Business continuity of MSMEs hinges on boosting purchasing power

Business continuity of MSMEs hinges on boosting purchasing power

Minister of Research and Technology (Menristek)/Head of the National Research and Innovation Agency (BRIN) Bambang P. S. Brodjonegoro. Antara/HO-UI

Jakarta (ANTARA) - Research and Technology (Menristek) Minister/National Research and Innovation Agency (BRIN) Head Bambang P. S. Brodjonegoro opined that boosting the public's purchasing power was crucial for maintaining the continuity of micro, small, and medium enterprises (MSMEs).

"Indeed, the government has made several efforts to restore the economy during the current pandemic. Many MSMEs cannot survive during the pandemic. Those able to survive are the MSMEs with exposure to digital economy. Going forward, digital economy is expected to become one of the backbones of the national economy," Minister Bambang P. S. Brodjonegoro noted in a written statement received in Jakarta on Friday.

The Central Statistics Agency (BPS) had announced that Indonesia's economy contracted by 5.32 percent in the second quarter of 2020.

Responding to the condition, Brodjonegoro affirmed that various steps under the framework of the National Economic Recovery (PEN) should be taken promptly, including being heedful of MSMEs as a precautionary measure against recession in the third quarter.

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The minister highlighted that based on the results of a study by the Indonesian Institute of Sciences (LIPI) 2020, the sales of MSME products had declined. Based on survey results, a 94.69-percent decline was registered.

"What remains is only 2.65 percent, which also increases 2.65 percent. Most MSMEs have vulnerabilities within the next six months, which will eventually lead to poverty," Brodjonegoro, as the main speaker at the virtual seminar “Indonesian MSMEs” stated on Thursday (July 6).

The minister noted that increasing the purchasing power was the key to economic recovery. The purchasing power or public consumption is the factor that drives the economy.

Hence, the government remains steadfast in its commitment to maintaining domestic purchasing power and demand in the context of restoring the national economy.

"The people's purchasing power will be maintained, through social assistance and subsidies, for the poor and vulnerable," Brodjonegoro remarked.

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