing)

The Project Development Objective is to increase the safety and functionality of dams in selected locations and strengthen the operation and management capacity for dam safety.