This is a part of a major work undertaken by the Asia Pacific Philanthropy Information Network (APPIN. This segment on Indonesia is divided into two sections. The first section provides an overview of philanthropy (including zakat and sadaqa), the third sector (including waqf or Muslim foundation), historical growth, policy environment, and the laws related to incorporation and tax treatment of the third sector. The second section provides an overview of an activity-based classification, identifying various fields internationally where non-profit organizations are active. The Johns Hopkins Comparative Nonprofit Sector Project developed the International Classification of Non-Profit Organisations or ICNPO. We used this classification to explore the variety of third sector activity in each country, but we extended the ICNPO to include trading co-operatives. Traditionally, philanthropy in Indonesia has been spontaneous and un-planned occurring within the family or neighborhood. Different community or occupational groups used to have their own informal bodies like Subak in Bali organised to ensure sustainability of water supply from common-pool resources. There also have been organized philanthropic activities in a hamlet or a village for protecting and creating public goods. There also have been self-reliant community organizations (LSMs) working to improve social and economic conditions as well as the welfare of local communities through community participation. Most importantly 500,000 or so arisan groups participated by housewives, employees, or young men for mutual savings, called pre-cooperatives, facilitate significant amount of savings to meet many financial needs of the members. Besides the above philanthropic activities, religion-based philanthropy is also practiced in Indonesia. For example, Muslims (85% of the population in Indonesia) provide zakat ul mal, zakat ul fitr, sadaqa, etc in charity. There are 623,829 mosques; 41,874 Protestant churches; 12,406 Catholic churches, 68,861 Hindu temples; and 7,424 Buddhist monasteries available for religious practices and educations in Indonesia (as of 2000). These organizations collect funds, build religious facilities, provide religious educations, and promote religious ethics and morale values. The re-emergence of democracy in 1998 resulted in many changes in the government’s policy and strategies. The Ministry of Justice and Human Rights issued a new law on foundation in August 2002. The newly created NGOs (mostly as foundations) are demanding and undertaking stronger roles in the on going political and democratic reform activities. Thus the identity of the Indonesian NGOs is being established as civil society organizations fighting for democracy. Some civil society organizations played considerable advocacy and consciousness raising roles in Indonesia for decades. For example, Nahdatul Ulama (NU), the largest Muslim organization in Indonesia, with millions of members, 330 branch offices, 6,000 traditional boarding schools or Pondok Pesantren, and 21,000 schools throughout the country has been an influential civil society organization since the beginning of the 20th century. Muhammdiyah, as the oldest Islamic non-profit organization in Indonesia, followed a similar path. Both the organizations, following the revival of democracy moved to national politics. The NU established its own political party, the Partai Kebangkitan Bangsa (PKB, or National Awakening Party) in 1999. One of the charismatic leaders of Muhammadiyah founded a political party, Partai Amanat Rakayat Nasional (PAN, or National Mandate Party) in 1999. These two newly formed political parties provided a president and the speaker of the parliament, respectively, to reinforce influence of the civil society organizations in Indonesian politics.
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