The Role of Small and Medium Enterprises (Sme) on the Economy (original) (raw)
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THE ROLE OF SMALL AND MEDIUM ENTERPRISES (SMES) IN IMPROVING THE LOCAL ECONOMIC GROWTH
IAEME, 2019
Small and Medium Enterprises (SMEs) have a great contribution to the economic growth in Indonesia both macro and micro. Economic growth in west Sumatra exceeded the national economy in 2015 up to 5.46% while the national economic only 4.71%. In 2016, economic growth in West Sumatra only grew about 4.81%. Despite the decline of economic growth, SMEs remain a factor supporting the economic growth in West Sumatra. This study was conducted to determine the extent to which the role of Small and Medium Enterprises (SMEs) in their contribution to the economy of local communities in West Sumatra. This study was empirically examining the role of SMEs in improving the economy of local communities by using qualitative methods. The research result explained that SMEs have already given a big share in improving the local people's economy due to most of the people of West Sumatera have an entrepreneurial spirit that have been ingrained hereditarily which has become the structure root of the original culture of the local economy.
Russian Journal of Agricultural and Socio-Economic Sciences, 2021
The role of Small and Medium Enterprises (SMEs) in encouraging the acceleration of economic growth is very important. This sector must continue to be upgraded and active in order to advance and compete. The purpose of this study was to analyze the influence of the development of SME such as (SME manpower, SME Production Value, number of SME units, and SME investment) on the GRDP of the Province of NTB from 2010 to 2019. This study used quantitative methods. The research location was in the Province of West Nusa Tenggara. Data collection techniques used were literature studies and documentation. Simultaneously, the results of this study indicated that manpower, production value, number of units, and investment value of SME had positive effects on the growth of GRDP of the Province of NTB. Partially, the manpower, number of Small and Medium Enterprises variables showed insignificant effect, while the variables of production value and investment value showed significant results. The results of the study indicate that it is necessary to increase investment to increase the growth of gross regional domestic product and to pay more attention to the issue of labor quality. KEY WORDS Gross regional domestic product, small and medium enterprises, manpower, small production value, number of units, investment.
Analysis of Factors Affecting Economic Growth in the SMEs Sector in Indonesia
2020
The role of SMEs has an essential meaning for an area, especially in the expansion of employment and the drivers of economic growth, including export activities. The purpose of this study was to analyze the effect of SME units, the value of SME investment, and the value of SME exports on Indonesia's economic growth. This study's analysis model refers to the basic model of multiple linear regression equations with the Error Correction Model method in estimating the short-term and long-term relationship between the SME, Investment, and Export variables with GDP in Indonesia. Error Correction Model (ECM) analysis results on the estimation results using the Error Correction Model method obtained ECT (Error Correction Term) with a negative sign and significant at α = 5%, then the model is valid to be used. Because the error correction model is declared valid if the ECT value obtained is significant and has a negative mark, in model 1 an R2 value of around 0.996 or 99.6% can be said that the types of independent variables entered in the model are very good, because only 0.4% the diversity of dependent variables that are influenced by independent variables outside the model and it can be said that in the short and long term the variables used in this study significantly influence economic growth.
Promoting SME development in Indonesia
OECD Economics Department Working Papers, 2012
Promoting SME development in Indonesia Micro, small and medium-sized firms (MSMEs) are a key source of employment and economic growth in Indonesia. They contributed to the country's economic resilience during the 2008-09 financial crisis. But many suffer from low productivity, curbing their role in boosting living standards. There are several ways to spur MSME productivity growth over the medium term. The first route would be to encourage the formalisation of small firms. Lessening red tape through simplification of the licensing process and lower tax compliance costs would help. Avoiding excessive rises in the minimum wage in provinces where it is already at a reasonable level would also be important. Looking forward, it would be useful to remove rigidities in the formal labour markets, while moving to some form of unemployment benefit system to insure workers against job-loss risks. The second route would be to boost investment. Clarifying property rights for real estate, and making the information collected by the credit bureau available to all financial institutions would ease access to finance. At the same time, the development of financing alternatives such as venture capital, leasing or micro-finance would enhance credit supply. The poor state of infrastructure, in particular in the transportation and electricity sectors, is also perceived as an important impediment to investment and could be remedied by increasing public infrastructure spending on cost-effective projects. The third route would be to enhance the quality of human resources. The country suffers from a lack of skilled workers, and policies should aim both at increasing the pool of workers and making education and training institutions more responsive to evolving labour-market demand. Indonesia has a long tradition of supporting MSMEs. But responsibilities between the different levels of government and within the central government need to be clarified to minimise overlap and inefficiencies. A rigorous assessment of existing programmes would allow schemes to be consolidated and scarce public funds to be directed to their most cost-effective uses. This Working Paper relates to the 2012 OECD Economic Review of Indonesia (www.oecd.org/eco/surveys/Indonesia).
SMALL AND MEDIUM ENTERPRISES (SME) DEVELOPMENT POLICY BASED ON ECONOMIC SOCIETY IN EAST JAVA
SMEs have a great role in the national economy, as well as in employment absorption and distribution results, through the law No. 5 of 1999 government give the limit on SME for small businesses is a business that: a. Owns 200 million assets, excluding land and office building, b. Annual sales proceeds at most 1 billion, c. Owned by Indonesian citizens. With these limits, it is expected that the role of government and society needs to give great attention to encourage its development. Development of SME through business empowerment approach, need to pay attention to social and cultural aspects of each region The existence of regulations both in the form of laws and government regulations relating to SME in terms of production and banking side, will spur the role of SME in the economy. For the government, licensing is necessary to maintain public order and provide protection to the public.
Facts that Indonesian SMEs have a great potency related with the ability to survive in crisis times do not lead to products capability. Moreover, several factors became reasons why the image of Indonesian SMEs does not emerge significantly; inability in competing in global market and the outcome will be obtained in measurement form consisting several barrier factors faced by SMEs. The methodology adopted in this research is critical literature reviews, quantitative and qualitative data collection through questionnaires to 200 respondents and in-depth interviews with each of them. The research showed there are ten major barriers faced by SMEs: competition barriers; financial access; price of energy; technology; inefficient production cost; economic factors; management skill; process; limitation of sales; and raw material. Most SMEs agreed that government should dedicate more efforts in certain actions to eliminate SMEs barriers, like security standards improvement, development programmes, good financing policy, rational energy policy, continuous performance evaluation, commitment of corruption termination, and many supporting program needed by SMEs. Hereinafter, this research could contribute government programmes for empowering SMEs as the pillars of Indonesian economy.
Role of Small & Medium Enterprises in Economic Development
Micro, Small and Medium Enterprises have been accepted as the engine of economic growth and for promoting equitable development all over the world, especially in India in view of second highly populated country in the world. Micro and small scale enterprises have existed in rural India since ages in the form of traditional skills. Recently, there is a lot of scope for rural entrepreneurship in SMEs (Small and Medium Enterprises) Sector of our economy, which plays a vital role in providing employment and income for the poor and unemployed in rural areas. As the population grows there will be pressure on land and the growth in the agricultural production cannot absorb the ever increasing rural labor force in agricultural employment. This leaves the rural non-farm sector in the form of rural SMEs to absorb those released from agriculture. The scope of rural industries is considered basically a question of properly utilizing the unexploited natural and human resources and tapping vast material existing in the countryside. The features of rural industrialization are low investment of capital, labour intensity and use of simple technology by employing local human and material resources. Thus, a judicious mix of local manpower with the local resource is necessary to bring about a viable development in these areas. In the era of globalization, entrepreneurship development in MSMEs in the rural context is a challenge.
Role of Micro Small Medium Enterprises (Msmes) Growth on the Indonesian Economy
Management Science Research Journal
The purpose of this research is to analyze the role of micro, small and medium scale (MSMEs) growth on Indonesian economy. The data has been taken from the data secunder of Biro Pusat Statistik (BPS) and Kementerian Koperasi dan UKM (Kemenkop UKM). The data analyze using regression analyze to determine the role of micro, small and medium scale (MSMEs) growth on Indonesian economy. The results show that a micro, small and medium scale (MSMEs) growth on Indonesian economy have a role but does not have much impact because there are a lot of a factors which have an impact on Indonesian Economy. This result has an implication that the increasing Indonesia’s economic growth on various factors including the increase the number of MSMEs if the increasing of quality products for MSMEs in Indonesia
The role of SMEs for development: A literature review
Paper submitted to ERSA 2004 CONGRESS:" …, 2004
The role played by SMEs in any society is undoubtedly important, for instance, in Portugal around 98% of the industrial fabric is composed by SMEs. Nowadays, entrepreneurship and firm creation is mostly related to small and micro firms, which lead us to look at them as an important development agent in any society.
The Influence Of Small Micro Industries On Economic Growth
JEJAK, 2019
The purpose of this study to determine whether SMEs have a role to economic growth and how big the role of SMEs to economic growth in Indonesia. Types of data used are time series data i.e SMEs data and Economic growth data from year 2003 until 2018 in Indonesia.Tool of analyze data used in this research is multiple linear regression. The result of analysis shows that the influence between of SMEs on economic growth in Indonesia is only 12,5%, it means that Small Micro Entreprises do not have a significant influence on economic growth in Indonesia, government to accelerate the development of SMEs in Indonesia in order to contribute to economic growth as in the economic crisis that occurred in 1998 SMEs are able to survive when many large companies are bankrupt. This may be caused by SMEs owners and workers in SMEs do not pay taxes to the government so that not much contribute to the economic growth of the Indonesia. In order for SMEs to contribute to economic growth, must export the...