Trade Minister Seeks Clarity on Modern Retail Restrictions in Villages

9 hours ago 5

TEMPO.CO, Jakarta - Trade Minister Budi Santoso stated that he would request an explanation from Minister of Villages Yandri Susanto regarding his intention to regulate the expansion of modern retail in villages. "I made an agreement with the Minister of Villages earlier; there was another event, so I will ask about it—what exactly does he mean by that," he said in Central Jakarta on Tuesday, February 24, 2026.

The presence of modern retailers in rural areas has recently become a subject of ministerial debate, with Yandri Susanto being a primary proponent of regulation.

During a working meeting with Commission V of the House of Representatives (DPR) on November 12, 2025, Yandri argued that the development of the Merah Putih Village Cooperative would not reach its potential if minimarket expansion remained unchecked. "It's not an apple-to-apple comparison; they are already very large and highly monopolistic," Yandri stated.

In response to the government's plan to regulate this expansion, the Director General of Domestic Trade at the Ministry of Trade, Iqbal Shoffan Shofwan, stated that modern retail business regulations currently still refer to Government Regulation Number 28 of 2025.

Iqbal noted that any regulatory changes concerning modern retail expansion would only be implemented after first reviewing the actual dynamics on the ground.

According to Iqbal, the business expansion of tens of thousands of networked modern retailers, such as Alfamart, has primarily been concentrated in urban centers. He explained that business operators typically evaluate a region's demographics and income levels before committing to an expansion.

Consequently, he noted that modern retailers have not yet proliferated in rural villages. "Until now, we rarely find networked modern retailers in villages, so I don't believe there is a problem," Iqbal said.

He mentioned that the Ministry of Trade instead encourages strategic partnerships between cooperatives and modern retailers. He pointed out that the Merah Putih Village Cooperative and modern retailers possess different characteristics, noting, for example, that cooperatives mainly aggregate products from their respective villages.

Nevertheless, Iqbal stated that there is an opportunity for cooperatives to expand by marketing products manufactured by SMEs from other villages. Meanwhile, Iqbal mentioned that the majority of merchandise sold by modern retailers is sourced from factories.