Human Resource Development And Entrepreneurship Ecosystem To Strengthen Indonesian Capital Market

Coordinating Minister for Economic Affairs, Airlangga Hartarto. (Photo: Doc. Coordinating Ministry for the Economy)

JAKARTA – A total of 750 companies have been listed on the Indonesia Stock Exchange (IDX) with a market capitalization of US$519 billion and an average trading value of US$948 million. This condition is considered to have great potential to develop, especially with the support of the retail investor base which continues to increase, making the Indonesia Stock Exchange has great potential to develop.

Retail investors' shareholdings in September 2021 had reached 14% of total investors, an increase compared to 2015 which was only 6.5%. At the same time, the trade value generated by retail investors shows considerable potential where the share has reached 63.5% in September 2021.

“Domestic investors dominate the Indonesian capital market, one of which is reflected in the share of ownership in the stock market which reaches 53.42%. Meanwhile, in the government and corporate bond markets, domestic investors have a share of 78.44 percent and 94.05 percent, respectively", said Coordinating Minister for the Economy Airlangga Hartarto in his remarks at the KAFEGAMA Webinar Series with the theme "Utilizing the Momentum of Rising Retail Investors in the Market Capital: Opportunities, Challenges, and Policies 2021", Friday 5 November.

Retail investor demographics show that Generation Z investors aged 18-25 years dominate with a share of 38% of the total retail investors. Therefore, improving the quality of Human Resources (HR) in the Young Generation, especially Generation Z will encourage entrepreneurial activity to accelerate job creation.

The emergence of new businesses in the form of Micro, Small, and Medium Enterprises (MSMEs) or startups will create the potential for Initial Public Offering (IPO) on the Indonesia Stock Exchange. Both types of businesses can enter the acceleration board and gradually can conduct a public offering (IPO) on the mainboard. Of course, the impetus to conduct an IPO will later encourage the development of the capital market as a whole.

In terms of human resources, the Government will encourage increased socialization and education related to the capital market at a young age through collaboration with universities in Indonesia. This socialization and education are expected to provide additional information to the younger generation and encourage increased participation in the Indonesian capital market.

In addition, the Government will also encourage the development of digital talent. Basic skill programs to advanced digital skills will help print digital talent that suits the company's needs.

Digital talent will help increase company productivity across all business sectors. At the same time, the use of digital talent will also act as an accelerator for entrepreneurship. Especially for MSME actors, the Government will encourage the MSME digitization program as part of empowering MSMEs.

This effort is expected to increase the productivity of MSMEs as well as encourage collaboration with business actors in the digital financial sector.

The government is committed to continuing to cooperate with all stakeholders, including the academic community, in developing an entrepreneurial ecosystem. In this regard, the Government has issued Government Regulation Number 7 of 2021 concerning the Ease, Protection, and Empowerment of KUMKM (Cooperatives and Micro, Small, and Medium Enterprises). This arrangement also emphasizes the important role of incubator institutions in encouraging entrepreneurial development and growth.

"I hope that universities can also encourage them to print coworking spaces or incubators so that students can start their startup businesses", said Airlangga.

All efforts to develop human resources and the entrepreneurial ecosystem are expected to provide benefits in strengthening the Indonesian capital market. Coordination and synergy with all stakeholders are important to make this happen.