This theme precisely
describes the condition of the national economy. There are also who perceive
that Indonesia’s economic dynamics were sluggish, because it is managed
procedurally and surrounded by layered bureaucratic administrative system on
the grounds of business protection and so on. In addition, economic activity in
the country is also burdened with cost ranging from official costs that
contributed to non-tax revenues (PNBP) as well as an official costs.
Economic activity grew very fertile,
including the management of states/regional budget (APBN/APBD). If we look in
more detail, what has been happening is the “contest” of various laws which is
characterized by the spirit for establishing administrative and technical
authority in each sector, taking refuge on behalf of economic development and
empowerments.
This fact is not a mirage, but has
become a fact of life in the minds of economic life of people every day. The
most suitable example is if cattle will be shipped from East/West Nusa Tenggara
to Jakarta, is slow to arrive to destination because it is hampered by the bureaucratic
system which desire authority. Distribution casts become high because they are
burdened with “official/unofficial cost” before the cattle is shipped and after
it is departed to port of destination, said industry and trade observer, Fauzi
Azis.
On the other hand, if you want to
invest it is not easy. Let alone spending the state/regional budged as it bound
by various requirement and procedures. Export and import activities are not
free from complicated issue when it is facing a long business chain process.
Imagine if economic activities and
processes in the field were blocked with a variety of administrative and
technical procedures, what happens if goods and services are produce. The price
is relatively costly and competitiveness is weak when the goods and services
are traded. The of Government is as regulator and public servant, but the
regulation made should be to provide leeway and certainly, as operation and
economic processes.
Production Process
and Output as well Competitiveness
Bureaucratic services as output will
also affect the formation of price of food and services product by economic
operators, because bureaucratic work output is included in economic process.
Economics as an activity and process is a continuous activity to produce output
that will meet the needs of consumers. The competitiveness of the resulting
output is determined by input factor and its processes.
When economic activity and processes
were “fouled” by non-economic factors that influence it, the beginning of un
competitiveness is already happening. That is why the national economy is very
vulnerable, both macro and micro, or both fundamentally and structurally. This
happens because of the low competitiveness of the national economy, while the
domestic economy is considered as procedural activities and processes, and full
of cost of rents of gratification bribe, and mark-up”, he explained.
The impact of this situation is that
the businesses must respond by building a bargaining position by conducting
cartel and oligopolistic practices, so that they the characteristics of the
activities and processes. Rents have no definite price. The process of
rent-seeking occurs from the lowest top level, from the central to the regional
government.
Even later it can get to the
villages since the availability of Village Act. If does not join the cartel and
establish network and distribution oligopolistic, they are unable to pay rents
which value can be quite large (billion of Rupiah or millions of US dollars).
Thus, Indonesia’s economy is
actually vulnerable, due to low competitiveness. An illustration which is the
general nature is production and low productivity. Its current account surplus
is nearly marginal, even recently is often in deficit.
The ratio of exports to GDP is only
an average of 25% per year. It is necessary to compare it with the average
condition in ASEAN which could research 50% at the GDP of each country.
Similarly, the contribution of physical investment to GDP on average is only
30% per year. Government spending only accounted for an average of 9% per year.
Only houses hold consumption expenditure which contributes an average of 56%
per year.
That is why when I meet with
entrepreneurs and ISEI some time ago, President Joko Widodo emphasized that
Indonesia must escape that Indonesia must escape its dependence on consumption
economy to an economy based on production and investment. We agree with this
statement. These changes are not instant, but evolutionary. Such changes must
be running to improve the structure on the national economy so that the
foundation is strong, and not continuously dependent on the outside. (E)
Business New - September 4, 2015
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