Elevating Indonesia’s Performance in Ease of Doing Business Index : Policy Reforms to Improve the ‘Starting a Business’ Indicator

Abstraksi

In 2018, Indonesia was ranked at 72nd in the Ease of Doing Business rank and 144th among 190 countries in the Starting a Business Indicator published by World Bank, taking 23 days and 11 procedures to register a business in Indonesia. While the government has attempted to simplify the process through the Online Single Submission (OSS) system since July 2018, lack of information, inadequate IT infrastructure, and lack of synchronization between central and local governments remain as problems. This research recommends regulatory amendments to improve the system through qualitative analysis of data gathered from semi-structured interviews conducted between March and August 2018 in Jakarta, Bandar Lampung, and Bandung. The analysis concluded that provincial governments should revise bylaws that contradict national regulations, specifically Regulation of the Head of Investment and One Stop Integrated Services of the Jakarta Capital Region 23/2017 Article 2d that still requires the Mandatory Labor Affairs Report (MLAR), which contradicts Regulation of the Ministry of Manpower 14/2006. Second, Government Regulation 24/2018 Article 78 should require that the government collaborates with local business associations to disseminate information about the OSS. Third, Government Regulation 24/2018 Article 88 should ensure that ministries related to the OSS assist local governments to synchronize SOPs and regulations to implement the OSS for at least one year. Lastly, Government Regulation 24/2018 Article 91 should ensure that the government will collaborate with the private sector to improve IT infrastructure in all regions to support OSS. These policy changes will reduce unnecessary procedures, ensure that information regarding OSS reaches remote communities, that failure of compliance will result in penalties, and maximizing collaboration between local governments with the private sector for quick synchronization.