Boosting the Economy, the Government Strengthens the Role of the Red and White Village Cooperative

Photo: Antara

JAKARTA - Trade Minister Budi Santoso stated that the government would optimize the role of the Red and White Village/Neighborhood Cooperative (KDMP) as a distribution partner for the retail network.

According to him, the scope of KDMP is much wider and can become a channel for distributing products from retailers and distributors to rural communities.

"If we talk about Kopdes / Kel Merah Putih, its reach is wider. Regarding retail, this can supply its products through Kopdes / Kel Merah Putih," he told the media, Thursday, February 26.

Budi explained that the cooperative was designed to be present in various regions of Indonesia with flexible functions, so that it can operate like a minimarket with a variety of product choices, Kopdes/Kel Merah Putih also has the potential to provide agricultural production facilities such as fertilizers and medicines.

Budi also highlighted a number of advantages of village cooperatives that will be present throughout Indonesia so that they can operate like a minimarket with a wider variety of products, these cooperatives also have the potential to provide agricultural needs such as fertilizers and medicines.

"KDMP can also function as a pharmacy, as a clinic, and also as an exporter," he explained.

He added that cooperation between modern retail and village cooperatives is very possible, because products from retailers and distributors can be supplied through KDMP.

In addition, Budi said that modern retail permits remain the authority of the local government and it is hoped that they will be wise in developing cooperatives so that they really benefit the prosperity of the village.

"So I think the local government will be wise in developing its cooperatives for the prosperity of the village. Because the village cooperation belongs to the village, so whatever is produced for the prosperity of the village community or the village government," he explained.

According to Budi, the existence of Kopdes/Kel Merah Putih aims to mobilize the local economy and as a village-owned entity, all its results and activities must add value for the local community.

"So that economic empowerment can run well. So we hope that the KDMP will be more proportional so that it becomes a strong institution and an institution that has a function to empower the economy in the village," he said.

Previously, Minister of Finance Purbaya Yudhi Sadewa revealed that the government had allocated Rp90 trillion in the first quarter of 2026 for the development of Kopdes/Kel Merah Putih.

The program is expected to be able to encourage village investment as well as accelerate national economic growth from the grassroots level.

"With the support of capital expenditure of IDR 90 trillion in the first quarter of 2026, this program is expected to be an impetus for village investment and an accelerator of national economic growth from the grassroots level," he said.

The development of Kopdes/Kel Merah Putih is directed at strengthening food security and village economies, cutting the distribution chain and reducing dependence on middlemen, suppressing commodity prices so that purchasing power increases, creating jobs, and supporting poverty alleviation.

"Through this program, the government encourages villages as new growth centers by making village funds not just a routine expenditure but an investment instrument with productive and sustainable capital expenditure," he added.