Indonesia Eyes China Supply Chains to Boost MSME Growth
Indonesia Eyes China Supply Chains to Boost MSME Growth
02 Apr 2026 12:25 WIB
Voice of Indonesia
Key Points
Indonesia seeks to integrate MSMEs into China-linked global supply chains through industrial clusters, investment, and technology transfer.
With 65.5 million enterprises, MSMEs are central to Indonesia’s economy and key to regional growth amid shifting global trade dynamics.
RRI.CO.ID, Jakarta - Indonesia is pushing to integrate its vast small business sector into global production networks, with China identified as a key partner in scaling up micro, small, and medium enterprises (MSMEs).
Speaking at the Indonesia-China SME, Trade and Investment Cooperation Forum 2026 in Beijing on April 1, 2026, Minister of MSMEs Maman Abdurrahman said Jakarta aims to connect Indonesian MSMEs to regional and global supply chains while developing industrial clusters.
“In strengthening Indonesia-China cooperation, particularly in MSME development, I want to enhance the integration of Indonesian MSMEs into global supply chains, including China, and develop industrial clusters,” Minister Maman said, as quoted by Antara.
He emphasized that MSMEs need to be embedded in structured industrial ecosystems through strategic partnerships. Sector-based clustering and integration into regional production networks, he added, would improve scale, efficiency, and long-term competitiveness.
He also highlighted the need for investment collaboration and technology transfer. “Modernizing MSMEs requires support in technology, financing, and human resource development,” he said, pointing to opportunities in manufacturing, processing industries, production machinery, digital technology, and smart manufacturing.
Policy alignment and institutional cooperation were identified as another priority, with the forum expected to lay the groundwork for more structured, long-term collaboration between Indonesia and China.
Indonesia, he added, is committed to transforming MSMEs through downstream industrialization, digitalization, improved financing access, and expanded international market reach.
“We believe Indonesia-China strategic partnerships will accelerate MSME integration into global supply chains and strengthen regional economic stability,” he continued.
Indonesian’s Ambassador to China and Mongolia Djauhari Oratmangun underscored China’s role as Indonesia’s largest trading partner, with bilateral trade nearing USD 168 billion. He encouraged Chinese investors to tap into Indonesia’s market of 280 million people and its position as Southeast Asia’s largest economy.
“Just do it, come and invest in Indonesia,” Djauhari said, drawing laughter from business participants.
Against a backdrop of shifting global supply chains and geopolitical realignment toward Asia, he added that stronger ties between China, Indonesia, and ASEAN could ensure the region remains central to future economic transformation.
Indonesia’s MSME sector includes around 65.5 million enterprises, contributing 61.9 percent of GDP and employing over 119 million people, or about 97 percent of the national workforce. Meanwhile, China has more than 60 million SMEs, including a rapidly growing segment focused on technological innovation. ***
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