To anticipate global economic crisis, it was important for Indonesia to reform investment climate to solve the problem of export downturn. For that matter it was necessary to cast aside all investment obstacles. The first obstacle was weak law enforcement. Other obstacle was poor infra-structure, which affected business operation cost. Investment would flow in to the regions if basic infrastructure were adequate. Other obstacle was the so many complicated regulations which held back development.
The Director for institute for development of economics and finance [INDEF] Enny Sri Hartati state in Jakarta on Tuesday [21/5] rhat many regional regulations stagnated development of entrepreneurs in Indonesia. Other hindrance was that banks which could not reach the informal sector. According to Enny, banks needed to render financial service, for big or small business. The last hindrance was lack of trained experts, which was the hindrance of middle and big business. In this case it was necessary to from a private forum and the government to crack all problems in investment.
Somehow investor’s zest to invest in Indonesia was still high. Enny saw that high investment Indonesia lately was on account of global crisis. Investors tend to play it safe by investing in countries where economic growth was relatively favorable. Indonesia was one of the countries with abundant resources and good economic growth. Investors tend to play it safe by investing in countries where economic growth was relatively good. “Direct investment could grow by 30% today” Enny said.
Enny said that infra-structure outside java was today most disheartening. Mist of the investment entering Indonesia were the type of investment that was aimed at the domestic market. The result of the high investment value was not synchronous with the added value resulted for the domestic industry. According to Enny, improvement of the infra structure was most pressing need in regions where growth of downstream industry was prevalent such as the CPO or rattan industry.
Beside Enny saw that bureaucracy was still a serious problem which hindrance investment In Indonesia. On of the obstacles was complicated produce in permit application. According to Enny, the complex bureaucracy would stagnate investment process in the regions. This means enormous loss, considering that Indonesia now adopted decentralization of government. She said that by decentralization the focus of development process was in the regions which held enormous potentials.
Investment process in the regions according to Enny was not maximized as there were many regional regulations which was not in parallel with the spirit of creating favorable climate for investment. Therefore betterment as necessary to build healthy economy of the regions, through the process of one stop service had been proclaimed for long by the government. Bad bureaucracy in permit application in the regions was still seen as stagnator to investment.
Provincial governments needed to collaborate in developing investment potentials in the respective regions. It was mentioned that the provincial government could synergize in scheming up plans, promote development, and enhance potentials in investment based on data and information; and to facilitate joints promotions in investment while the benefactors could step up human resources capacity in permit issuance service. Meanwhile data of BKPM mentioned that investment in the industrial sector over the period of January-September 2012 was Rp.38.11 trillion for domestic investment and USD 8.9 billion for foreign investment. (SS)
Business News - May 24,2013