10 Dec 2019
INDONESIA: Government Looks to Woo Investors Via Revised Regulatory Environment
The Investment Coordination Board (BKPM) has now taken on responsibility for issuing all business licences. Prior to this, many such licences fell within the remit of various government bodies and regional agencies, with this rationalisation – detailed in Presidential Instruction (Inpres) No.7/2019 – seen as part of a government bid to improve the country’s standing in the World Bank’s Ease of Doing Business Index. Currently rated 73rd out of 190 countries, it is notably behind many neighbouring countries, including Malaysia (12th) and Thailand (21st).
In an additional move, the BKPM has also been mandated to review all statutory procedures deemed likely to deter potential investors, as well as to make recommendations as to how best to reduce investment-related bureaucracy at every government level. In order to action the BKPM’s recommendations, all ministries and regional investment agencies are also to be required to establish a dedicated secretariat.
It has also been announced that as many as 40 existing ministerial regulations deemed to downgrade the country’s investment environment will be abolished by the end of the year. One consequence of this is expected to be on overhaul of the country’s Negative Investment List.