Post on 10-Feb-2017
ECONOMIC REGULATION IMPROVEMENT PROCESS IN INDONESIADeddy S Bratakusumah, Phd
2016
DEDDY S BRATAKUSUMAH, PhD - 2016
BACKGROUND
MAJOR INDICATORS:
1.SLOWER ECONOMIC GROWTH
2.LOW COMMODITY PRICES3.WEAKER INVESTMENT GROWTHS
4.INCREASING UNEMPLOYMENT AND POVERTY RATES
5.INEQUALITY HAS RISEN
GLOBAL ECONOMIC CONDITION
INDONESIA ECONOMIC CONDITION
DEDDY S BRATAKUSUMAH, PhD - 2016
WEAK GLOBAL GROWTH AND TRADE
SOURCE: IEQ –WORLD BANK-MARCH 2016
DEDDY S BRATAKUSUMAH, PhD - 2016
ECONOMIC GROWTH
SOURCE: BPS 2015
DEDDY S BRATAKUSUMAH, PhD - 2016
LOW COMMODITY PRICES
SOURCE: IEQ –WORLD BANK-MARCH 2016
DEDDY S BRATAKUSUMAH, PhD - 2016
INVESTMENT GROWTH
SOURCE: IEQ –WORLD BANK-MARCH 2016
DEDDY S BRATAKUSUMAH, PhD - 2016
POVERTY AND UNEMPLOYMENT RATES
SOURCE: BPS 2015
DEDDY S BRATAKUSUMAH, PhD - 2016
GINI COEFFICIENT
SOURCE: FAISALBASRI01
DEDDY S BRATAKUSUMAH, PhD - 2016
POLICY RESPONSE
QUICK RESPONSES
POLICIES IMPROVEMENT
(BETTER REGULATIONS)
1
2
DEDDY S BRATAKUSUMAH, PhD - 2016
QUICK RESPONSE STEPS
1. MACRO ECONOMIC STABILIZATION2. ESSENTIAL COMMODITY AND FUEL PRICES
CONTROL3. SPEEDING UP GOVERNMENT EXPENDITURES4. FOSTERING BIO ENERGY USAGE5. ESTABLISHING A TEAM FOR MONITORING AND
EVALUATION GOVERNMENT BUDGET EXPENDITURES6. ESTABLISHING THE PALM ESTATE FUND AGENCY7. SPEEDING UP VILLAGE FUNDS FOR “WORK FOR
FOOD PROJECTS” AND PROVIDING SUBSIDIZED RICE FOR THE POOR
8. SHIELDING THE POOR AND EMPOWERING MICRO AND SMALL ENTERPRISES THROUGH SUBSIDIZED CREDIT SCHEME
1
DEDDY S BRATAKUSUMAH, PhD - 2016
2 POLICIES IMPROVEMENT GOALS(BETTER REGULATIONS)
1. SOUND AND CONDUSIVE MACRO ECONOMIC POLICIES
2. ENERGIZING ECONOMIC SECTOR3. EMPOWERING SUSTAINABLE ECONOMY4. TO IMPROVE THE BUSINESS CLIMATE AND
COMPETITIVENESS5. ATTRACT HIGHER PRIVATE INVESTMENT6. DIVERSIFY THE ECONOMY, AMONG OTHERS
TOURISM7. EMPOWERING MICRO, SMALL, MEDIUM
ENTERPRISES AND COOVERATIVES8. SHIELDING THE POOR
DEDDY S BRATAKUSUMAH, PhD - 2016
POWER OF STATE IN INDONESIA
STATE
CURRENCY REGULATION TAXES/EXPEDITURE
MONETARY POLICY REGULATORY POLICY FISCAL POLICY
PARLIAMENT (LAWS)
EXECUTIVE (REGULATIONS)CENTRAL BANK
DEDDY S BRATAKUSUMAH, PhD - 2016
PROBLEMPOLICY
IMPROVEMENT URGENCY
NEW REGULATION
DRAFT
NEW REGULATION
ANALISYS RECOMMENDATION
IMPLEMENTATION
MODELLING
DECISION
PROBLEM SOLVED/ GOALS
ACHIEVED
MONITORING AND EVALUATION
REGULATION IMPROVEMENT PROCESS
DEDDY S BRATAKUSUMAH, PhD - 2016
REGULATORY PROBLEMS IDENTIFICATION
1. DUPLICATION, IRRELEVANT2. DISHARMONY, CONTRADICTORY AMONG
REGULATIONS3. INCONSISTENT4. UNPREDICTABLE COST AND TIME OF
LICENSE, CERTIFICATE AND PERMIT PROCESSES
5. MISCONDUCT AND CORRUPTIVE BUREAUCRACY
DEDDY S BRATAKUSUMAH, PhD - 2016
FLAW REGULATIONS IDENTIFIED
No REGULATION TOTAL1 GOVERNMENT REGULATION 172 PRESIDENTIAL REGULATION 113 PRESIDENTIAL INSTRUCTION 24 MINISTERIAL REGULATION 965 OTHER 8
TOTAL 134
DEDDY S BRATAKUSUMAH, PhD - 2016
PRESIDENT
COORDINATING MINISTER FOR
ECONOMIC AFFAIRS
MINISTRIES BUSINESS
ASSSOCIATIONS AGENCIES
COMISSIONS
REGULATORY IMPROVEMENT ACTORS
RESEARCHERS
PUBLIC OPINIONS
INVESTORS
CENTRAL BANK
FINANCIAL SERVICE
AUTHORITY (OJK)
DONORS/LENDERS
DEDDY S BRATAKUSUMAH, PhD - 2016
ECONOMIC STIMULUS PACKAGES
PACKAGE UNVEILED MAIN POINTS
1ST SEPTEMBER 9, 2015
• BOOST INDUSTRIAL COMPETITIVENESS THROUGH DEREGULATION• CURTAIL RED TAPE• ENHANCE LAW ENFORCEMENT & BUSINESS CERTAINTY
2ND SEPTEMBER 30, 2015
• INTEREST RATE TAX CUTS FOR EXPORTERS• SPEED UP INVESTMENT LICENSING FOR INVESTMENT IN INDUSTRIAL ESTATES• RELAXATION IMPORT TAXES ON CAPITAL GOODS IN INDUSTRIAL ESTATES & AVIATION
3RD OCTOBER 7, 2015 • CUT ENERGY TARIFFS FOR LABOR-INTENSIVE INDUSTRIES
4TH OCTOBER 15, 2015
• FIXED FORMULA TO DETERMINE INCREASES IN LABOR WAGES• SOFT MICRO LOANS FOR >30 SMALL & MEDIUM, EXPORT-ORIENTED, LABOR-INTENSIVE BUSINESSES
DEDDY S BRATAKUSUMAH, PhD - 2016
ECONOMIC STIMULUS PACKAGES
PACKAGE UNVEILED MAIN POINTS
5TH OCTOBER 22, 2015
• TAX INCENTIVE FOR ASSET REVALUATION• SCRAP DOUBLE TAXATION ON REAL ESTATE INVESTMENT TRUSTS• DEREGULATION IN ISLAMIC BANKING
6TH NOVEMBER 5, 2015 • TAX INCENTIVES FOR INVESTMENT IN SPECIAL ECONOMIC ZONES
7TH DECEMBER 4, 2015
• WAIVE INCOME TAX FOR WORKERS IN THE NATION'S LABOR-INTENSIVE INDUSTRIES• FREE LEASEHOLD CERTIFICATES FOR STREET VENDORS OPERATING IN 34 STATE-OWNED DESIGNATED AREAS
8TH DECEMBER 21, 2015
• SCRAP INCOME TAX FOR 21 CATEGORIES OF AIRPLANE SPARE PARTS• INCENTIVES FOR THE DEVELOPMENT OF OIL REFINERIES BY THE PRIVATE SECTOR• ONE-MAP POLICY TO HARMONIZE THE UTILIZATION OF LAND
DEDDY S BRATAKUSUMAH, PhD - 2016
ECONOMIC STIMULUS PACKAGES
PACKAGE UNVEILED MAIN POINTS
9TH JANUARY 27, 2016
• SINGLE BILLING SYSTEM FOR PORT SERVICES CONDUCTED BY SOES• INTEGRATE NATIONAL SINGLE WINDOW SYSTEM WITH 'INAPORTNET' SYSTEM• MANDATORY USE OF INDONESIAN RUPIAH FOR PAYMENTS RELATED TO TRANSPORTATION ACTIVITIES• REMOVE PRICE DIFFERENCE BETWEEN PRIVATE COMMERCIAL AND STATE POSTAL SERVICES
10TH FEBRUARY 15, 2016
• PROTECTING MICRO, SMALL, MEDIUM ENTERPRISES AND COOPERATIVES THROUGH NEGATIVE LIST INVESTMENT • INCREASING FOREIGN SHARE LIMITATION ON FDI
DEDDY S BRATAKUSUMAH, PhD - 2016
QUICK YIELDNo PROCESS THEN NOW1 INVESTMENT PERMITS IN
INDUSTRIAL ESTATE526 days 3 hours
2 FOREST EXPLORATION AND ENVIRONMENTAL SAFETY PERMITS
2 – 4 years
12-15 days
3 MEDICINE RAW MATERIAL IMPORT PERMITS
days 342 minutes
4 PERMITS PROCEDURES MANY AGENCIES
1 DOOR
5 TAX ALLOWANCE REQUEST - Max 25 days
6 TAX HOLIDAY REQUEST - Max 25 days
7 PORT SERVICE BILLING 1 BILL
DEDDY S BRATAKUSUMAH, PhD - 2016
INCENTIVESNo INCENTIVE1 TAX HOLIDAY FOR NEW INVESTOR IN ECOOMIC
ZONE, 5 TO 15 YEARS2 LOWERING INTEREST RATE FOR “SME”, FROM
22% pa TO 12% pa3 NEW FORMULA FOR WORKER SALARY4 MORE COUNTRIES WITH NO VISA POLICIES5 FOREIGNER IS ALLOWED TO HAVE PROPERTIES IN
INDONESIA6 TAX ADJUSTMENT FOR DEPOSIT INTEREST7 ELECTRICITY TARIFF ADJUSTMENT FOR SOME
INDUSTRIES8 ASSET REVALUATION FOR TAX ASSESSMENT9 SPECIAL ECONOMIC ZONE S DEVELOPMENT10 ONE MAP POLICY11 NEGATIVE LIST ADJUSTMENT
DEDDY S BRATAKUSUMAH, PhD - 2016
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SOURCE: CENTRAL BANK 2016
INTERNATIONAL TOURIST INFORMATION
DEDDY S BRATAKUSUMAH, PhD - 2016
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FDI INFORMATION
SOURCE: CENTRAL BANK 2016
DEDDY S BRATAKUSUMAH, PhD - 2016
REGULATION REFORM IS INTENDED TO LIFT THE CONSTRAINTS TO GROWTH IN TRADE, INVESTMENT CLIMATE, FINANCIAL MARKETS, AND SHIELDING THE POOR TOGETHER WITH EMPOWERING SME
THE REMAIN URGENT PROBLEM FOR INDONESIA IS INEQUALITY, WHICH URGE GOVERNMENT ACTION TO REDUCE IT
FINAL REMARKS
DEDDY S BRATAKUSUMAH, PhD - 2016
Thank YouTerima KasihGamsahabnida