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Ministry wants to increase SMEs role in supply chains

Dzulfiqar Fathur Rahman (The Jakarta Post)
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Jakarta
Sat, July 4, 2020

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T

he Industry Ministry is seeking to increase the role of small and medium enterprises (SME) in supplying raw materials for big businesses, as the government wants to reduce reliance on imported goods.

A program that runs from July 1-15 aims to prepare selected SMEs by helping them with brand registration, packaging as well as with National Industrial Standards (SNI) and halal certification to meet big producers’ product standards, according to Gati Wibawaningsih, the ministry’s director general of small and medium enterprises.

“The message this program is trying to convey is that local industries can produce what Indonesians need with quality products,” Gati said in a virtual press conference on Wednesday.

The program is part of the government’s efforts to increase the role of small businesses, which contributed nearly 61 percent to the country’s economy, to help reduce big industries’ imports of raw materials and intermediate goods.

The ministry has set itself a target of slashing Indonesia’s raw material imports by up to 35 percent to US$82 billion in 2022.

Imports of raw materials and intermediary goods declined last year and during this year’s January-to-May period, signaling a cooling of manufacturing activity and household spending. Last year, imports totaled $125.9 billion, down more than 11 percent from 2018, Statistics Indonesia (BPS) data show.

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