Business Incentives for MSME by the Ministry of Investment as a Driver of ‘Just’ Economy

There are still several things that need to be improved regarding the provision of assistance by the Ministry of Investment. Several aid recipients also complained about the lack of continuity by the government such as guidance and other incentives. Picture: Unsplash

At least for the past few months, the Minister of Investment/Investment Coordinating Board, Bahlil Lahadalia has provided several assistances to Micro, Small and Medium Enterprises (MSME) as well as symbolically providing Business Permit (NIB) in several areas. Minister of Investment/Head of BKPM Bahlil Lahadalia provided business assistance to 550 MSME players who attended from districts/cities in DI Yogyakarta Province such as Sleman, Gunung Kidul, Kulon Progo, Bantul and Yogyakarta. The event was held at the Gadjah Mada University (UGM) Valley Sports Center (GOR) in Sleman.

One of the recipients is Hardiyo (57) a disabled person from Gunung Kidul who received symbolic assistance from Bahlil Lahadalia at the event. Hardiyo explained that he expressed his gratitude to the government for helping the micro business he runs. Hardiyo, together with disabled friends who are members of the Mitra Sejahtera Disability Empowerment Center, has a business using patchwork cloth to make doormats.

According to him, the assistance provided by Minister Bahlil has had a huge impact on his business so that he has quite a large turnover, say 4.5 to 5 million per month, a much higher increase compared to before the assistance was given, namely 2.5 million. Hardiyo admitted that he received business assistance from Minister Bahlil in the form of an order for 480 products with a value of IDR 46,000,000. He used this assistance for capital expenditure and equipment to develop his business. Furthermore, Hardiyo appreciated the government's performance in providing assistance, especially to people with disabilities.

In line with Hardiyo, Sri Rumayanti (68) also appreciated the performance of the government, especially the Ministry of Investment/BKPM which gives special attention to Micro and Small and Medium Enterprises, especially in her region. Sri Rumayanti, who owns a jumputan fabric business, received assistance in the form of ordering 500 products with a value of IDR 100,000,000. He used the business assistance to buy business equipment and raw materials and set aside the money to teach community women how to develop jumputan businesses.

In conclusion, the various business assistance provided by the Ministry of Investment has had quite an impact, especially for Micro, Small and Medium Enterprises. In general, the aid recipients we contacted after providing business assistance stated that they felt a sense of 'fairness' in providing aid by the government. However, there are still several things that need to be improved regarding the provision of assistance by the Ministry of Investment. Several aid recipients also complained about the lack of continuity by the government such as guidance and other incentives. Hardiyo, for example, complained about the lack of continuity of assistance, especially for the disability groups he supports. Furthermore, he hopes that more assistance will be directed to disability groups in order to empower disability groups.

Based on interview data from all aid recipients that we obtained, the majority of aid recipients have an educational background that has not yet taken further education. Some of them even still have a secondary education background such as middle school or high school and equivalent. This can be correlated with the government's efforts to develop the business capabilities of people who do not take the higher education route. Thus, business assistance in the form of capital injection alone is not enough. Sustainability in providing assistance such as business provision, community and related community empowerment, as well as developing business capabilities is still very much needed to help move MSMEs in a fair manner.