Teten Masduki's Response To The 2025 Kemenkop UKM Budget Below Rp1 Trillion: Heavy!

Minister of Cooperatives and SMEs (Menkop UKM) Teten Masduki. (Photo: Doc. ANTARA)

JAKARTA - Minister of Cooperatives and Small and Medium Enterprises Teten Masduki assessed that a minimal budget will be a challenge for the Ministry of Cooperatives and SMEs in efforts to develop and empower the MSME sector in the upcoming government period.

Commission VI of the DPR RI in a working meeting in Jakarta, Wednesday, approved the budget allocation of the Kemenkop UKM for the 2025 fiscal year of IDR 937.17 billion, according to a letter from the DPR RI Budget Agency dated September 10, 2024.

The budget decreased by 37.44 percent compared to the 2024 budget allocation which reached Rp1.49 trillion.

Teten said the Rp937.17 billion budget would be allocated for management support of Rp388.23 billion, as well as entrepreneurship programs, MSMEs, and cooperatives of Rp548.92 billion.

The ministry's budget is considered too small to support the MSME development program.

According to him, MSMEs, which are the backbone of the Indonesian economy and absorb 97 percent of the workforce, require a much larger budget.

"With a budget below Rp1 trillion, it is very difficult for us to take care of millions of MSMEs, especially those on a micro scale. They really need help," he said as quoted by ANTARA, Wednesday, September 11.

He argues that the Ministry of Cooperatives and SMEs needs to be raised to group 2, so that the budget allocation can reach IDR 6 to 10 trillion.

In addition to the increase in the budget, he also emphasized the importance of increasing access to MSME financing to banks.

Teten said that currently there are around 30.76 million MSMEs that have not been connected to banks because they do not have credit history.

"So it's nonsense that you want to empower MSMEs if access to financing is still low. It's not just the ministry's budget that's small," he said.