Jakarta. According to the Indonesian Entrepreneurs Association, or Hippi, businesses in Jakarta are hoping that the provincial government could use the capital city's 493rd-anniversary celebrations on Monday to provide momentum for recovering an economy that has been reeling from the coronavirus crisis. 

Hippi members expect the Jakarta provincial government to improve the business climate by issuing regulations and policies that will encourage productivity, including exemptions on land and building tax (PBB), hotel and restaurant tax and entertainment tax and a tax penalty waiver.

"Businesses are collapsing. They're frustrated by the shutdown in the past three months, which has caused their cash flow to plummet," Hippi Jakarta chairman Sarman Simanjorang said on Monday.

He said that although Hippi members fully support the provincial government's decision to hold this year's anniversary celebrations without a crowd, they expect the event could still provide much-needed momentum to restore the economy.

Sarman said that in addition to continuing to try to flatten the pandemic curve, the Jakarta administration must also reopen businesses so people can return to work.

According to Hippi's data, nearly 500,000 workers had been laid off since the pandemic started in earnest in early March and they need to find new jobs as soon as possible. 

Jakarta's transition to the "new normal" has seen some businesses in the retail sector welcome back visitors.  

However, most of them are still a long way from recovering their cash flow to pre-pandemic level. 

Hippi said this is why the government needs to provide more stimulus for businesses.

"We need more pro-business policies, stimulus and tax exemptions. We don't want a repeat of when happened in the first quarter, when the economy was reduced by 5.06 percent," Sarman said.

Hippi said the Jakarta government should target their stimulus at micro, small and medium enterprises (MSMEs) – the biggest contributors to Jakarta's economy.

Out of 1.24 million businesses in Jakarta, around 90 percent are MSMEs. Sarman said almost all of them are running out of money and need capital assistance if they were to survive beyond the pandemic. 

Sarman said the provincial government needs to talk to the central government to find sources of new capital for these MSMEs.