Cheap loans won’t fix SMEs

Cheap loans won't fix SMEs

Limited growth potential and informal structures often disqualify Indonesia's small enterprises from external financing, as lenders perceive them as high-risk or unattractive clients.

<Cheap loans won’t fix SMEs - Editorial - The Jakarta Post>

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(48)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

Private sectors in Singapore, especially SMES have been aggressive in broadening their horizons across the region to excavate fresh growth chances. However, the future of the AEC may be overshadowed unless Indonesia fails to utterly nudge itself to the AEC. 

Then rosy pictures on the AEC where skilled labor forces in various fields will freely cross the borders of Southeast Asia may turn out a wishful thinking. This even holds true to the relationship between Singapore and Indonesia.

Inauguration of the AEC and Its Impacts on Relation between Singapore and Indonesia(29)

Comparative Research on Relationship of Singapore and Indonesia in the AEC Aspect

Thus, while Singapore acknowledges that some problems are faced by the ASEAN countries in implementing the AEC Blueprint, there is an urgent need to persevere in order for the region to remain competitive and relevant to the global economy. 

It is significant that SMEs tend to be in the more optimistic category in relation to regional integration. SME leaders in Singapore have urged fellow companies to expand within the region and to seriously consider investing in ASEAN neighbors for the many benefits that an integrated ASEAN economic community can bring.

Advent of the Era of the AEC and Its Impact on Singapore and Indonesia(49)

Comparative Study on the Perception and Response of Singapore and Indonesia

In general, Singapore is appraised more prepared to explore the age of the AEC than Indonesia. Private sectors in Singapore, especially SMES have been aggressive in broadening their horizons across the region to excavate new growth chances. 

However, the future of the AEC may be overshadowed unless Indonesia fails to utterly nudge itself to the AEC. Then rosy pictures on the AEC where skilled labor forces in various fields will freely crossing the borders may turn out a wishful thinking.

Advent of the Era of the AEC and Its Impact on Singapore and Indonesia(39)

Comparative Study on the Perception and Response of Singapore and Indonesia

In addition, concerns of SMEs (Small and Medium-sized Enterprises) particularly in Indonesia that they may be isolated from the far-reaching age of the AEC are getting bigger. In spite of such negative voices raised, Singaporean and Indonesian governments have been regarded to take necessary steps to realize their commitments to the AEC as ambitiously set out in the AEC Blueprint. 

When it comes to the details of the perception of and the response to the AEC, however, Singapore is often evaluated ahead of Indonesia by and large.

Advent of the Era of the AEC and Its Impacts on Singapore and Indonesia(41)

Comparative Study on the Perception and Response of Singapore and Indonesia

In addition, concerns of SMEs (Small and Medium-sized Enterprises) particularly in Indonesia that they may be isolated from the far-reaching age of the AEC are getting bigger. 

In spite of such negative voices raised, Singaporean and Indonesian governments have been regarded to take necessary steps to realize their commitments to the AEC as ambitiously set out in the AEC Blueprint.

Advent of the Era of the AEC and Its Impacts on Singapore and Indonesia(43)

Comparative Study on the Perception and Response of Singapore and Indonesia

Nevertheless, overall perception and response of Indonesia is assessed still lagging behind those of Singapore. This could explain why governmental attention and consideration for non-major players in the business sector including SMEs would be top priority for Indonesia to pave the way to the AEC. 

Truly speaking, as a backbone of the national economy, Indonesian SMEs have undertaken as much as 59% of the GDP and 97% of the business establishments.

Advent of the Era of the AEC and Its Impacts on Singapore and Indonesia(39)

Comparative Study on the Perception and Response of Singapore and Indonesia

In addition, concerns of SMEs (Small and Medium-sized Enterprises) particularly in Indonesia that they may be isolated from the far-reaching age of the AEC are getting bigger. 

In spite of such negative voices raised, Singaporean and Indonesian governments have been regarded to take necessary steps to realize their commitments to the AEC as ambitiously set out in the AEC Blueprint.

Advent of the Era of the AEC and Its Impacts on Singapore and Indonesia(28)

Comparative Study on the Perception and Response of Singapore and Indonesia

Thus, while Singapore acknowledges that some problems are faced by the ASEAN countries in implementing the AEC Blueprint, there is an urgent need to persevere in order for the region to remain competitive and relevant to the global economy. 

While it fully supports efforts taken to accelerate internal integration towards AEC 2015, the ASEAN needs to deepen its engagement with key trading partners in parallel. It is significant that SMEs  tend to be in the more optimistic category in relation to regional integration. 

Advent of the Era of the AEC and Its Impacts on Singapore and Indonesia(47)

Advent of the Era of the AEC and Its Impacts on Singapore and Indonesia

In general, Singapore is appraised more prepared to explore the age of the AEC than Indonesia. Private sectors in Singapore, especially SMES have been aggressive in broadening their horizons across the region to excavate new growth chances. 

However, the future of the AEC may be overshadowed unless Indonesia fails to utterly nudge itself to the AEC. Then rosy pictures on the AEC where skilled labor forces in various fields will freely crossing the borders may turn out a wishful thinking.

 

Advent of the Era of the AEC and Its Impacts on Singapore and Indonesia(42)

Advent of the Era of the AEC and Its Impacts on Singapore and Indonesia

Truly speaking, as a backbone of the national economy, Indonesian SMEs have undertaken as much as 59% of the GDP and 97% of the business establishments. What will be the ASEAN like in the time of the AEC? It may be too early to predict the ASEAN in the next 10-20 years when the AEC just pulled up its anchor. 

Even short-term outlook is not an easy thing to challenge as emerging markets with high volatility take up most parts of the region. This could explain why skeptical voices concerning the future of the AEC are ceaselessly echoed. 

Advent of the Era of the AEC and Its Impacts on Singapore and Indonesia(39)

Advent of the Era of the AEC and Its Impacts on Singapore and Indonesia

Proactive approach of SMEs in Singapore toward the AEC may demonstrate Singapore's skyrocketed anticipation for the new generation of a common market. Most experts have been in the same boat that the AEC may serve Singaporean SMEs armed with regional competitiveness well to navigate tremendous business momentums in one single market with 650 million populations. 

Besides, awareness of the importance of the AEC is not only high in the corporate sector but also considerably widespread among the general public in Singapore.