High Cost Economy in Indonesia

ROOM Commerce and Industry (Kadin) Indonesia assess infrastructure development in Indonesia is still bad. Indonesian infrastructure ranked very low compared to other countries ranked. Infrastructure development to improve the competitiveness of the investment.

Infrastructure is a vital means of support for economic progress, especially to ensure the smooth flow of goods and reduce transaction costs or a high-cost economy.

Deputy Chairman of the Chamber of Commerce Information and Communication Technology, Kadin, Smith Suwondo revealed in Serang, Banten, on Friday (5/9), poor infrastructure development in Indonesia. World Economic Forum 2012-2013 report shows, Indonesia ranks 78 out of more than 100 surveyed countries.

The position is even worse than the previous year, ie on 76 ratings. As Singapore is ranked second, ranked Malaysia 32, Thailand ranked 46th, and Brunei rank 57. Indonesia's poor logistical encourage high economic costs, thereby reducing the competitiveness of the investment.

Logistics costs in Indonesia are very expensive, which is about 30 percent of gross domestic product or GDP. To that end, the government and the House of Representatives Chamber of Commerce invites to think clearly so that national budgets are sourced from the business tax and the wider community should be free of waste and free from heavily subsidized.

Kadin expressly asked the government to cut the subsidy of Rp 150 trillion to make available a larger budget for regional development, particularly in the area of infrastructure development. Allowance for funds allocated to each province of Rp 4 to Rp 5 trillion. Thus, there is a strong impetus for development in the area. Kadin center also encourages local Chamber of Commerce to be able to touch the small and medium enterprise sector for equity in economic development.

Kelihan the Chamber of Commerce, in fact, has become a classic. On the other hand, the Coordinating Minister for the Economy, Hatta Rajasa, said the government continues to reduce the high costs of economic constraints. Steps to reduce the high cost economy continue, including through the development of infrastructure such as toll roads, expansion of ports, making port cleaning.

However, it must be recognized, only recently, the government boost infrastructure development. Similarly, the government continues to reduce bureaucratic barriers, regulations that hinder investment and combating bribery and corruption.

Previously, a number of businessmen complained that production costs are still high. The employer rate is still a lot of homework to finish government. In fact, President Susilo Bambang Yudhoyono has been confirmed to continue to suppress and reduce the high cost economy.

In addition to infrastructure development, the various regulations that impeded investment climate was reviewed. The central government has evaluated the 13,520 regulations that hamper the environment, and local regulations 824 has been canceled.

High cost economy can not be separated system of government bureaucracy convoluted that the business climate. Permit issues are complicated and time consuming investment is very disturbing. In addition, labor costs in Indonesia are often mixed with political affairs. In fact, the political and economic affairs, not to be confused because it is very detrimental to investors.

When yoked to political problems in the economy, economic activity will interfere with the interests of stakeholders. On the other hand, Indonesia needs investment that quickly broke down in the middle of the world economy today. Current economic situation became the right moment to be able to attract more investors. Again the world economy on the brink of a crisis and face uncertainty.

However, precisely the right moment to establish policies that support investment in Indonesia. Incentives such as tax holiday and tax allowance between five years and 10 years will increase investment. Incentives are very important. If there is no incentive, investors coming into the country difficult. The amount also depends on the amount of investment incentives and the location of their investment.

About the bureaucratic obstacles that the business climate, it's not a new discourse. At the very least, obstacles and problems that must be addressed government, namely the eradication of corruption, improvement of infrastructure, and bureaucratic problems. Efforts to eliminate these obstacles will stimulate economic growth in the future.



sumber: http://makassar.tribunnews.com/2012/10/10/kita-dan-ekonomi-biaya-tinggi