By : Ananda Prameswari )*
The President of the Republic of Indonesia (RI) Joko Widodo (Jokowi) initiated the implementation of the Job Creation Law (UU Ciptaker) policy which turned out to be able to increase Indonesia’s economic growth.
President Jokowi’s government continues to innovate to improve people’s welfare and economy, including through regulations. This set of policies is one of President Jokowi’s efforts to promote structural reforms to accelerate national economic growth and increase competitiveness at the global level.
The Ciptaker Law, which is also known as the Omnibus Law, is an important milestone that makes doing business easier and attracts more investment, both from within and outside the country.
President Jokowi realizes that the global economy is facing serious challenges. Therefore, he took strategic steps through the Ciptaker Law, which aims to overcome bureaucracy which often slows down the business licensing process. This policy provides clearer legal certainty for investors, as well as improving the business climate in Indonesia, making it more attractive for global investors.
According to the President’s Special Staff for Economic Affairs, Arif Budimanta, the implementation of the Job Creation Law has created a positive impact on the business world. With all its derivative regulations, this policy simplifies the licensing process which was previously complicated.
Arif explained that since the implementation of the law, Indonesia has experienced structural improvements, especially in terms of ease of risk-based licensing. The OSS-RBA (Online Single Submission-Risk Based Approach) system introduced through the Ciptaker Law helps automate the licensing process, making it more efficient and transparent.
This success can be seen from the increase in investment that occurred after the licensing reform, which is seen as one of the factors driving sustainable economic growth.
The Ciptaker Law also allows various business sectors to develop more quickly. Basic permits such as Building Approval (PBG) and Functional Worthiness Certificate (SLF), which previously took a long time, can now be processed more quickly with clearer standards. This is recognized as one of the important innovations that helps increase productivity and efficiency in various economic sectors.
Deputy for Macroeconomic and Financial Coordination at the Coordinating Ministry for Economic Affairs, Ferry Irawan, stated that Indonesia had proven its success in carrying out structural reforms through the Ciptaker Law.
The increase in Product Market Regulation (PMR) indicators released by the OECD is proof of the success of this reform. This increase shows that product market regulations in Indonesia have become more competitive and conducive to the business world. In addition, this reform is also recognized globally as a significant step in creating a healthy and sustainable business environment.
Ferry also emphasized that these reforms not only have an impact at the national level, but also strengthen Indonesia’s position on the international stage. The increase in Indonesia’s competitiveness at the global level can be seen from the improvement in the PMR index which has increased from 2.79 in 2021 to 2.2 in 2024. This places Indonesia as one of the countries that has succeeded in carrying out significant policy reforms, along with other countries. such as Greece and Peru.
On the other hand, the Organization for Economic Co-operation and Development (OECD) also expressed its appreciation to Indonesia for this nation’s success in improving the business environment.
Mathias Cormann, Secretary General of the OECD, acknowledged that Indonesia had made significant progress in reforming regulations that were previously considered less competitive. Although there is still room for further improvement, this achievement shows that structural reform in Indonesia is on the right track.
In the context of increasing global competitiveness, Indonesian President Jokowi also showed that this policy had succeeded in boosting Indonesia’s competitiveness ranking. Based on the IMD World Competitiveness Ranking 2024 report, Indonesia managed to rise eight places, from 34th to 27th. This increase cannot be separated from the positive influence of the Job Creation Law, which provides regulatory clarity and strengthens the labor sector and national productivity.
Now in Indonesia, there has been a risk-based licensing reform which is able to minimize obstacles in the business licensing process, so that various economic sectors can move more quickly.
The government has also made efforts so that the licensing system can be well integrated between the central and regional levels. Thus, not only the central government has regulations that support this reform, but also regional governments through the issuance of regional regulations that are in line with central policies.
The reforms achieved through the Job Creation Law show how President Jokowi’s government is able to face global economic challenges with innovative policies.
These reform efforts continue and are an important part of Indonesia’s economic transformation. With the support of this policy, it is hoped that the Indonesian economy will continue to grow, achieve higher economic growth targets, and strengthen Indonesia’s position as one of the countries with the best economic competitiveness in the world.
In the decade of President Jokowi’s leadership, the structural reforms introduced through the Job Creation Law have become one of the major achievements. This policy not only has a direct impact on increasing investment and job creation, but also improves the quality of regulations to make them more competitive in the global market. These reforms have brought positive changes to the Indonesian economy which continues to develop to this day.
)* The author is a Media Space contributor
