"In order to build a fair and inclusive industry, we need to increase the role of the community, especially SMEs, as part of the national manufacturing industry supply chain," Industry Minister Agus Gumiwang Kartasasmita said in a written statement here on Saturday.
He made the statement after the signing of the Memorandum of Understanding (MoU) on Cooperative Partnerships, Micro, Small and Medium Enterprises (MSMEs)/SMEs in the Supply Chain of State-Owned Enterprises (SOEs) on Friday.
"Empowering and increasing the role of the SMEs sector greatly helps the resilience of the domestic manufacturing industry," the minister said.
Secretary general of the Industry Ministry, Dody Widodo, earlier on Friday, represented the minister at signing of the MoU with SOEs Minister Erick Thohir and Minister of Cooperatives and Small and Medium Enterprises (SMEs), Teten Masduki.
According to data from the Statistics Indonesia (BPS), the number of SMEs has currently reached 4.41 million business units, with the number of workers in their employ reaching 15.64 million. SMEs contribute 21.2 percent to the growth of the non-oil and gas industry, with the most dominant sectors being food and beverage, fashion, and handicrafts.
"This achievement is a big potential for SMEs in accelerating the national economic recovery due to the COVID-19 pandemic," said Widodo.
Therefore, to optimize the performance of SMEs, a strong synergy between relevant ministries and institutions is needed to create a conducive business climate, maintain social stability, and develop a dynamic private sector, he added.
"National economic recovery efforts require very hard, progressive, and collaborative efforts from all stakeholders," he remarked.
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The cooperation that has been signed by MSEs with a number of SOEs also shows that MSEs are able to meet the high requirements and specifications applied by SOEs, he said.
"Through the synergy of this partnership program, we will continue to encourage partnerships between MSEs and other SOEs to increase the use of domestic products," he added.
Increasing competitiveness in order to revive the businesses of MSMEs/SMEs actors in the midst of the pandemic is one of the government's priority programs, he noted.
"The government has currently increased the budget for handling COVID-19 to Rp744.75 trillion, Rp161.2 trillion of which has been allocated to support MSMEs and corporations," he informed.
Various SMEs empowerment programs that have been initiated by the Industry Ministry include coaching and mentoring of SMEs to enable them to become a part of the domestic and global industrial supply chains, both through the development of supply chain ecosystems such as link-and-match as well as partnerships with large industries and SOEs, he said.
In addition, the ministry is also trying to build a digital ecosystem by encouraging SMEs to enter marketplace platforms and become involved in the procurement of government and SOEs goods/services, Widodo added.
He said that cooperatives and SMEs can have wider market access in the long term in the SOE supply chain.
"Besides being in line with the policy of the program to increase the strengthening of domestic products (P3DN), this partnership also supports import substitution policies that are simultaneous with increasing production utilization of the entire manufacturing industry sector," he added.
Meanwhile, the cooperation signed by SME actors with SOEs includes SMEs of metal foundry CV Baja Kurnia, which will partner with PT PLN and repair and mechanical part manufacturer CV Byakta Prakasa, which will partner with PT Krakatau Steel, he said.
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Translator: Risbiani Fardaniah, Katriana
Editor: Suharto
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