Remarks of President of the Republic of Indonesia at the 18th National Work Meeting of the Indonesian Young Entrepreneur Association (HIPMI) at Nusantara Hall Indonesia Convention Exhibition BSD City, Tangerang Regency, Banten Province, August 31, 2023

By Office of Assistant to Deputy Cabinet Secretary for State Documents & Translation     Date 31 Agustus 2023
Category: Remarks @en
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Bismillahirrahmanirrahim.

Assalamu’alaikum warahmatullahi wabarakatuh,

Good morning,

May peace be upon us all,

Om swastiastu,

Namo buddhaya,

Greetings of Virtue.

Distinguished heads and leaders of state institutions in attendance,

Distinguished ministers of the Indonesia Onward Cabinet,

Distinguished Acting Governor of Banten, regents, and mayors,

Distinguished Chief of the Indonesian National Police and leaders of the Indonesian National Defense Forces in attendance,

Distinguished Chairperson of the Central Management Board of the Indonesian Young Entrepreneur Association (HIPMI) Akbar Himawan Buchari, founder and senior of HIPMI Mr. Abdul Latief and all seniors whom I cannot name one by one,

All members of HIPMI management board, chairpersons of HIPMI at province, regency, and city levels in attendance who came from Sabang to Merauke, from Miangas to Rote Island,

Ladies and Gentlemen,

What Mr. Akbar said was true. Many HIPMI alumni joined the cabinet, including Mr. Sandi, Mr. Erick, Mr. Bahlil, Mr. Rosan who recently joined, Mr. Dito who was also a HIPMI member, and also the President. Do not forget that I was part of HIPMI too, regional HIPMI. Indeed, I was not part of the Central Management Board, not part of the central HIPMI, but regional HIPMI. Once again, the President was still part of HIPMI.

The Chairperson asked me to give directives, so if I give directives, I am not in the wrong because as Mr. Latief told me, “You are still in the category of HIPMI seniors.” Thus, it is okay to give directives. It is okay to interfere too because we are still family. I began to think that HIPMI has become the Indonesian Minister Association because so many ministers were HIPMI members. Too many, but it is alright. If there is still a chance, I will make Mr. Akbar a HIPMI member again, but no, no. I suppose Mr. Akbar can queue to become a minister next year although the President is not me.

Second, the Chairperson of HIPMI asked for support, primarily financial support, especially for MSMEs, for our MSMEs. I need to inform you that since I took office, Rp460 trillion is allocated for people’s business credit (KUR) with only 6 percent of interest. I am not aware of whether anyone here received the credit. If no one here did, it means that those in attendance already have large enterprises because the maximum credit for KUR is Rp500 million. The problem is that there needs to be dissemination about it so that the Rp460 trillion quota is used up. It must be used up because the interest is only 6 percent. However, it must strictly be disbursed to MSMEs.

Unfortunately, I continue to push the ministers, the Financial Services Authority (OJK), and Bank Indonesia (BI) to allow KUR to be given without collateral. It must use the credit scoring system. It is supposed to work like that since 145 countries have used the credit scoring system for MSMEs. Check the score, check the character whether it is good, give Rp500 million, give Rp300 million, give Rp100 million. It should work like that because young entrepreneurs who only begin to enter the business world usually have not had any asset, have not had any collateral. Thus, if the credit scoring system is used, it will facilitate them. and I will continue to promote it.

Third, I need to inform you that competition between countries, competition between countries is currently very tight, be it in fighting over export market, be it in getting investment, or all other matters. We should be thankful that in the 2023 IMD Global Competitiveness Index, Indonesia has risen in rank from the 44th to the 34th, an increase of 10 ranks. This is among the highest in the world because of the 10-rank leap. As for the competitiveness component, our competitiveness is the best in infrastructure. Now we are deemed good at infrastructure. Furthermore, business efficiency rose 11 ranks. This is excellent, excellent. Government efficiency also rose although only by four ranks. The best one is economic performance, which rose by 13 ranks from the 42nd to the 29th. We need to keep it up so that our competitiveness index continues to improve. Thus, it shows that we are capable of competing with other countries. We do not issue this ranking as this is an international one.

Furthermore, related to downstreaming. Once again, let me inform you that downstreaming is not only carried out in big sectors. It is not merely for nickel, not merely for copper mining or other big sectors. No. we must also industrialize SMEs. We must carry out downstream process for all raw products.

Earlier, I stopped by Banten province’s booth. There were items like this, natural coffee from coffee plants in Banten province. What I saw was great. After [the beans] were roasted, they are put into a packaging like this. This is amazing. The packaging is excellent. The brand is Hajirocker Coffee, Hajirocker Coffee. This is great. Oh, the owner is here.

Goods like this, coffee, are not found only in Banten. They are all over our regions. We have various kinds of coffee, be it Robusta or Arabica coffee. We have everything. We must not continue exporting in the form of raw beans. We must not. Make products like this. Dominate the domestic market. We must dominate the domestic market. Once we are ready, export it all. It will be fine. This product is truly a good product.

Other commodities should follow suit. Usually, traditional sugar is not packaged. Granulated brown sugar like this is also excellent. Palm sugar. I am impressed with good packaging like this. It must be continued not just by Banten province. All province must follow suit and the initiator must be HIPMI. HIPMI must be the initiator because young entrepreneurs must have creativity and innovation. They must, I assure you. Packaging like this is excellent. Excellent.

For that reason, do not assume that downstreaming only applies to nickel, processing nickel ores into steel or copper ores into copper foils. It is not limited to that industry only. Downstreaming applies to all industries. I noticed that there are not many downstreaming processes for seaweed. We are the second largest seaweed producer in the world, but it is exported raw. I checked where the raw seaweed is imported, to the Philippines, to Thailand. Why don’t we make our own industry here so that we can make flour, semi[-refined] carrageenan? The added value will skyrocket.

Do not continue to export raw commodities. Industrialize and downstream them at home so that jobs are created, we get the added value, and the country gets it too. If there is an added value, the country will get it and the state revenue will automatically increase.

Oil palm planted by, not by big companies, by our farmers, if it is downstreamed—as we produce 46 million tons per year—can enter a medium industry. It can [be processed into] soaps, cocoa butter, oleo food, and [the added value can increase by] 79 times, eight times, or five times. We must have the same awareness because we have exported raw commodities for 400 years, since the VOC era. Once again, do not continue it despite pressures from the European Union, from the WTO, from the IMF. Do not back down. Do not stop.

I will also urge the next president, I will urge the next president to not cease downstreaming or we will experience a huge loss. If we downstream everything, based on the estimated calculation of the National Development Planning Agency (Bappenas), our per capita income will reach US$10,900 in the next 10 years, our per capita income will reach US$15,800 in the next 15 years, and in Golden Indonesia in 2045, the figure of our per capita income will be approximately US$25,000. This is our goal. We must have a tactical vision, not only a big vision. This is a tactical vision. This is it. this is the tactical vision that we must work on together.

That concludes my statement on this auspicious occasion and by saying bismillahirrahmanirrahim, this morning I officially inaugurate the 18th National Work Meeting of the Indonesian Young Entrepreneur Association.

I thank you.

Wassalamu’alaikum warahmatullahi wabarakatuh.

(DH/MMB)

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