Minister Maman Calls China a 'Scary Ghost' for the Survival of MSMEs in Indonesia

JAKARTA - Minister of Micro, Small and Medium Enterprises (UMKM) Maman Abdurrahman called imported products from China as a "scary ghost" for the sustainability of micro, small and medium businesses in Indonesia.

In a working meeting with Commission VII of the Indonesian House of Representatives in Jakarta, Tuesday, January 20, Maman emphasized that various government intervention programs would not be effective if the domestic market continued to be flooded with cheap imported products.

"As good as the penetration of the policies we do, the interventions we do to MSMEs, as long as the market is not cleaned up, it will not succeed ... This is a very scary ghost," he said, quoted by Antara.

Maman highlighted the practice of under invoicing, namely reporting the value of goods lower than the actual price, as well as the entry of white label products without brands that are then branded domestically.

This condition, according to him, is further pressing MSMEs because local products must compete directly with cheap imported goods.

He gave an example of commodities such as underwear, hijabs, clothes, and batik - which can clearly be produced domestically. However, the cost of production of MSMEs in Indonesia is often equivalent to the selling price of imported products, making competitiveness weak.

He also cited the textile industry and the eyelash center in Purbalingga, which is now under pressure from the influx of cheap imported products.

"Purbalingga was once known as the world's best fake eyelash cluster, now it is starting to fall because imported goods from China are sold very cheaply," he said.

Maman emphasized that the government was not anti-import, but stressed the need for restrictions on products that could already be produced domestically.

"If there are products that we can produce ourselves, let's limit (imports). Currently, we have agreed with the Ministry of Trade to start with 10 items of UMKM products first which will be imported later," he said.

According to Maman, the 10 products were selected based on two main criteria: first, the high level of community needs; second, the significant involvement of MSMEs in their production.

Maman emphasized that efforts to improve the market and restrict imports require cross-ministerial coordination.

He explained that at least four ministries must be involved, namely the Ministry of Industry which handles technical aspects, the Ministry of Trade as the executor of imports and exports, the Ministry of MSME from the affirmative side because MSMEs are the parties most affected, and the Ministry of Finance.

"If we want to fix this, let's agree that the fundamental problem is imported goods," he said.