Inter Sectors Collaboration in Strengthening SMEs, Key for Post-Pandemic Recovery Acceleration

INDUSTRY.co.id - Jakarta - Indonesia owns an important role to support the world’s policy that prioritize various parties collaborations as the key to realize an inclusive world economy, included Small Middle Enterprises (SMEs) participation in the global value chain. This is one of the issues that is discussed by the B20 business forum members, mainly in the Trade and Investment Task Force, in line with the focus of discussions on the 2022 G20 forum led by Indonesia.

 

Dr. Juan José Daboub, the 2022 Co-Chair Trade & Investment Task Force B20, disclosed, the COVID-19 pandemic, which has been lasting for two years, has a very big impact on the economy in various countries, included in Indonesia. For the first time in G20, Indonesia owns a chance to form a policy of the inclusive world economy that involves all parties, included to help SMEs.

 

Dr. Daboub, who has ever been as the World Bank Managing Director for 2006-2010 said, Indonesia owns many special experience to lead discussion regarding economy recovery in many international forums. Indonesia has successfully proven through the COVID-19 pandemic crisis. The country is enable to rise and recover faster than many other countries, so that the World Bank appreciates the country. In 2021, the Indonesian Gross Domestic Products (GDP) rose by 3.7%. In 2022, the World Bank hopes, the Indonesian GDP is expected to raise by 5.2%.

 

That successfulness, according to Dr. Daboub, are inseparable from the government’s role in good macroeconomic management and the implementation of the National Economic Recovery Program (Program Pemulihan Ekonomi Nasional/PEN). “The Indonesian fiscal and macroeconomic policies are enable to become a good example for other countries because it reflects a flexibility for adaptation without interfering with dicipline for years,” asserted Dr. Daboub, who has also been a member of the Board of Directors of Phillip Morris International (PMI).

 

Currently, several B20 task forces is finishing the discussion of policy recommendation that will be presented to the G20. The B20 forum that is consisted of the international-scale companies is one of the G20 group engagement. Dr. Daboub explained, PMI together with other members led by Arif Rachmat, Chairman of the Trade & Investment Taks Force B20, is processing many policy recommendations on economy recovery efforts. Besides, it is also finishing the discussion of joint action steps as a commitment form of the B20 members that support G20 in empowering the SMEs.

 

According to Daboub, despite a large part of the B20 policy recommendations is aimed to the government, but as the business actors, the B20 group is also enable to express a real example for collaboration, global cooperation, and dialogue between stakeholders on good policies and business practices in supporting a recovery acceleration as well as global economic stabilization, that is in line with the President Joko Widodo’s direction.

 

One of the initiatives of the 2022 B20 Trade and Investment Task Force in supporting the Indonesia G20 Presidency target is a real role of the business actors in B20 to encourage a digital transformation, as well as expanding the SMEs access in order to be enable to compete, and become a part of the global supply chain through the Inclusive Closed Loop Ecosystem B20.   

 

Dr. Daboub mentioned, the SMEs sector is a veins of the Indonesian economy. He clarified, the business actors are enable to play important roles in realizing the inclusive economic commitments through a partnership with the SMEs and collaboration with many parties, included the government, for equipping the SMEs with knowledge, skills, technology and networks to increase competitiveness, both domestically as well as in the global value chain.

 

PMI is one of the companies that supports the B20 initiatives in raising the SMEs capabilities. The PMI affiliation in Indonesia, PT HM Sampoerna Tbk, has developed more than 160.000 SMEs grocery stores that are incorporated in Sampoerna Retail Community (SRC). Through many programs, the SRC members’ grocery stores are drived to adapt a digital technology in helping business development and increasing competitiveness.

 

“Through the B20 forum, we contribute, both in giving suggestion and sharing experience regarding our real efforts in supporting business actors for the SMEs digitalization so that they are more competitive and not lagging behind in economic growth. The collaboration between the business actors and SMEs also needs a full support from the government, in a form of the inclusive policies and programs, that involves all of stakeholders,” Dr. Daboub clarified.

 

Meanwhile, the Chairman of the Indonesian Commerce and Industry Chamber (KADIN), Arsjad Rasjid, agreed with the importance of developing Indonesian SMEs in increasing capacity in the digital era so that the inclusive economic growth is enable to be realized.

 

Evidently, referring to data obtained by KADIN, of the 12.5% of Indonesian SMEs that have implemented online selling strategies during the COVID-19 pandemic in 2020-2021, all of them were not affected by the economy impact. In fact, 27.6% of them showed sales increase.

 

Arsjad revealed, SMEs own an important and strategic role in the Indonesian economy structure. It is caused by 99.99% of business actors in Indonesia are SMEs with employment up to 97%. It contributes to the national GDP of 61.97%.

 

Therefore, the private sector role, especially corporations, in collaborating with the government is needed so that SMEs are more competitive in the recent digital era. “Assistance from the large business actors and the government is enable to reduce the challenge burdens for SMEs actors, such as capital assistance,” said Arsjad.

 

The same thing is also carried out by KADIN as the direct participation form in realizing the spirit of inclusive economic growth. “Currently, the Indonesian KADIN encourages the strengthening of partnerships, synergies, and collaborations between SMEs and large businesses in the industrial supply chain,” he continued.

 

Moreover, SMEs are also unable to be separated from the recent dynamics where the business world enters the Industrial 4.0 era. All things are integrated through digital. “The Indonesian KADIN hopes that SMEs are enable to overcome the challenges that have been faced, such as capital access and raw materials, marketing access, including to penetrate the export market as well as expanding the coverage area through digitalization,” he explained.

 

In the role of organizing the B20 Business Forum, the Indonesian KADIN invites all G20 member countries to participate in a dialogue regarding the formulation of recovery solutions and the global economy strength. It is hoped that there will be more investment come to Indonesia in accelerating the national economy recovery and movement.

 

The common thread is innovation and collaboration. “Collaboration between governments, communities and business associations of many countries and different industry categories will provide input from rich and diverse points of view. It’s hoped that later on it will be followed by real actions and policies that are enable to be implemented in order to realize an inclusive economy,” he added. ***