No instant solution, KPOD says

JAKARTA: Supervisory Committee on Local Autonomy (KPOD) affirmed that there is no instant solution to eliminate five investment problems, requiring more than policy and bureaucracy reform.Policy and bureaucracy reform has been the first priority of the
Wandrik Panca Adiguna
Wandrik Panca Adiguna - Bisnis.com 30 Mei 2011  |  04:40 WIB

JAKARTA: Supervisory Committee on Local Autonomy (KPOD) affirmed that there is no instant solution to eliminate five investment problems, requiring more than policy and bureaucracy reform.Policy and bureaucracy reform has been the first priority of the government. If the president complains on bureaucracy problems, it means that the government needs more than that way, Agung Pambudhi, Executive Director of Supervisory Committee on Local Autonomy (KPPOD), said yesterday.Agung reminded the commitment of President Susilo Bambang Yudhoyono to eliminating five problems hampering investment.The five problems are slow bureaucracy, deviation from master plan, self-centered and non-supporting local policies, and hidden political interest.The government is recommended to take serious and continuous normative action, including making better partnership between the central or local governments and investors. Moreover, the government has to enforce regulation and form solid organization in regions to handle investment.The central and local governments must facilitate investors by making concrete actions.He highlighted the importance of solid bureaucracy and continuous policy in creating friendly business climate in central and local scope to eliminate various investment problems in Indonesia without scarifying the people.Adding to the 2011-2025 Master Plan of Economy Acceleration and Expansion, it needs synergy between many sectors to reach the goal, Chairman of Indonesian Young Entrepreneurs Association (Hipmi) Erwin Aksa said.It needs monitory and complete supervising to make all sectors coordination work.Moreover, it needs proper incentive offer to make project attractive for investors.However, former Head of Fiscal Policy Agency, who currently lectures at Economy Faculty in Universitas Gadjah Mada Anggito Abimanyu reviewed that the government does need to give tax holiday.Vice Secretary General of Electronics Joint Federation Yeane Keet said that high cost and slow service in making license for investment.In addition, many infrastructure plans, mainly roads, have not started although they are crucially needed for business.Operational guidelinesSecretary General of the Association of Planning Expert Indonesia Bernadus Djonoputro asked the government to immediately issue regulation of operational guidelines MP3EI in order to synchronize the development process with the long-term plan and provincial spatial structure that has been well-formed.The implementation of MP3EI, as he said, is not easy since it needs seriousness from the local government to interpret it in provincial and regional strategic plan.Bernardus said that the masterplan which created by the government is still too shallow since it only looks at investment rules and economy.In fact, each province or region as the target of development of the masterplan has a long-term development plan (RPJP) and medium term development plan (RPJM,), which should be taken into account.Chairman of the Indonesian Contractors Association Sudarto said the government also needs to make strict regulations to foreign investors who participate who are involving in the acceleration of development projects from 2011 to 2025.The government, as he said, must ensure that any projects funded by foreign investors must involve local human resources, good contractors, consultants and technicians to work on the project.Public Works Minister Djoko Kirmanti confirmed the existence of MP3EI does not mean to replace the Medium Term and Long Development Plan which have been devised. It is intended to provide the additional of several initiative programs to strengthen the six corridors, particularly the acceleration of economic infrastructure in the region.To implement the acceleration of infrastructure projects, Ministry of Public Works still depends on foreign investors and contractors.However, Public Works Ministry will commit that any foreign investor who participated in the tender for infrastructure in Indonesia must cooperate with a local contractor.Head of Commission VI of the House Airlangga Hartarto said that basically investors which have planned to invest their capital did not deny their commitment. Thus, if they cancel the investment one day, it does not mean that the condition is harmful.According to him, the investment will depend on the effectiveness of bureaucracy. So each investor will have different opportunity and the opportunity in the market is not always synchronous with the governments masterplan. (t03/t04/wiw)

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