Indonesia's local governments doing little to boost investment climate

2007-12-01 13:25:22

JAKARTA, Dec. 1 (Xinhua) -- Many regency and municipality administrations in Indonesia have done nothing to improve the investment climate in their regions, according to local media on Saturday.

A survey, conducted by the Regional Autonomy Monitoring Committee (KPPOD), a body established by Indonesian Chamber of Commerce and Industry, recently showed that 31 percent of the 2,000 ordinances reviewed have done nothing in improving the investment climate, the Jakarta Post said.

The 2,000 ordinances are only a small portion of the 7,000 ordinances issued by regency and city administrations since the enactment of the Local Autonomy Law in 2001, which gave local administrations more power to manage their own economic affairs.

"Some ordinances have even resulted in the double taxation of investors," executive director of the committee Agung Pambudhi quoted by the Jakarta Post as saying.

Ordinances introduced in Tangerang and Serang, both in Banten, for example, require companies to provide full-protection insurance for employees both during and outside work hours, he said.

He also said that the long and costly bureaucratic procedures for obtaining business licenses needed to be replaced with one-stop services in every locality in the country.

Agung said that this year, a total of only 180 regions had established one-stop services out of the country's 460 regions.

Unfortunately, there were no sanctions that could be imposed on local governments that had not complied with the decree, despite the urgent need to improve the country's investment climate, Agung added.