Some 30 million MSMEs to join digital trade: Trade Minister

Jakarta (ANTARA) - Trade Minister Muhammad Lutfi is optimistic that the government would persuade more than the targeted 30 million Micro, Small, and Medium Enterprises (MSMEs) to join digital trade by 2023.

"Seeing very positive developments, we are optimistic that the government's target to encourage onboarding of 30 million MSMEs to digital platforms by the end of 2023 will be achieved. It will even exceed the target set by President Joko Widodo," the minister remarked at the Pelangi Sulawesi - Proudly Made in Indonesia Movement (Gernas BBI) event held virtually on Thursday.

Lutfi expects this to drive the performance of the trade sector and facilitate the recovery of the national economy.

In the second quarter of 2021, the national economy recorded a growth of 7.07 percent from the corresponding period in the previous year. Meanwhile, the trade sector recorded a growth of up to 9.44 percent.

E-commerce transactions during the first semester of 2021 also grew significantly by 63.4 percent, with a transaction value of Rp186.7 trillion (almost US$13 billion), and it was estimated to reach at least Rp395 trillion (over US$27 billion) by the end of 2021.

Lutfi stated that until mid-August of 2021, over 15 million, or 22 percent, of the total MSMEs nationwide had joined the digital trade.

"Of the 15 million MSMEs, more than seven million MSMEs are the result of onboarding during the Gernas BBI campaign launched in May 2020," he informed.

He opined that Indonesia, as one of the largest countries globally, had the potential to become a key player in the world's digital economy.

Indonesia's digital economy in 2020 was valued at Rp632 trillion (almost US$44 billion) and is projected to grow eight folds by 2030 to reach up to Rp4,531 trillion (around US$314 trillion).

"This can be achieved if we optimize the development of equitable telecommunications infrastructure and competent human resources as well as through comprehensive regulatory support," he remarked.

According to Lutfi, MSMEs should conduct collaboration and innovation as the main keys to accelerate digital transformation.

Collaboration is deemed necessary between all stakeholders -- the government, private sector, associations, and banks -- in order to succeed in creating strong, capable, and competitive national MSMEs in the global market.

The second key is innovation. National MSMEs must continue to adapt to advancements of digital technology.

"MSMEs, let us improve our ability to read and analyze the market. Be observant in seeing new opportunities domestically and globally and continue to make product breakthroughs and new innovations," he stated.

Lutfi believes that Indonesian MSMEs can grow and contribute to the national economy if these two main keys were applied, complete with support in the form of good regulations, training, comprehensive digital transformation development, and inclusive financing access.

Reporter: Sella P G, Mecca Yumna
Editor: Sri Haryati
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September 02, 2021