Increase Economic Growth, MSMEs Must Be Part Of Industrialization

Minister of Cooperatives and SMEs (Menkop UKM) Teten Masduki. (Photo: Theresia Agatha/VOI)

JAKARTA - Minister of Cooperatives and SMEs Teten Masduki said micro, small and medium enterprises (MSMEs) must be part of industrialization in order to increase competitiveness and encourage economic growth.

When he was a speaker in a discussion entitled "Innovative and Sustainable Entrepreneurs Growth" in Bandar Lampung, Tuesday, Teten said that although MSMEs in Indonesia are the backbone of the national economy, most of them have not been connected to industry. SMEs

For this reason, the Ministry of Cooperatives and SMEs (Kemenkop UKM) will strive to connect micro-enterprises into industrial supply chains.

"In Indonesia, many MSMEs are independent. They produce their own, buy their own raw materials, market themselves," said Teten as quoted by ANTARA, Tuesday, March 5.

"This makes it difficult for our MSMEs to access raw materials, financing, or wider production. So that there is no transfer of knowledge that makes MSMEs not productive," he continued.

Teten added, since 1998 Indonesia has continued to experience deindustrialization, where the industry's contribution to GDP is only 18 percent.

The government, he said, continues to prepare the industrialization of raw materials, one of which is through downstreaming in order to increase the contribution of the industrial economy.

If the industry does not grow, then jobs are difficult to provide. As a result, they can only open micro-enterprises. If more micro-enterprises grow, the competition at that level will be even higher," he said.