Prabowo's Niece Proposes Strategy to Upgrade Indonesian MSMEs

Bogor, CNBC Indonesia - House of Representatives Commission VII has stated that to achieve a people’s economy, Indonesia must no longer only discuss keeping MSME players able to develop, but must also improve productivity and upgrade MSMEs.

This was conveyed by Deputy Chair of House Commission VII Rahayu Saraswati Djojohadikusumo at the National Seminar of the Indonesian Economists Association (ISEI).

“When we talk about the people’s economy, what comes to mind is how MSME players can keep their businesses alive. But discussing the people’s economy must also address how MSMEs can become more productive and move up a class,” Rahayu said at the ISEI event on Thursday (27/8/2026).

Rahayu continued that she wants MSME players in Indonesia to be able to compete with national business players, and even compete globally.

“The goal is not for micro enterprises to remain micro forever, but for micro enterprises to have the opportunity to become small enterprises, then small enterprises to rise to become medium enterprises, and medium enterprises to rise to become national companies, even global ones,” Rahayu explained.

She explained that Indonesian MSMEs currently receive a great deal of training, access to capital, technology training, and so on. However, many MSME players still have not seen their turnover and productivity increase. This raises the question of how effective the government’s efforts have been in improving the welfare of MSME players.

“MSME players have received a lot of access to capital, training, including technology training, skills training, and so on. But many still have not seen their turnover and productivity increase drastically. Have our interventions truly succeeded?” she said.

Therefore, there needs to be a change in the government’s approach to improving the welfare of MSME players so that a genuine people’s economy can be created.

The government should guide MSME players so that they are able to integrate into national and global value chains.

“I emphasise that social transformation must be carried out through equitable people’s economy, including MSMEs, cooperatives, and the informal sector, so that they are able to integrate into national and global value chains,” she stated.

Moreover, according to her, the people’s economy and industrialisation should not be separated, because Indonesia needs large industries.

“The phrase ‘integrated into the value chain’ is very important, because the people’s economy and industrialisation actually do not need to be set as two different agendas. Instead, the two must be united, because Indonesia needs large industries,” she added.