MSMEs players, especially micro-enterprise players, including small shops, have the potential to have a significant impact on the improvement of people’s welfare and national economic recoveryJakarta (ANTARA) - MSMEs that have adopted digital technology have managed to survive the challenges presented by the COVID-19 pandemic, Minister of Cooperatives and Micro, Small, Medium Enterprises (MSMEs) Teten Masduki has said.
“According to World Bank data, 80 percent of MSMEs that are connected to the digital ecosystem have better resilience. MSMEs could survive (the pandemic) to run their businesses because they adopted digital technology," the minister said at a virtual press conference held by Tokopedia on Tuesday.
He also revealed that research conducted by the United Nations Development Programme (UNDP) in October 2021 has identified several obstacles faced by MSMEs during the pandemic: production costs (35.2 percent), decline in demand (30.2 percent), government regulations (27.5 percent), financial access (4.9 percent), and raw material procurement (2.2 percent).
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The entry of MSMEs in the digital ecosystem has had a very positive impact and helped business owners to survive and even develop their businesses, Masduki said.
MSMEs can potentially have a significant impact on improving people's welfare, he added.
The reason is, currently, MSMEs dominate 99.9 percent of businesses in Indonesia, with around 65.4 million MSMEs registered in the country, he said. The MSMEs contribute 61 percent to the national Gross Domestic Product (GDP) and absorb up to 97 percent of workers, he added.
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“MSMEs players, especially micro-enterprise players, including small shops, have the potential to have a significant impact on the improvement of people’s welfare and national economic recovery,” he noted.
For that reason, Masduki affirmed that his ministry has continued to support the acceleration of national economic recovery and digital transformation.
One of the efforts is the target of digitalizing 30 million MSMEs by 2024, he added.
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According to the minister, as of late September 2021, as many as 16.4 million MSMEs have migrated to the digital ecosystem. That number has increased by more than 100 percent compared to before the pandemic, he noted.
“The pandemic has opened opportunities for the digital economy to grow where the potential digital economy value in Indonesia is projected to be the largest in Southeast Asia. By 2025, digital economic transactions are estimated to reach Rp1,700 trillion," he pointed out.
The government is also cooperating with various stakeholders to reach the target, he added.
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Translator: Suci Nurhaliza, Raka Adji
Editor: Fardah Assegaf
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