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Making omnibus law in time of coronavirus
Jokowi has somewhat lost the narrative because it looks like the government only eases regulatory burdens on businesses that many of his supporters and donors already do not like.
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World of work: Hundreds of applicants head for a walk-in interview for a bank at the Smesco Building in Jakarta in November 2019. Much of the controversy around the omnibus bill focuses on fears of existing workers, while others hope the new law will create new jobs. (JP/Wendra Ajistyatama)
E
arly this year Investment Coordinating Board (BKPM) head Bahlil Lahadalia struck an optimistic tone for 2020. The BKPM’s target for 2020 is to rake in Rp 886 trillion (US$64.96 billion) of investment, with around 55 percent from overseas. Then the novel coronavirus (COVID-19) outbreak hit.
Nobody has an idea how long the global epidemic will last. If the recovery moves fast, everything should normalize quickly. However, there is little hope for the country to meet its economic growth target of 5.3 percent.
From the investment side, hopes abound that the omnibus bill on job creation can boost foreign direct investment (FDI). President Joko “Jokowi” Widodo has tried to rush through the many steps of the lawmaking process because he believes that regulatory changes through the omnibus law will change the game in wooing investment.
The job creation bill comes with an aggressive and clear-cut strategy, including provisions to relax the need for companies to conduct environmental studies, the introduction of a new regime to calculate severance payments in the event of work terminations and rule easing on coal mining.
The bill has 174 articles in 15 chapters and will amend and repeal 79 prevailing laws. According to the Indonesian Center for Law and Policy Studies, the bill will create 516 implementing regulations.
A huge problem is the government’s fuzzy endgame, namely that it is unclear just what the goal from the deregulatory moves would look like. Jokowi has somewhat lost the narrative because it looks like the government only eases regulatory burdens on businesses that many of his supporters and donors already do not like.
More to the points, at the beginning of the Jokowi administration, there were hundreds upon hundreds of central and regional regulations in the books.
