The government needs to prioritize assistance for micro, small, and medium enterprises (MSMEs) in four sectors, namely manufacturing, agriculture, tourism, and the creative economy, the Institute for Development of Economics and Finance (Indef) has said.

“These four sectors are essential to be pushed, (but) it does not mean that we do not need to pay attention to other sectors. These four sectors are essential to be pushed to boost MSME productivity,” deputy director of Indef, Eko Listiyanto, said at the “Strategies for Boosting MSME Productivity and Financing” webinar on Wednesday.

To increase their productivity in the manufacturing sector, MSMEs need to become suppliers to large companies so that they can imitate the efficient operational activities of large companies with good product quality standards, he observed.

“MSMEs in the manufacturing sector must also participate in the global production networks to push them to produce more efficiently and competitively,” he said.

In addition, MSMEs in the manufacturing sector need to partner with universities that can help them innovate and increase their entrepreneurship competence.

Manufacturing-sector MSMEs that are export-oriented must be provided financing, both by banks and the government, at the same time as the coaching program.

The productivity of MSMEs in the agriculture sector must be increased by providing professional extension workers who can connect farmers with vendors and finance providers.

“The productivity of (MSMEs in) the tourism sector that has been affected by the pandemic also needs to be increased by boosting the community’s confidence to travel again. And, MSMEs in the tourism sector need to be met with the banking sector frequently,” he remarked.

Meanwhile, MSMEs in the creative economy sector need to improve their digital service quality and human resources and integrate research, design, and development with the modernization of other sectors, Listiyanto said.

Financing for creative economy MSMEs can be developed not only through banking, but also crowdfunding, venture capital, and angel investment.

Based on data from Statistics Indonesia (BPS), in 2019, the productivity of MSMEs stood at only Rp80.13 million per worker per year, or lower than the productivity of large businesses, which reached Rp1.64 billion per worker per year.

Source: Antara News