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RI pledges continued reforms
The government will continue trying to improve the investment climate, which has been reformed since 2005, to attract more investment to stimulate the country’s economy, according to senior ministry officials
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The government will continue trying to improve the investment climate, which has been reformed since 2005, to attract more investment to stimulate the country’s economy, according to senior ministry officials.
On Sunday, Edy Putra Irawadi, industry and trade deputy to the coordinating minister for the economy, said the government would keep pushing for regulatory reform in various economic sectors amid the global economic downturn.
“Along with the state minister for administrative reform, we’ve designed licensing guidelines for state officials at central and local levels. We also have a team whose job is to oversee the national single window for investment, providing electronic services for information and investment licensing,” he said.
He added the government also had a logistics team to develop the national logistics system in a bid to reduce business costs, increasing Indonesia’s economic competitiveness.
“All of those are expected to better Indonesia’s investment climate. But we can’t improve it overnight due to the dynamic in regional autonomies and democratization in the country,” Edy said.
According to the latest report from the European Business Chamber of Commerce in Indonesia
(EuroCham), which represents more than 100 European companies and organizations here in the country, the government needs to address several issues to attract more foreign investment to generate higher growth.
These include reforming heavy bureaucracy and difficult operating environment for businesses both at central and regional levels; improving rigid manpower regulations that force companies to limit hiring new employees; and developing infrastructure, particularly roads, ports and electricity networks, to help cut business costs.
Foreign investment makes up a large part of investment in Indonesia.
Last year, according to the Investment Coordinating Board (BKPM), Indonesia secured Rp 20.36 trillion (US$1.69 billion) and $14.87 billion in domestic investment and foreign investment, respectively.
Mahendra Siregar, investment deputy to the coordinating minister for the economy, said the government would address EuroCham’s recommendations by improving the investment climate, while mitigating the impact of the global financial crisis.
Edy said the government was “open to receive any complaint and recommendation” from businesses operating in Indonesia.
“We’ll discuss their complaints at a coordination meeting called the Ekuin Club [comprising related ministry officials],” he said.
Amid pressing economic times, investment growth may plunge to about 11 percent this year, from 20.5 percent growth in 2008, said BKPM head M. Lutfi.
Bambang Susantono, infrastructure deputy to the coordinating minister for the economy, said the government had provided Rp 8.4 trillion in stimulus funds for important infrastructure projects, including trains, roads, ports and airports, in addition to more than Rp 90 trillion already set aside for infrastructure projects in the 2009 state budget.
