Partnership program ineffective: Analyst

JAKARTA (JP): An economist has criticized the government's policy of helping small companies, saying the existing partnership program is ineffective.

Prof. Anwar Nasution of the University of Indonesia's School of Economics said Thursday the government's policy to help the small companies still relied too much on big companies.

"We can't leave such things entirely to business conglomerates," he said to reporters on the sidelines of a seminar on the empowerment of small entrepreneurs through partnership programs.

Nasution said partnerships should be undertaken pragmatically, based on the field of business and background of each partner.

"There are limits to a partnership and we can't expect every big business to join hands with just any small business," he said.

Nasution said several cases showed mismatches between small and big businesses brought no benefit to either partner.

"We can't expect (state-owned steel manufacturer) Krakatau Steel to assist a small krupuk (rice cracker) home-industry, even if both are in the same town," he said.

Nasution said the government should do more through its policies to ensure that businesses should not feel they are coerced into partnerships.

"Partnerships are not a medicine that can cure every illness -- although to a certain extent it can help improve the peoples' income," he said yesterday.

Nasution said partnerships should always be beneficial to both partners, but should never be considered a gesture of charity.

He said partnership programs, together with solid government regulations, should also be able to provide more job opportunities and strengthen Indonesia's role as an agricultural country.

"Now, for example, we are still importing fruit. We have more agricultural land than Singapore, yet the small country exports more agricultural products than us. What is the Ministry of Agriculture or the Ministry of Industry and Trade doing about this?" he said.

Nasution said he suspected there was "something wrong" with the way things were done in this country.

"We must find a solution. Maybe we have the wrong policies," he said.

He said a quick solution was needed because global free trade was now closing in. He suggested the government synchronize its policies because it was essential to allow Indonesia's entrepreneurs and businesses to be competitive on an international level.

"I think it's not that the system is not functioning. Actually there is no system," he said. (pwn)