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Jakarta Post

Go local or risk sanctions

  • Fedina S. Sundaryani

    The Jakarta Post

Jakarta   /   Wed, August 2, 2017   /  08:00 am
The Jakarta Post Image
In coordination: President Joko “Jokowi” Widodo (left) and Vice President Jusuf Kalla (second left) lead a limited Cabinet meeting at the Presidential Office in Jakarta on June 7. (Antara/Rosa Panggabean)

From smartphone to cars and power plants, the government is set to intensify a policy on local content requirement (TKDN) for a wide range of electronic products after proclaiming that it had not been sufficiently enforced. The government is preparing a regulation that will slap sanctions on companies that refuse to comply with the rule. The TKDN, first introduced in 2009 to widespread criticism by Indonesia’s major trading partners as it is prohibited by the World Trade Organization (WTO), is aimed at protecting local industries, enhance local innovation and create employment. Veering away from his commitment to promote market-friendly economic policies, President Joko “Jokowi” Widodo is leading the foray to forge interventionist policies for domestic industries by taking the TKDN regulation to a new level. During a Cabinet meeting to discuss the implementa...