President Jokowi Orders Inflation Control Team to Improve Farmers’ Productivity, Strengthen MSMEs
President Joko “Jokowi” Widodo has ordered the Central Government Inflation Control Team (TPIP) and the Regional Inflation Control Team (TPID) to improve farmers’ productivity and strengthen Micro, Small and Medium Enterprises (MSMEs).
“I order the TPIP and the TPID not only to focus on controlling inflation, but also to be proactive in encouraging the economic sector to grow more productively, help improving farmers and fishermen productivity, and strengthen MSMEs sector so that they are able to survive and improve their capacity,” the President said at the opening of National Coordination Meeting (Rakornas) of the 2021 Inflation Control on Wednesday (25/08) at the State Palace, Jakarta.
The President said that the pandemic momentum should be used to increase added value in the agricultural sector. In the midst of the pandemic, this sector has become a leading sector because it is still able to increase productivity and absorb a lot of workers.
“Thank God, in the first quarter of 2021 the agricultural sector grew positively by 2.95 percent and in the second quarter it grew by 0.38 percent. I believe that, God willing, in the third quarter, the agricultural sector will be able to grow even higher, because we have a large target market at home and abroad,” the President said.
From January to June 2021, export value from the agricultural sector reached Rp282 trillion (US$1.95 billion), 4.05 percent higher than that of the same period in 2020, which was Rp247 trillion (US$1.71 billion).
“There are still many potential export commodities that we need to develop. For example, konjac could become a new commodity that provides added value for farmers. There are also other commodities such as swiftlet nests, edamame, and various other horticultural products,” President Jokowi stated.
The President said that measures to develop and increase the added value of agricultural commodities must be taken seriously, not only to improve the Farmers Exchange Rate (NTP) and farmers’ welfare but also to achieve progress so that the agricultural sector has a greater contribution in driving the engine of economic growth.
“Everything must be prepared from upstream to downstream sector, and farmer institutions in this cluster model need to be strengthened. Farmer-owned enterprises, whether cooperatives or Village-Owned enterprises (BumDes), should continue to be developed so that the added value of this post-harvest products can continue to be increased. Market access must be expanded by establishing partnerships with industry, and access to financing must be facilitated and simplified,” he said.
Regarding financing, the President said that the Government will continue to accelerate the distribution of micro and small credit (KUR), especially for the agricultural sector. The KUR allocation for agricultural sector in 2021 is Rp70 trillion out of the total existing KUR allocation of Rp253 trillion.
“The KUR distribution scheme will continue to be improved to adapt to the characteristics of the existing businesses in the agricultural sector. KUR requirements must also continue to be simplified,” the President said, adding that KUR must also be used to improve post-harvest added value, such as in the procurement of RMU (Rice Milling Unit), so that the loan will benefit the farmers.
“I also order Cabinet Ministers, Heads of Government Institutions, and Regional Heads to strengthen assistance for farmers by making use of technology, including digital platforms, to improve productivity of farmers and shorten the marketing chain for MSMEs in food sector,” he said.
On that occasion, the President also said that since the people’s purchasing power has decreased, stability in food prices is very important for the people.
“If there are on the ground obstacles, we must immediately resolve them. We need to take more measures on the ground, in terms of overcoming production and distribution constraints. Every city has to monitor the availability of staple food on the ground and mitigate production constraints or distribution constraints,” he said.
The President also ordered Government officials to remain vigilant in managing balanced policies in handling COVID-19 and economic recovery.
“In the third quarter of 2021, we must be vigilant and be careful in managing the balance between health and economic sectors. We must manage balanced policy to tackle the spread of COVID-19, we must be able to control it, and we must protect vulnerable people. The people’s purchasing power must continue to be increased, which will improve the demand side, and can drive the engine of economic growth,” the President remarked. (TGH/UN) (RI/MMB)