Appreciation for President Prabowo’s Commitment to Strengthening MSMEs as Engines of Economic Growth
By: Astrid Widia )*
Strengthening micro, small, and medium enterprises (MSMEs) has once again become a central focus of the government as a strategy to safeguard the foundations of the people’s economy amid global challenges. MSMEs are viewed not only as buffers of the national economy, but also as engines of equitable welfare distribution due to their direct impact on people’s daily lives. Through a range of integrated policies, the government seeks to ensure that MSMEs can survive, grow, and move up the value chain so that their contribution to the economy becomes stronger and more sustainable.
President of the Republic of Indonesia, Prabowo Subianto, reaffirmed this commitment while delivering a keynote speech at the World Economic Forum Annual Meeting 2026 in Davos, Switzerland. At the international forum, Prabowo Subianto explained that the Free Nutritious Meals Program was designed with a dual-impact approach. The program is not only oriented toward improving children’s health and intelligence, but also toward stimulating the grassroots economy through the broad involvement of MSMEs and cooperatives. More than 61,000 MSME actors and cooperatives are now recorded as part of the program’s supply chain.
According to Prabowo Subianto, the involvement of MSMEs in the Free Nutritious Meals Program has created more than 600,000 jobs across various regions. This number is expected to continue increasing as more vendors and supporting suppliers participate. The government is even optimistic that up to 1.5 million direct jobs can be generated at the peak phase of implementation. This optimism is based on the belief that social policies should be designed to enhance productivity and generate tangible economic growth, rather than being merely consumptive in nature.
Domestically, the commitment to strengthening MSMEs has also been emphasized by Coordinating Minister for Economic Affairs Airlangga Hartarto. At the 2026 Retail Festival of the Sampoerna Retail Community in Bogor Regency, Airlangga Hartarto stated that MSME players are national economic heroes. He assessed that Indonesia’s economic resilience amid global uncertainty cannot be separated from the role of MSMEs in maintaining purchasing power and driving economic activity down to the local level.
On that occasion, Airlangga Hartarto expressed his appreciation to PT HM Sampoerna Tbk. for its consistency in building an MSME empowerment ecosystem through the Sampoerna Retail Community (SRC) over the past 18 years. With around 250,000 partner stores, this ecosystem is considered a concrete example of equitable economic development, as business ownership remains fully in the hands of MSME actors. The platform support provided encourages traditional community shops to transform into modern retail outlets without losing their business independence.
The strength of the SRC ecosystem is also reflected in the readiness of MSME actors to face digital transformation. Nearly all SRC partners have utilized digital platforms, including the use of non-cash payment systems through QRIS. This condition demonstrates that Indonesian MSMEs are capable of adapting to technological changes and evolving transaction patterns. The government views digitalization as a key factor in improving efficiency, expanding markets, and strengthening the competitiveness of small businesses in the digital economy era.
At the national level, the government has recorded that around 25 million MSMEs have been integrated into the digital ecosystem. The growth of QRIS transactions in the fourth quarter of 2025 reached nearly 140 percent year-on-year and was dominated by MSME actors. This digitalization has been supported by the development of digital startups in 15 regions through the facilitation of co-working spaces and office facilities. In addition, access to financing continues to be strengthened through the People’s Business Credit (KUR), which in 2026 is being made more flexible with a target ceiling of up to IDR 295 trillion and an interest rate of 6 percent per year, as well as an increased share of lending to the production sector.
The push for MSMEs to move up the value chain has also been emphasized by Minister of Micro, Small, and Medium Enterprises Maman Abdurrahman. He stated that MSMEs contribute around 55 to 60 percent of gross domestic product and absorb up to 95 percent of the national workforce. However, the dominance of the informal sector remains a major challenge. According to Maman Abdurrahman, transformation toward formalization is essential so that MSME actors can obtain more sustainable protection and social security.
To address this challenge, the Ministry of MSMEs is currently developing an integrated digital-based data system called Sapa UMKM, which is targeted to be fully operational by December. This system is expected to integrate MSME data across government institutions so that public policies become more measurable and well-targeted. These efforts are also accompanied by cross-ministerial collaboration to accelerate business licensing and certification, which are key to enhancing competitiveness.
Deputy for Micro Enterprises at the Ministry of MSMEs, Riza Damanik, added that throughout 2025 the government recorded strategic achievements that serve as a strong foundation for strengthening MSMEs. More than 14.66 million MSMEs successfully transitioned into the formal sector, 6.5 million MSME products obtained halal certification, and more than 1 million micro-enterprises received SNI certification. In terms of financing, KUR realization reached IDR 257.9 trillion, with 60.8 percent allocated to the production sector, which has the potential to create up to 11.6 million jobs.
Going forward, strengthening MSME capacity will remain a top government agenda through digitalization, productive financing, and the reinforcement of partnerships and supply chains. With the support of all stakeholders, MSMEs are expected to become more competitive and capable of serving as the main pillar of the people’s economy. The call to continuously support MSME products and businesses represents a concrete step toward ensuring that national economic growth is felt equitably across all segments of society.
*) The author is a public policy observer
