<![CDATA[This study investigates the impact of Public–Private Partnerships (PPPs) and digital transformation on the performance of micro, small, and medium enterprises (MSMEs) in Indonesia’s creative economy sector. Using a quantitative approach with Partial Least Squares–Structural Equation Modeling (PLS-SEM), data were collected from 120 MSMEs actors participating in collaborative programs between local governments and digital start-ups. The findings reveal that PPPs and digital transformation significantly strengthen the digital capabilities of MSMEs, which subsequently enhance their business performance. Moreover, digital capability functions as a mediating variable that links PPP initiatives and digital transformation efforts to improved MSME outcomes. The results emphasize the importance of multi-stakeholder collaboration among government institutions, private enterprises, and digital innovators in fostering a resilient and competitive creative economy ecosystem. Accordingly, local governments are advised to develop non-infrastructure PPP models that prioritize digital innovation, capacity building, and literacy enhancement for MSME actors.]]>
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