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Indonesia's new mega-rich spend it big as inequality grows

Reashot Xigwin

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By Karishma Vaswani BBC News, Jakarta
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Indonesia's socialites hold exclusive and expensive fundraisers for the country's poor

The masters of ceremonies at this charity gala in a flashy suburban Jakarta mall are in top form tonight, entertaining hundreds of orphaned children.

They laugh and applaud as a troupe of brightly coloured Sufi dancers swirl and twirl to Arabic music blaring from the speakers.

Surrounding the children are various stalls of food and sweet treats and a long table filled with goodie bags.

This is "Jakarta with Love", a breaking of the fast event, organised by some of Indonesia's richest wives and girlfriends.

"We collected 360m rupiah ($30,000; £18,000) for this event," Heidi, a beautifully made-up Indonesian socialite tells me, as she fans herself with her Gucci clutch bag.

"We want to give the joy we have in our lives to these little children," she says.

'It's not a bank'

This grand get-together is an "arisan" - a ladies club that combines saving with socialising.



A branded bag is not simply a luxury item for these women. It's a status symbol


Dini Indra Butterfly Republic

It is a unique part of Indonesian culture, especially for those in the country's ultra-rich set.

Wulan and her friends are members of at least four of these ladies clubs.

"We collect money from all the members of the club on a monthly basis," she explains. "Then when it's your turn to draw the lottery, you win the pot. So it's like putting your money in a bank - but it's not a bank, it's a ladies club!"

But it's not just any old ladies club. Membership can come with a hefty price tag.

"The monthly amount you put into the pot can vary, from 1m rupiah to around 100m rupiah," says Wulan with a picture perfect smile. "Imagine the winnings then - each member walks away with $100,000 a month."

That's a fortune in this country where the minimum wage is around $250 a month.

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Dini Indra sells bags worth up to $50,000 to Indonesia's new elite

But the women in this gathering are from some of the wealthiest families in Indonesia. Spending this kind of money is not a luxury for them - it's an expectation.

Bag ladies
At this event, they take selfies of each other with their blinged out mobiles. Others keep reapplying their makeup, as the bewildered children who this event is for look on.

All of the women have one thing in common - they are well-dressed, well-heeled and beautifully bagged.

The socialites carry some of the trendiest and most expensive handbags in town - worth tens of thousands of dollars.

This love for indulgence among Indonesia's wealthy set is helping other businesses grow.

"These women love to buy Hermes bags, or Chanel, or Louis Vuittons," Dini Indra tells me. She is the chief executive of Butterfly Republic and buys, sells and rents luxury handbags to Indonesia's aspirational set.

"My bags can cost you anywhere from $1,000 to $6,000, or even $50,000," she tells me in her studio in central Jakarta.

"I know it seems ridiculous but this kind of extravagance exists in Indonesia. A branded bag is not simply a luxury item for these women. It's a status symbol.

"We could buy a car or a decent house in Jakarta for that price - and sometimes it doesn't make sense to me, why they want to spend that kind of money, but they do. But it's great for my business."

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Indonesia is Lamborghini's third biggest market in the Asia-Pacific region

Indonesia's new rich appear to be good for a lot of businesses, including legendary sports car maker Lamborghini.

It opened its doors in Indonesia in 2009 and since then the country has become its third largest market in the Asia-Pacific region.

"I think in a big city like this, maintaining the image of a good lifestyle is really important for young professionals," Johnson Yaptonaga, the owner of the Lamborghini showroom told the BBC.

"And owning an expensive car has become a trend for this group. Once you're in this community, you have to keep up with this lifestyle."

Surviving on $2 a day

But for many in Indonesia, life moves on a different track.

Rohma lives in a small slum near a railway track just a few kilometres from Dini Indra's branded bags studio.

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Like most of Indonesia's poor, Rohma finds it hard to make ends meet

It is one of hundreds of slums peppered across Jakarta.

The cheapest handbag in Dini's studio could pay Rohma's rent for a year.

She lives in a tin shack with her husband and seven children.

She has seen the fancy cars and houses that have cropped up just a few hundred metres away from her slum - but they might as well be on a different planet. Her reality is filled with feeding seven mouths.

"My husband used to drive a taxi, and now he does odd jobs," she says as she cradles a one-month-old baby in her arms - her first grandchild from her eldest son.

"I cannot see a good future for us, because my husband doesn't work that often while we have to eat every day. For me as a woman it's been very tiring because I have a lot of kids, and my husband doesn't make a lot of money, and I feel really tired."

Life by the railway tracks is grim and Rohma's story is not unique.

Two-thirds of Indonesia's population lives on $2 a day - perilously close to the poverty line.

The ranks of Indonesia's mega-rich may be growing, but so too is the gap between the rich and poor.

BBC News - Indonesia's new mega-rich spend it big as inequality grows

A bit of reminder to my 'Homies' in here that while there's still a large number of people living in poverty in this country Indonesia still has a long way to go...
 
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Surely, if we deny that, that's will be the ending spell for Indonesia as a Nation.



BTW, a lot of true poor people in Indonesia is living in rural areas especially the so called "buruh tani" and marginal tribes in Indonesia outer provinces. I kinda don't believe if the beggar in big cities is truly poor since the incidents a while back.
 
Bloody women and their ridiculously overpriced handbags.

Pretentious and petty.

"It doesnt matter if a cat is black or white, if it catches mice its a good cat." - Deng Xiaopeng

A good bag is one that carries your belongings, not its price tag.

If I were the government, I would tax the crap out of frivolous luxury goods.
 
Bloody women and their ridiculously overpriced handbags.

Pretentious and petty.

"It doesnt matter if a cat is black or white, if it catches mice its a good cat." - Deng Xiaopeng

A good bag is one that carries your belongings, not its price tag.

If I were the government, I would tax the crap out of frivolous luxury goods.

The government already taxed it, but it doesn't matter anyway. Most of them buy the bag directly from Europe or Singapore when they go traveling, cheaper and obviously not fake. I think, it's the same case with China rich.
 
Bloody women and their ridiculously overpriced handbags.

Pretentious and petty.

"It doesnt matter if a cat is black or white, if it catches mice its a good cat." - Deng Xiaopeng

A good bag is one that carries your belongings, not its price tag.

If I were the government, I would tax the crap out of frivolous luxury goods.

The Indonesia government is very notorious for their progressive tax in SEA, especially for the luxury items such as those pricey bags and sports car, much more bloodier than Singaporean tax rates. But it can't be helped if they found another way to evade the tax and getting what they want legally
 
The gap between haves and haves not destroys a peaceful society.
 
The gap between haves and haves not destroys a peaceful society.

Quite differently, more wider the gap, more large the chance of clash between the upper class and lower class strata bound to be happened. The clash itself not really must be articulated into violent and direct clash between them, but can be found in Political and economical clashes in which one party will dominated the others so thoroughly, and the other party will find a way to escaped themselves from those kind of domination and in the longer run it will affect your country cohesiveness and it will be more like the time bomb put under your bed. So the most wisest thing to do with those kind of situations is to enlarge the number of middle class people in your country, elevated the lower class strata into the new middle class.
 
Quite differently, more wider the gap, more large the chance of clash between the upper class and lower class strata bound to be happened. The clash itself not really must be articulated into violent and direct clash between them, but can be found in Political and economical clashes in which one party will dominated the others so thoroughly, and the other party will find a way to escaped themselves from those kind of domination and in the longer run it will affect your country cohesiveness and it will be more like the time bomb put under your bed. So the most wisest thing to do with those kind of situations is to enlarge the number of middle class people in your country, elevated the lower class strata into the new middle class.

he is exatcly talking about what you are thinking, he said; "the gap between the "haves" and "haves not" destroys a peaceful society.
 
Bloody women and their ridiculously overpriced handbags.

Pretentious and petty.

"It doesnt matter if a cat is black or white, if it catches mice its a good cat." - Deng Xiaopeng

A good bag is one that carries your belongings, not its price tag.

If I were the government, I would tax the crap out of frivolous luxury goods.

You obviously doesn't know woman. I used to date one & my wallet paid the price for doing so.
 

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