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Jakarta Post

Advocates call for targeted govt support to allay COVID-19 impacts on women-owned SMEs

  • Yunindita Prasidya

    The Jakarta Post

Jakarta   /   Tue, July 21, 2020   /   04:03 pm
Advocates call for targeted govt support to allay COVID-19 impacts on women-owned SMEs Upskilling for productivity: Former migrant workers produce 'tenun' (handwoven textiles) in Besar district, Sumbawa regency, West Nusa Tenggara. (thejakartapost.com/Panca Nugraha)

Experts have highlighted the need to support industry sectors dominated by women, as the economic downturn from the pandemic was affecting a disproportionately high number of businesswomen.

Women had been left in especially dire straits from the pandemic's economic impacts, such as reduced work hours and mass layoffs in women-dominated sectors such as textile, tourism and health, according to women entrepreneurship program officer Pertiwi Triwidiahening of United Nations (UN) Women Indonesia.

A 2017 report from the International Labour Organization (ILO) shows that women make up 58 percent of employees in Indonesia's garment, textile and footware industry.

“If businesses do not support women during this time, then when the economy restarts, companies risk losing their women workers or workers becoming less productive as a result of dealing with [their own] difficulties during the crisis,” Pertiwi said in a webinar on July 16.

The government estimates that some 5.5 million people may lose their jobs this year due to the economic crisis spawned by the public health crisis.

According to a report from the Indonesian Hotel and Restaurant Association (PHRI) on July 14, tourism had lost Rp 85 trillion (US$5.87 billion) in total revenue with more than 95 percent of the industry's workers furloughed without pay.

Meanwhile, the latest Bank Indonesia (BI) survey shows that all manufacturing businesses tumbled in the second quarter of the year, with the deepest contraction recorded in the textile industry.

In addition to mass layoffs, a UN Women study found that women has seen an increase in unpaid care work, whereas women were already carrying three times the domestic workload of men before the Indonesian outbreak emerged in early March.

The coronavirus-induced economic crisis is also affecting women-owned enterprises. According to the April 2020 survey of UN Women's WeEmpowerAsia program, produced in collaboration with the European Union and UN Women, 86 percent of all women entrepreneurs surveyed said that they had been negatively affected by the health crisis, while 34 percent of respondents said that they might have to permanently close their businesses. 

The impact has been greater on small and medium enterprises (SMEs), as they had “lower capacity to absorb the shock to the supply chain and customer revenue,” said the UN Women Guidance Note for Action on supporting SMEs toward gender equality in COVID-19 recovery. 

Women entrepreneurs owned 60 percent of all SMEs in Indonesia, where SMEs accounted for more than half of gross domestic product (GDP), according to production and marketing undersecretary Victoria Simanungkalit of the Cooperatives and Small and Medium Enterprises Ministry.

The government has earmarked an SME stimulus fund of Rp 123.46 trillion as part of its economic recovery program, out of which Rp 114.06 trillion is allocated for loan repayment relaxation and loan restructuring. Another Rp 7 trillion is for working capital financing that aims to reach 23 million SMEs and cooperatives that do not have access to financial institutions. 

Victoria noted, however, that women-owned SMEs had contributed just 9.1 percent to GDP. She added that common issues included business planning and strategies, and that women owners of SMEs needed support through training.

“Training is an important aspect. It’s not enough to hold webinars only, it is more important [that they have] mentorship,” she said.

Numerous organizations are making efforts to address the specific issues women are facing during the health crisis, like UN Women Indonesia’s WeLearn online training program for women entrepreneurs.

Offered in collaboration with consumer goods giant Unilever, WeLearn had over 5,200 registered users as of May 31, according to Pertiwi of UN Women Indonesia.

Some women business owners have taken advantage of the free training program, including Vidi Astuti Damayanti of MamaIbu Chicken Wings and Sauce. The 48-year-old homemaker told The Jakarta Post by text message on July 16 that she was able to expand her business by taking part in the WeLearn women entrepreneurs program.

“The interactive learning was robust and continuous,” said Vidi, elaborating that she learned the how-tos of business plans and basic accounting, as well as digital marketing and the legal aspects of running her business. 

She now employs two other female homemakers in keeping with the spirit of women's empowerment and social entrepreneurship, which she says she learned during the program. 

Nita Yudi, who chairs the Indonesian Businesswomen Association (IWAPI), said during last Thursday's webinar that such initiatives were commendable and should be continued, but stressed that additional support programs were still needed. 

“The provision of WiFi or free internet [access] is necessary because right now, everything is done [online],” Nita suggested as a form of government support, pointing out that internet access was uneven between regions in the country, despite the facility's vital importance during the health crisis.