Minister Seeks Greater Role of MSMEs in Boosting Indonesia's Economy

TEMPO.CO, Jakarta - National Development Planning Minister/National Development Planning Agency (Bappenas) Head Suharso Monoarfa seeks Micro, Small and Medium Enterprises (MSMEs) to play a broader role in boosting Indonesia’s economy, with a mere 57-percent contribution to GDP.

"Some 99 percent of the businesses in Indonesia are dominated by MSMEs, which absorb 97 percent of the total number of workers, but MSMEs only contribute 57 percent to the national GDP," Monoarfa stated here on Wednesday.

The minister viewed that despite various MSME development programs being conducted by ministries and state institutions, the results had yet to be optimal.

The minister drew attention to an evaluation of MSME programs from January 2020 that pointed to moral hazard existing in the capital grants offered by ministries and state institutions to MSMEs.

"This is since it does not have to be returned and utilized for non-business related purposes," he stated.

Meanwhile, the ministry's Deputy in charge of Population and Manpower, concurrently Deputy Chairman of Bappenas, Pungky Sumadi, stated that such conditions indicated that the assistance process was not optimal as it was conducted by ministries and institutions that have no tasks and functions to develop MSMEs.

The Ministry/Bappenas, Ministry of Finance, SME and Cooperatives Ministry, and other concerned ministries and institutions will evaluate the MSME development programs as a basis for budget allocation in 2022.

He opined that the role of the SME and Cooperatives Ministry, as the coordinator of the MSME development programs, should be bolstered. Companies partnering with MSMEs should receive incentives.

Read: Minister Teten Masduki: 8.6 Million MSMEs Receive Presidential Aid

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