1. Environmental Soft Loans Schemes
Promoting Green Economy in Indonesia Through Small Medium Enterprises (SMEs) Mahayekti Hacinthyasakti MBA in International Management, Hochschule für Wirtschaft und Umwelt (HfWU) Nürtingen-Geislingen
Introduction
Objectives
Conclusion
Small Medium Enterprises (SMEs) have been playing a big role in Indonesian economic since they represent 99,9% of the enterprises in the community.
Knowing this fact, it is a big opportunity to promote green economy implementation by handing over recycles waste products from small experiments, which have passed some tests and proofed by academic researchers, into SMEs to be further commercially processed and offered to the society. With this approach, SMEs have opportunity to create shared value, both for the company‘s profit as well as society‘s benefit.
The possibility of this approach however still needs to be further researched.
This study will try to find out the possibility of green economy implemention in Indonesia, with help of SMEs approach to bring the products into the community. Some detail objectives are outlined as follow:
Identifying primary barriers of SMEs
Financial barriers
Other barriers
Recognizing possible government, investors and related industries supports
Identifying strategies to overcome the barriers
Since the research has not fully conducted, the final result yet could not be concluded. However some questions that might arise within the study are:
How to secure the supply of waste as the source for “green products” production.
How high are the cost of R&D and production that can be covered by SMEs so that they able to offer the product with an affordable and favorable price in the market.
Green Definitions
Industries that provide products or services related to renewable energy, increased energy efficiency, clean transportation and fuels, agriculture and natural resource conservation, and pollution prevention or environmental cleanup
(Michigan Department of Energy, Labor & Economic Growth)
Environmental Soft Loans Schemes
JBIC-PAE
IEPC-KfW 1
IEPC-KfW 2
DNS
Target Groups
All scales of enterprise
SMEs
(small and Medium Enterprises)
MSEs
(micro and small Enterprises)
Participating Banks
5 National Banks (State own/private)
4 Regional Banks + 1 National Bank
2 APEX Bank, 4 Regional Banks + 1 National bank
1 Syariat Bank
Type of Credit
Investment
Investment (60%) + Working Capital (40%)
Interest Rate (effective)
At Central Bank’s Rate (SBI)
11-14% pa
Minimum 2% Below market
Syariat (equal to 10-13% pa)
Technical Asisstance
-none-
Regional Consultant
Technical Assistance Unit (TAU)
Methods
Review of literatures related to current waste researches is conducted to compare theories and possible realization in industry world. The research will be further analyzed through interviews, by , phone and in person, with both SME managers and academic researchers.
A case study by finding a possible current experiments is used to simulate the realization of the project by SME.
References
Porter, M. E., & Kramer, M. R. (2011). Creating Shared Value. Harvard Business Review .
Abbreviations and Acronyms
JBIC-PAE Japan Bank International Cooperation-Pollution Abatement Equipment
IEPC-KfW Industrial Efficiency and Pollution Control-Kreditanstalt fur Wiederaufbau
DNS Debt for Nature Swap
Ministry of Environment (2009). Financing Green Industries: Incentives for Environmental Investment in Indonesia. International Conference on Green Industry in Asia. Manila.