Increasingly more number of Indonesian MSMEs will indubitably enter the international market.
Indonesian MSME products are increasingly in demand in the global market and are able to compete with other products. Online or digital transactions will further expand the reach of MSMEs to the global market.
Nevertheless, MSMEs need boosters to strengthen and expand their presence on the global stage. The capacity, quality, and quantity of MSMEs need to be improved, so that the products of Indonesian MSMEs can expand their reach and be increasingly consumed in the global market.
The government continues to provide attention, support, and various efforts to make MSMEs level up and become global and export-oriented players. In this way, MSMEs can bolster themselves and increase their competitiveness on the global stage.
If more and more MSMEs go global and go digital, this will have an impact on improving the Indonesian economy alongside increasing exports from MSMEs. The contribution of MSMEs to exports increased, from 14.37 percent in 2020 to 15.69 percent in 2021.
Even during the COVID-19 pandemic, MSMEs continued to support the economy, with an export contribution of 15.65 percent in 2022. The government is targeting the contribution to reach 17 percent in 2024.
However, MSMEs are still facing several challenges, including innovation and technology, digital literacy, productivity, legality, financing, branding and marketing, human resources, standardization and certification, equal coaching, training, and facilitation, as well as a single database.
To this end, collaboration and synergy among all stakeholders are needed to tackle the various problems faced by MSMEs to go global and digital.
To strengthen MSMEs, state-owned enterprises (SOEs) have taken part in supporting the development of MSMEs, including by providing access to financing, coaching, market access, and brand improvement.
For instance, state-owned retail company Sarinah has cooperated with a global duty-free shop operator Dufry International AG to open Windownesia stores to promote Indonesian MSME products in several countries.
The first Windownesia store was launched in Perth, Australia, on October 11, 2023.
Windownesia showcases quality products of Indonesian MSMEs that can compete with those from other countries. In addition to Australia, Windownesia stores are planned to be opened in other countries, such as Turkey and Saudi Arabia.
SOEs Minister Erick Thohir lauded the opening of the Windownesia store in Perth, as it is deemed able to raise global awareness of the presence of Indonesian MSME products.
Thohir believes that the presence of Windownesia will change the ways in which Indonesian products are viewed and consumed worldwide. Windownesia has become a new platform for Indonesian MSMEs to grow in the global economy, which is increasingly interconnected.
Apart from having international standards, the products marketed at the Windownesia store are flagship domestic products, such as luwak coffee, tea, and essential oils. These MSME products have also passed selection, in terms of design, quality, sales, and licensing, thereby leaving no doubt regarding their quality.
The continuity of Windownesia will continue to be maintained, and its use will continue to be optimized, so that increasingly more number of MSME products can enter the global market and attract foreign buyers.
Meanwhile, another SOE, namely state-owned bank Bank Negara Indonesia (BNI), also participates in advancing Indonesian MSMEs to enter the global market through ways including by improving MSMEs' access to financing, so that MSMEs can obtain capital to run and develop their businesses.
As of August 2023, BNI had disbursed credits worth Rp28.53 trillion (around US$1.79 billion) to export-oriented MSMEs, reaching 41,114 borrowers in total. Meanwhile, in 2022, the value only stood at Rp26.72 trillion (around US$1.67 billion).
The increase has shown that credit coverage has expanded, covering more MSMEs to support them in developing their business capacity.
BNI's Director of Retail Banking, Putrama Wahju Setyawan, stated that the bank is also implementing programs to help MSMEs level up through training, coaching, and business matching, among others.
In helping MSME entrepreneurs increase their potential to go global, BNI has a special program, namely Xpora, which serves as a portal for a one-stop shopping solution for MSME entrepreneurs to meet their needs to develop their businesses to be productive as well as to go digital and global.
Xpora also serves as a service center for the Indonesian diaspora abroad.
Through the Xpora program, launched in October 2021, BNI has also disbursed credits worth Rp19.05 trillion (around US$1.19 billion) to 27,518 borrowers whose products are oriented to export in 2021.
Under the Xpora program, MSME products have been marketed to various countries, such as Japan, the United States, South Korea, the United Kingdom, Hong Kong, and the Netherlands. Businesses in the food and beverage and furniture sectors dominate the Xpora ecosystem.
MSME players can also take advantage of services at the BNI branch office network abroad in cities that become the world's economic centers, such as New York in the United States, London in England, Hong Kong, Singapore, Tokyo in Japan, Amsterdam in the Netherlands, and Seoul in South Korea.
The network plays a strategic role in developing the export-import ecosystem in accordance with BNI's competence in international banking.
Through the Xpora program, BNI provides integrated services and assistance to MSMEs to improve their productivity and their digital literacy, inclusion, and capability, as well as to help them develop their businesses to penetrate the global market.
To support MSMEs to become productive, BNI provides easy and integrated financing for export-oriented MSMEs in the Fast Trex credit program, with a maximum credit of Rp25 billion (around US$1.57 million).
The program, launched in 2022, is a business credit program with a competitive interest targeting exporters.
With access to financing, branding, and market access facilitated by SOEs, MSMEs are expected to move more swiftly to go global and go digital.
As a result, Indonesian MSME products would be able to compete and reach a wider market on the global stage.
Related news: Minister explores MSME development cooperation with South Africa
Related news: Bank Indonesia, World Bank preparing training module for MSMEs
Related news: SOEs Ministry facilitates MSMEs to expand market reach
Translator: Martha Herlinawati, Raka Adji
Editor: Azis Kurmala
Copyright © ANTARA 2023
