Container Shortages Slow Down Indonesia’s Export of MSME Products

JAKARTA, KOMPAS.com – Indonesian micro, small and medium enterprises bear the brunt of the disruption in the container shipping industry due to the Covid-19 pandemic.

Cooperatives and Small and Medium Enterprises (SMEs) Minister Teten Masduki said that MSME products have been in high demand among export products from Indonesia but the growth was hindered by low capacity production and container shortages amid the pandemic.

“Furniture products, coffee, tropical fruits, and culinary delights were among the most sought-after products but the delivery was hindered by container shortages,” Teten said in a press statement on Monday, August 30.

He said that the container shortages still hamper the current logistics industry, especially in the export and import trade. Additional shipping cost makes the expenses for logistic become higher. This is affecting not only big companies but also export-oriented SMEs. The matter has been discussed by relevant ministries under the national economic recovery committee.

Also read: MSMEs in Agriculture, Digital Technologies Contribute Greatly to Indonesia Economy

“I am still studying how other countries deal with the matter, including the additional container fees and the subsidy that can later be given to export transactions,” the minister said.
Teten said that currently they are targeting the oriented-export MSMEs that have market demand but the supply chain is still unclear.

“I just found out that palm sugar and charcoal briquettes which are made of coconut shells are in high demand for export [from Indonesia],” said Teten.

Though the demand is high the producers in Sulawesi and West Java cannot meet the demand due to various conditions such as production capacity and business management.

Meanwhile, the export contribution of MSME is still low at 14.37 percent. He said MSMEs should be focusing on the domestic market that can substitute imported products such as fruits and Islamic clothing following import restrictions.

Also read: Indonesia to Disburse $27.6 Million Stimulus Payments for MSMEs April 20, Says Senior Minister