"Village-owned enterprises must not develop a business unit that can shut off villagers' businesses," Iskandar stressed in a statement received in Jakarta on Friday.
The minister said that the purpose of village-owned enterprises is to enhance the quality of life and prosperity of residents, hence, village-owned enterprises must consolidate business units in the village in the best interest of residents.
"We need to clarify this issue to village heads and the village assembly, including the misconception that a village-owned enterprise is not obliged to contribute to the village’s original revenue," the minister said.
The main purpose of village-owned enterprises is to consolidate all business units in the village to advance business growth, the minister said, adding that if village-owned enterprises perform well, then they can contribute more to the village's original revenue.
Village-owned enterprises must prioritize villagers' interest by assisting local businesses, from the production to the marketing stage, Iskandar said.
Village-owned enterprises must be managed in such a way to prevent new issues in villages' economic development, he added.
Meanwhile, the ministry's director general of economic development and village investment, Harlina Sulistyorini, informed that of the existing 39,854 village-owned enterprises, at least 29,043 enterprises have registered their institution with the ministry, while another 10,811 units have applied for legal entity status to the Ministry of Law and Human Rights.
Of the existing 1,896 joint village-owned enterprises, at least 1,805 have registered with the ministry and 91 have applied for legal entity status, she said.
Of the existing 496 village-owned financial institutions, at least 307 have registered with the ministry, and 189 have applied for legal entity status, the director general added.
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Translator: Zubi Mahrofi, Nabil Ihsan
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