Govt expands poverty alleviation program

JAKARTA (JP): The government is embarking on a program to stimulate the emergence of new entrepreneurs in a bid to reduce poverty in the country.

State Minister of Population Haryono Suyono and Minister of Industry and Trade Tunky Ariwibowo singed a memorandum of understanding to develop small-scale industry and traders in rural areas.

Coordinating Minister for Production and Distribution Hartarto witnessed the signing yesterday.

Haryono said after the ceremony that the program will focus on developing skills and the capacity of the rural poor to run small-scale industry and work as traders.

The Ministry of Industry and Trade will provide technical assistance, and the office of the State Minister of Population will allocate the funding, raised through donations, and also coordinate the program.

The program will start in South Sumatra and East Java and involve 510 very-small business units run by groups of the rural poor. Of the total business units, 105 are in South Sumatra and 405 in East Java. The program will eventually cover all 27 provinces.

The government wants to develop 230,000 new business units in the current five-year development plan, to end in 1999.

Savings

According to the office of the State Minister of Population, 56 percent of the 39.4 million families in Indonesia do not have an adequate standard of living.

Haryono said his office will specially target these families for the program.

He explained that the poverty alleviation program has so far extended Rp 23 billion to 11.5 million families, in the form of savings accounts of Rp 2,000 each (85 U.S. cents).

He added that his office plans to extend credit, through state-owned Bank Negara Indonesia 1946 and the state postal firm PT Pos Indonesia, to families which are ready to run businesses.

The funds are raised by the Dana Sejahtera Mandiri Foundation, which so far has collected over Rp 100 billion in donations from Indonesians earning Rp 100 million or more a year.

The government, through a Presidential decree, has ruled that companies and individuals with annual incomes of Rp 100 million or more must donate 2 percent of their incomes to the foundation.

Haryono said that the foundation is expected to collect between Rp 200 billion and Rp 250 billion in donations a year for the government-sanctioned program.

Haryono noted that his office has also received some Rp 100 billion in Presidential aid, some of which was taken from the interests earned on the reforestation fund.

"I don't care where it came from. What I know is that the fund is Presidential aid," Haryono asserted. (rid)