Indonesian President Joko Widodo (Jokowi) believes that several export commodities in various regions in the country can be developed for penetrating foreign markets.

Jokowi made the statement during his speech via video conference at the Release of Agricultural Exports, as witnessed on the Presidential Secretariat's YouTube channel on Saturday.

"Currently, out of the 514 districts and cities throughout Indonesia, only 293 have centers of leading agricultural commodities for exports," the president noted at the Bogor Presidential Palace, West Java, Saturday.

The export commodities in several areas comprised palm products, rubber, coffee, and various other commodities of interest to the global market. Several commodities can still be potentially developed, he affirmed.

According to the head of state, export commodities that can be developed comprised swallows' nests, porang plants, jasmine flowers, ornamental plants, edamame, essential oils for which customers have developed interest in recent years, and other horticultural products as well as processed livestock products whose markets are increasingly open.

The president also called for strengthening domestic and foreign markets.

The state-owned Small and Medium Enterprise Bank of Cambodia Plc (SME Bank) has officially launched the “Phase II Co-financing Project” to prop up the business activities of local small- and medium-sized enterprises (SME) and abate economic Covid-19 woes.

The second phase was introduced after the first iteration achieved positive results, with participating financial institutions providing lifelines for SMEs in need of financing to keep from going under, and promoting economic recovery, the SME Bank noted in a press release on August 16.

The project aims to provide low-interest loans to promote the development of SMEs in priority sectors such as industry, services and commerce.

The funds under this co-financing project amount to $100 million, which is an equal counterpart fund between the SME Bank and the participating financial institutions.

At present, there are 26 participating financial institutions: 21 commercial banks, one specialised bank and four microfinance institutions (MFI) – three of which are authorised to receive deposits.

“SMEs in need of funds can apply for a loan under this scheme at any participating financial institution, in accordance with the terms of this co-financing project and the lending conditions at each participating financial institution,” the SME Bank said.

Author: May Kunmakara

Source: The Phnom Penh Post

For full article, please read here.

Original publication date: 20 August 2021

Establishing a foreign investment company or PT PMA, is the preferred structure for companies looking to have a legal presence in the country. Foreign investors will need to have a minimum paid-up capital equivalent of 10 billion rupiah (US$696,000), up from the previous 2.5 billion rupiah (US$174,135), as the government aims to attract more high-value investments into the country.

Prior to setting up, applicants should study the new Positive Investment List (PIL) to see which business sectors are unavailable or restricted for foreign ownership. The general principle under the positive investment list is that a business sector is open to 100 percent foreign investment unless it is subjected to a specific type of limitation. The regulation presents one of the greatest liberalizations in foreign ownership limitations in Indonesia since the negative investment list was first introduced in the 1980s.

Important sectors that had previous foreign ownership restrictions, which have now been lifted include, among others:

o   Telecommunications;

o   Transportation;

o   Energy; and

o   Distribution.

The Positive investment list

The government has classified business fields into four categories.

1.     Priority sectors – 245 business lines open for foreign investment;

2.     Business fields that stipulate specific requirements or limitations — 46 business lines open;

3.     Businesses fields open to large enterprises, including foreign investors, but are subject to a compulsory partnership with cooperatives and micro, small, and medium-sized enterprises (MSMEs) — 51 business lines open; and

4.     Business fields reserved for cooperatives and MSMEs (not open to foreign investment) — 112 business lines.

Priority sectors

To classify as a priority sector, business enterprises must meet the following criteria:

o   Must be labor intensive;

o   Must be capital intensive;

o   Must be part of a national project/program;

o   Must be export-oriented;

o   Must involve a pioneer industry (renewables, oil refining, metals, etc.);

o   Must utilize advanced technologies; and

o   Must implement research and development activities.

There are 245 business fields under this category that can be found under Exhibit 1 of the positive investment list. Moreover, businesses in priority sectors are eligible for a range of fiscal and non-fiscal incentives.

Fiscal incentives include a 50 percent corporate income tax reduction for investments between 100 billion rupiah (US$6.9 million) and 500 billion rupiah (US$34.8 million) for a period of five years and 100 CIT reduction for investments over 500 billion rupiah (US$34.8 million) for a period between five and 20 years.

In addition, there are tax allowances available in the form of a reduction in the taxable income of 30 percent of the total investment for six years, a special withholding tax rate on dividends of 10 percent, and tax losses carried forward for up to 10 years.

Examples of non-fiscal incentives are the provision of supporting infrastructure, simplified business licensing procedures, and the guaranteed energy supply or raw materials.

What are the advantages of a PT PMA?

There are several advantages of PT PMAs, including: 

o   Special financial and non-financial incentives, particularly in pioneer industries;

o   Incentives for setting up in special economic zones (SEZs);

o   Foreign investors can own as little as one percent and as much as 100 percent of the company (depending on the industry);

o   Able to participate in government-sponsored business tenders in the country;

o   Ease of processing for business licenses;

o   Ease of processing for work permits;

o   Lower tax and import duties;

o   Simple organization structure (requiring only one director, one commissioner, and two shareholders); and

o   Ability to sponsor foreign executives.

There are no restrictions on where the PT PMA can be set up in the country, but the business can only focus on one specific sector or area.

Set up requirements for a foreign investment company

According to the Investment Coordinating Board Regulation No. 4 of 2021 (BKPM Reg 4/2021), investors looking to incorporate a PT PMA need to adhere to the following requirements:

o   A minimum paid-up capital of 10 billion rupiah (US$696,000);

o   Appointment of two shareholders (these can be foreign individuals or corporations – the percentage of local involvement will depend on the foreign ownership limitation based on the PIL);

o   There must be minimum equity of 10 million rupiah (US$601) per share;

o   The appointment of at least one commissioner and a director (these can be held by foreign individuals); and

o   The director will be responsible for running the day-to-day activities of the company.

Set up process for a PT PMA

1.     Reserve a company name with the Ministry of Law and Human Rights (which should not be similar to the name of other companies or contain vulgar language), Further the company name shall consist of 3 words and can be in English;

2.     Establish a legal entity with the company’s activities stated in the Deed of Establishment (this must be done with a local notary and the Deed of Establishment will have to be ratified by the Ministry of Law and Human Rights);

3.     Obtain a taxpayer identification number from the local tax office and domicile letter from the district government (businesses establishing in Jakarta do not require a domicile letter);

4.     Obtain a tax registration certificate through the tax office where the business is domiciled;

5.     Obtain a Single Business Number (NIB) by applying through the Online Single Submission (OSS) system. The NIB applies as the company’s import identification number, customs ID, and registration certificate. Further, the NIB will also automatically register your company under the government’s health and social security scheme; and

6.     Some companies may need to apply for additional business licenses (such as for mining and fintech). Business licenses will now be issued based on the assessment of ‘business risk level’ determined by the scale of hazards a business can potentially create.

Risk Based Business Licensing

To determine the risk level, the government will conduct a risk analysis of each application before deciding on issuing a business license. This will comprise of:

1.     Identifying the relevant business activity;

2.     Assessing the hazard level;

3.     Assessing the potential occurrence of hazards;

4.     Determining the risk level and business scale rating; and

5.     Determining the type of business license.

Based on the aforementioned risk analysis, the businesses activities undertaken by the applicant company will be classified into one of the following risk-level types:

o   Low-risk businesses;

o   Medium-low risk businesses;

o   Medium-high risk businesses; and

o   High-risk businesses.

Based on this risk-based approach, the lower the business risk, the simpler the business licensing requirements will be.

What sectors are impacted?

The government will undertake the risk-analysis for business activities in the following sectors:

1.     Maritime affairs and fisheries;

2.     Agriculture;

3.     The environment and forestry;

4.     Energy and mineral resources;

5.     Nuclear energy;

6.     Industry;

7.     Trading;

8.     Public works and housing;

9.     Transport;

10.  Health, medicine, and food;

11.  Education and culture;

12.  Tourism;

13.  Religious affairs;

14.  Post, telecommunications, broadcasting, and electronic system, and transactions;

15.  Defense.

What are the requirements to obtain a business license?

The requirements vary depending on the risk level of the business with those in the high-risk categories requiring more permits and licenses.

The first stage of the process is obtaining a business registration number (Nomor Induk Berusaha – NIB) through the OSS system. To register for a NIB, businesses will need to provide the following information:

o   Taxpayer number (Nomor Pokok Wajib Pajak– NPWP);

o   Business activity code according to the KBLI;

o   Business profile;

o   The capital structure of the business; and

o   The proposed location of the business.

Furthermore, the OSS system will be linked to all relevant ministries, such as the Ministry of Finance, the Ministry of Home Affairs, and the Ministry of Law and Human Rights.

Low-risk business activities

Low-risk business activities are only required to obtain an NIB to commence their operations. In addition to serving as the formal identity of the business, the NIB also serves as a company’s import identification number, as well as the number for registering with the national social insurance program.

Medium-low risk business activities

Business activities in this category must obtain a NIB and Certificate of Standards before beginning operations. A Certificate of Standards is a statement of the fulfillment of certain business or product standards, which must be filled in through the OSS system.

The NIB allows the business to conduct activities from ‘preparation to the ‘commercial stage’.

The preparation stage includes:

o   The procurement of tools or facilities;

o   Land acquisition;

o   Recruitment of manpower;

o   Feasibility studies;

o   Financing operations for the construction phase.

The commercial stage includes:

o   The production of goods/services;

o   Distribution of goods/services;

o   Marketing of goods/services; and

o   Other commercial activities.

Medium-high risk business activities

For medium-high risk business activities, companies will need to obtain a NIB and Certificate of Standards. However, the certificate will need to be verified by the central or regional government.

A company with a NIB and an ‘unverified’ Certificate of Standards are only permitted to conduct activities deemed in the preparation stage of operations.

Once the central or regional government is satisfied the business has fulfilled the specific business standards, they will issue the ‘verified’ certificate and the company can begin the commercial stage of operations.

High-risk business activities

High-risk business activities will require a NIB and a license to operate. The license will be issued once the business has fulfilled certain conditions and verifications set out by the central or regional government, which may include an environmental impact analysis.

The NIB, however, allows the business to conduct activities in the preparation stage of operations.

Depending on the products or services being provided, businesses may have to obtain other supporting licenses to conduct commercial activities regardless of what risk level their activities are classified as.

A note on the local limited liability company 

Foreign investors who want to operate a local limited liability company (PT PDMN) should understand that this can carry legal uncertainties as a PT PDMN can only be owned by Indonesian citizens.

According to Article 33 of the Investment Law of 2007, foreign investors are prohibited from making an agreement that states the share/ joint ownership in a company is on behalf of another party. Also known as a ‘nominee agreement’, foreign investors have used such arrangements to avoid regulations and requirements that apply to them.

This carries inherent risks as the local shareholders will have full control of the business and the foreign investors’ rights will not be recognized by the law.

Foreign investors who cannot afford to establish a PT PMA can engage in joint ventures or partnerships with domestic firms. This will also enable investors to enter industries that are restrictive for foreign ownership without having to face the legal ramifications.

Another option would be to buy an established PT PDMN, but this entity would need to be converted to a PT PMA. This would also mean having paid-up capital of 10 billion Rupiah (US$696,000).

Source: ASEAN Briefing

Author: Ayman Falak Medina

Original published date: 10 August, 2021

Read full article here

House of Representatives' Commission VI member Nevi Zuairina suggested the government to build collaboration between State-owned Enterprises (SOEs) and Micro, Small, and Medium Enterprises (MSMEs) to boost digitalization of MSMEs to drive Indonesia's economic growth.

"A link and match between MSMEs and SOEs must be developed immediately," Zuairina noted in a written statement obtained here on Saturday.

Zuairina suggested that the State Budget should not solely be allocated to SOEs but the government should also channel attention to the MSMEs ecosystem for allotment since the sector also helped to maintain the nation's economic growth and development.

The House member called on the government to strengthen the digitization of MSMEs and encourage them to prepare for the international market.

One of the signs of progress was greater acceptability of the products of commodities manufactured by domestic producers in the international market, she pointed out.

To this end, Zuairina pushed to strengthen the digitization of MSMEs based on centralized data.

She believes that information technology and supporting infrastructure, such as a competitive delivery service, will offer wider business opportunities without limitations on location and time.

"The current pandemic is not only altering the people's lifestyle but is also presenting a strong warning of a decline in the number of MSME players, which were earlier valued at Rp64.7 million in 2019, though fell drastically to 34 million business actors in 2020," Zuairina stated.

Earlier, Minister of State Enterprises Erick Thohir noted that MSMEs and SOEs were the backbones of the Indonesian economy.

Thohir remarked that transforming SOEs into global business players was one of his key tasks as minister of SOEs.

However, it is a shared task of all stakeholders to transform MSMEs, which are people-owned enterprises, to become stronger, more resilient, and more competitive.

SOEs will continue to make all-out efforts, so that all public services, infrastructure development, energy availability, telecommunication access, and business financing for Indonesians can be achieved optimally.

The initiative to involve MSMEs as partners in the industrial supply chain as well as the procurement of goods and services for SOEs is a tangible form of sustainable synergy, Thohir remarked.

Source: Antara News

Reporter: M Rahman, Resinta S

Editor: Sri Haryati

Original published date: 14 August, 2021

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Ride hailing application company Gojek supports the Ministry of Cooperatives and Small and Medium Enterprises in digitizing 30 million MSMEs by 2024, Gojek Senior Vice President Public Policy and Government Anita Sukarman stated Thursday. "In May 2021, Gojek and the Ministry of Cooperatives and Small and Medium Enterprises signed a cooperation agreement on the use of Gojek application services in the development and empowerment of micro-enterprises to expand the scope of cooperation and the process of digitizing MSMEs," she said at an online press conference.

To support the ministry in achieving the target of digitizing 30 million MSMEs by 2024, Gojek would start training 5,000 micro-enterprises assisted by the ministry with the number of micro-enterprises undergoing training increasing, she said.

With the collaboration between Gojek and the ministry Eddy hoped that the target of digitizing the MSMEs could be achieved, and the program could reach MSME players in underdeveloped areas.

The synergy created between both sides is beneficial to accelerate MSMEs digitization, the ministry's assistant deputy for business protection Sutarmo added.

Source: Antara News

Reporter: Suci Nurhaliza, Raka Adji

Editor: Suharto

Original published date: 13 August, 2021

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On July 23, 2021, the updated Indonesia-Singapore double taxation agreement (DTA) entered into force, strengthening efforts to prevent tax evasion, increase the tax base, and increase investments between the two countries. 

Updating the DTA can further enhance Singapore’s status as a hub for international investments into Indonesia. There were three significant changes to the tax treaty, namely, the introduction of an article that provides capital gains tax protection, the reduction of withholding tax (WHT) on royalties, and the reduction in branch profit tax (BPT).

In addition to updating their tax treaty, the Indonesia-Singapore Bilateral Investment Treaty (BIT) came into effect on March 9, 2021, and replaces the previous BIT. Under the treaty, investors from both countries will enjoy specific legal protection, such as access to international arbitration, thereby safeguarding bilateral investments and boosting investor confidence.

Indonesia and Singapore have substantial cooperation across a variety of sectors, and total merchandise trade between the two reached S$48.8 billion (US$36.1 billion) in 2020. Singapore has been Indonesia’s largest foreign investor since 2014, with total investments reaching S$13.2 billion (US$9.7 billion) in 2020. Further, there is approximately US$300 billion worth of Indonesian assets in Singapore.

What are the key changes in the updated DTA?

o   Introduction of the provision of capital gains article

o   Reduction in the branch profit tax rate (BPT)

o   Removal of limitation of relief to treaty benefits

o   New provisions on anti-tax avoidance

o   Exemption on interests for sovereign wealth funds and government-issued bonds

o   Reduced withholding tax rates for royalties

Source: ASEAN Briefing

Author: Ayman Falak Medina

Original published date: 06 August, 2021

Read full article here

Indonesia is set to open two new special economic zones (SEZs) in the island city of Batam after President Joko Widodo recently approved the decision.

The new zones aim to develop a number of industries in Batam, with an emphasis on the digital economy, data centers, logistics, tourism, and aviation.

Batam has been a free trade zone since 2009, along with the neighboring Bintan and Karimun islands, and its first SEZs were set up in 2017. Together, the three islands are known as the BBK free trade zone.

In addition to the new SEZs, Batam has several other projects in the pipeline, including upgrades to the Batu Ampar Port and the development of the healthcare sector.

What are the advantages of a special economic zone in Indonesia?

SEZs in Indonesia benefit from several advantages, such as business tax and income tax cuts as well as special investment incentives. They also tend to have a higher-quality infrastructure and benefit from industry clustering. Free trade zones, in contrast, are not able to offer fiscal incentives.

Where are the new Indonesian special economic zones located?

Nongsa Digital Park currently focuses on digital technology and tourism and Batam Aero Technic specializes in the maintenance, repair, and overhaul of passenger aircraft; both will be upgraded to SEZ status.

Nongsa Digital Park: a hub for electronics and data centers

Nongsa Digital Park, located in the northeast of Batam, will see its status upgraded from a technological park to an SEZ. With the upgrade, the park will focus on research and development, education, and creative industries, along with its existing focus on technology and tourism.

The park originally opened in 2018 after bilateral discussions between Indonesia and Singapore to develop a “digital bridge” between the two countries. Travelers can reach Batam from Singapore with a one-hour ferry ride.

Currently, the park’s 155.43 hectares of land is home to over 100 technology companies, mostly from Singapore, employing 1,200 workers.

As an SEZ, the park aims to attract more international investors, beyond the largely Singapore-based contingent currently active in the area. Its goal is to receive 16 trillion rupiah (US$1.1 billion) in investments and to create 16,500 new jobs.

To reach this target, the park hopes to become a hub for data centers, an industry the market research firm Technavio projects will grow by US$10.57 billion between 2019 and 2023 in Southeast Asia.

Batam Aero Technic: A node in Indonesia’s booming aviation industry

Batam Aero Technic is currently a 30-hectare facility owned by Lion Air Group, the holding company that owns Indonesia’s largest private airline.

With the upgraded SEZ status, Batam Aero Technic plans to expand from maintenance, repair, and overhaul of passenger aircraft to logistics and distribution, production and processing, and technology development.

The closest airport to Batam Aero Technic is Hang Nadim Airport, which is the region’s only international airport. In March, Korea’s Incheon International Airport Corp. won a project worth KRW 600 billion (US$519 million) to develop and operate the airport for 25 years, including opening a second passenger terminal by 2024.

Why Batam is likely to attract more Singapore-based investors

Batam’s new SEZs, combined with its proximity to Singapore and location on the busy Malacca Strait shipping route, give the island strong potential to grow and attract more international investors, especially those based in Singapore.

Singaporean-based companies can also benefit from the Singapore-Indonesia expropriation protection and upgraded double taxation avoidance agreements that entered into force in 2021, and access Indonesia’s huge 270 million strong domestic market.

Source: ASEAN Briefing

Author: Alexander Chipman Koty

Original published date: 12 August, 2021

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Cambodia and Malaysia on August 11 officially launched cross-border payments through the National Bank of Cambodia’s (NBC) Bakong system with Maybank, enabling faster and more convenient real-time money transfer between the two countries.

Speaking at the launch, NBC technical director-general Chea Serey said the collaboration is a solid starting point between the two ASEAN nations in the development of financial technologies that make it easier for people to transfer money in a faster and more convenient manner.

“The collaboration is just a beginning and I am sure there will be more that we can do together – for instance, for now it is a one-way transfer, but we also work on both-way transfers where people from Malaysia can also send money from Bakong to their Maybank App to the local one in Malaysia.

Maybank Cambodia CEO Mohd Hanif Suadi said the collaboration will be in response to the current development of the cross-border payment ecosystem and will address the challenges of Cambodian people working in Malaysia, who require a more convenient, affordable and faster way to send money back home.

Malaysian ambassador to Cambodia Eldeen Husiani Mohd Hashim said the collaboration will facilitate and expedite the transfer of funds between citizens of Malaysia and Cambodia.

Author: May kunmakara

Source: The PhnomPenh Post

For full article, please read here.

Original publication date: 11 August 2021

If you’re in the retail business, one of your worst nightmares is being stuck with boxes and boxes of unsold inventory taking up space in your warehouse. Wasted stock can be a huge cost to your bottom line and pose serious risks to your business. For eco-conscious brands, a lot of unsold inventory is also detrimental to the environment, especially if the products are textile-based. Of the more than 100 billion items of clothing produced each year, some 20% go unsold leftovers are usually buried, shredded, or incinerated (Forbes). Businesses that end up in an overstock situation generally use traditional bulk manufacturing which requires products to be made and then warehoused until they are shipped. While there is a risk of costly unsold inventory, bulk production can also be economically effective if a product is proven to be a best-seller.

On the opposite side of the spectrum sits on-demand manufacturing – a process by which goods are produced only when they are needed and, in the quantities, required, eliminating the cost and effort of storing and managing inventory. Although on-demand products are not produced at economies of scale, businesses can more easily and quickly test and go to market with new products and designs.

Previously, businesses would need to choose one method or the other but with recent advancements in technology in the past decade, retailers can get the best of both worlds through hybrid manufacturing. An economically and environmentally sustainable solution, a hybrid approach blends the cost-effectiveness of bulk production with the risk-free per-order fulfillment process of on-demand manufacturing.

How Hybrid Works
Before adding any new item to product lines, experts recommend testing them through on-demand manufacturing to ensure viability. An on-demand approach gives retailers the freedom to sell more SKUs and products that they might not think will take off en masse. Once retailers know a product has the potential to move into mass production, the switch can be made. Eventually, when interest wanes and the product becomes more evergreen but to a smaller audience, retailers can realize ongoing value by going back to an on-demand approach.

Why Utilise a Hybrid Approach

Adapt to trends quickly without risk. Culture is now manufactured on-demand and consumers are setting trends on social media. Because buyers are now changing the way we capitalize on culture, it is affecting how brands produce and manufacture products on-demand. With a hybrid approach, brands can quickly mockup a design and add the product to their online store without prepaying for costly order minimums by first using on-demand manufacturing.

Improve cash flow. When a business utilizes a blend of on-demand and bulk manufacturing for its products, it can more easily optimize its cash flow. For bulk products, they can get a higher per product profit margin due to economies of scale. For on-demand products, they don’t have to pay for costly inventory or order minimums, freeing up a business’s cash flow.

Shift toward sustainability. Being eco-conscious is no longer a consumer marketing trend, it is a real practice many businesses are implementing in their business model. Because on-demand manufacturing allows companies to produce only what consumers order, it eliminates unnecessary production and harmful waste—saving both the business’s bottom line and the environment.

Be better prepared for economic disruptions. When COVID-19 disrupted supply chains across all industries last year, many retailers were forced to shut down and were left with boxes of unsold inventory. When utilizing on-demand manufacturing in a hybrid approach, it is important to look for a provider that manages a distributed supply chain network. This type of fulfillment process allows on-demand manufacturing providers the ability to carry a large number of product SKUs in more than one facility, therefore orders of that product are able to be fulfilled in multiple locations.

Source: Global Trade Magazine

Read the full article here

Jakarta. Bangkok Bank, Southeast Asia's sixth-largest lender by assets, saw ample opportunities to bridge more Thailand businesses to invest in Indonesia and bring the two economies closer following a landmark deal that saw the lender acquire Bank Permata, one of Indonesia's largest lenders last year. 

“Bangkok Bank is pleased to help bring investment into Indonesia as well as help Indonesian companies seeking gold opportunities across Asean and beyond," Chartsiri Sophonpanich, president of Bangkok Bank and president commissioner of Bank Permata said, during a media visit to  Berita Satu Media Holdings on Thursday. 

"With the synergy between Bangkok Bank and PermataBank and our international network, we will work together to create opportunities for our clients to do more in Indonesia,” Sophonpanich said, referring to the local lender by its trade name.  

The G20 Ministerial Meeting on digitalization was held today in Trieste and chaired by Minister for Economic Development Giancarlo Giorgetti and Minister for Technological Innovation and Digital Transition Vittorio Colao. Undersecretary of State for Economic Development Anna Ascani also attended the meeting.

The Italian Presidency placed the issue of the digital transformation of productive activities towards sustainable economic growth at the heart of the debate, with a particular focus on micro, small and medium-sized enterprises, social inclusion, governance, and the development and application of innovative technologies.

Building on the achievements and commitments of past Presidencies and acknowledging the impact of the Covid-19 crisis on the economy, employment, and the wellbeing of our societies, Ministers recognized their responsibility to work together to increase the overall positive effects of digitalisation, building on common objectives and converging on action principles as a means to accelerate the digital transformation and reflect on how to reap its benefits, while addressing the challenges ahead. The work of the DETF (Digital Economy Task Force) was enriched by a multistakeholder approach through the organisation of dialogue forums and consultations with engagement groups.

G20 Members signed a Declaration that identifies 12 actions to accelerate the digital transition:

• Digital Transformation in Production for Sustainable Growth. Ministers commit to leveraging digitalisation for an economic recovery that intends to be resilient, strong, sustainable and inclusive, in the three dimensions of “people, planet and prosperity”, leaving no one behind. Ministers recognise that companies have to be prepared for the “new normal” and for further technological shifts, in order to cope with future challenges towards a sustainable, open, shared and more innovative economy. They acknowledge that there is a need to increase efforts on developing a human-centered approach to digital economy that also takes into account the needs and perspective of traditionally vulnerable groups. Ministers therefore commit to take action towards reinforcing industrial policies and international cooperation for the digital transformation of production for sustainable growth, in a way beneficial to all.
• Leveraging Trustworthy Artificial Intelligence for MSME Inclusiveness and Promotion of Startups. Ministersreaffirm their willingness to implement trustworthy Artificial Intelligence (AI). They acknowledge the need to bolster the AI capabilities of MSMEs, including their capability to use data, access finance, share opportunities, and build a talented and skilled workforce.
• Measurement, Practice and Impact of the Digital Economy. To support an inclusive and multi-stakeholder dialogue on measurement, Ministers affirm that the 2020 Roadmap can help ensure that measurement of the digital economy remains a priority in G20 countries and in International Organisations, and that adequate resources are devoted to its implementation. They value the contribution of sharing good practices, also in relation to monitoring digital economy developments beyond the G20 itself, especially with regard to the measurement of AI and the digital gender divide.
• Consumers Awareness and Protection in the Global Digital Economy. Ministerscommit to take action to raise awareness, educate and support consumers, including through digital literacy programs, with the aim of preventing the detriment of consumers and ensuring consumer protection regarding product quality and safety, privacy and personal data protection, and unfair commercial practices, with particular consideration for vulnerable consumers. They also stress the need to promote stronger international cooperation, including between consumer protection authorities. Furthermore, the Presidency opened the dialogue on distributed ledger technologies, such as blockchain, and produced a G20 Report on Blockchain in Global Value Chains to increase knowledge on transparency and accountability of products for the benefit of consumers.
• Child Protection and Empowerment in the Digital Environment. Ministers are pleased to include the protection and empowerment of children in the digital environment, for the first time, among the priorities of the G20 Digital Economy. They stress theshared responsibility of different stakeholders, especially the providers of digital services and products, in creating a digital environment that both empowers and protects children. To promote a safe, secure, inclusive, transparent and beneficial digital environment for children, centered around age-appropriate and high-quality online content, Ministers are guided by the G20 High Level Principles on child protection and empowerment, drawn from the OECD Recommendation, which can be instrumental to guide policies.
• Encourage Innovation for Smart Cities and Communities. Ministers welcome the Italian Presidency’s Report of G20 Practices of Innovative Public Procurement for Smart Cities and Communities, as a tool to increase and share knowledge.
• Connectivity and Social Inclusion. Ministers affirm their commitment to bridge connectivity gaps, and encourage the goal of promoting universal and affordable access to connectivity for all by 2025. They believe that enhanced collaboration and exchange of practices at international level and interaction with stakeholders can contribute to our connectivity and social inclusion goals.
• Data Free Flow with Trust and Cross-border Data Flows. Building upon and recognising the work and achievements of the Japanese and Saudi Presidencies, Ministers acknowledge the work of the OECD on Mapping Commonalities in Regulatory Approaches to Cross-border Data Transfers, which identifies “commonalities, complementarities and elements of convergence” across different approaches. Such commonalities can foster future interoperability.
• Digital Tools for Public Services. Moving from the 2018 G20 Digital Government Principles, developed under the Argentine Presidency, Ministers focused on how to guide and improve the digitalisation of public services to better meet the needs of citizens. They therefore commit to pursue and ensure the quality, diffusion and accessibility of digital public services, and to foster better skills for civil servants.
• Digital identity. The importance of easily usable, reliable, secure, trusted, and portable digital identity solutions is recognised as a means to guarantee secure access to digital services to citizens and businesses, protecting their privacy. Reference is also made to the potential of digital identity in emergency and humanitarian aid contexts. 
• Agile Regulation. The role of agile regulation in fostering innovation and economic growth, as well as in controlling and preventing possible negative impacts of technological progress on society and on the planet is acknowledged. The contribution of the Survey on agile regulation across G20 Members is welcomed as a useful tool to share experiences and common approaches to more agile governance and regulatory models for innovation.
• Transformation of the task force into a permanent Working Group. Ministers commit to continue working towards digitalization for resilient, strong, sustainable and inclusive recovery while tackling inequalities. In this regard they welcome the transformation of the Digital Economy Task Force (DETF) into a Digital Economy Working Group (DEWG).

Source: The G20

Original published date: 05 August, 2021

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Indonesia has launched a risk-based online single submission system for business licensing on Monday, a long-delayed milestone that the government had hoped would improve the ideas of doing business in the country and boost investment.

"Business licensing that is integrated, fast, and simple, determine our competitiveness to attract investment," President Joko "Jokowi," Widodo said during an inauguration event for the Risk-Based Online Single Submission (OSS) System at the Ministry of Investment and Investment Coordinating Board (BKPM) office in Jakarta on Monday.

Jokowi said the new risk-based OSS system provides service standards for all levels of government that issue permits at the central and regional levels. The system defined clearer responsibilities of the licensee and made licensing services more integrated, Jokowi said.

“I also want to emphasize that risk-based OSS services are not meant to castrate local authority," the president said.

BKPM data showed domestic and foreign direct investments in Indonesia grew 10 percent reached Rp 443 trillion ($30 billion) in the first six months this year compared to the same period last year.

Minister of Investment and the Head of BKPM Bahlil Lahadalia said the new risk-based OSS system could link investors with ministries or agencies, local governments, administrators of special economic zones (KEK), and the Free Port Free Trade Zone (KPBPB).

The OSS system can accommodate licensing process for 1,702 kinds of businesses, including 1,349 already registered in the  Indonesian Standard Classifications of Business (KBLI), which have been implemented in the risk-based OSS system, minister said.

Source: JakartaGlobe

Author(s): Novy Lumanauw, Triyan Pangastuti

Original published date: 10 August, 2021

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