Jakarta, CNBC Indonesia – The local company from Central Java, Margono Paper, has successfully expanded to five continents with its product, fancy paper (colored patterned paper). A total of 50 countries are export destinations, representing non-traditional markets.
The Export Director of PT Margono Paper, Ferianti Chandranta, shared that the surge in demand occurred during the Covid-19 pandemic when fancy paper factories in Europe and China closed.
Margono Paper initially struggled to meet the demand due to operational limitations, necessitating additional working capital. This issue was resolved with assistance from the Indonesian Export Financing Agency (LPEI).
“LPEI offers various products that can help export-oriented businesses. LPEI’s financing support has enhanced the company’s competitiveness to penetrate global markets, including exports to non-traditional countries. With very competitive interest rates, we were able to smooth cash flow and add capital to purchase raw materials, ultimately driving company innovation by adding other product variations,” said Ferianti.
LPEI focuses on increasing Indonesia’s exports, including strengthening trade relations between Central Java and several of the world’s largest economies.
The Central Statistics Agency (BPS) noted that Central Java currently has 2,261 exporters, with details as follows: 1,897 exporters with export values below IDR 50 billion, 296 exporters with export values of IDR 50-500 billion, and 68 exporters with export values above IDR 500 billion.
Central Java’s export distribution is dominated by several main commodities, such as clothing and accessories (non-knitted) (20.18%), clothing and accessories (knitted) (12.24%), footwear (11.01%), wood and wood products (9.98%), and furniture, lamps, and lighting equipment (7.20%).
The United States is the largest export destination for Central Java, contributing 30.43%, followed by China (7.66%), Japan (6.51%), Singapore (6.49%), and the Netherlands (5.6%). Additionally, the number of buyers collaborating with Central Java exporters continues to increase, with 22.25% of them being loyal buyers.
“LPEI supports the increase of exports by providing facilities such as Business Matching to expand access to international buyers, both conventionally and digitally,” said Maqin U. Norhadi, Managing Director of Business Development.
Rini Satriani, Market Intelligence & Leads Management Chief Specialist at LPEI, analyzed that Central Java’s export growth will remain stable until 2025, supported by several leading products. “Some products have significant export potential in 2024, including Wood Products estimated at USD 2.20 billion, Furniture products valued at USD 2.30 billion, and Essential Oils for beauty products estimated at USD 1.40 billion.”
At the same event, LPEI explained the facilities and support for export-oriented SMEs. Export SMEs can take advantage of various Special Export Assignment Programs (PKE) according to their export profiles/characteristics, including PKE UKM (designed for export-oriented SMEs), PKE Kawasan (for non-traditional country target markets), and PKE Trade Finance (with trade transaction schemes).
As of June 2024, LPEI has disbursed PKE Kawasan facilities amounting to IDR 4.247 billion for exports to over 40 countries, PKE Trade Finance amounting to IDR 8.187 billion for exports to over 55 countries, and PKE UKM up to IDR 1.058 billion for exports to over 65 countries.
