Over the past few years, a number of Indonesian regions have made progress in cutting red tape and enabling business activities to be carried out with greater ease.

At the heart of their achievements is the deployment of an e-system, the child of the digital revolution, that allows administrative processes to be more transparent, faster and cheaper.

Regional governments are the backbone of improving the country’s investment climate and the use of e-systems must be pushed through on a larger scale to support effective reforms, a 2016 report suggests.

The report, jointly prepared by the Asian Development Bank (ADB) and the Regional Autonomy Watch (KPPOD), notes that local governments have been inconsistent in their efforts to cut complicated bureaucratic procedures and red tape, performed at poor capacity and failed to catch up with the central government.

The Medan municipal administration in North Sumatra, for instance, slashed the time to set up a business to 17 days from 34 days, reducing costs by 26 percent, but increased the number of procedures from eight to 14.

Similarly, Balikpapan municipal administration in East Kalimantan was able to simplify business procedures and lower costs, but failed to make progress in land and property registration.

“The national government is already quite progressive in its reforms, but it has yet to resonate at the local level,” said KPPOD executive director Robert Endi Jaweng recently. “The reform strategy in local governments still centers on routine bureaucracy, not a full breakthrough.”

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