Indonesia Aims to Add One Million New SMEs by 2024

TheIndonesia.id - The government of Indonesia, through Presidential Regulation No. 2 of 2022 on 2021–2024 national entrepreneurship development, is seeking to add one million new small and medium enterprises (SMEs) by 2024 to increase the country’s entrepreneurship ratio. 

Ninety-nine percent of entrepreneurs in Indonesia run micro, small, and medium enterprises (MSMEs), Cooperatives and SMEs Minister Teten Masduki noted during the “Entrepreneurship Interactive Dialogue and Public Lecture” themed “Young Entrepreneurs Wanted” here on Friday.

However, only 3.18 percent of them are in the established entrepreneurs category, he added during the program held to unveil the ministry’s cooperation with Andalas University for bolstering startup capacity.

"This is very small when compared to Singapore, which has established MSMEs that reached 8.76 percent, with the population at less than 5 million people," he elaborated.

Indonesia currently has a population of 270 million, but entrepreneurs make up only 3.18 percent of it. Meanwhile, the proportion of entrepreneurs in Malaysia and Thailand is already higher than in Indonesia at 4.74 percent and 4.2 percent, respectively.

Therefore, the government is seeking to add one million new entrepreneurs so that, by 2024, their composition will rise to 3.95 percent.

"It would be great to reach 4 percent because, in order to become a developed country, the number of entrepreneurs must be 4 percent of the total population," he informed.

He added that in developed countries, the proportion of entrepreneurs is 10–14 percent. It is estimated that Indonesia will become the fourth largest economic power in the world after the United States, China, and India by 2045.

"To become a developed country, we have to prepare not only human resources and infrastructure but also the business world by increasing the number of young entrepreneurs," the minister remarked.

Therefore, Masduki's ministry is seeking to cooperate with Andalas University in Padang, West Sumatra, because the land of Minang, an ethnic group native to West Sumatra, is known for its entrepreneurial spirit.