SBY's 100-day program gets thums-up

The Jakarta Post/Jakarta

While details remain sketchy, the newly unveiled 100-day national economic program has apparently met the expectations many people have, by showing that the government literally means business when it comes to improving the country's investment climate and economy.

Economist Pande Radja Silalahi of the Centre for Strategic and International Studies (CSIS) and Indonesian Employers Association (APINDO) chairman Sofyan Wanandi expressed their optimism that the program provided a sound basis for developing policies that could cure the country's economic ills.

"The direction is there, be it on tax reform, fiscal and macroeconomics consolidation, and others. There's still a long way to go, but at least (the program) shows clear signs as to where the new government and its policies are headed," Pande said on Sunday.

The government announced last week its to-do list for its first 100 days in office that highlights the need for further tax reform -- among others -- in annulling certain regulations that are deemed detrimental to the nation's business climate.

The revocation of luxury tax imposed on non-alcoholic carbonated drinks and value-added tax (VAT) on heavy machinery or equipment for the mining industry, for example, are high on the list.

Additional plans to introduce tax amnesty for long-time tax evaders are also being considered, under which the government would throw out all criminal charges in return for a calculated fine in a kind of bail-out scheme.

Pande said in principle, the measures in the program reflected the business community's needs and requests, and thus indicated the government's commitment to improving the business climate and so boosting economic activities.

Still, the program was lacking in details, he added.

"As regards tax amnesty, for instance, how is the government going to do this? It requires a massive, coordinated effort among state institutions... Not to mention it will need a law on the issue, which means it would be impossible for the government to accomplish in its first 100 days," Pande said, adding there was no guarantee such a legislation would be passed within such a short time.

APINDO chairman Sofyan, who also heads the powerful business lobby the National Economic Recovery Committee (KPEN), also hailed the planned revocation of rulings that discouraged business.

"Amending the decrees and bylaws alone would help solve 60 to 70 percent of the problems faced by businesses here, and would eventually attract investment," Sofyan said, adding that some parts of the economic program followed the recommendations made in the trade and investment road map prepared by the Indonesian Chamber of Commerce and Industry (Kadin) and the KPEN.

"In short, I don't believe that the government would not implement our recommendations, as among SBY's aides are men and women who were involved directly in drawing up the road map," said Sofyan, referring to former Kadin chairman Aburizal Bakrie, Mari Elka Pangestu and Fahmi Idris, who now sit in President Susilo Bambang Yudhoyono's Cabinet as Coordinating Minister for the Economy, Minister of Trade and Minister of Manpower and Transmigration, respectively.

Sofyan said the business community had recognized the need for a control mechanism and were forming a team to monitor the implementation of the 100-day program, comprising local business players and representatives of foreign trade chambers, as well as noted economists such as Hadi Soesastro and Faisal Basri.