Indonesian parliamentary body urgers the government should complete the omnibus law draft within the next 1-2 months - Photo by Coordinating Economic Ministry

JAKARTA (TheInsiderStories) – Indonesian parliamentary body urgers the government should complete the omnibus law draft within the next 1-2 months to get them into parliament’s list of priority legislation, the body said in a hearing with the President Joko Widodo’s ministers today (11/13).

The parliament, who controlled by more than 70 percent of political parties supporting Widodo, expressed support for a plan by the president to replace dozens of existing, overlapping laws with bills to improve the investment climate.

“In terms of political support, I don’t think there’s a problem for the omnibus laws,” said Supratman Andi Agtas, the chairman of Legislative Body, a parliamentary group that sets legislation priorities. Agtas is a member of the Gerakan Indonesia Raya Party, leads by Prabowo Subianto who is the currently-appointed defense minister by Widodo.

Previously, the president told new cabinet members last month that simplifying 74 laws that overlap with each other was a top priority in an order to attract investment. The new bills will try to simplify rules in a wide range of areas, including investment requirements, research, and innovation, as well as more sensitive issues such as labor and land acquisition rules.

“Through this legal scheme, the president will later have the authority to cancel regional regulations,” said Yasonna Laoly, minister of law and human rights.

Airlangga Hartarto, coordinating minister for the economy said the omnibus law would also include encouragement for research and innovation. In addition, trimming these big rules will make the employment copyright act regime based on civil, not criminal.

Foreign direct investment (FDI) into Indonesia has been sluggish in recent years because of factors such as regulatory uncertainty and weak commodity prices. Widodo has complained the country has not attracted as much investment from manufacturers trying to move out of China compared with other Southeast Asian countries.

Yesterday, Hartarto announced the government will immediately revise presidential regulation no. 44 of 2016 concerning Indonesia’s negative investment list which broadly aims to reduce current account deficit, improve financial stability. In its place, the government will issue a positive investment list.

The minister said the positive investment list will later be issued in the form of presidential regulation that replaces the negative list policy. The government targets the regulation to be completed and ready to be published in January 2020.

The new policies will focus on restraining imports and expanding exports as well as boosting foreign investments in the country. As such, the measures will include tax incentives to attract FDI and the opening up of several market sectors to foreign investment.

Written by Lexy Nantu, Email: lexy@theinsiderstories.com