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Jakarta Post

37,000 SMEs hit by COVID-19 crisis as government prepares aid

  • Riska Rahman

    The Jakarta Post

Jakarta   /   Thu, April 16, 2020   /   07:45 pm
37,000 SMEs hit by COVID-19 crisis as government prepares aid Cooperatives and Small and Medium Enterprises Minister Teten Masduki. (JP/Dzulfiqar Fathur Rahman)

The government is working on reviewing businesses that are eligible to receive government aid as it receives reports from 37,000 small and medium enterprises (SMEs) severely hit by the COVID-19 pandemic.

Around 56 percent of the reports are related to declining sales, 22 percent to funding, 15 percent to goods distribution and 4 percent to access raw materials, according to the Cooperatives and Small and Medium Enterprises Ministry.

The ministry’s specialized staff on creative economy empowerment, Fiki Satari, said on Thursday it would review the reports to determine which ones are eligible to receive government support aimed at protecting SMEs amid the -19 pandemic.

“Around 87.4 percent of the reports were coming from micro-scaled businesses that have felt the impacts of the COVID-19 crisis,” Fiki said during a virtual press conference. “We are also designing the criteria for businesses eligible for the program so that they don’t receive the same benefits twice.”

The government is preparing a stimulus package for SMEs to help them survive amid the pandemic. The stimulus includes loan relaxations, a six-month tax waiver and cash transfers for micro-scaled businesses, Cooperatives and Small and Medium Enterprises Minister Teten Masduki said Wednesday.

Read also: Indonesia announces Rp 405 trillion COVID-19 budget, anticipates 5% deficit in historic move

The ministry suggests that SMEs convert their businesses to meet current demand, such as making masks and coveralls as the government’s large-scale social distancing (PSBB) policy has forced business owners to close down shops as demand weakens with people staying home.

“This effort could help fulfill the domestic demand for [PPE] personal protective equipment and masks, as well as help them fulfill their daily needs during this pandemic,” Victoria Simanungkalit, the ministry’s undersecretary for production and marketing, said during the briefing.

The ministry is also working together with industrial goods supplier PT Daruma Adira Pratama to help SMEs produce appropriate PPE that corresponds to the Health Ministry’s medical equipment standards.

Currently, there are around 330 SMEs from 16 provinces that have joined the program and around 80 have been included in the Cooperative and Small and Enterprises Ministry’s catalog, Victoria said.

The SMEs have also received a total of Rp 127.8 million (US$8,145) worth of orders from potential buyers consisting of 10,276 masks, 962 hazmat suits and 25 pairs of shoe covers, she added.