West Papua To Embrace Cooperative and SMEs Digitalization

West Papua
Source : Kompas

The 2021 National Sports Week (PON) has ended. But some traces were left behind. They are expected to bring huge benefits to the prosperity of West Papua. One of the traces is the digitalization of cooperative and small-medium enterprises, as declared by the minister himself. This plan is deemed to help the local economy rise after the pandemic. 

West Papua
Source : Medcom

The 2021 PON and Digitalization

The 2021 PON was not only meant to prepare the national athlete for the international Olympics. It was also meant to boost local’s potential. After careful consideration, the state officials determined that the eastern areas of Indonesia needed digitalization. It was to help socialize and promote various local products to other areas.

Also read: Papuan Economic Is Expected to Rapidly Grow Following PON XX

In running the program, the government introduced digital transactions. It was socialized in front of around 8,000 micro, small, and medium enterprises in Mimika Regency, West Papua

As the Secretary of the Regional Revenue Agency for Mimika Regency, Yulianus Amba stated that online or digital transaction was necessary. Besides following the modern era, this also had something to do with Covid-19. 

Furthermore, he claimed that the audiences would be more likely to employ online or digital transactions. It would be unfortunate if local people could not facilitate the demands for digital transactions. (https://jnewsonline.com/pon-xx-jadi-momentum-digitalisasi-umkm-papua/)

So that this program to run smoothly, the Bank of Indonesia and BRI were entangled to provide information and knowledge of digital transactions to MSMEs business actors. The Mimika governments also asked for cooperation with a leading virtual money business actor in West Papua.

Besides delivering insights on virtual money, all those business actors were freed from business license and waste management retribution during the event from September 22nd until October 15th.

Minister Teten Masduki saw this as the right time to help local youths show what they were capable of. Just so you know, despite living in the less developed region, they could do as many as the people in the city did.

Moreover, Teten stated that the event could also be a moment for MSMEs owners in West Papua to connect to business accesses. Those included funding, raw materials, markets, and partners. All were necessary to ensure the sustainability of this initiative.

Pandemic and Digitalization in West Papua

The economic impact of the pandemic was catastrophic. Most countries received its negative impact, including Indonesia. Some sectors impacted by Covid-19 were cooperatives and MSMEs. And due to such a terrible pandemic, Indonesian economic growth in quarter II of 2020 was minus 5.32%.

Therefore, as stated by Secretary of the ministry of cooperatives and MSMEs Rully Indrawan, saving the national economy became a priority. The first thing to do was the fiscal stimulus in MSME, cooperative, and corporate sectors. In MSME and cooperative sectors, the government allocated 123.46 trillion rupiahs. It was meant to save the national economy in both sectors.

To overcome such conditions, Rully stated that the first thing to do was prepare cooperatives with important resources. But, both sectors faced challenges related to the Covid-19 spread prevention. It should also face the newest demands of changing the business method using information technology development.

Rully encouraged cooperatives and MSMEs actors in West Papua to be digitally literate. It is necessary for reaching a wider area to promote their products or services. He further said that the pandemic was the right time to implement it.

To help digitalize their business, the ministry of cooperatives and MSMEs is preparing a national strategy alongside other related stakeholders. The ministry is committed to helping cooperatives overcome basic issues. It included market access, increasing product quality and innovation, funding and investment acceleration, and increasing cooperatives capacity and scale.

Also read: The Development and Progress of Digital Economy in West Papua

Up to semester I of 2020, the registered cooperatives in West Papua amounted to 2,178 units. Meanwhile, the unregistered cooperatives were 58 units. Based on the type of business, Papua’s cooperatives were divided into producer by 694 units, saving and loan by 178 units, service by 47 units, marketing by 44 units, and consumers by 1,215 units.

All those units yielded a business capitalization value of 299.18 billion rupiahs and employed 7,468 workers. Meanwhile, the total number of members of those cooperatives amounted to 60,283 people. (https://kemenkopukm.go.id/read/kemenkopukm-siap-dukung-digitalisasi-koperasi-dan-ukm-di-papua)

The huge number of cooperatives businesses in the area should have attracted attention from all parties, including the central government. Thus, the central government gave support in the form of digital awareness.

The local government supported this initiative. Governor Lukas Enembe stated that digitalization was without question. He said now is the right time to utilize digital technology using e-commerce, online retail applications, etc.

The positive side aside, there should be control over cooperatives in West Papua. It is due to many cooperatives being going off track. This situation is similar to other regions throughout Indonesia. Thus, besides providing insights or virtual money, the central government should also become a controlling agency.

Lastly, the central government was expected to fund the program immediately. It is to ensure a quick improvement in cooperatives and MSMEs sectors because the eastern regions of Indonesia are important parts of the national economy.