Ahmad Dante (Local MSME Activist)
Micro, Small and Medium Enterprises (MSMEs) are one of the backbones that have an important and strategic role in the structure of the Indonesian economy. MSMEs play a role in encouraging economic activity such as being a source of income and also a source of work, especially for the poor group, which amounts to around 689 million people (in 2019).
MSMEs also play a role as providers of important services for the community, for example MSMEs engaged in health, education, and MSMEs that provide utility-related services such as clean water, garbage and so on. In addition, MSMEs also play a role in environmental improvement and conservation, for example MSMEs engaged in agriculture, fisheries, and others. MSMEs are able to fulfill their role as poverty alleviators after several crises or disasters that hit Indonesia made many formal workers lose their jobs so that they started businesses or were employed by MSME actors.
G20 Summit supports Indonesia’s MSME industry
The G20 Summit (Summit) or Group of Twenty is a major forum for international economic cooperation consisting of countries with the world’s largest economies. The G20 represents more than 60% of the world’s population, 75% of global trade and 80% of the world’s GDP. Indonesia, which will host the 2022 G20 Presidency, takes the theme “Recover Together, Recover Stronger”. Through this theme, Indonesia wants to invite the whole world to work hand in hand, support each other to recover together and grow stronger and more sustainable.
Indonesia can benefit from early information and knowledge about global economic developments, potential risks faced, and economic policies implemented by other countries, especially developed countries. Thus, Indonesia is able to prepare the right and best economic policies, and can fight for national interests with international support through this forum. Indonesia’s name and achievements are also increasingly recognized and recognized by various international organizations and forums.
At the G20 event, Indonesia has the opportunity to form an inclusive world economic policy, by including the involvement of all parties, including helping MSMEs.
The COVID-19 pandemic that lasted from the first quarter of 2019 to more than two years had a huge impact on economies worldwide, including Indonesia.
Indonesia has proven to have succeeded in getting through the COVID-19 pandemic crisis and was able to rise and recover faster than many other countries, thus earning appreciation from the World Bank ( World Bank ). Throughout 2021, Indonesia’s Gross Domestic Product (GDP) will grow to 3.7%. Even until the end of 2022, the World Bank estimates that Indonesia’s GDP growth will increase again to 5.2%.
Based on World Bank data, there are 365 million – 445 million MSMEs in developing countries with a composition of 25 million – 30 million formal small and medium enterprises, 55 million – 70 million formal micro enterprises and around 285 million – 345 million informal enterprises.
Referring to a report issued by one of the United Nations units, the United Nations Department of Economic and Social Affairs ( UN DESA ), as many as 4 out of 5 or 80% of jobs in the formal sector are also newly created from SMEs.
As many as 99.99% of business actors in Indonesia are MSMEs with employment up to 97% and contribute to national GDP of 61.97%.
The MSME Industry Players were greatly helped by the implementation of the G20 Summit
Several sub-forums of the G20 Summit with the theme of formulating solutions for recovery and strengthening the global economy in supporting business actors to digitize MSMEs to be more competitive and not left behind in Indonesia’s economic growth were held in several regions, such as in Yogyakarta, NTT, Bali, and Bangka Belitung, has made several MSMEs get new learning and get international markets.
For example, the MSME ‘Emping Melinjo Bu Poni’ in Yogyakarta, which managed to go international to New Zealand thanks to networking and promotion through digital media, made this product able to expand abroad. They embrace local youth through village organizations such as youth organizations by conducting digital marketing training. Emping Melinjo Bu Poni innovates in various creative ways, such as using digital tools to market products on Alibaba’s website , local marketplace , and international marketplace , as well as expanding international networks with the diaspora in New Zealand, Australia, and the Netherlands.
Furthermore, the forum in Labuan Bajo, East Nusa Tenggara, discussed digital skills and digital literacy to develop the MSME industry so that they can market their products in the online market . In addition, with digital skills, MSMEs are expected to be able to produce new technologies or applications that can be used by other similar business actors. The Ministry of Communication and Informatics continues to provide assistance to MSMEs to sell actively on the platform For example, in the 26,000 MSMEs in the manufacturing sector in 10 priority tourist destinations by 2021, as well as in the food, beverage, woodcraft, woven, textile, apparel, furniture, leather and handicraft sectors. From May to October 2022, the Ministry of Communication and Informatics is assisting 30,000 MSMEs to improve their Industry 4.0 technology capabilities for manufacturing sector producers in 13 priority areas, including the province of East Nusa Tenggara.
Meanwhile in Bali, Uwais Craft, which is an MSME in the craft, food & beverage sector , since last August has received a 70% increase in orders from usual. The best-selling products produced by Uwais Craft in the form of pouches , laptop bags and tote bags made from Balinese woven fabrics, have become one of the most ordered products. They were greatly helped by the holding of the G20 on the island of Bali with an increase in orders of up to 70% to 100-200 pcs for one order. One of the positive impacts is getting insight on how to become an entrepreneur, and how to determine the target marketto market their products, because no matter how good the product is, it will be useless if there is no market.
Then as many as 200 MSME actors in the Bangka Belitung Islands participated in enlivening the G20 sub-forum meeting which was attended by dozens of delegates from 22 countries some time ago. All MSME products that are highlighted are very diverse, ranging from batik, cual, accessories, handicrafts, frozen meals and dry foods, complete with G20 T-shirts. It is hoped that through this G20, MSME actors will be more creative and continue to be enthusiastic about increasing the value of their products so that they can compete with foreign products.
Indonesian MSMEs need to be promoted to become more competitive in this digital era. There are several things that can be done, namely MSMEs must be more active for integration with digital technology in the Industrial 4.0 era. supported by government and private sector assistance. Furthermore, MSMEs need to get coherent financing capital assistance so that it will have a stronger driving effect. In addition, MSMEs must also be encouraged to become part of the global supply chain, such as being a supplier to several private companies or state-owned enterprises.
