LPPOM Urges Government to Prioritize Upstream Sector Following Delay of #WHO2024 for SMEs

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Tanggapi Penundaan #WHO2024 bagi UMK, LPPOM Dorong Pemerintah Prioritaskan Sektor Hulu

In an surprising move, Coordinating Minister for Economic Affairs, Airlangga Hartarto, announced the postponement of the #WHO2024 (Mandatory Halal October 2024) deadline for micro and small enterprises (MSMEs) in the food and beverage sector. This delay, which extends the deadline to 2026, is aimed at providing businesses with more time to adhere to halal certification requirements, including those for raw materials, additives, and auxiliary substances. The announcement followed an internal meeting on accelerating mandatory halal certification and the progress of the Government Regulation draft related to Halal Product Guarantee in Jakarta on May 15th, 2024.

According to the Coordinating Ministry for Economic Affairs, BPJPH has issued halal certificates for only 4,418,343 products since 2019, a mere 44.18% of the target of 10,000,000 products. With approximately 28 million MSMEs in Indonesia, President Jokowi’s decision to extend the mandatory halal certification deadline to 2026 is a testament to the government’s commitment to ensuring a smooth transition for businesses without disrupting their operations.

“This aligns with traditional medicines, herbal products, cosmetics, accessories, household items, and various medical devices, which are all set for mandatory halal certification by 2026. The requirement for MSMEs has also been shifted to 2026,” stated Airlangga.

Reacting to this decision, LPPOM Director Muti Arintawati empathetically expressed that many stakeholders, particularly those concerned about the future of MSMEs, will feel a sense of relief. Recognizing the vast number of businesses and the limited time until October 2024, she acknowledged the challenges MSMEs would face in meeting the deadline, potentially jeopardizing their sustainability. However, she cautions that this extension should not breed complacency. Intermediate programs and strict targets must be established to ensure businesses do not delay in obtaining halal certification. Extensive socialization efforts will be crucial to achieve this.

LPPOM emphasizes that prioritizing mandatory halal categories should consider not only business scale but also product criticality. If a critical product serves as a raw material for other products, its widespread use must be taken into account.

“We need to sift through the root of the issues. The attention should not be solely on the business scale within the MSME sector. Focus should be put on businesses supplying critical materials used in other industries, regardless of they are MSMEs or not. This is because the supply of food and beverage-related materials and services involves both large /medium and small/micro businesses,” Muti explained.

For example, meat availability from Animal/Poultry Slaughterhouses is crucial, as meat and its derivatives are used in various culinary products. Not all slaughterhouse products are produced by medium and large businesses; many come from small and micro slaughterhouses, including traditional and individual slaughtering in markets and residential areas. Extension of such MSMEs with a vital role in the halal supply chain would hamper the availability of halal meat, hindering halal certification of businesses using meat.

Additionally, many MSMEs offer repackaged products (in small quantities) for spices and baking ingredients (including imported ingredients). They also operate services related to food and beverage, such as trading goods and grinding.

“Ensuring the availability of halal materials and services will make it easier for MSMEs to produce halal food and beverage end products. It’s like a domino effect. If upstream issues are resolved, most halal product issues in Indonesia will also be resolved. The halal certification process will be easier, and the halal guarantee can be more accountable,” Muti Arintawati explained.

Therefore, LPPOM urges the government to focus on solving halal issues in the upstream sector first, whether it is produced by large, medium, or MSMEs. As a Halal Inspection Agency (LPH), LPPOM is ready to support the government in successfully implementing the mandatory halal regulations to achieve Indonesia’s goal of becoming a global halal center. LPPOM’s concrete actions to support this goal are manifested in various programs.

One such initiative is the annual Syawal Festival, which demonstrates LPPOM’s commitment to MSMEs. This year, LPPOM facilitated independent regular halal certification for 125 MSMEs, 85 of which come from 5 Super Priority Destinations (SPDs). These include 42 MSMEs in Labuan Bajo, 10 in the Lake Toba area, 8 in the Borobudur area, 6 in the Likupang area, and 20 in the Mandalika area. Another 40 are spread across various provinces in Indonesia.

“This number is indeed tiny compared to the target and the number of MSMEs spread across Indonesia. However, through the Syawal Festival, we believe LPPOM can be a catalyst that will accelerate the growth of the halal industry in Indonesia,” Muti Arintawati concluded.