The lingering pandemic should prompt the government to consider optimum approaches to MSMEs without having to hinder national income or increase budget burden in the wake of the COVID-19 (pandemic).
Jakarta (ANTARA) - Only a limited number of micro, small, and medium enterprises (MSMEs) in Indonesia are using government assistance, senior economist with the Asian Development Bank (ADB), Shigehiro Shinozaki, has said. “The use of government assistance by MSMEs affected by COVID-19 is still limited. MSMEs need a platform to inform them comprehensively of the government’s assistance programs,” Shigehiro remarked during a webinar on ‘Asian Impact: ADB Research in Action’, accessed from Jakarta on Thursday.

Based on data supplied by 2,509 Indonesian MSMEs during a survey, the ADB has found that most MSMEs are availing the ultra micro assistance unveiled by the President. However, they only make up 22 percent of the MSMEs surveyed, Shinozaki noted.


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In fact, 52 percent out of the 77.3 percent MSMEs benefiting from the Presidential assistance considered it very useful and 25.9 percent considered it useful, he informed.

Meanwhile, 14.4 percent of MSMEs are taking advantage of the interest subsidy, 11.1 percent of fund placement, 12.8 percent MSMEs credit guarantee, 10.7 percent MSMEs’ final income tax incentives, and 5.4 percent are availing the investment financing program, he said.


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In fact, 57.6 percent of MSMEs are qualified for final income tax incentives, he pointed out. However, only 10.8 percent of MSMEs have registered for the incentives, while 60.6 percent have no knowledge of the procedure to apply for the incentives, he said.

“The government needs to further describe gradual and different approaches, depending on the sizes and (business) sectors of MSMEs and give much support for entrepreneurship and capital distribution growth,” he added.

In addition, it needs to prioritize policy which encourages the digital transformation of MSMEs, including those engaged in informal sectors, he said.

“The lingering pandemic should prompt the government to consider optimum approaches to MSMEs without having to hinder national income or increase budget burden in the wake of the COVID-19 (pandemic),” he said.



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Translator: Sanya Dinda S, Suharto
Editor: Fardah Assegaf
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