Sandiaga Uno: If COVID-19 Starts To Be Conducive, The Earliest Will Be MSMEs, Not Malls

JAKARTA - Founder of OK OCE Indonesia, Sandiaga Uno, proposed that Micro, Small and Medium Enterprises (MSMEs) be the first business sector to open after the conditions of the corona virus or COVID-19 pandemic began to be conducive.

Sandi said that MSMEs are the backbone of the Indonesian economy which has the lowest risk of virus transmission. Therefore, according to Sandi, UMKM must be a priority.

"If I look at the one with the greatest economic impact because it supports 90 percent of the economy, it is the UMKM sector. This is the first sector to be opened," Sandi said in a virtual discussion, Friday, May 22.

Moreover, Sandi said, MSMEs were able to absorb 2.8 million jobs per April or 97 percent of employment. The growth of MSMEs is also supported by the application of social distancing and the imposition of large-scale social restrictions (PSBB).

Furthermore, Sandi said, the COVID-19 pandemic had caused job losses for 10 to 15 million people throughout Indonesia, both formal and informal workers. This means that as many as 37 million middle class people are included in the new poor.

The increase in the number of unemployed, Sandi said, also had an impact on economic growth pressure, which is estimated to only grow by minus 1 percent to 1 percent this year.

After conditions are getting better, Sandi said, the next sector that will be opened is the pivot zone sector, where this sector has a greater public health risk than MSMEs but has an equally large economic impact.

Then, lastly, when conditions had fully improved, a business was opened, namely in the white zone sector which has a large health risk but low economic impact.

However, Sandi said, efforts to open these economic sectors must be based on data from the medical side in the form of the level of spread of the virus both nationally and per region.

"If the focus is on MSMEs, the ones that will be opened in June are shopping centers. Not large-scale malls, but small and medium scale ones. Of course, with a very strict protocol and must focus on the MSME sector and consumption," he explained.

Not only that, Sandi also emphasized that policy makers also cannot make decisions independently. Because, in dealing with COVID-19, there must be one command, namely the direction of the Task Force for the Acceleration of Handling COVID-19.

"The commander must be one, namely the Head of the Task Force General Doni Monardo so as not to confuse and the others should not comment yet, comment on the diet first. So that the opening is one door and gets a similar narrative," he said.

For your information, to restore the MSME sector, the government has provided industry support amounting to IDR 70.1 trillion and business sector IDR 150 trillion. The Ministry of Finance (Kemenkau) noted that the business sector that was significantly affected was MSMEs.