Remarks of President of the Republic of Indonesia during the Launching of Legal Entity Certificates and the Opening Inauguration of National Coordination Meeting for Village-Owned Enterprises (BUMDes), the Birawa Ballroom, Bidakara Hotel, Jakarta Province, 20 December 2021

Bismillahirrahmanirrahim,

Assalamu’alaikum warahmatullahi wabarakatuh,
Good morning,
May prosperity be upon us all,
Shalom,
Om Swastiastu,
Namo Buddhaya,
Greetings of virtue.

Distinguished Minister of Village, Development of Disadvantaged Regions and Transmigration, and Ministers of Indonesia Onward Cabinet in attendance,
Distinguished Governors, Regents, and Mayors as Chancellors,
Distinguished Village Heads, all Leaders and Directors of Village-Owned Enterprises (BUMDes), Joint Village-Owned Enterprises, Village Facilitators, participants of National Coordination Meeting for Village-Owned Enterprises,

Ladies and Gentlemen,

Esteemed Guests,

Since 2014, the Government and all of us have been committed to developing Indonesia from the periphery areas, building the country from the borders, from the villages. The development is not Java-centric but Indonesia-centric instead.

We do not just build big infrastructure projects such as toll roads, large ports, or airports. We also build access roads in the villages, small retention basins in the villages, and revamp the people’s markets in the villages.

And I need to remind you that we have disbursed Rp400.1 trillion for Village Fund program since 2015. Why are you so quiet? Shocked? A total of Rp400.1 trillion, starting from Rp21 trillion in 2015, Rp46.7 trillion in 2016, Rp59.8 trillion in 2017, Rp59.8 trillion in 2018, Rp69.8 trillion in 2019, and Rp71.1 trillion in 2020, and Rp72 trillion in 2021. The total amount has reached Rp400.1 trillion.

If we notice the Regional Budget (APBD) at the village level, it has also increased drastically. In 2014, the average budget stood at Rp329 million, while in 2015, the budget increased by Rp701 million, and in 2021 the budget stood at Rp1.6 billion. We must be careful in managing the Village Fund since it is not a small amount. That is a very large number. Once again, Rp400.1 trillion is an enormous amount of money. If it is not well-targeted and the budget management is inefficient, it could all go wrong. I need to remind you of this matter.

However, according to the data I received, the physical development has shown result. For instance, 227 thousand kilometers of village roads have been built. There are also 4,500 small retention basins, 71,000 irrigation systems, 1.3 million-meter of bridges in total, 10,300 village markets. The number of BUMDes has reached 57,200. The development has been evident.

We have come this far so we need to focus more. What is BUMDes for?

I have not mentioned the quality of life. To improve the quality of life, we have built 1.2 million kilometers of water pipeline for clean water, 38 thousand integrated health services posts (Posyandu), 12 thousand village delivery facilities (Polindes), and 38 million-meters drainage. We have them all of them. There are also 59 deep wells, 56 additional early childhood education schools (PAUD), sports facilities, and communal bathroom and toilet blocks (MCK), all of which are built to improve the quality of life in rural communities.

The number of BUMDes has shown a significant increase by up to 600 percent. It is 606 percent precisely from 810 in 2014 to 57,200. We must not focus on the numbers only. The quality of activities in it must also provide benefits that can be felt by the communities, by our people. Do not just receive a legal entity certificate and install the nameplate of ‘Village-Owned Enterprises of Sukamakmur Village’ without any economic activities in it or with the quality of activities that is not clear. Instead, they should work hard to provide economic benefits to our people.

BUMDes and Joint BUMDes should take part in beneficial economic activities instead of eliminating the existing people’s businesses. For instance, there are already 5 or 10 small shops in the villages, but BUMDes has even built a bigger shop. This will eliminate the ten shops, while the bigger one survives. That is not right. It should not work that way. All of you should double the 10 to 20 shops, or improve them to become medium or large businesses. That is all what we expect instead of eliminating the existing businesses.

We must be focused on the birth of new businesses needed by the communities. [Those BUMDEs and Joint BUMDes] must trigger, spur new businesses in the communities that did not exist before but are needed so that people in the villages do not have to go to district or regency areas. It will be enough for them to stay in the village since economic activities have been fulfilled there. And that way, of course, the BUMDes will receive benefits through the activity.

The BUMDes can also strengthen their role in consolidating people’s businesses to facilitate more supplies. The procurement of fertilizer supplies for farmers can be carried out by BUMDes. As shown in the video earlier, it can be also carried out through cooperation with plantation companies in the transportation activities.

I will order state-owned enterprises (SOEs) and the private sector in the fields of plantations, mining, and others to involve BUMDes in their businesses. We must not let those in the villages merely become spectators. While trucks pass by carrying large production of plantations, the people just watch and see. [Or they just] see the mine’s output taken out of the areas, out of the village. And they all just watch it. Involve them. Later on, I will order involvement of BUMDes and Joint BUMDes in their activities.

I have seen a great economic activity that can be used as an example in East Kalimantan. There is a village that can export broomsticks in Kutai Kertanegara, broomsticks made of oil palm, nipah palm and halaban wood charcoal. It is a great leap. They took a big leap by selling the products to export markets, not only in the village or domestically. And now such opportunities abound. Agricultural products are now easy to export. For coffee, most of our regions are homes to coffee plantations. For fruits, most of our regions also produce fruits, as well as horticulture products. That is just how do we prepare a good quality.

Yesterday, I visited Ngawi regency and I was surprised by a young farmer who was able to harvest a very large number of avocados from a tissue culture. There are also big bananas there. This kind of things must be pursued and developed by BUMDes and Joint BUMDes. If the quality is that good, it is easy to export the products. If only the quality as good just like what I saw yesterday. How can the village cooperate with, as an example, the Bogor Institute of Agriculture (IPB). We have horticultural products but the quality is not good. Please, cooperate with universities so that the quality can be improved and then enter a bigger market, the export market. This is what we expect.

Ladies and Gentlemen, Participants of the National Coordination Meeting,

During the pandemic, when economy in the cities / urban areas is severely disrupted, economy in  rural areas has become one of the saviors. We must make the most of this situation to carry out economic transformation in the villages. We have to making changes. All of us must have the courage to transform economy in the villages. This is very important. BUMDes and Joint BUMDes must also transform and do not only work on things for the villages only. These two instruments should have a big vision so that people’s businesses can operate to bigger markets, especially to export markets and invite the communities to develop and make the village become basis of productive economic activities.

That concludes my remarks on this auspicious occasion.

And by saying bismillahirrahmanirrahim, I hereby launch the Village-Owned Enterprise Legal Entity Certificates and I open the 2021 National Coordination Meeting for Village-Owned Enterprises.

Wassalamu’alaikum warahmatullahi wabarakatuh.

(RIF/EP)