Flawed regional rulings, harm investor confidence<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
Regencies are calling on the government to scrutinize more
\nclosely all regional rulings, saying the absence of any
\ncoordination between the regions is resulting in overlapping and
\nflawed regulations that harm investors.<\/p>\n
\"It is not our job to coordinate with regulations that have
\nbeen issued by other regions,\" said H.R. Syaukani, who is the
\nregent of Kutai Kartanegara regency in East Kalimantan, and also
\nthe chairman of the Association of Regional Administrations
\n(Apkasi).<\/p>\n
A year and five months into regional autonomy, investors are
\ncriticizing regions for issuing rulings they say are damaging.<\/p>\n
Regional autonomy empowers provinces and regencies to manage
\ntheir own affairs, including imposing their own regulations.<\/p>\n
But since regional autonomy came into effect, the government
\nhas identified 1,003 regional regulations it deemed as damaging.<\/p>\n
And the International Monetary Fund has tied the revocation of
\nsuch regulations to its lending agreement with the government.<\/p>\n
So far the government has revoked 68 rulings, and the Ministry
\nof Finance recommended in March the revocation of 16 others.<\/p>\n
Syaukani said Apkasi supported these efforts, as they would
\nimprove the business climate in the regions. But he added that
\nsuch measures would not have been necessary if the government had
\nbeen doing its job all along.<\/p>\n
He cited Law 34\/2000 on regional taxes and regulations, which
\nrequires the government to assess regional rulings within a month
\nafter receiving notification from the regions.<\/p>\n
Article 5A of the law stipulates that regions must report any
\nnew regulations to the central government. And if no response is
\nreceived within one month's time, the ruling is deemed
\nacceptable.<\/p>\n
\"So don't wait a year (to revoke the regulations) and then
\nblame us,\" Syaukani said.<\/p>\n
He also claimed that investor interest in the regions has
\nremained high since regional autonomy went into effect.<\/p>\n
According to him, 25 mining investors, including foreign ones,
\nwere vying for five coal mining contracts in his regency.<\/p>\n
But he added that regional autonomy did not make regions poor
\nin natural resources any more attractive to investors.<\/p>\n
Foreign investment expert Harvey Goldstein of PT Harvest
\nInternational Indonesia said foreign investors had grown more
\nconfident about investing in the regions.<\/p>\n
For their part, regents and governors have become more
\nunderstanding about business needs, he said.<\/p>\n
\"Because it is the regents who realize the benefits (of
\ninvestment) in the regencies,\" he said.<\/p>\n
Mining, oil and gas companies, he said, were among the first
\nto invest in the regions, despite the perceived higher level of
\nuncertainty.<\/p>\n
\"Investors look for stability, predictability and
\ncontinuation,\" Goldstein said.<\/p>\n
Over time, he said, investors would rate the regions by the
\ndifferent investment incentives and regulations they offered.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/flawed-regional-rulings-harm-investor-confidence-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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