No extra protection for small firms: Adi
No extra protection for small firms: Adi
JAKARTA (JP): The government will not provide excessive
protection for small and medium-scale enterprises because it
would discourage competition, Minister of Cooperatives and Small
Enterprises Adi Sasono said on Tuesday.
Adi said any efforts to build strong business competition
through protection would be doomed to fail, as was demonstrated
by past measures by the government.
"In past years, the government gave excessive protection to
conglomerates. This resulted in the destruction of our economy."
"The government will not repeat this mistake by providing
excessive protection for small-scale businesses because it will
not build competitiveness," he said at a seminar on rebuilding
Indonesia's international competitiveness.
However, Adi said a certain amount of government protection
for small businesses would be needed because the market economy
would only take off when all players had equal footing.
Adi, lambasted by critics for his populist policy of
distributing cheap loans to small businesses, again defended his
so-called people's economy, calling it a democratized economy.
"We can't promote the people's economy if we continue to
practice cronyism like in the past. The people's economy means we
have to democratize our economy."
Adi also said his concept of the people's economy did not
contradict with the market economy or oppose conglomerates or big
businesses.
Big businesses are an essential part of his vision for
developing the economy, he said, adding conglomerates still could
do business in the country as long as they were not monopolistic.
Adi promised the government would never tolerate monopolies or
unfair competition.
"There will be no more businessmen controlling over 3.6
million hectares of forests, controlling 90 percent of the supply
of a commodity or two companies holding 80 percent of the
domestic paper market."
"Such practices have resulted in a high-cost economy because
competitors could not enter the market."
However, efforts to ensure fair competition and create a
competitive market economy would be futile unless the country
adopted an open political system, he added.
Adi said because Indonesia was pursuing a competitive, market-
friendly, people-oriented economy, it won the approval of the
Asia Pacific Economic Cooperation (APEC) forum to establish an
APEC entrepreneurship center in Jakarta.
"We are currently conducting a feasibility study and gathering
resources needed to realize the plan. Further moves will be taken
at the APEC ministerial meeting in New Zealand next month."
He said the center would provide, among other things, business
consultations, market information, programs to improve human
resources and access to financing. (gis)