'Anti-competitive' policies cause market distortions<\/p>\n
JAKARTA (JP): Emil Salim, a former cabinet minister, yesterday
\ncriticized the government's \"uncompetitive\" economic policies
\nwhich help create market distortions.<\/p>\n
Speaking at a two-day workshop, hosted by the Investment
\nCoordinating Board, Emil noted that such uncompetitive policies
\nconflict with the country's commitment to free trade arrangements
\nin the Southeast Asian and Asia-Pacific regions.<\/p>\n
Such uncompetitive policies, Emil said, include pricing
\npolicies on a number of commodities, tolerance toward cartel-like
\ninstitutions, barriers of entry into a number of businesses and
\nexclusive licensing.<\/p>\n
\"In Indonesia, cartels are not regulated but tolerated,\" Emil
\nsaid. \"The government even lets some associations help regulate
\nbusinesses.\"<\/p>\n
Because of the privileges, becoming executives at a number of
\nassociations, including the Indonesian Chamber of Commerce and
\nIndustry (Kadin) and the Associations of Indonesian Young
\nBusinesspeople (Hipmi), is the best deal to do business, Emil
\nsaid.<\/p>\n
\"Therefore, it's not surprising many people compete for the
\nchairmanship of Kadin or Hipmi. There is something behind it,\" he
\nsaid.<\/p>\n
He suggested that the involvement of associations in
\nregulating business life be abolished because this can create
\nbarriers to entry into business.<\/p>\n
He also questioned \"obligatory\" fees imposed by associations
\non their members.<\/p>\n
Such levies, combined with various levies imposed by the
\ngovernment and local administrations, reduce the competitiveness
\nof Indonesia's products both in local and international markets.<\/p>\n
Emil questioned the need for such uncompetitive policies which
\nhelp discourage exports at a time when the competitiveness of
\nIndonesia's exports is weakening.<\/p>\n
The policies include the banning of exports on certain
\ncommodities, supervision on the exportation of certain
\ncommodities, licensing of exporters and export taxation.<\/p>\n
These uncompetitive policies, which are essentially
\nprotectionist, should be abandoned in the current era of economic
\nliberalization, Emil said.<\/p>\n
\"Such policies were valid for the last 25 years, but not
\nanymore, not for now and the coming years. Particularly since we
\nwill have free trade in Southeast Asia by 2003. Those policies
\nare just irrelevant,\" Emil said.<\/p>\n
In addition to the uncompetitive policies, Emil said
\nIndonesia's economy is also plagued by the ineffectiveness of the
\nlaw enforcement, which results in uncertainty.<\/p>\n
In terms of \"predictability in business\", Indonesia is placed
\nat the lowest among the seven members of the Association of
\nSoutheast Asian Nations (ASEAN), just above Vietnam, Emil said.<\/p>\n
Besides Indonesia and Vietnam, ASEAN also groups Brunei,
\nMalaysia, the Philippines, Singapore and Thailand.<\/p>\n
To make doing businesses in Indonesia more predictable, the
\ngovernment should launch more reforms on its economic
\nlegislations, some of which are still based on colonial rules.<\/p>\n
\"Our legal infrastructure for the economy, especially for the
\nservices sector, is still inadequate. We should floor the gas
\npedal, and reform it,\" he said.<\/p>\n
Emil served as state minister of administrative reforms from
\n1971 to 1973, as minister of transportation from 1973 to 1978, as
\nstate minister of development supervision and environment from
\n1978 to 1983 and state minister of population and environment
\nfrom 1983 to 1993. (rid)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/anti-competitive-policies-cause-market-distortions-1447893297",
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