Amendment to bylaws sought to boost economy

Tifa Asrianti , The Jakarta Post , Jakarta | Tue, 08/26/2008 10:33 AM | City

Members of Jakarta's business sector have urged the administration to amend bylaws they believe are detrimental to the city's economic growth and future investment.

President of Jakarta's Chamber of Commerce and Industry Sofian Pane said his organization had lodged complaints concerning five such regulations.

"One of the regulations we find offensive is the domicile permit. We have filed our complaint with the administration in the hopes they will amend the law," Sofian told reporters at City Hall after the signing of a memorandum of understanding (MoU) between the city administration and the chamber Monday.

The domicile permit, required for establishing a business, prohibits commercial activities in residential areas. In the case of an existing permit in a residential area, the law instructs local officials to deny a permit extension.

The city administration already has two such regulations on the books, banning business activities in residential areas: a 1977 gubernatorial decree issued by then-Governor Ali Sadikin and a 1988 decree by then-Governor Wiyogo Atmodarminto.

While the 2007 Spatial Planning Law also prohibits activities that fail to comply with allotted land usage, it provides a loophole through articles 10 and 37, which give local administrations the authority to oversee planning efforts.

Sofian said the administration should define which business establishments are to be allowed in residential areas, as not all cause pollution.

"As long as the business doesn't pollute the environment -- tailors, embroidery makers or financial consultants are some examples -- I think it will be fine," he said.

The administration should also amend the residential ban to assist small businesses, which support economic growth and help reduce unemployment, he added.

"All small and medium enterprises start out in the home, because renting an office is too expensive," Sofian said.

The chamber of commerce will continue to gather data on similar regulations from its members, he added.

Governor Fauzi Bowo said the administration and the chamber had many regulations to discuss, if they are to find ways to improve the city's economy.

"Sometimes we are slow to issue a regulation, while economic development can occur quite rapidly. As a result, we miss out on some business opportunities," he said.

"If we can't fix the regulation at the regional level, we'll appeal to the central government," Fauzi added.

The MoU will allow businesses from specific sectors to engage in intense dialogue with their colleagues, said Mara Oloan Siregar, assistant to the city secretary for the economy.

The MoU signed Monday covers nine sectors: cooperatives and small and medium enterprises; the service industry; husbandry, fishing and maritime activities; farming and forestry; tourism; transportation; manpower; investment and capital; and economic data management services for business.

The MoU between the administration and the chamber, first signed in 1987, is renewed every five years, with the current agreement set to expire in 2013.

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