Presidential Regulation Number 38 of 2026 Regulates the Governance of National Entrepreneurship Development

Introduction

On July 2, 2026, the President promulgated Presidential Regulation Number 38 of 2026 on National Entrepreneurship Development ("Presidential Regulation 38/2026"), which took effect on July 2, 2026. Presidential Regulation 38/2026 establishes the policy framework and national guidelines for ministries/agencies and regional governments in designing, implementing, and coordinating the integrated execution of entrepreneurship development programs across the entire territory of Indonesia. The Government enacted Presidential Regulation 38/2026 to support the achievement of the objectives outlined in the National Long-Term Development Plan (RPJPN) for 2025–2045. Through this regulation, the government encourages the accelerated improvement of the entrepreneurship ratio as an effort to strengthen inclusive economic growth, enhance the investment climate and business competitiveness, and expand the creation of quality employment opportunities for the public. 

Key Provisions 

Empowerment Based on Entrepreneurial Phases

Pursuant to Article 15, Presidential Regulation 38/2026 classifies national entrepreneurship development programs progressively according to the maturity level of businesses, namely prospective entrepreneurs, novice entrepreneurs, and established entrepreneurs. Programs for prospective entrepreneurs are focused on strengthening entrepreneurial character, developing business ideas, and facilitating access to business legality. For novice entrepreneurs, programs are directed towards improving business capacity and sustainability to enable them to grow, absorb labor, and participate as suppliers to government agencies and State-Owned Enterprises ("BUMN"). As for established entrepreneurs, development emphasizes increasing business scale, expanding access to domestic and export markets, and strengthening their roles as mentors within the entrepreneurship ecosystem.

Focus on Thematic Entrepreneurial Fostering

Pursuant to Article 19, the government also categorizes entrepreneurship fostering programs based on thematic categories to ensure that empowerment policies are structured in a targeted manner and in accordance with the characteristics of each businesses. Such categories include social entrepreneurs, technology-based entrepreneurs, youth entrepreneurs, women entrepreneurs, village entrepreneurs, and entrepreneurs in the creative economy sector. 

Integration of Information Systems and Data Reporting Obligations 

Pursuant to Article 5 and Article 6, all ministries/agencies and regional governments are obliged to coordinate in submitting and updating entrepreneurial profile data through the National Entrepreneurship Information System administered by the Minister of Micro, Small, and Medium Enterprises. Data updating shall be conducted periodically 2 (two) times within 1 (one) year, specifically in July and December, guided by data standards and interoperability principles in accordance with the provisions of laws and regulations. Nevertheless, Presidential Regulation 38/2026 has not further regulated the procedures, operational mechanisms, or technical specifications for the administration of the National Entrepreneurship Information System; hence, further regulations are still required to support its effective implementation. 

Formation of the National Entrepreneurship Development Committee

Pursuant to Article 20, to ensure that the execution of entrepreneurship development programs operates in an integrated and aligned manner, the government forms the National Entrepreneurship Development Committee, which is positioned under and reports directly to the President. This Committee is chaired by the Coordinating Minister for Community Empowerment as the Directing Chairman and the Minister of Micro, Small, and Medium Enterprises as the Executive Chairman. The Committee serves to formulate strategic policy recommendations as well as to perform cross-ministerial/agency and regional government coordination, synchronization, and evaluation in the execution of entrepreneurship development programs.

Obligation to Draft National and Regional Action Plans

Pursuant to Article 9 and Article 11, each ministry/agency and regional government is obliged to draft an entrepreneurship development action plan at both the national and regional levels. The regional entrepreneurship development action plan shall contain:

• implementing agency;
• type of activity;
• name of activity;
• indicator;
• target;
• activity objective;
• location; and
• related agencies.

These action plans serve as guidelines in achieving the entrepreneurship ratio targets as stipulated in the National Medium-Term Development Plan (RPJMN) and the Regional Medium-Term Development Plan (RPJMD). 

Funding

Pursuant to Article 27, funding for the implementation of national entrepreneurship development is sourced from the State Revenue and Expenditure Budget (APBN), the Regional Revenue and Expenditure Budget (APBD), and/or other lawful sources in accordance with the provisions of laws and regulations. Furthermore, in Article 28, specifically for funding at the regional level sourced from the APBN, its disbursement is allocated through the central government expenditure mechanism and/or transfers to regions, which must comply with the prevailing policy directions and state expenditure budgeting planning cycles. Moreover, the utilization of such funds in the regions is restricted to funding strategic activities such as enhancing entrepreneurial capacity through incubation, improving the quality of mentors, expanding market access, strengthening the entrepreneurship ecosystem, constructing or repairing supporting facilities and infrastructure, as well as administering entrepreneurial data collection. 

Closing

Presidential Regulation 38/2026 regulates the governance of national entrepreneurship development through arrangements between the central government and regional governments. Presidential Regulation 38/2026 classifies empowerment programs based on the maturity level of businesses, introduces a thematic-based fostering approach, mandates the drafting of national and regional action plans, forms the National Entrepreneurship Development Committee, and integrates entrepreneurial data management through the National Entrepreneurship Information System.

Presidential Regulation Number 38 of 2026 obliges ministries/agencies, regional governments, and relevant stakeholders to align policies, programs, and budget planning with the national entrepreneurship development framework. Nonetheless, the implementation of several provisions, particularly concerning the administration of the National Entrepreneurship Information System, is necessary to ensure that coordination, data integration, and program monitoring can be executed optimally, as well as to provide legal certainty for all parties involved.