PP 57/2016 Fraudulent Regulation for Investment

By : Herry Barus And Aldo Bella Putra | Friday, December 08 2017 - 21:00 IWST

INDUSTRY.co.id - Bogor - Government Regulation (PP) on protection and management of peat ecosystems contained in PP 71/2014 jo.PP 57/2016 is still a scary regulation for investors amid the hard work of the Jokowi-JK government to improve infrastructure to attract investors.

This was raised in a National Seminar on Reflection on Policies on the Management of Wetlands of Indonesia held by Soil Science Association of Indonesia (HITI) in Bogor, Thursday (7/12/2017)

Researcher of Institute for Economic and Social Research (LPEM) Faculty of Economics and Business University of Indonesia (UI) Riyanto warned, the government needs to be rational in issuing regulations in order not to interfere with the investment that has been running.

What the use of building infrastructure is if the existing regulation makes investors fear. The government should be rational to see that this PP is not yet an instrument capable of supporting economic and conservation activities simultaneously, Riyanto said.

Riyanto revealed that the purpose of this regulation is to reduce land and forest fire disasters (karhutla). If you look at the objectives, what should be regulated is the management of fire prevention.

Riyanto argued that gas stations in the general area are more at risk of high fires and tremendous impacts than forests. It's just that, because there is good management, the problems can be overcome with almost perfect level of supervision.

The government should have good management related to peatland management so as not to interfere with the interests of the existing investment.

These non-pro-investment rules will have a significant impact on the economy, especially if many peatlands are converted into protected functions.

Based on an analysis of the economic impacts, the provisions in PP 57 have a direct impact on the reduction of the land area and the provision of raw materials. This has an impact on the macro economy as well as providing uniform social consequences for unemployment due to termination of employment.

In the palm oil industry, this regulation has an impact on the decline in the labor force of 1,116,170 people, the decrease of the community's income by 15 trillion, the decrease of the national GDP of Rp 46 trillion and the decrease of national output of Rp 76.5 trillion. Yet on the other hand the industry is able to absorb the workforce of about 5.3 million people and support more than 21 million people.

While for Industrial Timber Estate, PP 57 resulted in the decrease of wood production as industrial and paper raw material by 26,46 million m3 of timber. If rupiah reach Rp 76 trillion and the number of workers who will lose their livelihood reaches 610 thousand inhabitants. It is conceivable if the PP realized how big the economic, social and investment threats would come true.

Director of the Directorate of Agricultural Policy and Policy Studies IPB Dr Dodik Ridho Nurrochmat said, many regulations are not in sync with the needs of this country. This is due to a lack of understanding from policymakers.

Such a policy is dangerous because it makes the direction of state development unclear because of its overlap. Rules,

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