Remarks of President of the Republic of Indonesia at the Signing of Cooperation of Partnership between the Foreign Investment (PMA) and Domestic Investment (PMDN) and Micro, Small, and Medium Enterprises (MSMEs), Monday, 18 January 2021 from the Bogor Presidential Palace, West Java Province
Date 18 Januari 2021
Assalamu’alaikum warahmatullahi wabarakatuh,
Peace and prosperity be upon us,
Greetings of Virtue.
Honorable Coordinating Ministers, Ministers of the Indonesia Onward Cabinet;
Honorable Head of Investment Coordinating Board (BKPM) and members of the Board;
Honorable Governors, Regents, Mayors, Heads of BKPM Offices, as well as Heads of Investment and One-Stop Integrated Services throughout the country, large entrepreneurs, corporate partners and MSMEs;
The Job Creation Law has been promulgated and its derivative regulations will also soon be issued. Some have already been finalized and others will soon follow. To continuously improve the ease of doing business and strategic partnerships between large companies and MSMEs, we will continue to develop them with the principles of mutual benefit and greater competitiveness in the global market.
Previously, Head of BKPM has made it clear that partnership between SMEs, MSMEs and large businesses is of particular importance. On what purpose? So that our MSMEs and SMEs can enter the global value chain to increase the opportunities for our MSMEs to move to the next level. The micro businesses can upgrade themselves to small businesses. The small businesses can upgrade themselves to medium businesses. The medium businesses can upgrade themselves to large businesses. We also hope to improve the quality of MSMEs to be more competitive. What does it mean? It means that the quality of the products should be better, the design should be better, the management should be better. And, they should also be more bankable. They can learn from big companies, be it large domestic companies or large foreign companies. The goals are to achieve an inclusive economic growth, an equitable economic growth, and an economic equality.
On this auspicious occasion, I invite you, ladies and gentlemen, to ensure that this work contract really makes significant contributions to inclusive economic growth. First, the work contract between MSMEs and large enterprises must be sustainable, not only one and done contract. Then, we want the value and scope to improve. If currently, the contract may only amount to Rp1 billion. Next year, it could be Rp5 billion, the following year, it could be Rp10 billion, it could be Rp100 billion. So, that it can significantly increase the level and competitiveness of our MSMEs in the global market. This is important.
Second, I also hope that our MSMEs will continue to learn. I have said earlier to continue to upgrade the quality of their products, improve their management, update product designs according to market demands, improve all packaging. And, to benefit from cooperation, collaboration with large businesses to raise their level slowly, or even faster.
And, third, I order that similar partnerships continue to be expanded. I am elated to receive a report from BPS (the Central Statistics Agency) yesterday that our trade balance in 2020 recorded a surplus of USD21.7 billion. Based on the data and if the exporters can invite MSMEs; this will immediately raise their level. The exporters are certainly more familiar with competitive prices, good product quality, and on-time delivery. They will learn these.
So once again, the development of large businesses must continue to involve our MSMEs, this partnership business model must be institutionalized, we must find mutually beneficial patterns of relationships between large businesses and MSMEs. Everyone has to gain, the large one can’t ask for losses to save SMEs’ profit, no, win-win solution. And, what I need to continuously see is that big businesses should not be concerned with their own companies only. Please look at the surrounding environment where there are medium-sized businesses, there are small-sized businesses, there are micro-sized businesses. Involve them in company activities so that it will take these businesses to the next level.
The Government will continue to strive and build a conducive ecosystem so that the collaboration between large businesses and MSMEs will benefit both parties and we hope it will continue to grow. If previously those involved were 196 MSMEs and 56 large businesses, I order that this be expanded, because I know that this is only the initial stage. It can be expanded, it can be magnified in the future.
Finally, I’d like to express my appreciation to the BKPM for the strong efforts amid the current COVID-19 pandemic. I appreciate the efforts of BKPM to continuously accelerate the investment process, starting from simplifying licensing and facilitating investors as best as possible, serving, so that investment from domestic and abroad can grow rapidly, create jobs to contributing greatly to improve the MSME level in Indonesia.
This concludes my remarks on this auspicious opportunity.
I thank you.
Wassalamu’alaikum warahmatullahi wabarakatuh.
Om Santi Santi Santi Om.