Indonesia pushes village cooperatives to expand MSME markets

Jakarta (ANTARA) - The government envisions businesses established under the Red and White Village Cooperatives (KDMP) program expanding market reach for products from micro, small, and medium enterprises (MSMEs), Deputy Cooperatives Minister Farida Farichah said.

During a visit to an MSME in West Lombok, West Nusa Tenggara (NTB), she said village cooperatives are being developed as facilities capable of distributing local products beyond their regions of origin.

“We want products here to be consolidated and distributed to the entire cooperative network across NTB and on the national scale even,” Farichah remarked on Saturday (June 27), as quoted in a statement on Sunday.

She emphasized that the nationwide development of cooperatives is projected to shorten the distribution chains of MSME products and help local businesses access markets on a broader scale.

In addition to expanding MSME market reach, she added, village cooperatives function as providers of staple goods for rural communities, including rice, cooking oil, and fertilizer at lower prices.

The deputy minister further noted that MSME actors joining village cooperatives are eligible for loans carrying six-percent interest from the Revolving Fund Management Agency (LPDB) of the Cooperatives Ministry.

“Once becoming a cooperative member, you can access low-interest financing facilities to boost production or acquire new equipment,” she told the locals, adding that village cooperatives also provide a platform for MSMEs to exchange market information.

Farichah also encouraged MSME actors to prioritize locally sourced materials or ingredients to sustain business amid global economic uncertainty and volatile prices of imported commodities.

She observed that, because of their access to local resources, MSMEs tend to be more resilient to economic turbulence than larger businesses that rely on imported inputs.

In this regard, she reaffirmed the government's commitment to helping local MSMEs expand into export markets through collaboration with various stakeholders.

President Prabowo Subianto initiated the KDMP program as one of his flagship initiatives, aiming to stimulate national growth from villages while empowering rural communities.

Each cooperative established under the program is designed to operate multiple facilities, including a grocery store, pharmacy, clinic, and warehouse.

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Translator: Shofi Ayudiana, Tegar Nurfitra

Editor: M Razi Rahman

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