Swan.my.id - Minangkabau diaspora funds, estimated at Rp 20 trillion, could become a larger source of investment for West Sumatra as the province works to strengthen its economy and recover from disaster. Deputy Home Affairs Minister Bima Arya urged local governments to help direct more of this money toward productive activity rather than consumption alone.
He delivered the message at a coordination meeting on accelerating economic growth in Padang on Monday, November 2, 2026. The challenge, he said, is to turn the financial ties between Minangkabau communities at home and abroad into long-term benefits for local businesses, infrastructure and residents.
Making Minangkabau diaspora funds productive
Money sent or brought home by people living outside their region can support families and local commerce. Bima noted, however, that the estimated Rp 20 trillion potential largely goes toward consumption. He called on regional administrations to explore ways to channel a greater share into productive investment and long-term infrastructure.
The distinction matters because household spending and investment play different roles in an economy. Consumption can support demand in the near term, while well-targeted investment can help businesses expand their capacity, connect to larger markets and create jobs over time. The minister’s appeal focused on developing that longer-term contribution.
The estimate signals a substantial pool of potential capital, but it does not mean the entire amount is available for projects or will automatically flow into investment. Local governments would need to understand how diaspora funds move, what investors are willing to support and what barriers may prevent them from taking part.
That work calls for more than a general invitation to invest. Clear project information, credible local partners and an understanding of regional economic strengths can help make opportunities easier to assess. These are possible building blocks for engagement, rather than a guarantee that money will enter a particular sector.
Reducing reliance on public budgets
Bima said West Sumatra has economic potential that can contribute to national growth. At the same time, he urged the province to reduce its dependence on funding from regional budgets, or APBD, and the national budget, or APBN, by building a more self-sustaining economic ecosystem.
Public budgets remain important for government responsibilities, including services and development. Yet the minister’s message was that they need not be the only source of momentum. Regional businesses, local investors and diaspora communities could also play a role when projects align with the needs and strengths of each area.
He praised the provincial government for bringing together district and city leaders to discuss concrete steps for growth based on local potential. The meeting offered a forum for different administrations to coordinate, rather than treating economic development as a task for the provincial government alone.
For that approach to work, officials need to identify what each locality can realistically develop. Bima stressed that mapping local potential helps ensure growth reaches beyond statistical targets. The intended benefits include better livelihoods, more employment and progress in reducing poverty.
Recovery and an ambitious growth target
Governor Mahyeldi Ansharullah responded by instructing district heads and mayors to accelerate investment and the downstream processing of leading sectors. The province aims to reach economic growth of 8 percent by 2029, a target that will require sustained activity across its regions.
The push also comes as West Sumatra continues to address the economic effects of hydrometeorological disasters that struck in late November 2025. The damage was estimated at Rp 33.52 trillion. Against that backdrop, investment is being discussed not only as a route to expansion, but also as part of the province’s recovery effort.
Mahyeldi said growth should translate into tangible improvements rather than remain a figure in statistics or plans. He pointed to employment opportunities, income, poverty reduction and stronger purchasing power as outcomes that should accompany economic expansion.
Those goals also help explain the emphasis on productive investment. A project’s contribution cannot be judged only by its funding total; its wider value depends on whether it supports economic activity and benefits people. The meeting’s focus on local potential places those outcomes alongside the headline growth target.
Linking small businesses with industry
Deputy Head of Statistics Indonesia, Sonny Harry Budiutomo Harmadi, highlighted another part of the growth agenda: connecting local micro, small and medium-sized enterprises, or MSMEs, with larger industries. In his view, a large number of small businesses can contribute more when they have a place in industrial supply chains.
Sonny cited Japan’s automotive sector as an example of how smaller firms can supply components to larger manufacturers. His point was that growth in a major industry can reach local businesses when they are connected to production networks, rather than operating separately from them.
For West Sumatra, the practical task is to build links suited to the province’s own economic strengths. The example does not establish which industries local firms should enter. Instead, it underlines the importance of finding realistic ways for MSMEs to become suppliers and share in the opportunities created by larger businesses.
Such connections could also shape how diaspora investment is considered. Where a proposed investment supports local suppliers or helps businesses meet market needs, its benefits may extend beyond the project itself. That possibility depends on the details of each plan, including whether local firms can participate.
Better data for targeted decisions
Sonny also pointed to the 2026 Economic Census as an important source of information for regional policy. More accurate economic data can help local governments understand business activity and identify where an intervention may be useful.
Reliable information matters for investors as well as officials. A clearer picture of local firms, sectors and supply relationships can help decision-makers assess opportunities and gaps. The census, Sonny said, would provide a basis for better-targeted policy interventions.
Economic mapping, business connections and diaspora participation are related parts of the challenge. Estimates of available funds alone cannot show which projects are viable or which communities stand to benefit. Local data and coordination can help governments shape plans around evidence and regional characteristics.
West Sumatra’s effort therefore rests on several linked priorities: encouraging productive use of diaspora capital, accelerating investment, strengthening value-added activity and bringing MSMEs closer to larger industries. The province’s 2029 growth ambition and post-disaster recovery add urgency, while the stated aim remains practical improvement in jobs, income and residents’ purchasing power.
