Introductory Remarks of President Joko Widodo at a Limited Cabinet Meeting on Economic Equalisation Policy, 7 February 2017, at the Presidential Office, Jakarta

Unofficial English Translation

Assalamu’alaikum warrahmatullahi wabarakaatuh,

This afternoon, we will continue discussing economic equalisation policy that we have already discussed at a limited cabinet meeting two or three weeks ago in Bogor.

At this moment, we should be more focused on addressing interregional inequality by accelerating infrastructure development and interregional connectivity, as well as increasing transfer funds to the regions and villages. We want national economic movement to be centered not only in Java, but also throughout the country, including Indonesia’s peripheral areas, in a just and equal manner.

In 2017, we want to work more focused to realise economic equality, particularly to decrease economic inequality between the rich and the poor. I demand that this economic equalisation policy must affect the most underprivileged people. Therefore, we need to take breakthrough measures, be it redistributing assets, imposing affirmative measures to create equal opportunities, as well as improving access to education and skills for about 40 percent of the people who are most underprivileged.

In order to realise economic equality, inequality of land ownership will be our fundamental challenge which should be solved immediately. Land is a very important assest for 40 percent of the most underprivileged people. Therefore, we should provide the underprivileged people, small farmers or farm workers who do not own land with access to land ownership, so that the economic scale to develop their income can be realised.

We need to do so because I have the data which shows that land ownership is dominated by certain groups or corporations. Moreover, I also have information that the major landowners only paid approximately a quarter of transaction taxes that must be paid to state treasury. We need to improve and manage this immediately by implementing agrarian reform and fair tax system.

Lastly, regarding broader access to funds as well as education and skills development, particularly for the underprivileged people, I want the Smallholder Business Credit (KUR) system to be improved. Therefore, it will grant broader access to fund Micro, Small and Medium Enterprises. We also need to offer KUR with schemes instead of the current KUR with general scheme. We have to be able to turn the pyramid of workforce qualifications which is currently filled with primary and secondary graduates to be filled with educated and skilled workforce. It means that we need to make major breakthroughs in our education system, particularly in the vocational training system, so that we will be more focused on preparing human resources in key sectors, such as maritime, agricultural, tourism and creative industries.

That is all my introductory remarks. (PR Cabinet Secretariat) (SML/AW/YM/Naster)