Indonesia Strengthens MSME Fashion and Handicraft Sectors Through Holding Company

Enhancing Ecosystem and Competitiveness

The Indonesian Ministry of Micro, Small, and Medium Enterprises (MSMEs) has introduced a strategic initiative to strengthen the country's fashion and handicraft sectors through the establishment of a holding company. This program aims to fortify the national creative industry ecosystem by creating a more robust supply chain and enhancing the competitiveness of local products in the global market.

Key Objectives and Implementation

The holding company is designed to serve as a link between micro, small, and medium enterprises within the same cluster, thereby improving their access to essential resources such as financing, business mentoring, and marketing opportunities. According to Bagus Rachman, Deputy for Medium Enterprises at the Ministry of MSMEs, the holding company will foster a partnership ecosystem based on regional superior products, effectively connecting micro and small enterprises with medium and large industries.

Economic Significance of Targeted Sectors

The fashion and handicraft sectors were chosen for this initiative due to their substantial contribution to Indonesia's economy. The fashion sector alone contributed Rp249.67 trillion to the country's GDP and recorded Rp238.37 trillion in export value in 2024. Meanwhile, the handicraft industry, which comprises over 700,000 business units, generated approximately Rp11.03 trillion in export revenue.

Rationale and Future Prospects

The increasing global demand for Indonesian creative products underpins the rationale behind strengthening these sectors. By bolstering the ecosystem through the holding company, the government aims to ensure that local products remain competitive and continue to thrive in the international market. This strategic move is expected to have a positive impact on the overall growth of Indonesia's creative industry, enhancing its global footprint and economic contribution.