Regulatory Governance and SME Development: A Comparative Study of Indonesia and The Gambia

Lamin SaidyJeng; Modou Lamin Fatajo

Regulatory Governance and SME Development: A Comparative Study of Indonesia and The Gambia

Authors

Lamin SaidyJeng Faculty of Business and Public Administration, University of The Gambia, The Gambia
Modou Lamin Fatajo Faculty of Business and Public Administration, University of The Gambia, The Gambia

Keywords:

SME Development, Regulatory Frameworks, Comparative Governance, Indonesia, The Gambia

Abstract

Small and medium-sized enterprises (SMEs) are critical drivers of economic development, yet their growth is often constrained by fragmented regulatory frameworks. This paper presents a comparative qualitative analysis of regulatory governance and SME development in Indonesia a large emerging economy with ongoing digital governance reforms and The Gambia a small West African economy characterized by institutional capacity constraints. These countries were selected to represent contrasting regulatory environments, highlighting how institutional capacity, regulatory design, and implementation shape SME outcomes. The study addresses the question: How do regulatory frameworks in Indonesia and The Gambia enable or constrain SME development? Using document-based methodology informed by regulatory governance theory, the analysis examines legal instruments, policy documents, and institutional reports across four dimensions: regulatory design, institutional capacity, implementation and enforcement, and developmental outcomes. Findings reveal that Indonesia's coordinated reforms online registration, simplified tax regimes, and digital governance have enhanced SME formalization and market participation. In contrast, The Gambia's regulatory environment remains characterized by procedural fragmentation, limited institutional capacity, inconsistent enforcement, and high informality. The paper concludes with policy recommendations for simplifying regulations, strengthening institutional coordination, expanding digitalization, and adopting proportional regulatory approaches tailored to SME diversity.

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Regulatory Governance and SME Development: A Comparative Study of Indonesia and The Gambia