Small Medium Technological Enterprises and Local Economic Resources Development to Promote Activities of Industry and Trade, in Solok City West Sumatra, Indonesia

Abstract

The objective of this research is to analyze the macro and microeconomicenvironments of Small Medium Technological Enterprises (SMTEs) in Solok City. “SMTE” in Indonesian language is identical with the term of Small and Medium Industrial Enterprise which is abbreviated by IKM, are considered to be important as an engine to stimulate the growth of local economic resources development. There are two main aspects which are necessary to analyze. The first is to analyze the macroeconomic environments of SMTEs in Solok City. The findings showed that the contribution of industrial sector to GRDP was relatively smaller from year to year during the period of 2010 to 2016. It indicated that Solok City was relatively not yet functioning as the City in accordance to the Indonesian National Urban Development Policy. The result of LQ calculation showed that trade and service sector dominate the economic activities of Solok City, however it still weak in the field of industrial activities particularly in term of processing industry. The area around it such as Solok Regency, South Solok Regency, Sijunjung Regency were dominated by economic activity in primary sector. Padang City in another side has the surplus in secondary as well as tertiary product and services. The findings indicated that macroeconomic environments of SMTEs in Solok City were not yet so conducive to stimulate SMTEs creation and development. However the opportunity of SMTEs creation and development was open and quite prospective. SMTEs in Solok City besides using its owned local resources as the input of production, also it can take the surplus of agricultural commodities and mining from its surrounding regions. Padang City can support the growth of SMTEs by technology transfer. In relation with OTDA, the result of studies indicated that this policy is a profitable policy for SMTEs creation and development. The second is to analyze the microeconomic environments of SMTEs in Solok City. In this case, the primary data taken from questioners and field survey were analyzed. The findingsof study showed that SMTEs have not been so developed in Solok City, therefore it still requires several "program supports” to speed up its creation and development.