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To support the growth of small and medium enterprises (SMEs),
the World Resource Institute (WRI) -- an independent U.S.-based think
thank -- will assist 10 selected SMEs to gain global market access and
financial support.
Under a non-profit program called New Ventures Indonesia, WRI has
selected 10 profitable enterprises operating in a wide variety of
sectors, such as Archipelago Senoadi Perkasa which operates in the
renewable energy field, Caprina Agroindustry in organic agriculture,
Yussagrindo in sustainable forestry, Manunggal Aswinaba Sejahtera in
tourism and Dyna Energy in clean technology.
"Based on our set-up criteria, from 56 companies, we select 10 that
have the most environmental and social benefits, and profitability,"
New Ventures director Virgiana Barriero said during an investment forum
organized Monday to promote the ten firms among investors.
The reasons behind the choice of these criteria was because it was
firms that had a high level of social and environmental awareness that
were more likely to produce sustainable growth.
She added that the 10 selected firms would be able to avail of business
consulting services to improve their business plans, develop their
cash-flow analysis capabilities, allow them to contact investors and
better prepare them to move into the global market.
"There have been significant barriers existing, not only in Indonesia
but also in other developing countries, in relation to the development
of sustainable SMEs, such as barriers to accessing finance and
markets," Barriero explained.
Citing the institute's latest research, she said that less than half of
SMEs in the region had access to formal banking services, while a
similar number lacked collateral to secure loans, business plans and
the ability to engage with private investors.
"(This program) really focuses on giving access to global markets and
financial support to the SMEs so that they can grow."
The 10 firms have now been included in the New Ventures portfolio,
which consists of 130 firms worldwide.
"The market, globally, is paving a new path of market development,
which is more socially responsible, environmentally beneficial,
innovative and profitable," Barriero said.
German Vegarra, Indonesia and Malaysia country manager of the
International Finance Corporation, who was also present at the
investment forum, said it was important for SMEs to play a significant
role in promoting sustainable and environmentally friendly business if
they wanted to be able to grow globally.
Indonesia New Ventures country director Diyanto Imam stressed the
important role played by SMEs in the Indonesian economy. "Sixty percent
of gross domestic product (GDP) comes from SMEs and 90 percent of
employment also comes from this sector," he said.
Figures from the Central Statistics Agency (BPS) show that the total
number of SMEs in Indonesia stood at around 33 million in 2004, which
figure increased by 28 percent to 42.4 million in 2005.
The World Resources Institute's New Ventures program operates in five
key emerging economies: Brazil, China, India, Indonesia and Mexico. To
date, New Venture has trained more than 1,000 entrepreneurs, involving
more than 100 companies, and assisted with the transfer of over US$15
million in investment.
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