By: Dirandra Falguni)
The Indonesian government is increasingly intensive in accelerating market expansion for micro, small, and medium enterprises (MSMEs), especially in efforts to increase the export potential of local products. Several strategic initiatives have been initiated to encourage MSMEs to move up a class, ranging from mentoring, expanding market access, to providing access to capital.
The Minister of Trade, Budi Susanto, emphasized the importance of routine mentoring and identifying problems faced by MSMEs through ongoing discussions. MSMEs need to be well prepared to be able to compete in the international market. This effort is in line with the Ministry of Trade’s target which aims to increase national exports by 9.6% by 2029.
Budi Susanto said that the domestic MSME program can export, so his party gathered MSME mentors, aggregators, to work together. This is in order to find solutions to the challenges faced by MSMEs and determine concrete steps so that MSMEs can immediately export. This collaborative approach involves various parties, including trade attachés abroad who act as an extension in opening market access for local products.
Not only relying on product quality, but competitiveness must also be strengthened by increasing the managerial capacity of MSME actors. If the company does not understand how to export, it is a competitiveness problem. So MSME actors need to be taught to export. Through a dialogue forum held every month, the Ministry of Trade provides space for MSME actors and aggregators to carry out business matching in order to create concrete business opportunities.
The Coordinating Ministry for Economic Affairs noted that in 2023, the MSME sector contributed around 61% of the national Gross Domestic Product (GDP) or worth IDR 9,580 trillion. In addition, MSMEs managed to absorb 97% of the total workforce, which shows the importance of this sector in providing jobs and maintaining socio-economic stability in Indonesia.
The number of MSME actors reaching 66 million business units with a workforce absorption capacity of around 117 million people reflects the large contribution of this sector to the national economy. The role of MSMEs is not only limited to big cities, but also spread to remote areas, making them the driving force of economic development throughout Indonesia. The “Proudly Made in Indonesia” campaign launched by the government has also encouraged public awareness to appreciate and use domestic products more.
Most MSME products use local raw materials and local labor, from food, crafts, to technology-based products. This campaign emphasizes innovation and quality improvement so that local products can compete in the international market. To support this, the government encourages MSMEs to utilize digital technology and e-commerce platforms so that their products can be known more widely. With digital marketing, MSMEs are no longer limited by distance, so the potential to reach global consumers is wide open.
In order to strengthen the role of MSMEs as the backbone of the people’s economy, the Ministry of MSMEs is synergizing with PT Permodalan Nasional Madani (PNM) to empower MSME actors from the grassroots. The Minister of MSMEs, Maman Abdurrahman, said that PNM is a good example in efforts to improve the quality of life of MSMEs through sustainable empowerment.
Maman appreciated PNM’s contribution which has succeeded in embracing up to 15 million customers. He emphasized that the MSME sector needs to be protected and strengthened because it is a valuable national asset and has a strategic role in maintaining national economic stability. Maman said that PNM Mekar is not just an ordinary asset, but an important national asset that directly touches the lowest level of society.
The government’s commitment to improving the people’s economy is also reflected in President Prabowo Subianto’s vision which focuses on the people’s economy. Affirmative policies for MSMEs are an important foundation in President Prabowo’s economic strategy, where every policy must pay attention to the interests of the people.
As a concrete step, the Ministry of MSMEs together with PNM will create MSME clustering according to their business fields. In addition, the government will launch a super application to integrate all MSME data so that it is easier to monitor and support the needs of business actors. With this approach, problems faced by MSMEs will be easier to identify and overcome, including the management of permits and assistance facilities.
PNM President Director Arief Mulyadi emphasized that he is ready to support data collection on various types of businesses that will be carried out by the Ministry of MSMEs. His party has active data of 15.2 million ultra micro businesses and if accumulated the number of customers we have served is 21.2 million customers.