Coordinating Minister for Economic Affairs Airlangga Hartarto assured that the stimulus package provided through the National Economic Recovery (PEN) can facilitate the recovery of Micro, Small, and Medium Enterprises (MSMEs) battered by the COVID-19 pandemic.
“The nation’s economic recovery from the pandemic must be started from the UMKM since this sector has contributed as much as 61 percent to Indonesia’s GDP,” Hartarto noted in his Instagram feed here on Tuesday night.
The government has offered the stimulus package to strengthen MSMEs and cooperatives through interest subsidy, productive aid for micro-businesses, and guaranteed fee subsidy.
In addition, the minister noted that the stimulus package targeted 64.2 million MSMEs impacted by the pandemic, through budget allocation, to the central bank as well as tax incentive for credit restructuring and several other forms of support.
At the earlier work meeting of the Trade Ministry, Hartarto explained that the UMKM played a central role in creating either employment or boosting national exports.
The UMKM sector can significantly rise through the use of digital technology that is currently growing at a swift pace in Indonesia, and its value is projected to reach US$124 billion in 2025, according to Hartarto.
Moreover, digital transformation is direly required to keep economic activities on track amid limited face-to-face activities during the pandemic, he stated.
“Hence, in the next three years, the government will accelerate building digital infrastructure as well as improve the people’s understanding to ensure inclusive digital service is optimally available.
Earlier, the realization of MSMEs' stimulus package spending for the 2021 PEN program had reached Rp114.81 trillion, or 96.7 percent of the total budget of as much as Rp16.32 trillion.
In 2021, the government continues to allocate the stimulus package for UMKM along with cooperatives and State-Owned Enterprises (BUMN) at Rp63.84 trillion entailed in the State Budget (APBN), although the detailed allocation of spending has not been published.
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