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The Ciptaker Law Brings Benefits to the Indonesian Economy


By: Naufal Putra Bratajaya )*

The regulation in lieu of the Job Creation Law has been ratified by the government to become a law. The passing of this regulation will bring great benefits to the Indonesian economy, because there will also be rules that are favorable for MSME entrepreneurs. Apart from that, the Ciptaker Law also makes it easier for foreign investment to enter and will make Indonesia a developed country, because one indicator of the nation’s progress is the large amount of investment in it.

The Ciptaker Law was just passed in March 2023. With the new rules, economic stability will improve. Especially after the pandemic, when the country’s financial condition was unstable.

To deal with the impact of the pandemic on the economy and stabilize Indonesia’s finances, one of the government’s steps is to pass the Job Creation Perppu. The name changed to the Job Creation Law after it was officially passed. 

The Coordinating Minister for the Economy, Airlangga Hartarto claims that the Job Creation Law (UU) provides many benefits for the Indonesian economy. In addition to providing legal certainty, the presence of the law will also encourage investment to enter the country, as well as to move MSMEs that were previously in the informal sector to become the formal sector. 

Airlangga added that in the Job Creation Law, the government also made it easier for MSMEs to obtain halal certification. In addition, various policies are made flexibly, especially in the employment cluster. With the enactment of the Perppu on Job Creation to become a Law, the old PP regulations will soon be revised and of course it will become timely with the passage of the Job Creation Law. During these two years there was an opportunity to evaluate the PP.

In the Job Creation Law there are MSME clusters and ease of doing business clusters that will make it easier for small and medium-level businesses. They must be assisted because 90% of traders in Indonesia are MSMEs, so saving them also helps the country’s economy.

In the Job Creation Law there are several rules that facilitate the performance of MSMEs in Indonesia. First, there is the acceleration of digitalization of MSMEs. The digitalization acceleration is carried out by the Ministry of Trade and cooperates with the private sector. MSMEs will learn how to do business online and take advantage of networks in the digital era.

The acceleration of digitalization is very important because now is the era of information technology and online shops are very widespread. But unfortunately there are still MSME actors who don’t really understand technology and don’t use the internet as a promotional medium. Even if someone has social media, it is only used for  status updates  . Though it can also be used to market its products.

Digitization is also carried out in financial settings. Where MSMEs are trained to be disciplined and take advantage of financial regulatory applications, which are facilitated by the central and regional governments. The facilities are also 100% free, making it easier for MSMEs, where they are experiencing various difficulties due to the effects of the pandemic. 

Therefore, the community fully supports the ratification of the Job Creation Perppu into law. The reason is because the Indonesian economy will improve and MSMEs will greatly benefit. Society will bounce back from the effects of the pandemic and be less affected by the recession.

Meanwhile, UGM senior economist, Sri Adiningsih, stated that the ratification of the Job Creation Law was indeed  a red carpet  for investors in the Indonesian business world. However, on condition that fiscal policy does not make it difficult. Tax reform is expected to make things better. 

Sri added, Indonesia must be able to take advantage of the economic cooperation that has been carried out with various countries. This is one of the entrances for investors to come to Indonesia. In a sense, there are actually many foreign investors who will enter Indonesia and their steps will be made easier by the rules in the Job Creation Law. 

Economic cooperation has indeed been established between Indonesia and other countries, such as China. They even prepared funds of up to 20 trillion rupiah to build a furniture factory. This collaboration is clearly beneficial because it will add new job vacancies. Moreover, many Indonesian citizens lost their jobs during the pandemic, so they could apply for jobs there.

The economy can be stable when there are many investors coming in. Moreover, one indicator of a country’s progress is the amount of investment there. Therefore, the government made regulations that could protect foreign investors, so that they would no longer hesitate to do business in Indonesia.

The Job Creation Law cut complicated permits. So that foreign investors will easily get permission when they want to start a company in Indonesia. With this Perppu, permits can be taken care of online through an integrated system. The system will set up so that licensing is done quickly, in just a few working days.

The Job Creation Perppu which has been passed into law will bring many positive benefits to the people of Indonesia. First, Indonesian citizens who have small and medium-level businesses (MSMEs) benefit because business management is made easier and their business runs smoother. Second, investment will be facilitated so that investment-produced factories will be built, and reduce the number of unemployed people in Indonesia.

)* The author is a contributor to the Inti Media Institute

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