Delivering on Promises

Kompas/Wawan H Prabowo

Finance Minister Sri Mulyani Indrawati fulfills the invitation of President Joko Widodo at the Presidential Palace complex, Jakarta, Tuesday (22/10/2019). President Joko Widodo continued inviting a number of figures to serve on his Cabinet.

The hopes of many rest on the economic team in the upcoming Cabinet of President Joko “Jokowi” Widodo and Vice President Ma\'ruf Amin at a time when the Indonesian economy is rocked by global turbulences.

However, the government is also called to deliver on various promises made during the administration of President Joko Widodo and then-vice president Jusuf Kalla in 2014-2019. Such promises are, for example, based on continued regulatory reforms so far manifested in 16 economic policy packages.

As industrial processes are increasingly intertwined with information technology, Indonesian workers must be prepared. This is challenging given that around 52.4 million Indonesians or 40.51 percent of the working population have only primary school education.

The business community is demanding that the new Cabinet\'s economic team be competent and understand the economic realm within the global context. "[They must have] a professional attitude, no matter where [he or she] comes from," said Indonesian Food and Beverage Entrepreneurs Association chairman Adhi S. Lukman in Jakarta on Tuesday (22/10/2019).

According to him, the economic team needed to be committed to carrying out the President\'s vision. The ministers should together pursue one vision, with one coordinator, and therefore put aside personal interests.

KOMPAS/WAWAN H PRABOWO

United Development Party (PPP) member Suharso Monoarfa fulfills President Joko Widodo\'s invitation at the Presidential Palace complex, Jakarta, Tuesday (22/10/2019). President Joko Widodo continued inviting a number of figures to serve on his Cabinet.

In the property sector, the government has created a number of incentives, but Indonesian Real Estate deputy chairperson for regulatory affairs Ignesjz Kemalawarta says there are still some unresolved issues, namely taxation.

According to him, the developers of subsidized housing are subject to value-added tax, which puts a burden on developers as they seek to keep production costs low. Meanwhile, the selling price of houses for low-income earners is capped by the government’s upper limit.

PT Intiland Development founder and CEO Hendro S Gondokusumo said the economic team in the Cabinet should be solid and able to revisit policy packages that have not been optimally implemented. At present, good government policies are often hampered or overlap with other policies.

For example, he said, the policy package allowing foreigners to own property had not yet been fully implemented. Regarding complicated licensing, the upstream oil and gas industry shares the concern about inadequately implemented reforms.

KOMPAS/WAWAN H PRABOWO

Politician of the National Awakening Party (PKB) Ida Fauziyah fulfills the invitation of President Joko Widodo at the Presidential Palace complex, Jakarta, Tuesday (22/10/2019). President Joko Widodo continued inviting a number of figures to serve on his Cabinet.

"The government has made improvements in the form of streamlining licensing processes and [creating] one-stop licensing systems. However, there are still many licenses that we have to secure, with no certainty when the permit will be completed," said Indonesian Petroleum Association (IPA) director Abdul Manaf.

According to him, if there is no improvement, investors will turn to other countries that are more attractive and provide greater convenience.

Finance Minister

On Tuesday, after meeting President Joko Widodo, Sri Mulyani Indrawati said one of her reasons for accepting the offer to stay on as finance minister was similarity of goals. She added that the President aspired to improving human resources and making the bureaucracy more efficient.

The chairman of the digital economy at the Indonesian E-Commerce Association (idEA), Bima Laga, said idEA welcomed Sri Mulyani as the finance minister for the 2019-2024 period. The president\'s policy in the digital economy, especially regarding the empowerment of micro, small and medium businesses and digital entrepreneurship, was believed to be even stronger.

KOMPAS/WAWAN H PRABOWO

Businessman Bahlil Lahadalia fulfills President Joko Widodo\'s invitation at the Presidential Palace complex, Jakarta, Tuesday (22/10/2019). President Joko Widodo continued inviting a number of figures to serve on his Cabinet.

Nevertheless, idEA chairperson Ignatius Untung suggested that discussions on taxation, specifically on electronic commerce or e-commerce, should involve all stakeholders.

"The finance minister should not be a new person. The re-appointment of Sri Mulyani is also positive because, in quotation marks, she does not need to study anymore,"

Agustinus Prasetyantoko, an economist from Jakarta-based Atma Jaya Catholic University, contends that economic affairs must be handled seriously because challenges are increasingly complex and risks are rising. For this reason, the finance minister post was one of the key positions that should be filled by professionals.

"The finance minister should not be a new person. The re-appointment of Sri Mulyani is also positive because, in quotation marks, she does not need to study anymore," he said.

Read more : Time to Work Harder

Sri Mulyani is seen as having the capability and advanced understanding to lead national fiscal policy. Market actors are confident about the performance of Sri Mulyani. She is considered capable of managing the state budget in the midst of global pressure.

On Tuesday, the Jakarta Composite Index (JCI) gained 26.51 points, or 0.43 percent, to close at 6,225.49. Panin Securities analyst William Hartanto said the market responded positively to minister candidates being summoned to meet with the President.

(CAS/APO/LKT/MED/KRN/DIM)