Despite the Indonesian government'€™s strong commitment to improve the investment climate and simplify licensing procedures, the country still ranks among the lowest in the annual survey on Ease of Doing Business conducted recently by the World Bank and the International Finance Corporation (IFC).

Indonesia'€™s ranking improved to 120th position in the 2014 survey from a position of 128th, but the country'€™s position was still relatively low compared to other ASEAN members.

Singapore topped the list of the 189 economies surveyed by the World Bank and the IFC. Malaysia ranked 8th, Thailand 18th, Brunei Darussalam 59th, Vietnam 99th, and the Philippines 108th.

Southeast Asian countries ranked below Indonesia were Cambodia in 137th place and Myanmar in 182nd place.

The report also stated that throughout 2012 and 2013, Indonesia accomplished only one piece of business reform '€” improving its credit information system.

'€œIndonesia improved its credit information system through a new regulation, setting up a legal framework for establishing credit bureaus,'€ the survey stated.

The survey analyzes regulations that apply to an economy'€™s business during a life cycle, including start-up and operations, trading across borders, paying taxes and resolving solvency.

Most of the points were contained in a policy package announced by Vice President Boediono last week. The package includes easing the process of obtaining a business permit, access to power supply and bank credits.

Indonesian Employers Association (Apindo) chairman Sofjan Wanandi said that difficulties in obtaining permits and starting businesses were partly caused by a lack of proper spatial planning in most of the country'€™s provinces.

'€œA lot of regions in Indonesia don'€™t have proper spatial planning. For example, when businesspeople already decide to construct infrastructure in a particular area, they have to stop and relocate because the local administration suddenly tells them it'€™s going to allocate the space for another purpose and annuls their permit,'€ he told The Jakarta Post on Tuesday in a telephone interview.

Standard Chartered Bank Indonesia economist Eric Sugandi said that a lack of coordination between the central and local governments hampered the construction of infrastructure facilities such as power plants.

He said that many times, the central government had already approved companies'€™ proposals to build power plants in certain areas, but then the companies had to cancel their projects shortly before implementation as they faced resistance from local residents whose land they were about to acquire.

'€œInvestors will hesitate to make investments in infrastructure development when they face such inconsistent messages'€ he said.

Sofjan suggested the government reduce its energy subsidies to allocate more money for infrastructure development.

Investment Coordinating Board (BKPM) chairman Mahendra Siregar said he believed Indonesia'€™s business climate would improve nextyear thanks to the eight-point policy package launched by the Vice President recently.

The policy package is mainly aimed at helping start-up companies. It includes new regulations to speed up the process of obtaining business permits and applications for electricity access.

'€œWe plan to implement the policy package by February 2014,'€ he told the Post on Tuesday in a text message.

Meanwhile, Deputy Finance Minister Bambang Brodjonegoro said the World Bank'€™s report was unfair because it compared countries with different complexities.

'€œIt compares a city-state like Singapore to Indonesia, which comprises a lot of cities from Sabang in Aceh province to Merauke in Papua province and other big countries like China, Brazil and India,'€ he said. (ogi)

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