86 Percent of Indonesian MSME Businesses Depend on the Internet: Minister

TheIndonesia.id - Minister of Cooperatives and Small and Medium Enterprises (SMEs) Teten Masduki stated that the digital economy is very closely related to the use of digital aspects by MSMEs and cooperative business processes. President Joko Widodo had conveyed directions regarding the acceleration of the digital transformation of Indonesian MSMEs.

"It is recorded that 86 percent of MSME players depend on the internet to carry out their business activities, 73 percent have an account at digital marketplaces, and 82 percent promote via the internet," he said at the G20 Indonesia side event titled Digital Economy to Support SDGs which was monitored by Antara in Jakarta, Monday, August 8, 2022.

Masduki explained that MSMEs, which contributed 61 percent of the national gross domestic product (GDP), have an important role in Indonesia's digital economy map. This role did not subside when the pandemic hit Indonesia, because the adaptability of MSMEs that transformed during the pandemic has proven to be a key factor in MSME resilience in Indonesia.

"A study by the World Bank states that 80 percent of MSMEs that have a presence in the digital ecosystem have better resilience during the pandemic," said Masduki.

The digital transformation of Indonesian MSMEs is a necessity in the era of digital disruption at the end of the COVID-19 pandemic and is faced with the potential for a demographic bonus. The government targets that there are 30 million MSMEs onboarding in the digital ecosystem by 2024.

As of June 2022, the Ministry of Cooperatives and SMEs noted that 19.5 million MSME players or 30.4 percent of the total MSMEs have been present on the e-commerce platform. The government continues to encourage the creation of new economic value to bring MSMEs into the digital ecosystem, accelerate one million MSMEs' onboarding on the government's goods and service procurement platform, and prioritize the use of domestic products.

Not only that, the head of state also conveyed directions to ensure the protection of domestic online marketplace platforms.

"The three directives are a guide for us in preparing complete digital transformation programs from upstream to downstream and involving all relevant stakeholders," said Masduki. "This is an effort or endeavor so that the economic potential of MSMEs in Indonesia can provide the widest possible benefits for the community," he said.