Gov’t Launches 12th Economic Policy Package

By Office of Assistant to Deputy Cabinet Secretary for State Documents & Translation     Date 28 April 2016
Category: News
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President Jokowi accompanied by Coordinating Minister for the Economy, the Head of Investment Coordinating Board (BKPM), and Presidential Chief of Staff announces 12th Economic Policy Package, at the State Palace, Jakarta, on Thursday (28/4) afternoon

President Joko ‘Jokowi’ Widodo on Thursday (28/4) at the State Palace announced the 12th Economic Policy Package.

The Package that consists of 10 points is expected to bring positive impacts for the betterment in doing business and it will be carried out at the Central Government, provincial governments, and regional governments.

The President took an example when the people need to process Hinder Ordonantie or Nuisance Ordinance (HO), Trade Business License (SIUP) and Company Registration Certificates (TDP) one by one.  First, they need to obtain SIUP before being able to obtain TDP and the process used to take 3 days to a week to finish.

“Now, the process is done in one time, the process of obtaining the SIUP and TDP can be done in one day. It is impossible to merge the two documents because it is mandated by the law. The point is, people can apply for all permits at once and it can be done in one day,” President Jokowi told reporters.

Meanwhile, there are several types of Environmental Impact Analysis (Amdal), namely Amdal for the environment and Amdal for traffic.

“I think one Amdal is enough. There is no need to have Amdal for the environment or for the traffic. Later on, it will create another Amdal. I think one Amdal which covers everything is enough,” the President firmly said.

President Jokowi added the 10 points in the 12th Economic Policy Package are:

First, it has previously taken 13 procedures, 47 days and Rp 6.8 million to Rp 7.8 million, 5 permits, SIUP, TDP, business premises license, and HO to start a business; the Government has cut that to seven procedures, 10 days, Rp 2.7 million, and 3 permits. “The others have been eliminated,” President Jokowi said.

Second, for construction permits, the Government has cut the process to 14 procedures, 52 days, and Rp 70 million from the previous 17 procedures, 210 days, and Rp 86 million, as well as cut four building permit (IMB), environmental management scheme (UKL), environmental monitoring scheme (UPL), feasible building function (SLF), and warehouse registration certificate (TDG) to three permits: IMB, TDG, and SLF.

For property registration, the Government has cut 5 procedures to 3 procedures, 25 days to 7 days, and cut the cost that was 10.8 percent of the property value to 8.3 percent.

Fourth, tax payments that were paid manually, in 54 installments to cut into10 installment and the system is online.

Fifth, regarding access to credit, the President said that the new package is very comprehensive involving 20 ministries and institutions, all of which have worked for 4 months to complete the Package.

Fifth, access to credit which previously did not have Credit Information and Management Bureau (LPIP), online security system can only be accessed by the notary, and data migration can only be done manually; now the LPIP is established, fiduciary online security system can be accessed by the notary and other parties, data migration can now be done online for Java Island.

The sixth point is related to contract implementation. According to the President, no simple lawsuit settlement has been regulated in the previous contract implementation as well as the time limit to settle a case. Based on the previous survey, the time allocated to settle a case is 471 days.

“Now, procedure of the settlement is established as well as the procedure of simple lawsuit settlement. Therefore, the number of procedures is 8, and 11 once there is appeal. The time limit is cut from 471 to 28 days, and 38 days once there is an appeal,” President Jokowi explained.

Seventh is related to electricity installation which according to the President is considered as a small thing yet important.

The President mentioned that the Government has cut the process to 4 procedures, 25 days, and Rp 15 per VA in feasible operating certification (SLO) cost from a previous 5 procedures, 80 days, and Rp 17.5 per VA. The cost for electricity installation is also cut from Rp 969 per VA to Rp 775 per VA. Guarantee can also be used as security deposit subscription in the form of cash.

Eight is international trade. It used to be done offline, but now it uses online module for PED or notification of export goods and PID or notification of import goods. Moreover, there is time limit of goods piling up in seaport, which must not exceed three days. All of it is regulated in details.

The ninth point is for resolving insolvency. “We will simplify the cost and would be calculated based on the value of debt. The time limit of settlement that was 730 days and has 30 percent of recovery cost is now calculated based on the value of debt (through a negotiation scheme) or on the value of settlement (through a settlement scheme),” the President explained.

The last point is on the protection of minority investors. According to the President, this point is really important and added that the regulation has previously established but it lacks dissemination.

The current regulation will be disseminated at a large scale and in an effective way.

The President believes the measures in the 12th Economic Policy Package will help the business world, especially micro, small and medium enterprises, to start running businesses.  (FID/ ES) (RAS/EP/YM/Naster)

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