Is Indonesia a developing or industrialized country?

Development and development policy

International organizations such as the UN, the World Bank and the OECD have standards for assessing the level of development in individual countries, which enable them to be divided into groups. However, four country profiles make it clear how differentiated the reality is.

A refugee camp in Burundi. The country is one of the poorest in the world. (& copy EC / ECHO / Yves Horent)


There are different views on the criteria according to which countries are to be regarded as developing countries. In international organizations and in the practice of development cooperation, economic characteristics still dominate, since data on these are usually more easily available and seem most likely to be capable of reaching a consensus. There is, however, a clear trend towards including other, above all social, indicators.

Allocation standards from the World Bank and UNDP

Scale similar development
The World Bank has so far grouped all countries (including the former Eastern Bloc countries) according to their GNI per capita and differentiates between countries with low, middle and high incomes, with the middle income group being split into two subgroups. The high-income countries include not only the western industrialized countries, but also Singapore, Hong Kong and Israel as well as low-population oil exporters such as Kuwait and the United Arab Emirates, while Portugal and Greece, for example, two EU member states are in the upper part of the middle income group .

The "Human Development Index" (HDI), which was constructed by a working group in the United Nations Development Program (UNDP), represents a more differentiated assessment basis. It currently comprises three sub-elements:
  • the lifespan - measured as life expectancy at birth,
  • the level of education - measured as a combination of the illiteracy rate of adults (two thirds) and the total enrollment rate of children and adolescents distributed across the various school levels (one third) - and
  • the standard of living - measured as per capita income in real purchasing power, with income being taken into account to a decreasing extent above a threshold that is considered to be appropriate
One third of the three sub-elements are each included in the HDI. It is calculated so that it is between 0 and 1 for all countries, and a distinction is made between the subgroups with high (greater than 0.8), medium (0.5-0.8) and low (below 0.5) HDI .

OECD country lists

The Development Assistance Committee (DAC) of the Organization for Economic Cooperation and Development (OECD) is of great importance in development policy practice. The DAC distinguishes between a list of countries I - services to these countries are recognized as official development aid - and a list II, for which this does not apply. The subdivision of List I essentially follows the income groups of the World Bank. List II includes a subgroup of "Central and Eastern European countries" and a subgroup of "developing countries and areas that are more advanced in development", which include some petroleum exporters in addition to Singapore and the Bahamas. The five Asian and three Caucasus republics of the former Soviet Union have been recognized as developing countries and have been included in List I, while the remaining independent republics of the former Soviet Union have been put together in a separate group in List II. The Central and Eastern European countries clearly stand out from "classic" developing countries, especially with regard to the degree of industrialization and level of education, while this is not the case with other characteristics. The financially strong oil exporting countries, on the other hand, are in a position to finance development measures themselves, but in some cases it is a question of "bought" development that is not (yet) supported by their own economic efforts.

Subgroups of Developing Countries

Least Developed Countries

Poverty in Developing Countries
The group of Least Developed Countries (LDCs) are the poorest developing countries, which are also known as the "Fourth World" and are thus conceptually differentiated from the Third World. The formation of this group goes back to a resolution of the General Assembly of the United Nations in 1971. Since 1991, a catalog of criteria that has been changed several times has been used for the classification in order to capture the structural elements of poverty as broadly as possible:
  • Gross domestic product (GDP) per capita (2003 less than 750 euros on a three-year average),
  • supplemented index for physical quality of life calculated from indicators for nutrition, health, school education and literacy rate of the adult population,
  • Economic vulnerability index from indicators for the instability of agricultural production and the export of goods and services, for the share of industry and modern services in GDP, for the concentration on a few export goods, for the disadvantage of small markets (population size) and the share of those affected by natural disasters Population,
  • Population of a maximum of 75 million inhabitants, which excludes population giants such as China or India from the outset.
Recognition as an LDC entitles to preferential conditions for development aid and economic cooperation. After several extensions, the LDC list currently includes 50 developing countries with a population of around 500 million people. The majority of the countries are sub-Saharan Africa, from Latin America only Haiti belongs to the group. The term "absolute poverty" has been coined for the group of the most disadvantaged, regardless of national borders, who lack the essentials. In a famous speech in 1973, the then World Bank President Robert McNamara paraphrased this term as follows: "Absolute poverty [...] is characterized by such degrading living conditions as illness, illiteracy, malnutrition and neglect that the victims of this poverty are not to be able to satisfy even the most basic human existential needs. [...] ". At the World Social Summit in Copenhagen in 1995, the number of the poor was estimated at 1.3 billion people, i.e. almost a third of the population, more than half of whom are in "extreme poverty" (income of less than one US dollar per day) had to live.

The poorest countries in the world
Even if the greater part of the people living in the LDCs are extremely poor, India alone is likely to have at least as many extremely poor as the LDC group as a whole. The criticism of the "privileging" of the LDC countries in the context of development cooperation is directed primarily against the orientation towards national borders, which in fact do not stop at poverty and underdevelopment, but which in the practice of development cooperation - mostly on the basis of agreements between state governments - are of great importance.

Highly indebted countries

The World Bank emphasizes the importance of the debt burden in terms of development policy by grouping the countries with particularly high levels of foreign debt into separate groups. It distinguishes highly indebted, low-income countries (Severely Indebted Low-Income Countries - SILIC) and highly indebted middle-income countries (Severely Indebted Middle-Income Countries - SIMIC). In both groups, three of the following four criteria are above the limit values: ratio of foreign debt to GNI (limit value: 50 percent); Ratio of debt to export earnings (275 percent); Ratio of debt service to export earnings (30 percent) and ratio of interest payments to export earnings (20 percent).

Landlocked and small island countries

The groups of landlocked countries without their own access to the sea (such as Bolivia, Niger, Nepal) and small island countries (such as the Seyschelles, Mauritius, Madagascar or Fiji) point to location-related economic disadvantages, for example higher transport costs, in order to also demand discounts to compensate.

Emerging markets

If the groups mentioned so far are economically disadvantaged countries, it is assumed that the emerging countries - hence the German name - are on the threshold of an industrialized country and have enough momentum to overcome the characteristics of a developing country in the foreseeable future. There is no internationally binding list of emerging countries. Frequently cited examples are Turkey, the four "little tigers" in Southeast Asia, Brazil and Mexico in Latin America and the Republic of South Africa. It should be noted, however, that the economic progress of these countries by no means benefits all sections of the population and that, moreover, the political and socio-cultural development does not have to run parallel to the economic successes (see country examples).

Regional groups

In addition to the groups mentioned, which were formed primarily on the basis of economic characteristics, the regional component must not be disregarded. Countries see themselves as part of a region and usually pursue their interests together with their neighboring countries. A good example is Latin America, which has historical, linguistic, religious and political similarities as well as a regional self-confidence. Even Haiti, as the only Latin American LDC, is likely to see more in common with its neighboring countries than with the African LDC.