MSME digitization necessary to support Indonesia's economic recovery by Fardah

 Jakarta, June 3, 2021 (ANTARA) - Indonesia’s 64.2 million micro, small, and medium scale enterprises (MSMEs) have contributed Rp8,573.89 trillion, or 61.07 percent, to its GDP (gross domestic product) as of March, 2021, as per data from the Cooperatives and Small Medium Enterprises (SMEs) Ministry.

MSMEs absorb 97 percent of the national work force, account for 60.4 percent of the total investment, and contribute 14.37 percent to export growth, data has shown.

Given their contribution, Coordinating Minister for Economic Affairs, Airlangga Hartarto, has called MSMEs critical pillars of the Indonesian economy.

National Development Planning Minister/National Development Planning Agency (Bappenas) head Suharso Monoarfa, however, wants MSMEs to play a broader role in boosting Indonesia’s economy.

"Some 99 percent of the businesses in Indonesia are dominated by MSMEs, which absorb 97 percent of the total number of workers, but MSMEs only contribute 57 percent to the national GDP," Monoarfa stated on May 26, 2021.

Despite various MSME development programs being conducted by ministries and state institutions, the results have yet to be optimal, he observed.

The minister drew attention to an evaluation of MSME programs from January, 2020 that pointed to moral hazards existing in the capital grants offered by ministries and state institutions to MSMEs.

"This is since it (a grant) does not have to be returned and utilized for non-business related purposes," he explained.

The National Development Planning Ministry/Bappenas, the Ministry of Finance, the SME and Cooperatives Ministry, and other concerned ministries and institutions will evaluate MSME development programs as a basis for budget allocation in 2022, he said.

He suggested that the role of the SME and Cooperatives Ministry, as the coordinator of the MSME development programs, be bolstered. Companies partnering with MSMEs should receive incentives, he added.

 Indeed, a great number of MSMEs in Indonesia are still facing several challenges.

GLOBALIZATION, DEEPENING POLITICAL DIVIDE BRING TEST FOR PANCASILA by Fardah

 

The prolonged COVID-19 pandemic has once again forced the Indonesian people to commemorate Pancasila Day virtually.

 

Wearing the traditional attire of South Kalimantan, President Joko Widodo (Jokowi) led the commemoration ceremony, held in a "hybrid" manner, from the Bogor Presidential Palace, while high-ranking officials gathered in the yard of the Pancasila Building inside the Foreign Ministry compound in Jakarta, or joined in the celebrations from their offices.

 

Those who participated in the ceremony included chairman of the People's Consultative Assembly (MPR), Bambang Soesatyo, who read out the Pancasila text, and chief of the House of Representatives (DPR), Puan Maharani, who read out the preamble to the 1945 Constitution (UUD1945).

 

The Indonesian people have been commemorating the birth of the Pancasila ideology since 2017, following the signing of Presidential Decree no. 24 of 2016 by the President, who also declared  June 1 as a national holiday.

 

The Pancasila (Five Principles), which reflect the Indonesian state’s philosophy, were first articulated on June 1, 1945, in a speech delivered by Sukarno before the preparatory committee for Indonesia’s independence, sponsored by the Japanese colonizers.

 

Sukarno had argued that the future Indonesian state should be based on Five Principles: Indonesian nationalism; internationalism, or humanism; consent, or democracy; social prosperity; and, belief in one God. Indonesia proclaimed its independence on August 17, 1945, and Sukarno went on to become its first president.

 

Following a consensus among Indonesia’s founding fathers, the Pancasila, in a slightly altered order and amended wording, was enshrined in the 1945 Constitution, passed on August 18, 1945. The doctrine now envisaged belief in one God, a just and civilized humanity, Indonesian unity, democracy under the wise guidance of representative consultations, and social justice for all the people of Indonesia.

 

INCREASING AWARENESS OF INDONESIANS LIVING IN "DISASTER SUPERMARKET"

 

Jakarta, 28/5, 2021 (ANTARA) - Natural disasters are a day-to-day occurrence in Indonesia, as some 10 natural disasters occurred daily in January-March 2021, up from nine per day during 2020, of the total of 3,253 natural disasters that took place.

The world's largest archipelagic nation comprising over 17 thousand islands is located in the Pacific Ring of Fire, a horseshoe-shaped region of converging tectonic plates and several volcanoes.

The country has four disaster clusters: geology and volcanology (volcanic eruptions, earthquakes, and tsunamis); hydro-meteorology I (forest fires and drought), hydro-meteorology II (flash floods, landslides, and coastal abrasion); and non-natural disasters (waste, epidemics, and technological failures).

"In fact, outsiders call Indonesia a 'disaster supermarket' because of our complex demographic contours. We are one of the 35 countries, with the highest level of potential disaster risks in the world according to the World Bank's indicators," National Disaster Management Agency (BNPB) Head Lt Gen. Doni Monardo stated on May 6, 2021, while speaking at an online seminar on "The Importance of Building Disaster Competencies and Skills in Indonesia" organized by the School of Environmental Sciences (SIL) of the University of Indonesia (UI).

During the January-April 14, 2021, period, a total of 1,118 natural disasters had struck various parts of Indonesia, according to the BNPB data.

The natural disasters comprised 473 occurrences of floods, 305 whirlwinds, 217 landslides, 17 earthquakes, 90 forest and land fires, one incident of drought, and 15 high tides and abrasions. On April 13, 2021, the government declared the spread of COVID-19 as a non-natural national disaster.

At least 472 people lost their lives, 60 people went missing, and 12,872 others sustained injuries in the disasters. The natural disasters forced 4,901,400 people to flee their homes and damaged 137,719 homes, with 24,987 houses sustaining severe damage, 25,926 houses experiencing moderate damage, and 86,806 houses suffering light damage. A total of 2,547 public facilities were also damaged, comprising 1,316 educational facilities, 926 places of worship, 305 health facilities, 402 offices, and 297 bridges, according to the BNPB.

Most of the natural disasters were reported in West Java, reaching 284; followed by 157 in East Java; 156 in Central Java; and 76 in Aceh.

Finance Minister Sri Mulyani Indrawati earlier stated that disasters had led to losses amounting to Rp28.8 trillion annually.

Indonesians earlier paid no attention to weather forecasts. However, since the frequency of natural disasters, such as cyclones, whirlwinds, and tornadoes, had been increasing, several people are currently left with no choice but to follow the weather forecast news.

Hence, President Joko Widodo (Jokowi) has sought easier public access to weather forecast and warnings of the Meteorology, Climatology and Geophysics Agency (BMKG) to raise awareness on potential disasters.

NEW INVESTMENT MINISTRY EXPECTED TO DRIVE ECONOMIC TRANSFORMATION BY Fardah

Jakarta, 26/5, 2021 (ANTARA) - The Joko Widodo administration's decision to upgrade the Investment Coordinating Board (BKPM) into the Ministry of Investment has been welcomed by the business community as it is expected to create positive sentiment among domestic as well as foreign investors.

The new ministry, announced by President Widodo on April 28, 2021, has been created to improve the ease of doing business in Indonesia as it struggles to recover from the COVID-19 pandemic. BKPM chief Bahlil Lahadalia has been appointed as the Investment Minister.

Indonesia has been working to realize economic growth of around five percent this year through direct investment, among other things.

The newly formed Investment Ministry is expected to attract investment into the country and create jobs, which are key to driving economic growth in 2021, according to Widodo.

"The key to growth, our economic growth, is investment. Because it is impossible for us to drastically increase our state budget. This means that the key is in investment and creating as many job opportunities as possible, the President said recently.

He then asked that trade policies be formulated to invite investment inflows. Such policies must also help recover economic sectors that contracted last year due to the impact of the COVID-19 pandemic, he added.

Investment Minister Bahlil Lahadalia has formulated a strategy to increase the investment target up to Rp900 trillion for 2021 and Rp5 thousand trillion in 2024.

The new minister has a five-point plan to increase added value with downstream orientation to drive Indonesias economic transformation.

"The first one is investment in the health sector. We know that almost all of our medical devices and medicinal raw materials are imported," he said.

GOVERNMENT POSITIVE ECONOMIC RECOVERY ON HORIZON by Fardah

 

Jakarta, 23/5, 2021 (ANTARA) - The Indonesian government is optimistic the economy will grow positively this year with indications of an improvement emerging amid the pandemic and containment measures, which have plunged the global economy into a deep contraction.

After Indonesia recorded its first coronavirus cases in March, 2020, economic growth spiraled to minus 5.32 percent in the second quarter to reach minus 3.49 percent in the third quarter and minus 2.19 percent in the fourth quarter of last year. Overall, the Indonesian economy shrunk 2.07 percent year-on-year (yoy) in 2020, a figure that is considered better than several other countries.

In the first quarter of this year, the country saw a significant improvement, with the economy recording a smaller contraction of 0.74 percent as the Retail Sales Index, Consumer Confidence Index, and manufacturing Purchasing Managers Index strengthened. A rise in car sales, electricity consumption, and cement production also provided a positive impetus to Indonesia's economic recovery.

The government is optimistic that the national economy would continue to improve and grow at a high rate of 4.5 percent-5.3 percent by the end of 2021.

However, to achieve this figure, the economy needs to grow positively in the range of 6.9 percent-7.8 percent in the second quarter of 2021.

The government believes that positive economic growth can be attained through state budget stimulus programs, acceleration of the vaccination program, and consistent implementation of the health protocols.

Furthermore, the government plans to encourage the strengthening of local industries in various key strategic fields, such as palm oil, chemicals, aluminum, electronics, and footwear, to help boost the economy.

"Our economic growth rate indicates a positive trend. It is expected to reach seven percent (in the 2021 second quarter)," Coordinating Minister for Economic Affairs, Airlangga Hartarto, observed on May 15, 2021.

As of March, 2021, the realization of foreign direct investment reached 54.6 percent, while the consumer confidence index among people with expenses below Rp5 million was recorded at 90.1, inching towards the normal zone of 100, the minister stated.

A positive trend was also evident in the growth of Indonesia's exports and imports, gross fixed capital formation (GFCF), and government spending, Hartarto pointed out.

A surge in the prices of commodities, such as palm oil, rubber, nickel, copper, and coal also bolstered the government's efforts to revive the economy. The rising prices of those commodities helped improve economic conditions in several regions during the first quarter of 2021.

The economic improvement was also supported by the realization of the national economic recovery budget (PEN), which, as of May 11, 2021, touched Rp172.35 trillion, an increase of Rp49.01 trillion compared to the first quarter of 2021, or late March this year, Hartarto told the press following a limited ministerial cabinet meeting on May 17, 2021.

The PEN realization accounted for 24 percent of the total state budget of Rp699.43 trillion allocated for the program this year.

GOTONG ROYONG A SHOT IN THE ARM FOR COVID BATTLE by Fardah

 

Jumat, 21 Mei 2021 22:17

Daerah : Jakarta

Indonesia has been striving to win the fight against the COVID-19 pandemic since March last year. To stem the transmission of the lethal virus, the government has rolled out a nationwide vaccination program since January 13 this year.

In the first and second phase of the nationwide vaccination program, the government is targeting to cover 40,349,049 citizens, including human resources in the health sector, senior citizens, and public service workers.

According to the COVID-19 Handling Task Force, a total of 9,366,635 citizens have received two vaccine shots (have been fully vaccinated against COVID-19) and as many as 14,099,754 citizens have been administered the first vaccine shot as of May 20, 2021.

The government-funded vaccination program is using Sinovax vaccines bought from China and AstraZeneca vaccines received through the WHO-coordinated COVAX Facility.

Indonesia has so far secured 54 million vaccine doses free of cost through the World Health Organization (WHO) and spent nearly Rp77 trillion on procuring additional vaccine doses to cater to the large population of the country, which are being distributed free of charge.

The launch of the self-funded Gotong Royong vaccination campaign on May 18, 2021, witnessed by President Joko Widodo at PR Unilever Indonesia complex, Bekasi, West Java, is expected to expedite national efforts to contain COVID-19.

Supported by private and state-owned companies, the Gotong Royong program is seen as crucial for helping the government achieve the target of inoculating 181.5 million people to build herd immunity against the coronavirus.

President Widodo said he is optimistic that once workers begin receiving the self-funded Gotong Royong vaccines, the number of vaccine recipients could reach 70 million by September, 2021.

"We expect to be able to vaccinate 70 million citizens by this August or no later than September (2021),” he said.

Widodo said he also hopes to see the COVID curve flattening during the August-September period and normalcy being restored in industrial productivity.

Chairperson of the Indonesian Chamber of Commerce and Industry (Kadin), Rosan Perkasa Roeslani, said that at least 22,736 private companies have signed up for the program as of May 17, 2021.

The first phase of the Gotong Royong Vaccination Program will be implemented in 18 companies.

Based on the Indonesian Health Ministry's Regulation No.10/2021 on the Gotong Royong Vaccination Scheme, all vaccine costs will be borne by participating companies under the program.

Meanwhile, State-owned Enterprises (SOE) Minister Erick Thohir has said that his ministry has no plans to commercialize COVID-19 vaccines.

"Regarding prices, from the beginning, we in the SOE Ministry have been very open. We are not thinking about commercializing the COVID-19 vaccines," Thohir said at a press conference on May 19, 2021.

For the self-funded program, the SOE Ministry and Kadin have kept vaccine prices transparent and they are being audited by the Financial and Development Supervisory Agency (BPKP), he added.

The Indonesian government has set the price for Sinopharm and CanSino vaccines that will be provided under the Gotong Royong Vaccination Program at Rp500 thousand per shot.

The price includes Rp375 thousand as the cost of each vaccine dose and Rp125 thousand as the cost of inoculation, Coordinating Minister for Economic Affairs, Airlangga Hartarto, informed at an online press conference originating from the Presidential Palace recently.

The government has signed a contract with Sinopharm for 7.5 million doses and with CanSino for five million vaccine doses, he said.

Indonesia's Food and Drug Control Agency (BPOM) has issued emergency-use authorization (EUA) for the COVID-19 vaccine manufactured by China's Sinopharm.

"Today, we have issued EUA for the vaccine produced by Beijing Bio-Institute Biological Products, which is a unit of Sinopharm, a subsidiary of the China National Biotech Group. This is the Sinopharm vaccine," BPOM head Penny Lukito stated during an online press conference on April 29, 2021.

On April 30, a total of 482,400 doses of the Sinopharm vaccine arrived in Jakarta from China, and on May 1, Indonesia was gifted 500 thousand doses of the Sinopharm vaccine by the United Arab Emirates. This June, Indonesia is expected to receive another one million doses as part of its order with Sinopharm.

From July to September this year, Indonesia is hoping to receive Moderna and Novavax vaccines to support the Gotong Royong vaccination program. It is also planning to allow Pfizer and Sputnix vaccines for the Gotong Royong program.

Earlier, the Health Ministry had appealed to people to not be picky about the COVID-19 vaccines offered by the government, saying the WHO has declared all currently authorized and recommended vaccines safe.

"So, there is no reason for the public to hesitate to participate in the vaccination program," Siti Nadia Tarmizi, spokesperson for the ministry, said .

The huge number of vaccine doses needed by Indonesia cannot be supplied by just one vaccine manufacturer, she said. In fact, countries around the world have been competing fiercely to secure vaccine supplies for their populations, she pointed out.

"At first, Indonesia received the Sinovac vaccine. Then, at the end of March and early April, 2021, we had the AstraZeneca vaccine, and in June or July, 2021, other vaccines are scheduled to arrive, (which) include Novavax and Pfizer," she noted.

The government is calling all vaccines as COVID-19 vaccines, so that they are no longer identified on the basis of producers, Tarmizi said. (INE)

 

EDITED BY INE