The Indonesian government wants Micro, Small and Medium Enterprises (MSMEs) to take to the digital ecosystem as consumers shifted from physical stores to online buying. Using its presidency of the G20 Bali platform, the government is promoting local products to an international audience to spur economic recovery from the ravages of the Covid-19 pandemic.
According to Dedy Permadi, special staff, Ministry of Communication and Information for Digital and Human Resources, the economic contraction of MSME businesses due to the pandemic showed the urgency of digitalization. He said data from the Asian Development Bank Institute showed 19.76 percent of MSMEs experienced a decline in sales during the first half of 2020. This problem needed to be addressed immediately as MSMEs, which contributed 61.97 percent to the GDP, are the foundation for the economy.
Haykal Kamil, owner of a Muslim fashion business, is very grateful that digital technology has saved him from bankruptcy.
“We were doing well and then the pandemic hit. Orders were canceled and we could not repay our debts. I tried to slash my profit margin from 30 percent to five percent, but it did not work out. When I embarked on e-commerce at the end of 2020, I saw our revenue grew 40 percent. My business grows at triple digit now,” said Haykal.
Eddy Satriya, expert staff, Ministry of Cooperatives and SMEs (Kemenkop UKM), said the government used the Indonesian G20 Presidency and the G20 Summit at Bali to showcase local products to a global audience. He said selected local products are used as official merchandize for G20 Bali. There are 1,024 curated products, the government has appointed 20 SMEs to supply souvenirs for participants.
Top photo credit: Indonesian Minister of Cooperatives and SMEs, Teten Masduki, looks at local products. (Photo: KemenkopUKM)
