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Jakarta – The government regulation in lieu of a job creation law (Perppu) has received a positive response from investors, both domestic and foreign investors. This shows that before the Job Creation Law was declared conditionally unconstitutional by the MK, this regulation had actually produced several achievements.

Professor of Business Law at Gajah Mada University (UGM) Prof. Nindyo Pramono stated that the Job Creation Law had succeeded in increasing investment and expanding employment, especially during the Covid-19 pandemic.

          On the occasion of the Moya Institute Webinar entitled “Perppu for Job Creation and Economic Resilience”, Nindyo said, the data shows that both foreign and domestic investors have responded positively to structural reform efforts through the Job Creation Law. Based on the World Bank’s analysis report on the publication of Indonesia Economic Prospect December 2022, the Job Creation Law has had a positive impact on increasing Foreign Investment (PMA) in Indonesia.

            In this case, the total realization of FDI experienced an average increase of 29.4 percent in the five quarters after the issuance of the Job Creation Law. Therefore, Prof. Nindyo added that structural reforms through the Job Creation Law were also able to reduce barriers to trade and investment in Indonesia.

            The Organization for Economic Cooperation and Development in their publication released on 12 December 2022 stated that based on initial identification results, the implementation of the Job Creation Law could reduce obstacles for FDI or Foreign Direct Investment, by more than a third. Related to this, Prof. Nindyo said that this law had also succeeded in reducing trade and investment barriers by nearly 10% in 2021.

            Meanwhile, Afriansyah Noor as Deputy Minister of Manpower (Wamenaker) stated, with the enactment of Government Regulation in Lieu of Law (Perppu) Number 2 of 2022 concerning Job Creation, the Job Creation Law is repealed and declared no longer valid.

            However, all laws and regulations which are implementing regulations of the Job Creation Law are still valid as long as they do not conflict with the Perppu.

            And all implementing regulations of the Law that have been amended by the Job Creation Perppu are declared to remain valid, as long as they do not conflict with the Perppu.

            On the same occasion, Political Observer from Pelita Harapan University Emrus Sihombing stated that the Job Creation Law actually provides even more opportunities for cooperatives as the backbone of the national economy, such as establishing cooperatives with legal entities that will make it easier. This is because the requirements for the establishment of cooperatives that have occurred so far have made it possible for pro-administrative cooperative activities to occur.

            Thus, the domination of founders and administrators in making decisions in the field of cooperative business is no longer the case. In addition, cooperatives with legal entities can be used to drive the economies of their members, including applying for working capital loans to the central and regional governments.

            On another occasion, the Executive Director of the Moya Institute stated that global economic uncertainty is still and will continue to occur for an uncertain time. And such conditions overshadow the national economy. So that anticipation is needed by the government in order to create legal certainty for investors, increase domestic demand, and ensure the creation of jobs.

            Perppu Number 2 of 2022 was made because currently the world is facing a global crisis including Indonesia, it is necessary to take quick steps to deal with this condition, especially related to the need for a legal umbrella in strategic policies, as well as implementing the order of the MK Case Number 91/ PUU-XVII/2020.

            Not only that, the existence of the Job Creation Perppu was also able to fill the legal vacuum that occurred because the Job Creation Law was also previously considered conditionally unconstitutional by the Constitutional Court. On the other hand, if you want to issue a law with the usual procedures, it will take a long time even though it is in the midst of a very necessary condition.

            Of course, this legal vacuum cannot be overcome by making laws in the usual way because it will take quite a long time, while this urgent situation needs certainty to be resolved.

            The existence of Perppu No. 2 is something that is really needed by Indonesia, because this policy is a real solution for the Indonesian government so that it can still implement the Constitutional Court’s decision in the midst of an urgent situation.

Meanwhile, the Coordinating Minister for the Economy Airlangga Hartarto said that one of the government’s strategies to survive the threat of a 2023 global recession is to have legal certainty regarding investments that will enter Indonesia.

            The issuance of the Job Creation Perppu is important to provide guarantees to all elements, not only to employers, but also to workers. Airlangga also believes that the Job Creation Perppu also aims to ensure the welfare of workers.             In addition, to deal with an abnormal global economic situation, ease of doing business and a better climate are needed. Thus, through the Job Creation Perppu it is hoped that domestic investors will be able to expand their business, and MSMEs will continue their business in a sustainable manner and foreign investors will also be increasingly interested in investing in Indonesia.

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