Jakarta awaits one-stop service to raise investment

Damar Harsanto, The Jakarta Post/Jakarta

The Jakarta administration is currently drafting a new bylaw on investment in an effort to cut down on lengthy red-tape, aimed at encouraging investment in the capital.

In the revised draft obtained by The Jakarta Post, the administration will provide a one-stop service for investors operating in Jakarta.

Article 10 of the draft states that the one-stop service will be put under a single board, which its establishment will be further stipulated in a gubernatorial decree.

With the new system, the draft says, investors will no longer need to go to different city agencies in order to acquire documents. The board will help investors process documents through relevant agencies, such as building permits from the City Construction Supervision and Regulation Agency, as well as documents clarifying that the business is in accordance with the public order law.

Under the one-roof system, investors will acquire official documents and take the approved ones to only one desk.

A deliberation team from the Jakarta Council, who was assigned to delve into the proposed bylaw, said that the new system would also give certainty to investors about the length of time needed in respective steps to obtain documents for investment.

"We ask commitment from the respective agencies to determine how long they need to process the necessary documents after the investors fulfill the requirements for investment," the team said in an official statement obtained by the Post.

Governor Sutiyoso said earlier that current procedures for investment involved piles of paperwork and red-tape had discouraged investors to the city.

Foreign investment in the city has plunged sharply by 58 percent to US$1 billion and 376 projects as of August this year, compared to $2.5 billion and 341 approved projects last year.

Similarly, domestic investment had also declined to Rp 2.627 trillion in the first eight months of this year, compared to Rp 3 trillion in 2003.

Analysts as well as officials have blamed security concerns, coupled with lingering uncertainty in the procedures of investment behind the sharp decline.

A recent report from the World Bank and its private sector lending arm, the International Finance Corporation (IFC), ranks Indonesia as one of the most difficult places in the world to do business along with Laos, Cambodia and Vietnam at the bottom of the list of 145 nations surveyed.

Jakarta Investment Coordinating Board head Muzahiem Mokhtar explained over the weekend that the board monitoring the one-stop service will consist of his agency and representatives from relevant agencies.

"Hopefully, we could start implementing the new bylaw next year," he said.

I-Box

Proposed time needed to acquire documents for investment No. Permit Days ________________________________________________________ 1. Investment approval 8 2. Approval in investment expansion 8 3. Approval in change of investment 5 4. Fixed Operation Permit (IUT) 5 5. Expansion Operation Permit (IUP) 5 6. Private Importation Identification Number(APIT) 5 7. Import Duties * 5 8. Capital Import facilities* 5 9. Employment of foreigners* 4

*still under discussion at relevant agencies

Source: Jakarta Council's deliberation team on investment bylaw