Government's Strategy to Ensure MSMEs Profit from Trade Agreements

The Indonesian government is continuing to push for downstream processing and industrialisation to increase the nation’s bargaining power in global trade. According to the Deputy for Economic and Investment Coordination at the Coordinating Ministry for Economic Affairs, Edi Prio Pambudi, Indonesia is not satisfied with merely being a supplier of raw commodities but must also become a supplier of high-value finished products.

Strengthening Indonesia’s position in the global supply chain is being carried out through several strategies, including reinforcing 28 key commodity lines targeted for downstream processing. The strengthening of downstream industries is also being pursued by building regional ecosystems to enhance efficiency, attract investment, and enter high-tech supply chains such as semiconductors.

One of the commodities that is a focus of downstream processing is rare earth metals, which are highly sought after globally. Other challenges being addressed include regulatory ease and energy supply security to make production processes more efficient and increase the competitiveness of national products, including those from the MSME sector.