The government finally unveiled Tuesday its long-awaited package of new economic policy reforms that will, among other things, provide tax incentives for publicly listed companies and facilitate easier access to bank loans for small and medium enterprises (SMEs).
Coordinating Minister for the Economy Boediono said that the new reforms would significantly boost the government's efforts to accelerate economic growth so as to reduce unemployment and poverty.
"Hence, each of the policies contained in the new package set out the program, action and output with clearly measurable targets," he said during the announcement of the new policies.
The 60-page policy package covers programs and measures in four main economic fields -- the financial, investment, infrastructure development and SME sectors.
In the investment sector, the government will reduce the time required for obtaining business licenses to 25 days from the current 97 days. It will also simplify customs clearance procedures so that goods can be released through the green channel within 30 minutes and through the red channel in three days.
Speaking during the announcement of the economic package, Finance Minister Sri Mulyani Indrawati said that it would also provide tax incentives for publicly listed companies as part of the government's efforts to turn the country's capital market into an important alternative to the banking sector for businesses in raising funds.
She said that the regulation detailing the tax incentives would be issued in August.
The government will also push for the merger of the Jakarta Stock Exchange (JSX) and the Surabaya Stock Exchange (SSX) to make them more competitive and efficient, she added. According to the document, the merger process is expected to be completed in October.
In addition to providing tax breaks for publicly listed companies, the new economic policy package also stresses the need to provide SMEs with easier access to bank loans.
For this, the government will strengthen the financing capacity of state credit insurance firm PT Asuransi Kredit Indonesia (Askrindo) and state financing firm Perum Sarana Pengembangan Usaha so that they can extend the scope of their services to SMEs.
Also in the SME sector, Bank Indonesia will revitalize the role of local financial consultants so as to increase the bankability of SMEs.
Boediono said the government would also speed up land certification services for small businesses by revising the existing regulations issued by the National Land Agency, the Ministry of Home Affairs and the Ministry of Cooperatives and SMEs. "This is important so that small firms can use their land titles to secure loans," he said.
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