Coordinating Economic Affairs Minister Darmin Nasution has called the rupiah's depreciation since Friday 'illogical' and said the currency's decline does not reflect the state of the economy. (Antara Photo/Wahyu Putro A)

Indonesia Jumps to 72nd on World Bank's Global Ease of Doing Business Report

BY :TABITA DIELA

NOVEMBER 01, 2017

Jakarta. Indonesia's ease of doing business has improved on the back of efforts to simplify unnecessary procedures amid fiercer trade competition from other countries, Coordinating Minister for Economic Affairs Darmin Nasution said on Wednesday (01/11).

Indonesia climbed 19 positions to 72nd out of 190 countries assessed in the World Bank's "Doing Business 2018: Reforming to Create Jobs" report published a day earlier. According to Darmin, Indonesia is well on track to pursue President Joko "Jokowi" Widodo's target to reach 40th on that ranking by 2019. When Jokowi began his term as president in 2014, the country was ranked 114th.

"Indonesia has been an easier place to conduct business over the past three years on the back of cooperation from all people," Darmin said.

The Doing Business index measured the effectiveness of business-related procedures, time, cost and outcome on 10 indicators — from starting a business to resolving insolvency — in Jakarta and Surabaya, East Java.

Darmin said the government will focus on indicators —  such as starting a business, dealing with construction permits, registering property, paying taxes and trading across borders — that are currently still at the bottom of the index.

Indonesia is not the only country that made a significant jump this year. Thailand, for example, made a position jump to 26th from 46th; Brunei Darussalam leapt to 56th from 72nd; Vietnam ranked 68th from 82nd and India ranked 100th from 130th a year prior.

"Competition with neighboring countries is super fierce [...] without further reform, we will lose our part in the global manufacturing industry," Investment Coordinating Board (BKPM) chairman Thomas Lembong said.

Indonesia is set to further reduce permit procedures by using online systems, simplify tax payments through e-filing programs and improving databases on tax, as well as reducing restrictions on imports and exports.

"Indonesia has accelerated the pace of reforms in recent years and its efforts are paying back," Rodrigo A. Chaves, World Bank country director for Indonesia, said in a statement.

Chaves noted that in the past year, starting a business and getting electricity in Jakarta and Surabaya was made less costly. He also noted that access to credit was improved, the time needed for trading across borders was shorter and the rights of minority shareholders were strengthened.

The World Bank's report acknowledged that Indonesia was among the world's top 10 reformers as the country has carried out seven reforms in the past two years.

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