BI launches programs to support SMEs

The Jakarta Post, Jakarta

Coinciding with its 54th anniversary, Bank Indonesia officially launched four programs Monday focusing on the strengthening of micro, small and medium enterprises (SMEs) in the provinces to help accelerate the growth of the real sector.

The programs comprise the establishment of a task force to facilitate the acceleration of regional economies, a pilot project to cluster SMEs based on commodity and geographical groupings, an on-line service providing business data and information, and a visitor center at BI's headquarters, BI governor Burhanuddin Abdullah said.

They are all part of BI's commitment to improving the real sector in the regions, especially the role of SMEs, added Burhanuddin.

The task force is tasked with finding solutions to the problems hampering the strengthening of the real sector in different regions.

It's membership will consist of representatives from BI, provincial leaderships, commercial banks, private companies and academic institutions, and it is expected to function as a mediator and guarantor for SMEs in securing loans from banks.

The task force has already established pilot projects in eight regions, including Medan (revitalization of oil palm and rubber plantations), Bandung (vanilla, corn and rice cultivation), Manado (corn cultivation), Cirebon (cassava cultivation), Pontianak (orange groves), Jambi (palm and rubber plantations), Kupang (seaweed farming), and Purwokerto (goat raising).

As for the pilot projects to cluster SMEs based on commodity and geographical groupings, Burhanuddin said that these were intended to improve the bargaining positions of SMEs.

"SME clusters have been established in six provinces comprising Banten for the promotion of emping mlinjo (rice crackers), West Java for paprika, West Nusa Tenggara for seaweed, Central Java for rattan furniture, East Java for shoes and North Sumatra for cassava."

Burhanuddin further explained that the on-line service would provide up-to-the-minute information on business in Indonesia via the BI website at www.bi.go.id.

The information service, which would provide both micro and macro information, was expected to help improve the intermediation role of the banks in channeling loans to SMEs.

Lack of capital is one of the many problems facing SMEs, the economic mainstays in most of the country's provinces, as they attempt to grow their businesses.