Indonesia News Gazette

Jakarta (ANTARA) – Micro, small and medium enterprises (MSME) loan growth exceeded the total credit growth as of June 2021, in sharp contrast with June 2020, senior deputy governor of Bank Indonesia, Destry Damayanti, has revealed.

“The latest credit developments as of June, MSME loans continue to show positive signals. (As per) The latest data in the second quarter of 2021, MSME loan growth has exceeded total credit growth,” she said during an online discussion on the acceleration of MSME digitization, originating from Jakarta on Friday.

Based on data provided by Bank Indonesia, MSME loan growth stood at 0.13 percent in June, 2020, while total credit growth was pegged at 1.49 percent. Meanwhile, in June, 2021, MSME loan growth reached 2.35 percent, while total credit growth was recorded at 0.59 percent. In terms of segmentation, MSME credit growth was the highest in the medium and small segments, while micro credit growth continued to contract, Damayanti said.

New loans in the MSME sector, which has the largest share of credit, were recorded in the trade sector, both retail and large, especially the food and beverage trade sector, she added.

BI also noted an increase in new credit disbursement, which even exceeded credit repayments. As of June, 2021, new credit disbursement stood at Rp72.23 trillion, while loan repayments were pegged at Rp60.21 trillion, she informed. In addition, there was an improvement in the performance of MSMEs in 2021, Damayanti noted.

According to a survey conducted by the Mandiri Institute, as of April, 2021, around 84.8 percent of MSMEs were operating normally, 8.1 percent were operating on a limited basis, and 7.2 percent had halted operations, she said.

This number reflects an increase compared to 2020, when only 35.2 percent of MSMEs were operating normally, 34.5 percent were operating on a limited basis, and 30.4 percent had halted operations amid the pandemic, she added.

Although there was an improvement in the MSME sector, Damayanti reiterated that the key to economic recovery will be the handling of the COVID-19 pandemic in Indonesia.

“So, we are required to carry out health protocols in a disciplined manner, vaccination continues to be accelerated,” she remarked.

The decline in mobility due to the implementation of the public activity restrictions (PPKM) has had an impact on the performance of the MSME sector, she said.

Source: Antara News

Jakarta (ANTARA) – Economic liquidity, or the nation’s money supply, reached Rp7,119.6 trillion in June 2021, growing 11.4 percent (yoy), compared to 8.1 percent in May 2021.

“The increase was mainly driven by the acceleration of the components of the narrow money supply (M1) and quasi money,” said Erwin Haryono, Executive Director of the Communications Department of Bank Indonesia, in a statement released on Friday.

Erwin noted that the M1 component in June 2021 grew by 17 percent (yoy), higher than the growth in May 2021 of 12.6 percent. The growth was mainly due to an increase in the circulation of currency and rupiah demand deposits.

In June 2021, currency outside the monetary system was recorded at Rp739.1 trillion and grew by 13.4 percent (yoy) compared to the previous month of 8.6.

Likewise, quasi-money growth increased from 6.8 percent (yoy) in the previous month to 9.6 percent in June 2021.

Then rupiah demand deposits in June 2021 grew 19.3 percent (yoy), higher than the previous month’s 15.5 percent .

Nevertheless, the float of electronic money issued by banks grew 9.8 percent (yoy) lower than the previous month’s 31.4 percent.

Meanwhile, quasi-money in June 2021 amounted to Rp5187.6 trillion with a 72.9 percent share of M2, increasing from 6.8 percent (yoy) in May 2021 to 9.6 percent . The increase occurred in almost all quasi money instruments, both rupiah term deposits and foreign currency demand deposits.

“Based on the influencing factors, the increase in M2 in June 2021 was mainly influenced by growth in net foreign assets and an increase in lending,” Erwin said.

The increase was also recorded in the net foreign assets factor, which grew by 11.5 percent (yoy), an increase compared to the growth in May 2021 of 6.4 percent.

Then, credit disbursement recorded a positive growth of 0.4 percent (yoy), after recording negative growth since September 2020. On the other hand, net bills to the central government grew 33.9 percent (yoy), lower than the previous month’s growth of 61.4 percent .

Source: Antara News

Jakarta (ANTARA) – The government is preparing a regulation to prevent overseas micro, small, and medium enterprises (MSMEs) from selling their products in Indonesia via online marketplaces in a bid to protect domestic MSME players.

The Cooperatives and Small and Medium Enterprises (MSMEs) Ministry, Communication and Informatics Ministry, as well as the Trade Ministry have been tasked with drafting the regulation.

“This regulation aims to prevent more dumping cases of imported MSMEs products through marketplaces,” Cooperatives and MSMEs Minister, Teten Masduki, said during an online discussion on acceleration of MSME digitalization in Jakarta on Friday.

Currently, the government is digitalizing small local enterprises by connecting them to the digital ecosystem of virtual marketplaces to help them increase sales and develop their business, he noted. Hence, dumping of goods will threaten domestic businesses, he said. Just 13.5 million MSMEs, or 20 percent of small businesses, have joined the online market so far against the government’s target of digitizing 30 million MSMEs by 2024, he noted.

“It means we (the Cooperatives and MSMEs Ministry) have to drive another 5 million MSMEs to enter online commerce every year. We cannot fulfill this task alone,” the minister said.

He urged various stakeholders to collaborate closely to increase the number of MSMEs using digital commerce.

The government is focusing on improving the performance of small enterprises in Indonesia since they contribute significantly to Indonesia’s gross domestic product (GDP), Masduki said.

MSME recovery amid the COVID-19 pandemic is crucial as this sector absorbs 97 percent of the labor force, he pointed out.

During Bank Indonesia’s survey of 2,970 respondents, 88 percent of MSMEs actors had admitted that the pandemic had impacted their business.

Meanwhile, the remaining 12 percent had said they were able to survive due to the digital market, with as many as 27 percent of them reporting increased sales despite the pandemic.

Source: Antara News

Jakarta (ANTARA) – Children’s songs influence the growth and development of children, Education and Culture Minister Nadiem Anwar Makarim said at the Swara KILA 2021 media briefing, originating from Jakarta on Friday.

“Song is the language of teaching for children, which greatly influences their growth and development. Therefore, children’s songs should contain moral values, messages of love, and knowledge about Indonesian culture and nature,” he expounded.

However, in recent times, quality children’s songs have become more difficult to find, the minister said. This has become a challenge for parents and educators, he added.

For this reason, the Ministry of Education and Culture (Kemendikbud), in collaboration with KITA Indonesia, has organized the 2021 Kita Cinta Lagu Anak (KILA) contest, he said.

“The 2020 Kita Cinta Lagu Anak (KILA) contest proved that even during a pandemic, Indonesian children could still be creative by partaking in positive activities,” he added.

Quality work was produced during KILA 2020, and it will be followed up with recording and shooting of music videos, Makarim said.

He urged Indonesian children not to be discouraged from learning during the pandemic, adding one such avenue of learning is participation in KILA 2021.

“I invite all Indonesian children to participate in KILA 2021. KILA is an excellent learning and cultural event. Therefore, I also encourage schools and educators to socialize this event,” he said. The current COVID-19 pandemic has changed learning and play for children, Makarim noted.

KILA contest aims to embrace Indonesian children who have lost out on learning and play through children’s songs, he remarked.

Starting from the kindergarten to elementary age groups, KILA aims to encourage children to be active, creative, and make art cheerfully, he said.

Meanwhile, director general of culture of the Ministry of Education and Culture, Hilmar Farid, said children’s songs are a means of helping children become familiar with their identities, foster self-confidence, and have pride in their Indonesian roots.

“KILA is an effort from the Ministry of Education and Culture to restore childhood for children so they can develop naturally during the pandemic and to help children develop a sense of identity by knowing and singing Indonesian children’s songs,” he explained.

Chairman of KITA Indonesia, Dhenok Bientarno, said KILA 2021 will be held from July 23 to August 23, 2021.

The contest includes a children’s songwriting competition and a children’s song singing competition for the kindergarten and elementary age groups, he informed.

Participants at the singing competition will also be requested to sing new songs created by the 2020 KILA contestants, he said.

Source: Antara News

Jakarta (ANTARA) – Foreign capital inflows into Indonesia reached Rp2.45 trillion in the week from July 19 to July 22, 2021, Bank Indonesia (BI) reported.

They comprised Rp1.24 trillion accrued from net sales in the government bond market and Rp1.21 trillion from net purchases in the share market, it added.

“Overall, net inflows in the domestic money market have reached Rp2.53 trillion from January 1 to July 22, 2021,” executive director, chief of BI’s communication department, Erwin Haryono said in a written statement on Friday.

The central bank said Indonesia’s investment risk premium, reflected by the five-year credit default swap (CDS), increased from 77.53 basis points (bps) as of July 16, 2021 to 78.52 bps. Meanwhile, yield on 10-year government bonds fell slightly from 6.28 percent on July 22, 2021 to 6.27 percent on July 23, 2021, it added.

Haryono said the rupiah traded at Rp14,490 against the US dollar in opening trade on Friday morning, falling slightly from the close of Rp14,480 per US dollar the day before.

Meanwhile, the US dollar index strengthened to 92.82 and yields on US bonds fell to 1.278 percent on Thursday (July 22, 2021), he added.

BI will continue to coordinate with the government and related authorities to monitor the spread of COVID-19 and its impact on the national economy, Haryono said.

Source: Antara News

Jakarta (ANTARA) – Though Jakarta’s economy improved in the first quarter of 2021 compared to the previous quarter, people’s purchasing power has yet to recover, the Central Statistics Agency (BPS) Office in Jakarta has said.

The economy contracted 1.65 percent yoy (year-on-year) in the first quarter of 2021 compared to 2.14 percent yoy in the previous quarter.

The inflation rate in March 2021 also fell to 0.06 percent , lower than the previous month and the year-ago period.

“Although the inflation rate in March 2021 remained safe, the public’s purchasing power has yet to return to normal,” head of the BPS Office in Jakarta, Buyung Airlangga, said in a written statement on Friday. This has been indicated by the average per capita provincial gross domestic product (PDRB), based on quarterly constant price, which fell to Rp43 million in the first quarter of 2021 from Rp43.4 million in 2019, he informed.

In addition, the proportion of household spending on food, based on the current price, rose to 26.46 percent in the first quarter of 2021 from 24.9 percent in 2019.

In contrast, the proportion of household spending on non-food items fell to 73.54 percent in the first quarter of 2021 from 75.09 percent in 2019.

“On average household spending declined from Rp2.32 million in September, 2019 to Rp2.15 million in March, 2021,” Airlangga said. The drop in the people’s purchasing power was inseparable from low income and productivity levels in several sectors in the first quarter of 2021, he noted. One of the affected sectors was manufacturing, which contracted 0.06 percent, he said.

The sector which contracted the most was accommodation and other services due to public mobility restrictions (PPKM), he added.

“The low purchasing power was also the result of disrupted income sources due to the pandemic. This is evident from the high open unemployment rate and the worsening manpower indicators owing to the pandemic,” he said.

Source: Antara News

Batam (ANTARA) – The Indonesian Embassy in Singapore and Tourism and Creative Economy Minister Sandiaga Uno organized a virtual tour of tourist destinations and a discussion on ‘Road to the 10 New Bali’ at the embassy on Thursday.

During the discussion, participants were introduced to tourist spots in Labuan Bajo and Bromo through videos and photos.

“Tourism is a powerful weapon that can be utilized to recover Indonesia’s economy post-pandemic,” Uno stated in a press release issued by the Indonesian Embassy in Singapore on Friday.

The event on Thursday was part of a series of discussions organized to promote the second edition of the book Road to the 10 New Bali.

Thursday’s discussion, streamed as episode five of the discussion series, focused on Labuan Bajo and Bromo.

The 10 New Bali book was compiled by the Indonesian diaspora in Singapore as well as foreigners keen on photography and Indonesian tourists, Uno said.

The book will help accelerate preparations to present more qualified and sustainable tourism and creative economy sectors, he added.

Concurring with Uno, Indonesian Ambassador to Singapore Suryo Pratomo expressed the hope that the book as well as the embassy’s endeavors towards tourism promotion would support the Indonesian tourism sector’s development.

The second edition of the book not only features pictures of 10 leading tourist destinations — Lake Toba, Belitung, Tanjung Lesung, Seribu Islands, Prambanan and Borobudur Temples, Bromo Tenger Semeru National Park, Mandalika Lombok, Labuan Bajo and Komodo National Park, Wakatobi, and Morotai, but it also provides important information for travelers planning to visit the destinations, he said.

During the discussion, photographers shared stories behind the photos and videos of Labuan Bajo and Bromo with participants, he added.

The embassy said it expects the creative promotion of Indonesia’s tourist destinations to make travelers keen to visit Indonesia after the pandemic ends.

Source: Antara News

Jakarta (ANTARA) – Manpower Minister Ida Fauziyah said the government’s wage subsidy program (bantuan subsidi upah or BSU) was expected to help prevent workers affected by COVID-19 from getting laid off amid the enforcement of public activity restrictions (PPKM).

“The BSU (aid) is expected to increase purchasing power and ensure the prosperity of the workers. The aid is also expected to assist employers in maintaining their businesses during COVID-19 pandemic,” the minister said here Thursday.

“Through this aid, we hope the harmonious and conducive relations within companies are maintained, so, once again, termination of employment can be avoided,” Fauziyah said.

She hoped that the BSU scheme would be able to reduce companies’ burden so that employers and employees can work together to find solutions to the impacts of the pandemic.

Under the BSU 2021, eight trillion Indonesian rupiahs (about US$551 thousand) will be allocated to eight million people, with each beneficiary receiving Rp1 million (about US$69) via bank transfer, the minister added.

The aid amount is still an estimate as the data is still being worked on by the Workers Social Security Agency (BPJS Ketenagakerjaan), Fauziyah pointed out.

To receive the aid, workers need to be Indonesian citizens, registered under the Worker Social Security Program (Jamsostek), and still active in BPJS Ketenagakerjaan, she informed.

The aid will only be provided to workers living in PPKM Level 4 Zones, as laid out in Ministry of Home Affairs Instruction No. 20 Year 2021 to No. 23 Year 2021 on Micro Community Activities Restriction Enforcement and Optimizing Corona Virus Disease 2019 Handling Posts in Village Levels for Corona Virus Disease 2019 Spread Control, she said.

The beneficiaries will be required to pay a fee, which will be accounted for from the Rp3.5-million salary, as reported by employers to BPJS Ketenagakerjaan, she said.

The BSU will be provided to workers from sectors impacted by the PPKM, such as the consumption industry, trade and services, except education and healthcare, transportation, miscellaneous industries, property, and real estate, Fauziyah said.

“BPJS Ketenagakerjaan has been chosen as the data source since, at the moment, it has the most accurate and complete (data), thus (making it) accountable and valid to be used by the government as the basis for allocating the subsidy fast and accurately,” she added.

Source: Antara News