Meet the Minister of Finance Purbaya, Kadin proposes financing incentives to strengthen the furniture and electronics industry

JAKARTA - A number of entrepreneurs who are members of the Indonesian Chamber of Commerce and Industry (Kadin) have visited the Office of the Minister of Finance Purbaya Yudhi Sadewa to convey various business obstacles, especially in the furniture and electronics sectors.

Chairman of the Indonesian Chamber of Commerce and Industry (Kadin) Anindya Bakrie explained that Indonesia's furniture trade surplus continued to shrink due to the increasing number of imported products entering the domestic market.

According to him, this condition encourages Kadin and the government to discuss the possibility of deregulation and incentives to maintain the competitiveness of domestic industries.

"This industry (furniture) is growing quite healthy, but its trade surplus is shrinking. Why? Because there is also imported into the domestic. So here we are discussing about what deregulation or incentives can be done," he told the media, Friday, December 19.

Apart from the import issue, he said the furniture industry also faces external challenges in the form of an entry tariff from the United States of 32 percent, whereas the US market absorbs around 54 percent of Indonesia's total furniture and handicraft exports.

During the meeting, Anindya conveyed that Kadin also discussed funding schemes, including efforts to reduce the interest rate on financing.

Meanwhile, in the electronics sector, Anindya assessed that the potential was quite promising even though the export market was not too big, but Indonesia was said to be starting to enter the semiconductor industry through downstream, but still faced the constraints of limited experts and engineers.

Deputy Chairperson of the Human Development, Culture and Sustainable Development Coordinator Shinta Kamdani added that to mitigate the impact of US tariffs, furniture business actors continue to encourage market diversification to other regions, such as the European Union and Canada.

"Diversifying the market must be done, whether it is traditional or non-traditional. With trade agreements, this can really be utilized," he said.

In the electronics sector, Shinta said that the export market reach is still limited, but some business actors have ventured into the semiconductor industry and the main challenge is the availability of competent human resources.

"That was also discussed about the possibility of cooperation, bringing technology as well, how the training will be if the investment wants to enter, we want to develop, we need workers. So that is also a concern and what incentives can be given for the development of this technology," he explained.

"Because obviously, the government must also be present, it cannot rely only on business actors to be able to develop in terms of R&D. So, this is all a lot of aspects that are also related to the Ministry of Finance for incentives and others," he added.

Shinta also emphasized the importance of the government's role in supporting MSMEs, especially in the furniture sector which has a major contribution to the national economy.

In addition to financing, he said that strengthening the MSME ecosystem was crucial, including opening access to global markets through existing trade agreements so that these opportunities could be optimally utilized.

"How can we really take advantage of this. So, this is also what I think is the role of the Ministry of Finance from that side is also important," he explained.