Small businesses 'need good marketing': Mar'ie

JAKARTA (JP): Minister of Finance Mar'ie Muhammad said the main problem facing the development of Indonesia's small businesses was not money but marketing and human resources quality.

He cited as an example PT Sarana Sulsel Ventura, a venture capital firm in South Sulawesi, which had allocated Rp 10 billion (US$4.2 million) to help small businesses in the province but could not distribute all the funds.

"Up until now it has only managed to distribute about Rp 3.5 billion to a number of small businesses," he said in Ujungpandang, South Sulawesi, where he was visiting several of the province's small businesses Saturday.

Small companies in the province which have problems with human resources and management cannot make use of Ventura's funds.

Mar'ie said that, due to inferior human resources, many small businesses had serious bookkeeping problems. As a result they could not evaluate their assets and profit.

He said it was very difficult to find a bookkeeping teacher in regencies, where most small business were based.

"Therefore, more serious efforts are needed to develop the small businesses," he said.

He said the ministries of manpower, agriculture, industry and trade, rural banks, and Bank Indonesia (central bank), had organized special training for small businesses to improve their entrepreneurship.

He added that the government would also further encourage small financial institutions such as venture capital and rural banks to give more funds to small businesses.

The minister said the government would hold a limited cabinet meeting every three months to discuss the development of small businesses.

According to the Central Bureau of Statistics, 99.8 percent or 33.4 million of the 33.5 million businesses in Indonesia in 1994 were small enterprises, each with a turnover less than Rp 1 billion a year.

Mar'ie said that like Indonesia, other developing countries also faced a dilemma in developing their economies. But every time Indonesia tried to strengthen its business sector, small businesses ended up lagging further behind.

He said most developing countries were former colonies. By the time they gained independence, their leaders vowed to accelerate the development of their economies.

"That's right. We cannot blame them. Their people suffered during colonization. If they don't pursue development they risk being disliked by their people," he said. (bnt)