Indonesia: Govt boost exports of SME products through virtual business matching, coaching

The Trade Ministry is trying to spur exports by small and medium enterprises (SME) by connecting them with potential buyers abroad through virtual business matching events.

In a virtual meet-up in mid-May, West Nusa Tenggara-based brown sugar producer Gula Merah Lombok secured a purchase agreement worth Rp 529.8 million (US$37,000) with Bakso Rawit Ani Pty. Ltd, which sells meatball and sambal products in Australia.

Kasan Muhri, the Trade Ministry’s director general of export development, revealed on Monday that there would be at least four virtual business matching events between July and November. The upcoming session would be an ASEAN and South Korea virtual meet-up between July 13 and Aug. 15.

“COVID-19 is not only about constraints,” Kasan said in a virtual discussion on Monday. “Instead, our chance to introduce buyers to exporters is greater right now.”

“We can connect them virtually with the help of our trade representatives to confirm the buyers and then we provide the suppliers from here,” he added.

With the coronavirus pandemic limiting mobility worldwide, the Trade Ministry is using digital means to prevent Indonesia’s exports from plunging further after declining by 28.95 percent year-on-year in May.

The government is also keen to increase SMEs’ contribution to the national exports from the current share of around 14 percent.

Small businesses, which contributed nearly 61 percent to the country’s economy, are facing issues related to knowledge, production capacity and human resources to export their goods.

To spur exports of small businesses, the Trade Ministry runs a one-year program to guide them on export-related issues. The Export Coaching Program has helped 149 small businesses sell their products overseas since 2010, including Gula Merah Lombok.

West Java-based shoe and sandal manufacturer PT Indoto Tirta, which joined the program in 2019, shipped in late June products valued at Rp 541 million to neighboring Singapore, Indonesia’s fourth-largest export destination.

Joining the ministry’s effort, state-owned Bank Rakyat Indonesia (BRI) is planning to hold an expo in December to promote Indonesian small businesses’ products and introduce them to foreign buyers if the pandemic has abated, according to Supari, the director of small business at the bank.

“If [the potential buyers] cannot come, we will create an expo that buyers in other countries can access virtually,” said Supari.

The government was focusing on encouraging SME exports of furniture, marine products and food and beverages, including halal food products, said Cooperatives and SME Minister Teten Masduki.

“We will facilitate the export of these products, in line with the demand in the global market,” said Teten. “This is our priority.”