By: Abdul Hakim)*
The Constitutional Court (MK) has decided that the Job Creation Law is conditionally unconstitutional, so it needs to be revised as soon as possible. However, the government hopes that investors will not worry, because the government has guaranteed investment certainty in Indonesia.
We all know that the pandemic has changed the world’s economic situation, including Indonesia. The sluggish purchasing power of the people made the wheels of the economy spin slowly. The government is looking for a solution by enacting the Job Creation Law, which has investment clusters and lures foreign investors to enter Indonesia, because there are conveniences for them.
However, the Constitutional Court’s decision stating that the Job Creation Law must be revised apparently took the investment world by surprise. Entrepreneurs fear that investors will cancel their plans. However, this was immediately prevented by President Jokowi’s statement that investment would remain safe even though the Job Creation Law was in the process of being revised.
The process of revising the Job Creation Law will take at least 2 years and during that time the Law is still in effect. So, there is no such thing as annulment of a law when a law must be revised. Coordinating Minister for Economic Affairs Airlangga Hartarto stated that the implementation of the Job Creation Law would apply both at the center and at the regional level. So the investment will also continue.
This means that although the Job Creation Law is revised, it does not mean that investment will stagnate. The reason is that apart from investors receiving guarantees from President Jokowi, they will also continue to enter Indonesia knowing that this is a good place to invest.
The government is targeting an investment of 1,200 trillion next year. This target is certainly not grandiose, because it is evident that since the beginning of the enactment of the Job Creation Law, many foreign entrepreneurs have lined up to cooperate. Starting from entrepreneurs in the manufacturing sector, batteries, to electric-powered vehicles.
It should be noted that Indonesia is the top 5 countries that are investment destinations by entrepreneurs from other countries. The reasons are because: first, the natural resources are abundant and there are still some that have not been processed professionally. So that investors will be happy to help each other and this cooperation will be mutually beneficial.
Second, the Indonesian population is a good market, so that the products produced by investment factories can be directly sold in their own country. With more than 200 million Indonesian citizens and somewhat consumptive habits), the Indonesian people are a good marketing target. So that foreign entrepreneurs no longer bother to find new market share abroad.
Airlangga said, while the Job Creation Law will remain in effect, so will the Investment Management Agency (LPI). Activities there will not stagnate because the law must be revised. In fact, LPI received a total capital injection of 75 billion rupiah so that it could work well and manage investments professionally.
The revision of the Job Creation Law was surprising because the Constitutional Court decided that articles of this law could still be changed. The government was also given 2 years for revision. However, this does not mean that this law is 100% flawed because the government has made it as good as possible until the results are almost perfect and it is hoped that it will further refine it.
Therefore, investors or investors need not be afraid of changes to the Job Creation Law, because these changes will not affect investment projects that are already underway or that have just entered Indonesia. Its security has been guaranteed by President Jokowi himself. Investment will also continue to flow heavily and make Indonesia’s financial situation stable again as it was in the period before the COVID-19 pandemic.
To date, the government has issued 45 government regulations (PP) as derivative regulations of the Job Creation Law. The regulation regulates technically the ease of doing business, taxation, MSMEs, and so on.
Of course, the results of the revision are expected to be able to make the economic sector in Indonesia better, investors also do not hesitate to invest in Indonesia so that job opportunities will be more open.
)* The author is a contributor to the Pertiwi Institute
