Universitas Gadjah Mada
Faculty of Economics and Business

Faculty of Economics and Business UGM together with the Center Manager of the Alumni Family of the Faculty of Economics and Business Universitas Gadjah Mada (PP KAFEGAMA), KAFEGAMA DIY, Association of Indonesian Economics Scholars (ISEI), held a National Seminar with the topic: Acceleration of Advanced Indonesia through Investment and Fiscal Incentives (Perpres 10/2021 and PMK 18/2021). This National Seminar was supported by Bank Indonesia (BI), the Ministry of Finance of the Republic of Indonesia (Kemenkeu RI), the Directorate General of Taxes of the Indonesian Ministry of Finance (DJPK RI), and the Indonesian Chamber of Commerce and Industry (KADIN) was held through the Zoom Webinar and Youtube channel of Fakultas Ekonomika dan Bisnis UGM and was attended by 1345 participants.

This national seminar was attended by Perry Warjiyo, Ph.D., Governor of Central Bank of Indonesia(BI), General Chairperson of PP KAFEGAMA, and Chairman of ISEI who will present the Opening Speech to start the seminar. Also attending was Sri Mulyani Indrawati, Ph.D., Minister of Finance of the Republic of Indonesia as the Keynote Speech in this national seminar. Resource persons who will discuss the topic of discussion are Hestu Yoga Saksama (Director of Taxation Regulations I at the Directorate General of Taxes of the Indonesian Ministry of Finance), Darussalam (Tax Consultant in Danny Darussalam), and Rosan Perkasa Roeslani (Chairperson of the Indonesian Chamber of Commerce and Industry). This national seminar is moderated by Amirullah Setya Hardi, Cand. Oecon., Ph.D as Vice Dean for Research, Community Service, Cooperation, and Alumni.

Eko Suwardi, M.Sc., Ph.D., as Dean of FEB UGM, started the national seminar by giving a speech. Eko said that The realization of this webinar is a form of contribution from all committees to the community. "This webinar is held as a contribution to the academic community, business, local government, and society in general. This is our effort, KAFEGAMA DIY, ISEI DIY, together with FEB UGM to always work together. mutual cooperation and harmony and greece, thank you to all the committee and the supporters of this event, "said Eko Suwardi.

The next session was the delivery of remarks by Prof. Ir. Panut Mulyono, M.Eng., D.Eng., IPU, ASEAN Eng., As Chancellor of Gadjah Mada University. Panut opened the event by recounting the government's efforts to accelerate Indonesia's progress. "Starting the second period of his administration, President Joko Widodo in 2019 described five priority areas, including infrastructure development, human resources, bureaucratic reform, the state budget, and facilitating investment for job creation," said the Rector of UGM.

"Facilitating investment for job creation is very important because the Covid-19 pandemic has caused a sharp increase in unemployment to 10 million people," he said. With the investment, according to him, it will increase the economy and create jobs. In this regard, related to Presidential Decree 10/2021 and PMK 18/2021. UGM welcomes and committed to taking an important role with graduates who are qualified, dedicated, and high integrity. Not only preparing graduates who are ready to work, said Panut, UGM also encourages graduates to open jobs and become reliable entrepreneurs.

The next session was the opening speech from the Governor of Bank Indonesia, Perry Warjiyo. Perry started his remarks by conveying the objectives of holding this national seminar. "This webinar activity is part of a series to foster optimism, to show the big synergy between BI, OJK, Central Bank, Ministry of Finance, LPS, Banking, KADIN, and Entrepreneurs in order to restore the national economy in order to realize a developed Indonesia", said Perry.

In the spirit of building optimism, Strengthening synergy between the Government, BI, OJK, Banking, Ministry of Finance, and the Business World supported by fiscal stimulus continues to support economic recovery, as well as investment supported through the Cipta Kerja Law, Perry believes that the nation's economy this year will better than last year. He said the Indonesian economy could grow 4.3 to 5.3 percent supported by exports, fiscal stimulus, and increased investment.

Central Bank Indonesia’s contribution in the context of restoring the national economy, including reducing interest rates to the lowest in the nation's history, namely 3.5%. liquidity in banking remains at a loose figure, the largest quantitative easing in emerging markets, as well as digitizing the payment system and supporting joint efforts through the national movement to buy domestic products and travel in Indonesia.

The next session was a keynote speech by Sri Mulyani, Minister of Finance of the Republic of Indonesia. Sri Mulyani gave an introduction regarding the discussion on the Acceleration of Advanced Indonesia through Investment and Fiscal Incentives. Sri Mulyani said that until now, Indonesia has paid great attention to the Covid-19 Pandemic. However, according to her, this doesn’t neglects the focus on the goal of the state, namely to achieve an advanced and prosperous Indonesia.

“Currently we are included in the G-20 economic group with the size of the nation's economy in the 20 largest. 70 percent of our society is the middle class, our per capita income is 23,199 and is included in the (category) midder upper class. We hope that our future economic structure will be supported by an economic structure that is competitive and has high added value. This is a vision as well as a roadmap for us to achieve an ideal that must be prepared, ”she explained.

There is something interesting in the statement delivered by the Minister of Finance of the Republic of Indonesia this time. According to her, achieving an advanced Indonesia is not like the story of the Roro Jonggrang Temple.

"Realizing the big dream of becoming a developed country with a good and stable economic rank, unlike the story of the Roro Jonggrang Temple which asked for a temple to be completed in one night," said Sri Mulyani.

Achieving the progress of the nation requires various preparations and requirements, including how to build Human Resources, improve infrastructure, become technology inventors, improve the quality of the public sector, organize space and territory as an archipelago, and include how to use economic resources properly and healthily. These are the main requirements that must be met in order to reach Indonesia as a developed country and get out of the Middle Income Trap.

Quoting the Nobel Winner, Sri Mulyani said that Indonesia grew too much using muscle and sweat (a lot of capital and labor), but did not create added value based on innovation. This is the problem facing Indonesia today.

"Young demographics are indeed Indonesia's strength, but if our human resources are not yet able to innovate and can work with technology, then we will always be out of compute. 36 percent of our population has low education (junior high school and below), the majority of whom work in informal places. This is a fact that we are all aware of, ”said Sri Mulyani.

"This segment should benefit from the Cipta Kerja Law. Our economy has developed over the last few decades, but has not yet been able to meet the criteria as a developed, competitive, innovative, high-income country, which is based on high value-added sectors, ”she added.

She gave an example of the manufacturing sector, which had industrialized in the 70s, is now experiencing stagnation since we were reformed. This, according to him, shows a climate of competitiveness that creates jobs that are decreasing. Likewise the service sector which looks stable, but is dominated by the informal sector with low added value. This is a challenge that according to him we must solve together by policymakers, the business world, and the campus world.

Sri Mulyani said that our product market, labor market, skills, health service, and the adoption of information technology are still lacking even though we produce sufficient unicorns. Lots. From the logistics side, we see from the flow of goods, from import to export, to manufacturing to the marketplace. This still shows the absence of high competition, because there are infrastructure factors that must be built to create connectivity.

The important thing, according to him, is the simplification of the factors that hinder doing business in Indonesia. Among them is trading across borders, namely how to pay taxes in an efficient and definite time. In addition, to support starting businesses in Indonesia, simplification is needed in dealing with construction permits, registering property, and enforcing contracts or legal certainty. According to Sri Mulyani, this is part of the measure whether a country creates a healthy, competitive and simple environment. Because, often people are faced with difficulties in building a business, one of which is related to a complicated contract issue, which causes people to think thousands of times to build a business.

Talking about crises, Sri Mulyani shared Indonesia's experiences in dealing with various crises. “When we are close to overcoming a fundamental problem, shocks often occur. Now, for example, we are experiencing Covid-19, a global financial crisis, therefore we need to prepare a fiscal policy to prepare for conditions like now to maintain fiscal stability. In addition, it is also important to keep the macroeconomics stable. ", she said.

Moreover, the pandemic has hit demand and supply. Acceleration in economic recovery must continue to be implemented, we must carry out reforms, the state must not sink into a crisis, the state must see the crisis as a way to reform, like when we faced the 1997-1998 crisis. During the global financial crisis, we also formed the OJK. During the current crisis, we built the omnibus law, "she said.

Sri Mulyani conveyed that Presidential Regulation (Perpres) No 10/2021 is a derivative of Article 77 and Article 185 B of the Cipta Kerja Law, where there is a determination of a positive list of investments that provide support for the development of business sectors which are 245 priority business fields.

"The previous Presidential Decree was a negative list of investments that discussed restrictions on investment in what sectors should be closed or open with conditions. The Cipta Kerja Law is the opposite, it increases the potential for productive activities, our society is made easier to do business and increases its productivity, "said Sri Mulyani.

The government also provides support in fiscal incentives, which can provide support to accelerate Indonesia's economic growth. One of them is manifested in the Minister of Finance Regulation (PMK) No 18/2021 which discusses Income Tax (PPh), Value Added Tax (PPN), and General Provisions and Tax Procedures (KUP), where one of them is a discussion of the imposition of PPh Imposition exemption. which aims to create jobs, and ensure capital remains at a productive level. These two new rules are held to create an ecosystem that can improve Indonesia's fundamentals.

Reportage : Sony Budiarso/Kirana Lalita Pristy