By: Wahyudi Tama )*
The government has reaffirmed its commitment to strengthening the competitiveness of Micro, Small, and Medium Enterprises (MSMEs) as a crucial component of the national economic development strategy. Policies, banking facilitation, and standardization support are being implemented in an integrated manner to ensure that MSMEs not only survive in the local market but are also ready to compete globally.
The Minister of MSMEs, Maman Abdurrahman, stated that the government is paying special attention to the taxation aspect of small businesses. He emphasized that the government will not collect taxes from MSMEs with annual turnover below IDR 500 million. This policy aligns with Government Regulation No. 23 of 2018, which exempts small businesses from Final Income Tax (PPh).
According to Maman, this measure aims to ease the burden on early-stage businesses and create space for them to grow more rapidly. He believes this policy is not merely fiscal relief, but also a concrete affirmation that the government wants to protect MSMEs and make them the foundation of long-term economic growth.
The role of MSMEs is indeed vital. Data from the Ministry of Cooperatives and SMEs in 2024 shows that the number of MSMEs reached more than 64.2 million units, or approximately 99.99 percent of the total business units in Indonesia. This sector employs more than 123 million workers, equivalent to 97 percent of the total national workforce. This fact demonstrates that strengthening the competitiveness of MSMEs is tantamount to strengthening the economic resilience of the wider community.
Support also comes from the private sector. BCA Director Antonius Widodo Mulyono emphasized that his company consistently encourages MSMEs to upgrade through the Bakti BCA program. One concrete step taken is the business matching activity between 37 fostered MSMEs and potential buyers from Germany, Go Asia. This program focuses on the food and beverage product category to further prepare MSMEs to penetrate the European market.
Widodo assessed that this activity could boost business confidence and expand international market networks. He added that in addition to connecting MSMEs with buyers, BCA also provided workshops and certification facilities. These efforts aim to improve the capacity of the MSMEs under their guidance and optimize their contribution to the national economy.
The competitiveness of MSMEs is also strengthened through product quality. Sugeng Raharjo, Director of Accreditation Systems and Harmonization at the National Standardization Agency (BSN), explained that his agency supports Presidential Instruction No. 2 of 2022 concerning the acceleration of the use of domestic products. One way to do this is through the SNI Bina UMK program, which grants the right to use the SNI mark to low-risk micro and small businesses.
Sugeng explained that integrating SNI into the Online Single Submission (OSS) system makes it easier for businesses applying for a Business Identification Number (NIB) to obtain this right. This way, MSMEs have simpler access to national standards, allowing them to focus more on improving product quality and expanding their markets.
The government’s actions, along with those of banks and standardization institutions, demonstrate a consistent policy direction. The government is striving to ensure that MSMEs receive early-stage protection, easy market access, and product quality support. All of this culminates in the goal of MSMEs becoming not only a pillar of the local economy but also a driving force for national competitiveness on the international stage.
With a comprehensive strategy involving ministries, financial institutions, and standards bodies, the government’s commitment to increasing the competitiveness of MSMEs is increasingly clear. This support provides a crucial foundation for the continued growth of millions of small businesses in Indonesia, strengthening family economies, and bringing quality local products to the global market.
The government also recognizes that strengthening the competitiveness of MSMEs depends not only on fiscal, banking, and standardization aspects, but also on the ability of business actors to utilize digital technology. Therefore, various digital transformation programs continue to be expanded, ranging from e-commerce training and digital financial literacy to facilitating collaborations with major marketplaces.
The presence of technology is believed to expand marketing reach, connect MSMEs with global consumers, and reduce operational costs. This move aligns with the government’s vision of making the digital economy a new driver of inclusive and equitable growth.
Furthermore, efforts to increase access to financing continue to be strengthened through the People’s Business Credit (KUR), whose interest is subsidized by the government. This scheme not only provides working capital but also encourages MSMEs to enter the formal financial ecosystem, thus improving their growth readiness. The government emphasizes the importance of disciplined capital management to prevent misuse of aid. With good governance, MSMEs can build a positive credit track record and open up opportunities to obtain larger financing in the future.
Going forward, cross-sector synergy will be further enhanced to ensure that MSMEs not only advance in class but also survive global challenges such as competition from imported products and global economic fluctuations. With a combination of affirmative action policies, financing support, market facilitation, standardization, and digitalization, Indonesian MSMEs are believed to be capable of becoming the backbone of national economic independence and a key player in the international market.
)* Economic Observer
