|Indonesia Update | February 8, 2018
Authors: Kim Yaeger, Artha Sirait, Ian Saccomanno and Jade Hoang
|THE COUNCIL'S TAKE|
President Jokowi issued Implementing Regulation of the 16th Economic Policy Package
On January 23, President Joko “Jokowi” Widodo met with government officials both national and regional to discuss policy harmonization between the central and regional governments. President Jokowi held the meeting particularly to discuss the implementation of Presidential Regulation No. 91 of 2017 (PR91/2017), which is an implementing regulation of the Jokowi administration’s 16th economic policy package aimed at improving the ease of doing business in the country. The 16th economic policy package deals exclusively with the general licensing process for business activities. It was enacted with the view that Indonesia’s lengthy and unintegrated licensing process has discouraged potential investors. PR91/2017 identifies two steps to be taken by the government to achieve the purpose of accelerating business in Indonesia.
The first phase began with the enactment of PR91/2017 and the establishment of the National Task Force. The Integrated Single Submission System is expected to be implemented gradually through March 2018.
Although a step in the right direction, it remains unclear how the establishment of an additional task force will assist in simplifying Indonesia’s complex regulations. Indonesia currently has four coordinating ministries, with a main role to coordinate and synchronize the 30 ministries within their purviews. In practice, the coordinating ministries do not always use their convening authority. Indonesia also face challenges to harmonize and coordinate between national and regional governments. The decentralization process that took place as a result of the 1998 democratization reform has shifted a significant amount of regulatory power from the central government to the regional governments on certain sectors. This makes it more difficult for companies that operate in different regions of Indonesia as they need to adjust their business practices per region, and at high business and efficiency costs, in order to comply with sometimes conflicting national and local regulations. The need for harmonization between national and regional regulations is especially important now subsequent to the Constitutional Court’s April 2017 ruling which revoked the central government’s authority to annul regional laws without going through the judicial process.
Bank Indonesia Governor to Retire in May 2018
Bank Indonesia Governor Agus Martowardojo is set to retire in May 2018 even though President Jokowi has yet to announce any candidates to replace Martowardojo. The position of Bank Indonesia Governor must be proposed and appointed by the President with the approval of the House of Representatives. The President has publicly stated that he is considering announcing the names of the candidates by late February. Traditionally, the outgoing Governor would provide his replacement recommendation for the President to consider although this is not a requirement. There is also no particular pattern for a Bank Indonesia Governor to come within Bank Indonesia. Martowardojo himself came from a mixed of public-private sector background; he was the CEO of the state-owned Bank Mandiri and at some point a senior officer at Bank Niaga prior to joining Bank Indonesia.
Bank Indonesia is led by a Governor who is assisted by a Vice-Governor, and at least four but not more than seven Deputy Governors. Board Members are appointed for a term of office of five years and may be reappointed to the same position for no more than one subsequent term of office. A member of the Board of Governors may not be dismissed during his or her term of office, unless the person resigns; is convicted of a felony; unable to attend in person for a period of three consecutive months without a reasonable cause; is declared bankrupt or unable to settle liabilities to creditors; or is permanently incapacitated.
Martowardojo was appointed in March 2013 by Indonesia’s House of Representatives. He previously served as Minister of Finance in the administration of former President Susilo Bambang Yudhoyono in May 2010 replacing Sri Mulyani Indrawati.
The new Governor will inherit the policies pioneered by Martowardojo such as the national payment gateway and upon the finalization of the amended Government Regulation No. 82 of 2012, how it will it be interpreted in the financial sector. The Council will continue to monitor this development.
|On February 2, Indonesia's Minister of Communications and Information Technology Rudiantara shared with the Council the newest draft amendment to Government Regulation 82/2012 on Electronic Systems and Transactions Operations (GR82), which can be found here in Indonesian and English. The Council is urgently seeking input from members on the new draft before it is issued. A summary of the provisions of the draft amendment can be found in our recent Update here. If you have any questions, or would like to submit comments, please contact Artha Sirait at email@example.com and Ella Duangkaew at firstname.lastname@example.org.
Please submit all comments by COB Monday, February 12.
|IN THIS UPDATE|
Indonesia, Cambodia reaffirm commitment to enhancing bilateral cooperation Antara News 3rd Feb 2018
Indonesian trade mission to Pakistan opens investment opportunities Antara News 1st Feb 2018
Floods & Landslides: Jakarta & Bogor Plagued by Torrential Rains Indonesia Investments 6th Feb 2018
Government urged to implement decree on corruption elimination Antara News 5th Feb 2018
Some 5,000 East Jakartans affected by floods The Jakarta Post 5th Feb 2018
Indonesia strives for conclusion of RCEP talks The Jakarta Post 7th Feb 2018
Asean nations unite in fighting terrorism Bangkok Post 8th Feb 2018
Indonesia needs to boost exports as foreign debt increases: BI The Jakarta Post 8th Feb 2018
VP encourages economic development amid years of politics Antara News 8th Feb 2018
Indonesia eyes South Asia to expand and diversify its exports Antara News 7th Feb 2018
Indonesia to deal with last part of One Map Policy The Jakarta Post 5th Feb 2018
GDP up 5.07 percent in 2017 despite slow growth in govt spending The Jakarta Post 5th Feb 2018
Jokowi wants to privatize airports, says Luhut The Jakarta Post 2nd Feb 2018
Trade Ministry initiates $3.1m buying mission The Jakarta Post 2nd Feb 2018
President wants simplification for foreign workers permit Antara News 1st Feb 2018
President chairs limited meeting to boost investment Antara News 31st Jan 2018
Indonesia records exports worth US$168.7 billion in 2017 Antara News 31st Jan 2018
Kalla urges to develop mercury-free mine processing technology Antara News 5th Feb 2018
Digital rupiah won't be issued anytime soon: BI The Jakarta Post 7th Feb 2018
Government to provide national banks easy chance to expand businesses in ASEAN Antara News 7th Feb 2018
Indonesia to ratify ASEAN act to liberalize banking The Jakarta Post 7th Feb 2018
Taxed Out: New Regulation Requires Indonesian Banks to Give Up Credit Card Data to Gov't Jakarta Globe 5th Feb 2018
Indonesia explores coffee market in Vietnam Antara News 8th Feb 2018
Marsudi highlights palm oil issue in meeting with Alfano Antara News 8th Feb 2018
Susi Pudjiastuti Gets Banks to Lend Money to Fishermen Tempo 4th Feb 2018
Indonesia hosts FAO pilot projects for tackling zoonoses The Jakarta Post 8th Feb 2018
Taiwan eyes cooperation with Indonesia in biomedical industry The Jakarta Post 7th Feb 2018
Indonesia declares Papua health crisis under control Reuters 6th Feb 2018
Southeast Asia's top drugmaker sets its sights on consumer market Nikkei Asian Review 5th Feb 2018
Sri Mulyani Calls on Media to Help Combat Fake News Jakarta Globe 8th Feb 2018
Indonesian innovations win top four at Bangkok tech exposition Antara News 8th Feb 2018
E-commerce threatening imported footwear outlets: Aprisindo The Jakarta Post 5th Feb 2018
Bawaslu to Block Accounts Spreading Hoaxes During Elections Tempo 4th Feb 2018
BSSN to team up with Australia to deal with cyber attacks Antara News 1st Feb 2018
Indonesia lauded for its PPP scheme to develop ICT infrastructure Antara News 31st Jan 2018
Jokowi to kick off Padang-Pekanbaru toll road construction: Minister The Jakarta Post 5th Feb 2018
Government continues to boost growth of aircraft mro industry Antara News 3rd Feb 2018