investment policy updates: presidential regulation no 91 ... · for investment projects located...

INDONESIA INVESTMENT COORDINATING BOARD

© 2017 by Indonesia Investment Coordinating Board. All rights reserved

Investment Policy Updates:Presidential Regulation No 91/2017 on Acceleration of Doing Business

Farah Ratnadewi IndrianiDeputy Chairman for Investment Climate Development

Jakarta, 28 February 2018

The Investment Coordinating Board of the Republic of Indonesia

2

Global Perception on Indonesia

INDONESIA COMPETITIVENESS

Strong Reform Commitments

120114

91

106

2014 2015

Ease of Doing

Business Indonesia,

2013-2017

19

72

2016 2017 20182013

129

Country

India

DB 2018DB 2017

130

78

3540

123 125

100

China

Russia

Brazil

Indonesia

Indonesia vs other emerging economies

Indikator

Ranking

DB 2017 DB 2018

Indonesia’s DB Rank 91 72

Starting a Business 151 144

Dealing with Construction Permits

116 108

Getting Electricity 49 38

Registering Property 118 106

Getting Credit 62 55

Protecting Minority Investors

70 43

Paying Taxes 104 114

Trading across Borders 108 112

Enforcing Contract 166 145

Resolving Insolvency 76 38

91 72

78

4

Indonesia keep showing a progressive performance

toward business environment Indonesia

Investment Grade from International

Credit Rating Agencies

BBB- / Stable Baa3 / Positive BBB- / Positive BBB- / Positive

BBB- /Positive BBB/ Stable


5

World Economic Forum: the Global Competitiveness Report

Indonesia increase its competitiveness rank from 41st to 36th

Indonesian Competitiveness


6

Investment Performance in Indonesia

INVESTMENT TARGET AND REALIZATION


7

12015 2016 2017 2018 2019 Total

FDI 343.7 386.4 429.0 476.5 569.9 2,205.5

DDI 175.8 208.4 249.8 288.5 363.0 1,285.5

Total 519.5 594.8 678.8 765.0 932.9 3,491.0

Growth 12.2% 14.5% 14.1% 12.7% 8.1%

(IDR trillion) Excl. Financial Sectors and Upstream Oil and Gas

Strategic Plan of Investment 2015-2019

Investment Target total investment targetedin 2015-2019

113% increasefrom 2010-2014 period(IDR 1,632.8 trillion)

66.0 % average shareof total investment target in 2015-2019

FDI2015-2019

DDI2015-2019

IDR 3,491 trillion

34.0 % average shareof total investment targetIn 2015-2019

12.3%targeted in 2015-2019 periodaverage growth

Source: BKPM, 2018

Investment Target


8

Source: BKPM, 2018

Japan is the 2nd biggest investor in Indonesia

FDI Realization by CountryBased on Capex , not including financial, oil & gas sectors (US$ million)

No Country 2010 2011 2012 2013 2014 2015 2016 2017 Total

1 Singapore 5,565 5,123 4,856 4,671 5,832 5,901 9,178 8,441 49,569

2 Japan 713 1,516 2,457 4,713 2,705 2,877 5,400 4,996 25,377

3 USA 931 1,488 1,238 2,436 1,300 893 1,161 1,992 11,439

4 South Korea 329 1,219 1,950 2,205 1,127 1,213 1,065 2,024 11,132

5 Netherland 608 1,354 967 928 1,726 1,308 1,475 1,489 9,855

6 Malaysia 472 618 530 711 1,776 3,077 1,115 1,213 9,513

7 China 173 128 140 298 800 628 2,665 3,361 8,194

8 Hong Kong 566 135 310 376 657 937 2,248 2,116 7,345

9British Virgin

Islands1,616 517 856 786 624 731 1,157 844 7,130

10 UK 276 419 934 1,076 1,588 503 306 774,8 5,878

Total 10 Countries 11,249 12,517 14,283 18,199 18,135 18,068 25,775 27,251 145,432

Total (123 Countries) 16,215 19,475 24,565 28,618 28,530 29,276 28,964 32,239 207,848


9

Investment Realization Jan-Dec 2017Investment in Indonesia

692.8Rp. Trillion (US$

53.2 Billion)Investment Realization

+13.1%Investment

Growth (y/y)

+ 21.3%DDI Growth

(y-o-y)

+8.5%FDI Growth(y-o-y)


10

ECONOMIC POLICY REFORM

Economic Policy Packages I – XV

Phase I, 9 Sept ‘15Improving national industry competitiveness

Phase III, 7 Oct ‘15Financial services facilitation, export financing and

elimination of business unnecessary burden

Phase IV, 15 Oct ‘15Social safety net and betterment of people welfare

Phase V, 22 Oct ‘15Improving industry and investment climate through

tax incentives and deregulating of sharia banking

Phase VI, 6 Nov ‘15Stimulating economic activities in border areas and

facilitating strategic commodities availability

Phase VII, 7 Dec ‘15Stimulating business activities in labor-intensive

industries nation-wide through incentives in the form

of accelerating land certification process for

individuals

Phase VIII, 21 Dec ‘15Resolving land acquisition disputes, intensifying

domestic oil production, stimulating domestic parts

and aviation industries

Phase II, 29 Sept ‘15Easing permit requirement and simplifying export

proceeds requirement

Phase IX, 27 Jan ‘16Accelerating electricity generation, stabilizing

meat prices and improving rural –urban

logistics sector

Phase X, 11 Feb ‘16Revising Negative investment List and

improving protection for SMEs

Phase XI, 29 Mar ’16Stimulating national economy through

facilitation to SMEs and industries

Phase XII, 28 Apr’16Improving Indonesia’s rank on Ease of Doing

Business (EODB)

Phase XIII, 25 Aug ’16The reduction of bureaucracy to boost the

construction of low-cost housing for the poorer

segments

Phase XIV, 10 Nov ’16E- commerce Road Map that focuses on providing

facilities and incentives to e-commerce and

creative industries

Phase XV, 15 Jun ’16Focused on national logistics system

improvements to accelerate business development

and competitiveness of national logistics sectors

Packages Milestones:

9 REGULATION

REVOKED

49NEW

REGULATION

31REGULATION

REVISED

To reduce economic barriers

To accomodate new government

policy

To eliminate certain conditions that

hamper economic growth

89 REVOKED OLD REGULATION

35 REGULATION

MERGED

To simplify license and regulation

To addjust old irrelevant regulation

Objective of Reform - 15 Economic Policy Packages: To improve the competitiveness of national industries, exports and investments.

Rationalization (harmonization and streamlining) of regulations, simplifying bureaucratic process and ensuring law enforceability.

These packages cover deregulation of 222 regulations of 167 ministries/agencies and 52 regulations at the Presidential level.

Taskforce To Monitor Economic Policy Packages

Taskforce on the Acceleration and

Efficacy Implementation

of Economic Policies

Policy Campaign

(Chaired by Minister of

Trade)

Compliance

(Chaired by Chief of

Presidential Staff)

Regulatory Impact

(Chaired by Senior Deputy of Bank Indonesia)

Damage Control Channel/The Bottleneck

(Chaired by Minister of Law and Human

Rights)

NOWORKING

GROUPFUNCTION

1 Policy Campaign

Campaign, socialization, dissemination, roadshow, business matching, CEO meeting, talk show/dialog

2 Compliance Completing all of the regulation and technical regulation necessary for the implementation ofeconomic deregulation

Ensuring the regulation compliance

3 RegulatoryImpact

Observing, analyzing, and evaluating the implementation of policy/regulation and impact

Reviewing for the “next” deregulation

4 Damage Control Channel/The Bottleneck

As an complaint channel for the implementation of deregulation policy

Handling the cases related to the implementation of deregulation policy

5 Supporting Unit

Supporting the administration of the working group Coordinating with the ministry/board and local

government Business clinic and public private consultation for

testing the policy effectiveness

To monitor the implementation of economic policy packages, the Government established Task Forces

on the Implemention Acceleration and Efficacy of Economic Packages


13

ECONOMIC POLICY PACKAGE XVI:

PRESIDENTIAL DECREE NO. 91/2017 ACCELERATION OF DOING BUSINESS

Acceleration of Doing Business Policy: Regulation Framework

PRESIDENTIAL DECREE

NO. 91/2017ACCELERATION OF DOING BUSINESS

Online Single Submission (Integrated Business Licensing) System)

PH

ASE

1P

HA

SE 2

Safeguarding Issuance of the Licenses (end to end)

Licenses Checklist System

Reform of Business Licenses Regulation

Trial System

Roadmap OSS

Data Sharing of license

Concept of Doing Business Policy

Paradigm shift

From regulator to civil servant

Safeguarding Issuance of the

Licenses(end to end)

Establish task forces to ensure issuance of business permits in all government level

(Central, Provincial, and District)

Reform of Business Licenses

Regulation

Simpler, faster, cheaperand more accurate

Licenses Checklist System

Investor can start their business activity in SEZ, FTZ, Industrial Zone, and Tourism Zone

without completing permits in the beginning

Data Sharing of license and its requirements

Eliminate redundancy/repetition of license and recommendation

Including for SMEs

Integrated System

Online Single Submission

1. 2a.

2b. 3. 4.

A Breakthrough On Investment Services (1)

Starting January 2018

Pemerintahan Daerah

Penanaman Modal

Pelayanan Publik

persiapan

PERIZINA

N DAERAH

PERIZINAN

TEKNIS

InvestmentRegistration+ 7 Licenses*

+ Register Statement

Letter

For Investment Projects in KEK/KPBPB/KI/KSPN

Technical

Permits

2 Regional

Permits

* Notes:1. Notary deed and

legalization from MoLHR,

2. Tax ID/NPWP, 3. Foreign Worker

Plan/RPTKA, 4. Foreign Worker

License/IMTA, 5. Company

registration/TDP, 6. Import Identification

Number/API, 7. Customs ID/AKSES

KEPABEANAN

IN PARALEL

Preparation Construction Production1 2 3

Import Duty Facility

Tax Allowance

Tax Holiday

INVESTMENT FACILITY BUSINESS LICENSE

A Breakthrough On Investment Services (2)

Starting January 2018

Pemerintahan Daerah

Penanaman Modal

Pelayanan Publik

persiapan

PERIZINA

N DAERAH

PERIZINAN

TEKNIS

InvestmentRegistration+ 3 Licenses*

For Investment Projects Located Outside KEK/KPBPB/KI/KSPN

Technical

Permits

2 Regional

Permits

* Notes:1. Notary deed and

legalization from MoLHR,

2. Tax ID/NPWP, 3. registration/TDP,

Preparation Construction Production1 2 3

Import Duty Facility

Tax Allowance

Tax Holiday

INVESTMENT FACILITY BUSINESS LICENSE

Acceleration Doing Business Policy: ONLINE SINGLE SUBMISSION

The licenses data of all ministries/agencies and local governments are managed in singleintegrated licenses service system

Single submission of data and information

Single and synchronous processing of data and information

Single decision making on the issuance of business licenses

will be applied on 1 March 2018 simultaneously

Sistem OSS

SKPD PemprovSKPD Pemkab/

Pemkot

Investor

K/L

Lainnya

PTSPFront line


19

Badan Koordinasi Penanaman Modal

(BKPM)Indonesia Investment Coordinating Board

Jalan Jend. Gatot Subroto No. 44Jakarta 12190 - Indonesia

C all center : 0807 100 2576 (BKPM)

www.bkpm.go.ide . [email protected]

Thank YouTerima Kasih

Indonesia Investment Promotion Centre (IIPC)

http://www.bkpm.go.id/

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