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Employment Creation Law Effective Efforts to Simplify Regulations to Increase Economic Growth

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By: Achmad Faisal

The government has passed the Job Creation Law (Ciptaker), where the existence of the Act is believed to be very helpful for the business world. The Job Creation Law simplifies regulations that have been overlapping so far that hinder investment. With the smooth running of the business world, including investment, the economic sector in this country will definitely increase.

President Joko Widodo in the APEC CEO Dialogues 2020 forum said the ratification of the Omnibus Law on Job Creation by simplifying regulations from 79 laws into one law. The goal is to create a quality business and investment climate.

According to the President, regulatory and bureaucratic reforms are carried out so that the economy grows. Especially in these difficult times. The Copyright Act opens the door as wide as possible for entrepreneurs and investors to enter the country in new ways.

The new method meant by the President was to cut down on overlapping regulations through the Ciptaker Law. In addition to cutting regulations, the Ciptaker Law also cuts the bureaucratic chain of convoluted licensing and eradicates illegal levies that hinder business and investment.

Thus, the Ciptaker Law has a significant impact on improving the business and investment climate.

Especially for micro and small businesses, simplification of regulations makes MSMEs no longer need to apply for permits. MSME actors can directly run their businesses by simply registering. This effort is proof of the government’s commitment to helping and developing the potential of MSMEs in Indonesia.

The Ciptaker Law also integrates the entire licensing process into the electronic licensing system through an online single submission system. This step prevents illegal levies and corruption.

The President also emphasized that the Ciptaker Law facilitates the formation of a Limited Liability Company or PT. The formation of PT is made simpler and there is no minimum capital limitation.

Another positive value of the Copyright Law is that it regulates various attractive facilities and incentives for those who invest in Special Economic Zones (SEZs), Free Trade Areas, and Free Ports. Licensing services in a matter of hours for ease of investment are provided in these areas.

The Executive Director of the Islamic Student Economics Institute (LEMI) of the Executive Board of the Islamic Student Association (PB HMI), Arven Marta welcomed the Ciptaker Law. Arven said the simplification of regulations greatly helped the pace of the Indonesian economy. So far, the convoluted bureaucratic path due to lengthy regulations has made investment difficult.

He considered that the Job Creation Act played an important role in the investment climate in Indonesia. Arven is optimistic that the Job Creation Law can spur Indonesia’s economic growth.

Even Arven believes that the Job Creation Act is a solution to the current economic crisis due to the Covid-19 pandemic. The existence of the Employment Creation Law has become an economic slug that slowed down after being ‘hit’ by Covid-19.

Meanwhile, Lecturer of Political Science FISIP, University of North Sumatra (USU) Fredeick Broven Ekayanta said, the complexity of the bureaucracy caused the weakness of the national economy. For this reason, the simplification of regulations in the Job Creation Act is considered appropriate to advance the Indonesian economy.

He explained that the simplification of the regulation also makes it easier for all parties who want to invest in Indonesia. If the investment goes smoothly, it will have an impact on the absorption of labor for the people of Indonesia.

So there is no need to question the Ciptaker Law whether it favors employers or workers. The Copyright Act was created not only to benefit employers, but actually to help workers. Because the entry of investors provides opportunities for new job opportunities. This will absorb labor and reduce unemployment. This condition also directly affects the growth of the national economy.

)*The author is a former journalist

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