By: Dodik Prasetyo )*
The government targets the Omnibus Law Cipta Karya Bill (Ciptaker) to patch the potential for weakening economic growth due to the spread of the Corona Virus. The government predicts the omnibus law can boost economic growth by 0.2 percent to 0.3 percent.
Secretary of the Coordinating Ministry for Economic Affairs Susiwijiono said that his party could calculate up to 0.2 – 0.3 percent, so there was an offset there, the negative impact of the corona virus hit there but the positive impact of the Ciptaker Bill could be replaced.
He explained that the regulation would facilitate and encourage investment growth. When investment increases, employment is expected to grow.
Later, this can hoist income and consumption of the people. For the record, household consumption has the highest contribution to Gross Domestic Product (GDP) of 56 percent.
He continued that the Chinese economy is predicted to be depressed in the range of 1 percent to 2 percent due to the spread of the corona virus. This is because economic activity in China is hampered. This condition will certainly have an impact on Indonesia as a trading partner.
When only 2 percent down from US $ 14.4 trillion, its influence on the world is certainly extraordinary, and China is a trading partner of most of the world’s countries.
The government predicts the economic correction of the Bamboo Curtain country will make the Indonesian economy fall in the range of 0.11 percent to 0m3 percent in 2020. However, with the enactment of the omnibus law, this can patch the potential for economic growth decline.
Susiwijiono said the government was targeting the economy in Indonesia to grow 5.3 percent by 2020.
The presence of the Omnibus law prepared by the government is considered as an ideal step that can boost the Indonesian economy, one of which is in terms of investment when the corona virus outbreak adds pressure on the national economy.
We all understand that one of the causes of reduced investment is the large number of overlapping rules in Indonesia that make foreign investors reluctant to invest because they feel very inefficient and seem difficult.
Of course, the omnibus law has a good role, from which 74 overlapping regulations will be cut into one legal umbrella. This step can certainly be an added value for foreign investors to re-invest because in addition to simplifying the process it can also reduce licensing costs.
If examined, one of the causes of reduced investment is the number of overlapping rules in Indonesia that make foreign investors reluctant to invest because they feel inefficient and difficult.
If investment is encouraged and developed, this will certainly develop manufacturing industry sectors that currently seem to be running in place. If the manufacturing industry is not strengthened, we will continue to depend on imports.
The impact of the decline in Chinese manufacturing industry activities is of course very influential on the Indonesian economy. From the trade sector, this situation certainly has the potential for a lack of demand for Indonesia’s commodity exports to China.
At present, almost 17% of Indonesia’s exports are directed to the Chinese market, where every 1 percent of the slowdown in the Chinese economy will affect Indonesia’s economic slowdown of 0.3 percent.
After the corona virus is endemic in Indonesia, the investment sector can be seen from financial market turmoil that tends to be restrained.
This was received by Bank Indonesia by issuing various policies aimed at maintaining the stable value of the rupiah in the global market. The anticipation step is expected to be able to minimize the negative impact of Covid-19 on the Indonesian economy.
According to the Secretary General of the National Leadership Council (MPN), the Omnibus Law is expected to be a solution for the nation’s economic strength, where one of them discusses the ease in the investment sector.
Indonesia’s economic condition which is currently weakening due to being surrounded by the corona virus, of course Indonesia will need massive investment and need ease in terms of regulations and legislation after the pandemic ends.
In particular, the Omnibus Law Cipta Karya which is considered to provide a sense of social justice from the economic side between workers and employers is mutually beneficial so that economic growth in Indonesia is expected to be better.
)* The author is a social political observer