Govt has five commitments to help MSMEs

Jakarta (ANTARA News) - Indonesia's Cooperatives, Small and Medium Entrepreneurs Minister Suryadharma Ali said there were five government commitments in helping micro, small and medium entrepreneurs (MSMEs).

Among them were the empowerment of Business Development Service Providers (BDS-P), funding, creation of job opportunities and empowerment of civitas academic cooperatives as well as harmonization in understanding MSMEs through the law.

Speaking at a journalists orientation forum here on Thursday, the minister stressed that the first government commitment had to do with efforts to empower business development service providers (BDSP).

This institution played a key role in providing consultation services to MSME centers in Indonesia in addition to giving non financial assistance to MSMEs in developing the potential of their businesses. Besides, this institution was also attempting to bridge productive sources like information on capital, markets, technology and human resources.

Data from the Cooperatives, Small and Medium Entrepreneurs Ministry indicated that the empowerment of BDSP had already been developed since 2001.

At present there are about 957 BDSPs, most of which are scattered in 33 provinces and 339 districts/cities.

The second government commitment was linked particularly to funding sector. Talking about funding, many MSMEs were unbankable even though their business prospects were good. They often ran into difficulties in their efforts to obtain working capital.

MSMEs had such assets as plots of land or business buildings. Unfortunately their ownership right could not be made as a collateral in getting credit from banks.

Hence, the ministry had cooperated with the National Land Agency (BPN for many years to make certification program over their right, Suryadharma said adding that it was a chance for MSMEs to solve their funding problems.

"The funding aspect for MSMEs is one of the realizations of the government`s policy package in the real sector," he said adding that improving the aspect of funding, the government will take two steps, namely developing micro financial institutions and credit quaranty program for MSMEs.

Suryadharma also reiterated the third commitment which had to do with the efforts to create job opportunity through university graduates` self employment program (Prospek Mandiri).

This program is directly oriented to business by creating new business opportunities and not to create new job seekers.

In 2006, university graduates` self-employment and job-opportunity creation program was more focused on six provinces, namely East Java, Yogyakarta, West Kalimantan, Maluku, West Nusa Tenggara and Riau islands.

According to a plan, at least 925 university graduates who had set up around 37 cooperatives were reported to be members of the program.

In addition, the cooperatives, small and medium entrepreneurs ministry also had the fourth commitment for the employment of civitas academic cooperatives (Kocika).

The government had allocated a budget of about Rp5 billion for strengthening their capital in the form of revolving funds in 10 Kocika cooperatives in ten higher learning institutions.

Furthermore, the minister said the budget for Kocika program would rise to Rp13 billion in 2008.

The fifth comitment, he added, had to do with harmonization of MSMEs understanding under the law which until now is still under discussion at the House of Representatives.

Under the law, there will be a legal umbrella for the cooperatives, small and medium entrepreneurs ministry to execute their task in helping MSMEs in the country.