Interior Minister Emphasises Importance of UMKM Strengthening and Halal Market Potential
Interior Minister (Mendagri) Muhammad Tito Karnavian has emphasised the importance of strengthening the role of micro, small, and medium enterprises (MSMEs) and expanding the halal product market for regional economic development.
According to Tito, strengthening both sectors is important for maintaining economic stability whilst capitalising on growing market opportunities, both at national and global levels.
“MSMEs are indeed our main economic backbone, the real sector,” said Tito in a written statement on Monday, 9 March 2026.
He made these remarks during the closing ceremony of the Riau Islands Ramadan Fair 2026 held at the Dekranasda Building courtyard in Tanjungpinang city, Riau Islands (Kepri), on Sunday, 8 March.
Tito cited the success of the Special Region of Yogyakarta (DIY) provincial government in recovering its economy to 5.53 per cent in 2021, after declining to 0.68 per cent during the pandemic in 2020.
Tito explained that the economic recovery success in this region was supported by the MSME sector, which contributed 79.6 per cent to economic growth.
Furthermore, the Interior Minister stressed that Indonesia possesses an exceptionally diverse handicraft potential and ranks among the world’s largest. According to Tito, this potential must continue to be maximised. Local handicraft products should no longer be regarded merely as ordinary items but as part of the creative economy sector that possesses high competitiveness in the global market.
On this occasion, Tito also touched on opportunities in the halal product market. Tito revealed that the world’s largest halal product producers are currently dominated by non-Muslim-majority countries such as China and Brazil.
According to Tito, Indonesia must be able to compete and take on the role of producer, not merely remain a consumer.
“It is indeed ironic that our market is flooded by countries that are not Muslim-majority, but they are producing halal products. Why don’t we dominate it ourselves?” Tito explained.
Tito also appreciated the economic growth of Riau Islands province, which has successfully capitalised on its geographical proximity to Singapore as an export destination for regional products.
Based on presented data, Kepri recorded economic growth of 7.89 per cent year-on-year (YoY) in the fourth quarter of 2025. This figure exceeded national economic growth of 5.39 per cent.
Nonetheless, Tito reminded of the importance of equitable economic distribution between advanced regions and outermost island areas. In this context, he appreciated the innovation by Bank Indonesia (BI) through the QRIS payment system.
According to him, this digital system can be further developed to optimise regional own-source revenue (PAD). One way is by designing an online system that allows consumer tax from hotels and restaurants to flow directly into regional treasury without burdening the public.
“We are also creating a programme so that everything can be done online. So, when people go to a restaurant and pay tax, the money goes directly into the Regional Revenue Office (Dispenda),” said Tito.
Tito hopes that the Riau Islands Ramadan Fair will continue to be held regularly. This activity is expected not only to serve as a venue for interaction and economic circulation at the regional level, but also to make a meaningful contribution to national progress and development.
“It can bring joy to the community and attract visitors from outside the region. I certainly hope that this activity can continue,” said Tito.
The event was attended by the Head of Indonesia’s Central Bureau of Statistics (BPS) Amalia Adininggar Widyasanti along with BPS regional heads from across Sumatra; Riau Islands Governor Ansar Ahmad alongside the Provincial TP PKK Chairwoman Dewi Kumalasari Ansar; the BI representative head for Riau Islands Province; and the Head of the Financial Services Authority (OJK) for Riau Islands Province.
Also present were officials from the Regional Leaders Coordination Forum (Forkopimda) of Riau Islands Province and other relevant stakeholders.