By: Recky Rumbiak *)
The debt elimination policy initiated by the government has been a breath of fresh air for farmer groups and MSME actors throughout Indonesia. Amidst the challenges of the global economy and the prolonged impact of the pandemic, this policy is seen as a strategic step to reduce the financial burden that has been squeezing their productivity. Not only as a temporary solution, but also as a form of real support for the sustainability of the small economic sector which is the backbone of the national economy.
For farmers, debt elimination is the main support to restart the production cycle that had stopped. The Head of the Indonesian Farmers Association (HKTI) of Lumajang Regency, Ishak Subagio, said that he welcomed the policy of debt elimination or bad credit for farmers. So far, farmers have applied for credit for the purpose of financing capital during the planting season. As a result, Ishak assessed that agricultural productivity would be stimulated because the financial circulation of farmers was not involved in problems.
In addition, this policy provides space for farmers to be more innovative. Funds previously allocated to pay off debt can now be used to purchase quality seeds, upgrade agricultural equipment, and attend training to improve farming techniques. As a result, farmers’ productivity can increase, and the quality of the products they produce also improves.
Debt cancellation also opens up new opportunities for MSMEs to diversify their products and expand their markets. With this policy, they can access business assistance programs offered by the government, such as digital marketing training and business equipment assistance. This is important capital for MSMEs to compete in the digital economy era.
The success of the debt cancellation policy is not only felt by certain individuals or groups, but also has a significant impact on the national economy. With the freedom of farmer groups and MSMEs from the burden of debt, the wheels of the economy in the regions are starting to move again. Household consumption, which was previously depressed, is now gradually recovering, and jobs in the informal sector are starting to open up again.
Although this policy has received a lot of appreciation, it is not without challenges. Several parties have criticized the implementation mechanism which is considered less transparent. For example, there are still farmer groups and MSMEs that do not fully understand the debt cancellation procedure. As a result, not all of them can immediately feel the benefits.
Member of Commission XI of the Indonesian House of Representatives from the National Awakening Party (PKB), Anna Mu’awanah expressed her appreciation for the government’s policy of writing off debts of micro, small, and medium enterprises (MSMEs), as well as debts of farmers and fishermen. This debt cancellation policy has just been signed by President Prabowo Subianto as stated in Government Regulation (PP) Number 47 of 2024.
According to Anna, this debt cancellation is a concrete step by the government in easing the economic burden on people affected by the crisis, especially among MSMEs and the agricultural sector. Anna stated that the budget issued by the government to support this policy is not something that should be questioned as long as the funds are used effectively and on target.
Anna hopes that this debt cancellation policy will be able to raise the spirit of MSMEs, farmers, and fishermen to return to being productive, create better incomes, and support the local economy. In addition, the government is also strengthening the post-debt cancellation assistance program. This program aims to equip farmer groups and MSMEs with financial management, marketing, and product innovation skills. In this way, they are expected to be able to manage their businesses more professionally and independently.
Deputy Chairperson of Commission VII of the Indonesian House of Representatives, Chusnunia Chalim, appreciated President Prabowo Subianto’s move to officially ratify Government Regulation (PP) Number 47 of 2024 concerning the elimination of bad debts for micro, small, and medium enterprises (MSMEs) in the agriculture, plantation, livestock, fisheries, maritime sectors, and other MSME sectors.
Chusnunia assessed that this step was implemented as an effort to support MSME actors who have been affected by economic problems amidst the weakening purchasing power of the community. Chusnunia also said that he would also oversee the new regulation to ensure that only MSME actors are truly worthy of receiving assistance for debt write-offs.
Chusnunia hopes that through this policy, MSME actors will find a new spirit to continue fighting and free themselves from all the burdens that bind them. He also said that MSME actors are the spearhead of the Indonesian economy. That way, efforts to advance the country’s economy are by helping MSME actors to continue to develop.
Debt write-off policy for farmer groups
