Interior Minister Emphasises Importance of Strengthening MSMEs for Regional Economy
Jakarta — Interior Minister Muhammad Tito Karnavian has emphasised the importance of strengthening the role of micro, small and medium-sized enterprises (MSMEs) and expanding the halal product market for regional economic development.
According to him, strengthening both sectors is essential to maintaining economic stability whilst capitalising on growing market opportunities at both national and global levels.
“MSMEs are indeed our main economic backbone, the real sector,” said the Interior Minister in a statement in Jakarta on Monday.
The Interior Minister cited the successful example of Yogyakarta Special Region’s Provincial Government, which managed to restore its economy to 5.53 per cent growth in 2021, after falling to 0.68 per cent during the pandemic in 2020.
He explained that the successful economic recovery in the region was supported by the MSME sector, which contributed 79.6 per cent to economic growth.
Additionally, the Interior Minister affirmed that Indonesia possesses an extremely diverse handcraft potential and is among the largest in the world. This potential must continue to be maximised.
According to him, local craft products should no longer be viewed merely as ordinary goods, but rather as part of the creative economy sector with high competitiveness in the global market.
He stressed that Indonesia must be able to compete and take on the role as a producer, rather than merely being a consumer.
“Indeed, it is ironic that our market is being flooded by products from countries that are not Muslim-majority, yet they produce halal products. Why shouldn’t we ourselves dominate this? It’s rather like that,” he explained.
Furthermore, the Interior Minister also praised the economic growth of Riau Islands Province, which has successfully leveraged its geographical proximity to Singapore as a destination for exporting regional products.
Based on data presented, Riau Islands recorded economic growth of 7.89 per cent year-on-year in the fourth quarter of 2025. This figure is above national economic growth of 5.39 per cent.
According to him, the digital system can be further developed to optimise regional original revenue (PAD). One way is by designing an online system that allows consumer taxes from hotels and restaurants to go directly into regional coffers without burdening the public.
“We are also creating a programme to go online. So when people go to a restaurant and pay tax, the money goes directly into the tax office,” he said.
Finally, the Interior Minister hopes that the Riau Islands Ramadan Fair can continue to be held regularly.
The event is expected not only to serve as a forum for interaction and economic circulation at the regional level, but also to make a tangible contribution to the progress of the nation and state.
“It can create joy for the community and attract visitors from outside the region. I certainly hope that this activity can be continued,” he said.