Minister Of Industry Agus Says Labor Intensive Industry Credit Program Can Open New Jobs

JAKARTA - The Labor Intensive Industry Credit Program (KIPK) is believed to be an important instrument in strengthening the competitiveness of the national industry as well as creating new jobs.

Bali was chosen as one of the KIPK socialization areas because it has a dynamic industry, ranging from finished clothes, textiles, furniture, skin and footwear, food and drinks to crafts.

Minister of Industry (Menperin) Agus Gumiwang Kartasasmita said the program was here to strengthen the structure of the national industry.

"This program is an important milestone because it provides access to financing with interest subsidies, so that industry players are labor-intensive can increase productivity, expand employment while maintaining national economic resilience," Agus said when opening the Socialization of the KIPK Program in Denpasar, Bali, as quoted from his written statement, Saturday, September 6.

Agus explained, the KIPK Program provides loan facilities ranging from IDR 500 million to IDR 10 billion, with a 5 percent interest subsidy from the government. The period of flexible loans for up to eight years is expected to provide space for industry players for expansion and modernization.

The total loan ceiling prepared reached Rp260 billion, with a potential value of up to Rp20 trillion for labor-intensive industries meeting the requirements. Meanwhile, Bali Governor Wayan Koster welcomed the presence of KIPK which was considered in line with the concept of the Economy of Kerthi Bali.

"KIPK not only maintains industrial sustainability, but also supports sustainable, environmentally friendly and local wisdom-based growth. This program is very much needed to increase the capacity of industry players as well as create new jobs," he said.

On this occasion, the Ministry of Industry (Kemenperin) also signed a Financing Cooperation Agreement (PKP) with PT BPD Yogyakarta Special Region (BPD DIY) as a channeling bank. With this addition, there are already six banks that have distributed KIPK, namely BPD Bali; BPD Central Java; Bank Mandiri; Bank BNI; BPD Kalteng; and BPD DIY.

Symbolically, the first distribution of KIPK was carried out by BPD Bali to three industry players, namely CV Pelangi (food), Dians Rumah Songket and Endek (textile) and CV Bali Tedung Nusa Island (furniture). This initial distribution is expected to encourage other industries to immediately take advantage of the credit facility.

Director General of Regional Resilience and International Industrial Access (KPAII) Tri Supondy added that KIPK is a follow-up to the President's direction to strengthen labor-intensive sectors, such as food and beverages; textiles; finished clothing; leather; footwear; furniture; to children's toys.

"Through KIPK, we want to ensure that labor-intensive industries can grow competitive, contribute more to the economy and expand job opportunities for the community," he said.

The Ministry of Industry hopes that the KIPK Program will be a shared momentum to strengthen the competitiveness of the national labor-intensive industry. With solid cooperation between central, regional governments, distribution agencies and business actors, it is believed that the program will provide tangible benefits for the resilience of the national industry and the welfare of the community.