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The recent session of the Strive Learning Network showcased a peer-to-peer learning approach aimed at advancing Micro, Small and Medium Enterprise (MSME) development. Hosted by the Mastercard Centre for Inclusive Growth, the Ministry of National Development Planning, and Mercy Corps Indonesia, in partnership with the Indonesia Social Impact Centre by AVPN, this programme brought together key stakeholders to share insights and collaborate on effective strategies for supporting MSMEs in Indonesia.
The session highlighted the importance of coordinated efforts between the government, private sector, and communities to drive sustainable growth for MSMEs through the business development service. By leveraging the collective expertise and experiences of these diverse participants, the Strive Learning Network aims to foster a collaborative ecosystem that addresses the challenges faced by MSMEs and unlocks their potential for economic resilience and growth.
Here are some key takeaways for government, private sector, and communities:
Government/Regulator
- Institutional Format Evaluation: Government should evaluate the institutional format of the Ministry of Cooperatives and SMEs to align it with other ministries managing MSME development programmes. A format similar to the National Research and Innovation Agency (BRIN) in Indonesia or the Office of Small and Medium Enterprises Promotion (OSMEP) in Thailand, which operates directly under the president with a work team structure from the central to village level, should be considered. This approach would facilitate better coordination and implementation of MSME development programmes.
- Role as Facilitator: The government’s role in implementing MSME development programmes should be clarified as a facilitator or enabler, rather than a player. Doing so would help avoid the paradox of competition between the government and enabler organisations, focusing the government on its strategic role as a facilitator in MSME development.
- Inclusive Business Programmes: The new government programme, Kartu Usaha, should be designed to be inclusive, involving enabling/supporting organisations in its implementation. The government should maintain its focus as a facilitator or regulator and invite participants from the Strive Learning Network to contribute to the programme’s planning and implementation process.
Private Sector
- Recognition and Positioning: The private sector needs to clearly recognise and position development actors who have strategic potential to partner with the government in achieving development targets. This can be achieved by creating Corporate Social Responsibility (CSR) programmes with a clear theory of change and collaborating with formally recognised MSME support organisations.
- Matching Fund and Multi-Party Collaboration: The private sector can support MSME development programmes through matching fund concepts and multi-party collaboration schemes to accelerate MSME growth. This involves acting as an intermediary for matching funds between government programme funds and donors or corporations.
- Resource Hub and Expert Mentors: The private sector can contribute by supporting the development of resource hubs that provide expert mentors. This will enhance MSMEs’ access to the knowledge and skills necessary for growth and development.
Community/Intermediaries
- Recognition and Positioning: Communities need to formally register and obtain certain certifications or labels as formally recognised entrepreneurship support organisations. This will clarify their position as entrepreneurship mentors or business development service providers with a clear formal status.
- Collaboration and Role in Development: Communities can actively participate in collaboration with the government and private sector in building the MSME ecosystem. This includes clear role distribution, avoiding overlaps, and building complementary relationships to support MSME growth.
- Training and Literacy: Communities should incorporate mindset training into mentoring programmes, especially for women and micro-business actors. This will help improve the quality and resilience of MSMEs in facing business challenges and opportunities.
By addressing these key areas, the development and support of MSMEs in Indonesia can be significantly enhanced, leading to sustainable growth and economic resilience.
