By: Dewi Pohan
The Job Creation Law (UU) is an effort by the Indonesian government to increase the ease of doing business, especially for Micro, Small and Medium Enterprises (MSMEs). This law is designed to simplify and speed up bureaucratic processes which have been considered to hamper economic growth. One of the key elements of the Job Creation Law is the ease of business licensing which is expected to be a driving force for the growth of MSMEs in Indonesia.
The Indonesian government has long recognized the strategic role of MSMEs in the national economy. MSMEs contribute around 60% of Gross Domestic Product (GDP) and absorb around 97% of the workforce in Indonesia. However, despite their significant contribution, MSMEs often face various challenges that hinder their growth. One of the main challenges is the complexity and length of the business licensing process. Before the Job Creation Law came into existence, MSME actors had to face various complicated and time-consuming bureaucracies.
The Job Creation Law offers a concrete solution to this problem by simplifying business licensing procedures. One important step is the implementation of a risk-based licensing system. With this system, types of businesses that have low risk no longer require complicated and lengthy permits. They simply register online via the Online Single Submission (OSS) system. This step not only saves time but also reduces the costs that must be incurred by MSMEs to process permits.
Deputy Chair III of the Job Creation Law Task Force, Raden Pardede, explained that Indonesia has a vision to become a prosperous country with a per capita income above 25,000 US dollars by 2045. To achieve this goal, extraordinary efforts are needed to get out of the middle income trap. One important step is to simplify the business licensing process, which is the main philosophy behind the Job Creation Law.
The Job Creation Law Task Force is committed to continuing to improve and perfect the process, with the main focus on improving services to the community. The Job Creation Law Task Force believes that ease of business licensing will have a significant positive impact on MSMEs, such as increased public and investor confidence in the business climate in Indonesia, market expansion and increased competitiveness of MSMEs, faster growth and development of MSMEs, as well as greater contributions. MSMEs have a big impact on the national economy.
Chair of the Substance Synergy Working Group for Socialization of the Job Creation Law Task Force, Tina Talisa, explained that in the Job Creation Law there is an easy process for creating an NIB (Business Identification Number). This NIB provides various benefits for business actors, such as access to banking for capital, market access, and access to further training provided by the government.
The Job Creation Law is able to strengthen investment by providing legal certainty and simplifying investment procedures. With this convenience, Indonesia becomes more attractive to foreign investors, which in turn will increase the flow of capital into the country. Increased investment will have a positive impact on economic growth, create jobs and increase people’s income.
Apart from efforts from the government, MSME players also need to be proactive in taking advantage of the various conveniences offered by the Job Creation Law. They need to continue to improve their competence and product quality in order to compete in an increasingly competitive market. Innovation and creativity must be part of their business strategy. By utilizing technology and digital platforms, MSME players can reach a wider market and increase their operational efficiency.
However, this effort is not only the responsibility of the government and MSME actors. The wider community also needs to support the implementation of the Job Creation Law. Community support can take the form of awareness and active participation in the socialization process, as well as providing constructive input to improve existing policies. With broad support from the community, government and business actors, the implementation of the Job Creation Law can run more effectively and bring real benefits to the Indonesian economy.
It is hoped that the Job Creation Law will improve the welfare of society as a whole. With ease of business permits, more and more MSMEs can grow and develop. This will create new jobs which in turn will reduce the unemployment rate. People’s income will also increase along with the development of MSMEs. In addition, increasing the competitiveness and productivity of MSMEs will have a positive impact on the national economy, strengthen the economic structure, and encourage more inclusive and sustainable economic growth.
Overall, the Job Creation Law is a significant step forward in the government’s efforts to encourage the growth of MSMEs in Indonesia. With the ease of business permits offered, this law opens up great opportunities for MSMEs to develop and contribute more to the national economy. There needs to be a joint effort from the government, MSME players, and various related parties to ensure that this easy business permit can really be accessed and utilized properly. With good cooperation, we can hope that MSMEs in Indonesia will become stronger and able to compete in the global market, and contribute to realizing the vision of a Golden Indonesia 2045.
*The author is a professional worker