President Joko Widodo and Finance Ministry Sri Mulyani Indrawati

JAKARTA (TheInsiderStories) – President Joko Widodo reiterates the government’s commitment to simplify all permits and procedures, including investments for export-oriented products.

“It is time for all procedures and permits to be done in a simple way, fast and through online. I want all permits and requirements continue to be slashed therefore all can be done fast,” President Widodo said when visiting the customs facility and the launching of online permits at PT Samick Indonesia in Cileungsi, West Java on Tuesday (27/3).

“The procedures for export-oriented investments should be eased as much as possible,” he added.

Indonesia’s  ‘Ease Of Doing Business’ (EODB) ranking has jumped 19 points in 2018 to 72, thanks to a number of policy reform packages issued by the Joko Widodo government. However, the government realizes that improvement was not really enough. More work is needed.

The President wants to see a complete overhaul of the country’s business processes and permits, from central government down to local governments, by implementing the so-called ‘single submission’, a digital-based integrated business permit process.

Therefore, the President is finalizing the single submission system which is scheduled to be launched next month. The launch of a single submission protocol aims to attract more investment and speed up the realization of investments, both foreign and domestic. This was stated amid slow progress in the realization of investment in regional areas.

As many as 1,400 business players, whose business are located in bonded zone, attended the event on Tuesday. Some of them are engaging in export-oriented business. Finance Minister Sri Mulyani Indrawati said based on the Statistics Indonesia data, bonded zones have played significant role in lifting Indonesia’s exports (2016) to US$54.8 billion or 30.37 per cent of total national exports.

In 2016, investments in bonded zone reached Rp168 trillion, creating 2.1 million jobs or 13.5 per cent of total industry workforce. The tax revenues reached Rp54.9 trillion or around 3 per cent of national tax income.

In 2017, total investment in bonded zones reached Rp167.3 trillion and tax income reached Rp14.5 trillion.

She said the procedures for tax, custom registration and export and import permits have been simplified from 30 days to 1 hour. The permits for taxable goods are granted within 3 days from 30 days previously.

With the implementation of the INSW (Indonesia National Single Window) system, the Customs Office has simplified the permit (for exports) to 1 hour from 10 days.

Sri Mulyani added in addition to establishing Bonded Logistic Centers for capital goods, the government has also developed 8 E-Commerce Logistic Centers, covering small and medium enterprises (SME) needs, e-commerce, final products, raw material, floating storage and commodity goods. “With these Bonded Logistic Centers, companies have shifted their distribution hub from Singapore to Indonesia,” she said.

Simplifying the permit for investment has became main focus for Jokowi’s administration.

Written by Roffie Kurniawan, Email: roffien@theinsiderstories.com