PIP: In Indonesia, rapid economic development has led to a reduction in poverty among the 195 million inhabitants. While population increased more than 50% from 1971 to 1990, the annual growth rate, crude birth rate, and total fertility rates have declined rapidly. Life expectancy has increased from 45.7 years in 1971 to 62.7 in 1994 as crude death rates and infant and child mortality rates have declined. Causes of death have shifted from infectious to chronic diseases, but in 1992 major causes of death in children under 5 years old were preventable, and the maternal mortality rate was 425/100,000. Policies which guide the development of health care call for improvements in quality of life, adherence to humanitarian principles, use of scientifically approved traditional medicine, and provision of public health through a three-tiered system. Health care is financed by the government and the community, and managed care has been encouraged. Foreign aid has bolstered development in the health sector. Adequate sanitation has been achieved for 35% of the population, and 65% of urban and 35% of rural residents have reasonable access to clean water. Improvements in health indicators include 55% contraceptive prevalence, reduction in prevalence of anemia during pregnancy, 55.8% of pregnant women receiving prenatal care, a decrease in protein-energy malnutrition among children under five, and high vaccination coverage. Remaining public health problems include malaria, tuberculosis, dengue hemorrhagic fever, an increase in HIV/AIDS, iodine-deficiency, an increasing number of traffic fatalities, and an increasing number of smokers. New health policies have been instituted to meet these challenges as Indonesia's need for a productive and competitive labor force increases.