JAKARTA (TheInsiderStories) - The Indonesian government has made a bold step to scrap annual renewal of trade business permit (SIUP) as move to ease of doing business in the country. The move has been widely welcome by business players and investors.
Trade Minister Enggartiasto Lukita said the scrapping of annual renewable of SIUP is part of “new paradigm shift” in the management of the country’s trade sector. He said in addition to the scrapping of annual renewal, the Trade Ministry also scraps the requirement to seek approval to renew the Certificate of Company Registration (TDP) after 5 years of existence.
Business players are only required to inform the related institution through online or offline.
Minister Lukita has reported to the President about his ministry’s decision and that the President welcomes the decision. “The President has asked all layers of the Trade Ministry to carry on the work optimistically, pay attention on details as well as always undertake breakthroughs as the global business competition is tightening,” he said.
The Coordinating Minister for Economic Affairs Darmin Nasution praised the steps undertaken by the Trade Ministry to scrap the SIUP renewal and simplify TDP procedure.
“That’s a good move as these (SIUP and TDP) renewal doubles the works, which are not necessary,” said Darmin at the State Palace.
The decision becomes effective since February 21, 2017 and will apply throughout the nation.
So far, business players have to renew SIUP with the local government’s Trade Office, while foreign investors with PMA (foreign direct investors) status, they are required to renew the SIUP with local Domestic Investment Agency (PMDN).
“Why we have to renew SIUP? It is not necessary after all. If a company is already established, there is no need to renew it (SIUP),” Chairman of Indonesian Employers Association Hariyadi Sukamdani said. Therefore, he appreciates the government’s decision.
The Trade Ministry’s decision is in line with the drive of the Joko Widodo government to improve the country’s ranking of Ease of Doing Business (EODB), an indicator of a business climate in one country provided by a World Bank unit International Finance Corporation (IFC).
In 2016, Indonesia ranked 91 from 190 countries assessed in the World Bank’s “Doing Business 2017: Equal Opportunity for All” report, up 15 places from the previous list. The improvement was made possible thanks to government efforts to simplify and scrap unnecessary regulation. (*)
