More deregulation<\/p>\n
In what has become a custom at this time of year, the
\ngovernment announced yesterday another package of economic
\nderegulation measures. The timing, ahead of the meeting of the
\nConsultative Group on Indonesia in Paris later this month, may
\nleave the impression that the measures are intended to sweeten
\nthe nation's creditors preparing to gather in the French capital.
\nJudging by its content however, the package reflects a
\nconsistency in the government's goal of making the economy more
\ncompetitive, the very objective of the series of economic reforms
\nthat was started in the mid-1980s. And as with previous packages,
\nthere is something for everyone in yesterday's measures, from
\nimporters, manufacturers and exporters to local and foreign
\ninvestors.<\/p>\n
The package injected an element of certainty by setting
\nschedules for when the various tariff cuts that have been
\npromised will be implemented. This is a significant improvement
\nover the May 1995 package, which only set deadlines of cutting
\ntariffs to a range of between 5 and 10 percent. The schedule in
\nessence makes longer-term business planning much easier.<\/p>\n
The package sets out a ruling on how the government intends to
\nmeet the threat of increased dumping practices, a common side
\neffect of import liberalization measures. A new anti-dumping
\ncommittee will make all the decisions concerning when to impose
\nsuch tariffs, hopefully in a transparent way and based on
\nobjective criteria. There is a valid argument that our
\nmanufacturers must be shielded from unfair trading practices from
\nabroad but we hope this will not be abused by local companies
\nwhich wield strong political clout. The anti-dumping committee
\nmust be allowed to work independently and objectively.<\/p>\n
In the export sector, the government did away with export
\ndeclaration forms for exports worth up to Rp 100 million, the
\nlimit was previously Rp 10 million, and also eliminated the need
\nfor a surveyor's inspection. The new measures also greatly
\nsimplified the procedures for obtaining certificates of origin
\nand established a third agency to issue such documents. In
\naddition, selected exporters who meet the various criteria would
\nbe entitled to a whole range of special facilities in tax,
\ncustoms and banking services.<\/p>\n
There is also a whole range of measures designed to make the
\nlocal investment atmosphere more appealing, These range from the
\nelimination of many kind of permits for companies who operate in
\nindustrial zones to new regulations regarding bonded zones and
\nallowing foreign joint ventures to import complementary products
\nand sell them locally under certain requirements.<\/p>\n
Each time the government announces its deregulation packages,
\nthere are always those who feel that they do not go far enough
\nand that the government is moving too slowly in reforming the
\neconomy. Certainly, the export slowdown and import surge we saw
\nlast year are strong reasons to encourage Indonesia to move fast
\nto remain competitive. But on the other hand, there is also the
\nlingering fear that moving too fast could lead to an overheating
\neconomy. Whichever of these analyses is true, what is certain is
\nthat yesterday's package will not be the last.<\/p>\n
The deregulation package may not be as sweeping and
\ncomprehensive as many would have expected, especially given the
\nbarrage of statements and media publicity in the run up to its
\nannouncement. But it is not necessarily a token gesture either.<\/p>\n
In the final analysis, these deregulatory measures are only as
\ngood as how those who stand to benefit take advantage of them,
\nand how those who administer them implement the regulations.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/more-deregulation-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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