US Ambassador Criticizes Investment Regulations in Indonesia

TEMPO.CO, Jakarta - US Ambassador to Indonesia Joseph R. Donovan on Thursday, November 2, criticized a number of regulations that are against foreign investors. According to Donovan, the regulations not only hamper foreign investments but also obstruct innovation and development.

For instance, Donovan said, the regulation governing local contents would limit consumers’ access to the 4G network. In addition, the regulation that requires the establishment of regional representatives or the use of local data storage could limit choices and incur costs.

Donovan also highlighted a number of regulations in the payment sector that limit foreign ownership, causing limited choices for consumers. He views that the policy will lower the security level and hamper Indonesia in improving its investment negative list.

Read: US Companies to Boost Investment in Indonesia

Therefore, the US ambassador suggested Indonesia create a system that treats foreign companies fairly and provides regulatory certainty for all market movers.

Donovan revealed that the US government has invested more than Rp1 trillion in the Indonesia e-commerce sector. With such a substantial investment value, the e-commerce sector is expected to improve the transportation availability, open accesses to education, reduce traffic congestion, and help with the development of micro, small, and medium businesses.

In response to the criticism, Indonesia's National Development Planning Agency (Bapennas) head Bambang Brodjonegoro said that the government will continue to improve the investment climate by improving regulations and simplifying the permit application process for foreign and domestic investors.

ALFAN HILMI