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Omnibus Law Job Creation, Solution to Face Recession

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By: Abdul Razak )*

The ongoing Covid-19 pandemic has proven to have hit the financial sector hard. Nevertheless, the public appreciates the Government’s breakthrough through the Omnibus Law Ciptaker which is believed to be one of the solutions in facing an economic recession.

The Omnibus Law Cipta Kerja regulates that regional permits will be withdrawn to the central government and delegated back to the regions along with the norms, standards, procedures and criteria (NSPK) that are measured by the Central Government. In addition, permits in Ministries and Institutions will also be withdrawn to the President and delegated again through government regulations.

This will certainly give all permits a clear timeframe, and not seem complicated. The business licensing process will also be made easier so that it is hoped that new businesses or industries that are able to absorb labor will emerge.

We need to know that the impact felt in the Indonesian economic sector includes a contraction of economic growth in the second quarter of 2020 to 5.32% and an increase in the unemployment rate of 7 million people.

The investment sector also had an impact, where the global foreign direct investment (FDI) decreased by 30-40%.

Even though Indonesia can benefit from the presence of FDI in the midst of the Covid-19 Pandemic, including an increase in the amount of foreign capital, an increase in employment, an increase in savings, an increase in education and training, an increase in research, development and technology, an increase in infrastructure and an increase in large, supportive markets. the price of goods is getting cheaper.

On a different occasion, researcher from the Center for Indonesian Policy Studies (CIPS) Felippa Ann Amanta assessed that the Job Creation Bill (RUU) was able to open up investment opportunities, one of which was from the agricultural sector. This is because the agricultural sector continues to grow positively amid the Covid-19 pandemic.

Felippa explained that the investment regulations stipulated in Law Number 13 Year 2010 concerning Horticulture are currently considered unfriendly in the agricultural sector. So it is hoped that with the Job Creation Bill, these conditions can facilitate investment.

This includes articles in the Job Creation Bill which will replace several articles in the Horticultural Law. Like article 34 of the Job Creation Bill which invites horticultural facilities from within and outside the country. This article will revise article 33 of the Law on horticulture which makes it difficult to use foreign facilities.

Felippa assessed that by opening up investment, this could benefit the agricultural sector. Data from the 2019 Investment Coordinating Board, it is estimated that the agricultural sector is only about 3 percent of the total investment that enters Indonesia.

The facilities regulated in the Work Creation Bill are expected to have a positive impact on farmers and agriculture in Indonesia.

On different occasions, tourism researcher and lecturer at Gajah Mada University (UGM), Muhammad Baiquni said, the Work Creation Bill (RUU) can boost Micro and Medium Enterprises (MSMEs) in the tourism sector.

According to Baiquni, the current obstacle that is being faced by MSMEs in the tourism sector is about the ease of obtaining capital, especially for developing local tourism in the region.

He said, with the ease of permits in doing business, of course this would be a stimulus to bring in investment capital as partners that can be utilized by MSMEs in the tourism sector.

Baiquni claims that the tourism sector in Indonesia is currently very liberal, where many assets are ultimately owned by the private sector. So that the role of MSMEs is increasingly being shifted.

Therefore, the Job Creation Bill has become a new paradigm as a rule that not only regulates the investment process, but also focuses on the fate of workers and spatial planning.

With the Omnibus Law Cipta Kerja, he hopes that not only will money grow, but the space and ecosystem will be sustainable and people will prosper.

Omnibus Law Job creation also allows the government to be able to better regulate the running of investment. So that investors do not control many assets and sacrifice MSMEs, like what is happening today.

We must be aware that the relationship between investors and MSMEs or small entrepreneurs is a business partner. Through the Omnibus Law Cipta Kerja, it certainly shows the government is participating in implementing efforts to protect and strengthen MSMEs in the tourism sector.

The work copyright omnibus law is not only limited to making rules, but also provides strengthening and assistance to small entrepreneurs or MSME players, this is of course a solution to face the threat of a recession.

)* The author is a contributor to the Indonesian Strategic Information Studies Institute (LSISI)

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