Footwear Entrepreneur Asks For Economic Activities To Open Slowly: Government Subsidies Can't Lift The Fall Of The Economy

Director General of Small, Medium and Multifarious Industries (IKMA) of the Ministry of Industry Gati Wibawaningsih. (Photo: Doc. Antara)

JAKARTA - The Indonesian Footwear Association (Aprisindo) has asked the government to open economic activities in stages when the level 4 of the Community Activity Restrictions (PPKM) is implemented. This is considered better than continuously providing subsidies.

Aprisindo's Executive Director, Firman Bakri, said that opening trade activities slowly will have a bigger impact, compared to the effects arising from the subsidy policy provided by the government. He considered the subsidy not so meaningful to maintain business performance.

"I think what is needed now is about easing economic activity. Like it or not, that is the key," he told reporters, Monday, August 2.

So far, the subsidies provided by the government to industry and workers, said Firman, have not had a significant impact in preventing the collapse of the national economy due to the COVID-19 pandemic.

Furthermore, Firman said, if the economy is opened, business actors must strictly implement health protocols so that the spread of COVID-19 does not prolong. This is because this virus has spread for approximately 1.5 years in the country.

"We hope there will be subsidies, but the impact will be small if the economy does not move," he said.

Firman said that the current performance of the footwear industry is only supported by export demand which is still improving. Meanwhile, he said, industries with a domestic market orientation are still falling.

For your information, it is recorded that the production capacity of the domestic market-oriented footwear industry during PPKM is at the level of 20 to 35 percent. In fact, from May to June 2021, demand began to grow with the Idul Fitri moment and the discourse on the reopening of face-to-face schools.

"If the Lebaran moment yesterday was good, it was almost normal, the range of 85 to 90 percent for retail could be at that number. Then in our industry the production capacity can be above 50 to 60 percent, after now PPKM has all gone down," he explained.

As is known, the Ministry of Manpower is finalizing preparations for the implementation of wage subsidy assistance (BSU) in the amount of Rp. 1 million to workers who are in the area of the Enforcement of Community Activity Restrictions (PPKM) level 4.

The Minister of Manpower Ida Fauziyah said the amount of subsidy received by the recipient was IDR 500,000 per month for two months for each worker. Aid will be distributed at once Rp1 million.

"The amount of data that was completed today, we start with 1 million prospective BSU recipients out of an estimated 8.7 million workers will receive. The data for 1 million prospective BSU recipients will then be checked, screened by the Ministry of Manpower to ensure the suitability of the data format and avoid duplication of data ," he said in a virtual press conference, Friday, July 30.