Corporation had been known by Indonesians since about a century ago. The principle applied in financial institutions was considered an excellently fit with the character of the nation’s economy, Because in a corporation, there were unity, mutual cooperation, and kinship.
It was stated in a paper written by Dr. Ir. H. Fattah Jasin, MS, Head of Department of Corporations and Small and Medium Enterprises (SMEs) in East Java Province presented by Drs. M. Zainal Arief, MM, Secretary of Dinkop and SMEs in the East Java Province in a National Seminar “The Role of Corporation as Economic Pillar of the Nation” in the campus of the University of Widya Kartika Surabaya, June 27, 2013. “Corporation as an economic system hasa strong enough position (politically) because it has a constitutional basis, based on article number 33 in UUD 1945 especially in paragraph 1 which states that the economy is structured as a joint venture on a family basis. In explanation of the 1945 Constitution says that the most suitable business up with family principle is Corporation, “he said.
In that occasion, Drs M. Zainal Arief, MM, also presented a number of data related to the world of Corporations and SMEs in East Java. Important role of SMEs in the motion rate of the economy is also one of the discussions. “UMKM’s important role in the Indonesian economy, among others, reduces unemployment due to labor force that can bemaximized; employment by 97% by the UMKM became the backbone of economic resilience during a crisis,” he explained.
UMKM sector has been proved resiliently. During the economic crisis, only UMKM sector survived while the other economics collapsed, while the larger sector was down. “Why? It was because UMKM does not have much foreign debt; was not indebted to the bank because it is considered unbankable: use local resources and inputsmore, as well as not affected by rising interest rates,”he added.
Meanwhile, Dr. Murpin Josua Sembiring, SE, M.Sc., Chairman of the Indonesian Retail DPW Corporation Association (Akrindo) in East Java claimed that there was only 12% of Indonesia’s population who have been the members of corporations. Meanwhile, in neighboring countries, such as Malaysia and Singapore, there were more. “In Malaysia, about 24% of the population are members of the corporations. Then in Singapore around 50%, “he said. The lack of public interest in the corporation movement was in line with the corporation’s work itself. The majority, more corporations in Indonesia choose lending and borrowing sectors only. “In fact, in developed countries, its dominance in the form of consuming corporation,” he added.
the Corporation’s challenge in the era of globalization today was the lack of public awareness to each other mutual assistance through corporation. It was triggered by a concomitant increase in modernity and individualism.
The existence of political support from the state through the Ministry of Cooperatives should have been able to make the corporation established strongly and healthily. “But in fact, corporations which are coveted as a ‘pillar of the national economy,’ is not currently experiencing significant growth,” he said.