TEMPO.CO, Jakarta - The government on Thursday stated that Indonesia’s micro, small, and medium enterprises or MSMEs remain a critical engine driving the country’s economy as the gross domestic product generated from this sector reaches 61 percent. They also employ 97 percent of the total workforce in the country.

Coordinating Minister for Economic Affairs, Airlangga Hartarto, said that MSMEs have also boosted Indonesia’s investment and export growth.

“In order to maintain the economic recovery momentum through MSMEs empowerment, the government has set a strategy that would develop this sector along with increasing MSMEs access to financing options,” said the minister in a written statement on March 10.

The investment generated from this sector reportedly amounted to 60 percent of the total national investment and contributed 16 percent to the national non-oil and gas exports.

Hartarto said President Joko Widodo urged for the bank loans for this sector to be increased to 30 percent in 2024. This came after the fact that MSMEs credit share remains low at 18 percent, said the minister.

To support this industry, the government increases the cap ceiling of the microcredit program (KUR) through subsidies by 30 percent (Rp373 trillion) in 2022. It has also broadened the super micro KUR scheme dedicated to workers who were laid off and homemakers.

Read: BI: Siapik App Helps MSME Obtain Rp18.3bn Bank Loans

MUTIA YUANTISYA