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Jakarta Post

Government expects House to vote on omnibus bill next month: Luhut

  • Dzulfiqar Fathur Rahman

    The Jakarta Post

Jakarta   /   Wed, June 3, 2020   /   01:45 pm
Government expects House to vote on omnibus bill next month: Luhut Coordinating Maritime and Investment Minister Luhut Pandjaitan (center) speaks during a press conference in Jakarta on Dec. 10, 2019. (JP/Norman Harsono)

Coordinating Maritime Affairs and Investment Minister Luhut Pandjaitan said on Tuesday that the government was expecting the House of Representatives to conclude deliberation on the omnibus bill on job creation next month and that the government expected the bill, if passed, to speed up Indonesia’s investment recovery.

“We will complete the bill by early next month,” said Luhut, a close aide to President Joko “Jokowi” Widodo, in an online talk on Tuesday.

“If it passes into law, we may be one of the easiest countries for investment, but of course [the investment] must comply with the appropriate regulations.”

The government is hoping to attract more investment, especially from overseas, by improving the country’s regulatory scheme through the sweeping omnibus bill. However, the bill has drawn criticism from labor unions and environmental advocacy groups, among other parties, as they believe it jeopardizes labor rights and puts environment protection at risk. Many have also objected to the secretive drafting process of the bill.

Jokowi initially expected deliberations to be completed within 100 days of the bill’s submission in February to the House, where 75 percent of lawmakers are members of the government coalition. However, several experts, critics and politicians said the government and the House’s decision to continue deliberations on the controversial bill during the COVID-19 outbreak was insensitive and that postponement would have been better.

The government has agreed to delay deliberations on labor-related provisions following strong objections from members of the public, especially workers’ organizations.

During a semi-virtual hearing between the House Legislation Body (Baleg) and the government in late May, political factions at the House of Representatives were divided over the title of the bill, with four parties in Jokowi’s ruling coalition demanding a change.

Parties in the ruling coalition have expressed differences over the bill several times. 

The Golkar Party, whose chairman is Coordinating Economic Minister Airlangga Hartarto, is considered the main supporter of the bill, while the National Awakening Party (PKB), the political party to which Manpower Minister Ida Fauziyah belongs, often disagrees with the ruling Indonesian Democratic Party of Struggle (PDI-P).

The PDI-P, whose constituents are generally working class, has been reluctant to pursue the bill from the outset. It was the only party to urge lawmakers not to rush into deliberation, citing public objections to the bill.

Luhut, a retired military general, said he remained positive that Indonesia was an attractive country for investment because of its rich natural resources.

At the same time, he added, the government was taking steps to develop downstream industries in the extractive sectors to generate as much value as possible from those resources, such as nickel ore.

Indonesia recorded Rp 98 trillion (US$6.8 billion) in foreign direct investment realization during the first quarter, down 9.2 percent year-on-year (yoy) as the COVID-19 pandemic put the global economy on hold. Domestic investment grew by nearly 30 percent from the same period last year.