A transparent and comprehensive regulatory framework and the streamlining of the policy‑making process across government is a prerequisite for achieving Indonesia’s economic, social and environmental goals – including those articulated in the country’s Master Plan for Acceleration and Expansion of Indonesia’s Economic Development 2010-2025. Regulatory reform is also needed to ensure Indonesia’s competitiveness both in the ASEAN Economic Community and globally.
The OECD Regulatory Reform Review of Indonesia focuses on the administrative and institutional arrangements for ensuring that regulations are effective and efficient. It covers the medium term macroeconomic linkages with regulatory policy; institutional and procedural arrangements for regulatory policy and governance; non-tariff barriers and behind-the-border constraints to trade; competition policy; and governance arrangements for the management of public-private partnerships (PPPs). A specific emphasis has been given to the challenges of ports rail and shipping. Read the executive summary (English; French; Indonesian).
The Review’s policy findings are aimed at assisting the government of Indonesia to achieve its reform objectives and include:
- Build on existing systems to improve the co‑ordination of regulatory management practices and establish clear policy frameworks and institutional responsibilities for regulatory reform. Specific attention should focus on assessing the cost-benefit of regulations; and transparency and public consultation in regulatory decision making.
- Focus on effective co-ordination of competition assessment to avoid problems arising in the development of new infrastructure facilities and business licensing; and clarify the powers and support stability in the leadership of the Commission for the Supervision of Business Competition (KPPU) to improve its effectiveness.
- Renew emphasis on promoting market openness is needed to reverse the country’s deteriorating terms of trade. Specific attention should focus on achieving better co-ordination inside government to ensure that regulatory measures are not trade restrictive.
- Address contradiction between the laws or the supporting regulations and the broad strategic direction in ports, rail and shipping sectors. Doing so will require a more detailed articulation of the strategic directions to provide an effective platform for improved governance and increased efficiency.
- Strengthen capacity and improve institutional co-ordination in PPPs to secure private investment in infrastructure and secure value for money.
The OECD Regulatory Reform Review of Indonesia was launched by the Angel Gurría, OECD Secretary-General, in Jakarta on 27 September 2012. Read the press release.
The Regulatory Reform Review of Indonesia was made possible with the financial support of the governments of Australia through the Australian Agency for International Development (AusAID), United Kingdom through the Prosperity Fund – Indonesia Programme, and the Netherlands through the Ministry of Economic Affairs, Agriculture and Innovation.
Read the OECD Review of Regulatory Reform: Indonesia 2012 and the following background reports: