Presidential Instruction 2/2022 Becomes Momentum For Accelerating Domestic Product Shopping

Photo: BPMI Setpres / Laily Rachev

JAKARTA - Head of the Government Goods/Services Procurement Policy Institute (LKPP) Abdullah Azwar Anas assesses the Presidential Instruction (Inpres) No. 2 of 2022 as a momentum to accelerate domestic product spending and Micro, Small and Medium Enterprises (UMK) and cooperatives.

In Presidential Instruction 2/2022 concerning the Acceleration of Increasing the Use of Domestic Products and Products of Micro, Small Business, and Cooperatives in the Context of the Success of the Proud National Movement Made in Indonesia in the Implementation of the Procurement of Government Goods/Services issued on March 30, 2022, all line ministries/agencies and local governments were instructed to spur spending on domestic products (PDN) and MSEs.

"This is a very good momentum. The President has given instructions. If PDN and UMK-Cooperatives get more space in government spending, it is very good for economic recovery and economic equality," said Anas in a written statement in Jakarta, Saturday, April 2.

Anas said the Presidential Instruction shows that President Jokowi is very serious in helping PDN producers and UMK-Cooperatives.

"The involvement of PDN and UMK-Cooperatives will not only accelerate economic recovery, but also build the strength of the domestic industry," explained Anas quoted from Antara.

There are several points of the President's instructions in Presidential Instruction 2/2022, including establishing and/or changing policies and/or laws and regulations to accelerate the increase in the use of domestic products and empowering MSEs-Cooperatives.

In addition, realizing at least 40 percent of the budget value for goods/services to use UMK-Cooperative products from domestic production.

Likewise, formulating a strategic roadmap to increase the use of domestic products and products of Micro, Small Business, and Cooperatives, including a roadmap to increase the number of domestic products towards 1 million products displayed in electronic catalogs (e-catalog).

Another point is to convey the import reduction program by 2023 at the latest up to 5 percent for ministries/agencies and local governments that are still fulfilling their spending through imports.

Responding to this instruction, LKPP also cut the bureaucracy so that more domestic products and UMK-Cooperatives will appear in the e-catalog.

"The first thing we do is cut the bureaucracy/stages to enter the e-catalog, both national and local e-catalogs. Regarding the national e-catalog, we are now in the process of summarizing the flow of products that previously took eight stages to only two stages. ," said Anas.

The same applies to local e-catalogs, which play a role in promoting equity and economic development in the regions. Previously not many local governments had local catalogs due to various factors.

"So, at the suggestion of President Jokowi and the Coordinating Ministry for Maritime Affairs and Fisheries, we dropped several conditions. The local catalog management mechanism was simplified from the previous four stages to just one stage. Now that is the opportunity for regional entrepreneurs, regional MSMEs, to enter," explained Anas.

As for the next step, LKPP is currently preparing a system development in the government's general procurement plan (RUP), both ministries/agencies/local governments. The system can identify and manage the allocation of PDN and UMK-Cooperative spending from planning.

"The third is from the payment side. Now we are harmonizing the policy of the Minister of Home Affairs to issue regulations regarding ease of payment by encouraging the use of Government Credit Cards and Local Government Credit Cards," he said.

"With this facility, MSEs will no longer have difficulty transacting with the Regional Government because the Regional Government can pay directly, so that MSEs will not have cashflow difficulties. This is part of encouraging PDN and MSEs to be more involved in accessing the APBN/APBD," added Anas.