Indonesia passed the Omnibus Law on Job Creation last Monday on 5th of October, 2020. The initial reason for the creation of the law is to help boost the country’s economic growth. Instead, the jobs bill has been receiving backlash from Indonesia and international audiences.
Indonesia: Jobs bill claimed to help the country’s economic growth
Quoted from The Jakarta Post, Coordinating Economic Minister Airlangga Hartarto had earlier in February said the omnibus bill will help the country achieve Indonesia’s economic growth target. As of February, the government predicted around Rp 800 trillion and Rp 900 trillion income from investment under “business as usual”. With the new bill, the government expects around 6% economic growth with Rp 1,200 trillion (US$87 billion) through projected investment.
However, the Omnibus Bill on Job Creation has been receiving a lot of backlash from a lot of sides. Lack of worker and environment protections became the highlights of the concern. Numeral activist groups, including trade unions, have stated their concerns upon the law. Investors also expressed their hesitation to invest in Indonesia due to the bill.
Omnibus Bill on Job Creation backfires, investors hesitate
According to Reuters, 35 investors all around the world have voiced their concerns upon the new bill. Among the 35 investors are Aviva Investors, Legal & General Investment Management, Netherland-based asset manager Robeco, Japan’s largest asset manager, Sumitomo Mitsui Trust Asset Management, and others.
Robeco’s senior engagement specialist, Peter van der Werf also expressed his concern on the jobs bill. He commented that the Omnibus Bill on Job Creation might bring negative impact on certain environmental protection measures.
Several investors also supported the argument. They expressed the fear that the legislation may harm Indonesia’s forest. Hence, the law is opposing the global actions on suppressing biodiversity loss and holding back climate change.
Read also: Indonesia to Apply Taxes to Google and Others
Follow and join us on Youtube, Instagram, Facebook, and Twitter to be part of the trader community in Asia
