Government accelerates deregulation to boost investment and business

JAKARTA—The government continues to strengthen regulatory reforms and expedite licensing processes to create a more competitive and conducive investment climate for businesses. Strategic steps were underscored by President Prabowo Subianto through plans to establish a deregulation task force to simplify overlapping regulations and licensing procedures. In his directive, the President stressed that streamlining regulations is urgent for Indonesia to compete with other Southeast Asian nations in attracting investment. ‘State Minister, I want experts gathered to form a special task force to accelerate deregulation. Simplify, don’t complicate,’ President Prabowo said. The President noted receiving numerous complaints from businesses about lengthy investment licensing processes, which can take up to two years. This situation is seen as hindering new capital inflows and slowing job creation and national industrial growth. ‘If other countries can issue permits within two weeks, why does it take us two years? Regulations must be simplified,’ he stated. Beyond speeding up investment, deregulation is also crucial for enhancing transparency and closing loopholes for corruption arising from complex bureaucracy. The government affirmed its commitment to supporting businesses operating healthily and productively. ‘Entrepreneurs must be assisted and supported. Those who act improperly will be disciplined, but those who are genuinely working hard must be helped,’ President Prabowo said. In line with the President’s directive, the government is also strengthening investment acceleration mechanisms through the Debottlenecking Channel of the Government Program Acceleration Task Force for Supporting Economic Growth Enhancement (P3-MPPE). The initiative was introduced at the International Seminar on Debottlenecking Channel themed ‘Resolving Bottleneck, Accelerating Investment’ held in Jakarta. Finance Minister Purbaya Yudhi Sadewa stressed that higher economic growth requires a healthy business environment, legal certainty, and more adaptable regulations to meet business needs. ‘The establishment of the Debottlenecking Channel is a practical approach to achieving this,’ he said. According to the government, the channel is designed to resolve various investment hurdles—including licensing, taxation, logistics, infrastructure, and cross-ministerial and local government coordination—more effectively and transparently. Indef’s Centre for Macroeconomics and Finance Chief, M Rizal Taufikurahman, assessed that forming a deregulation task force could improve national investment flows if it effectively cuts overlapping regulations. ‘The government must ensure the task force has strong authority, measurable targets, transparent regulatory evaluations, and involves businesses and regions to prevent implementation from stalling at the central level,’ Rizal said. Rizal added that measured and consistent deregulation is expected to enhance Indonesia’s competitiveness and bolster business confidence in government policy stability.