Indonesia Is Considered Not To Be A Developed Country If The Job Creation Law Is Not Passed

JAKARTA - Head of the Fiscal Policy Agency (BKF) Febrio Kacaribu said that the structural reforms currently being carried out by the government through the Job Creation Law (UU Ciptaker) have a fairly strategic role in determining the fate of Indonesia in the future.

According to him, the current challenges have prompted the government to take quick steps in response to changing conditions being faced.

“The crisis we are currently facing is still overshadowed by a high level of uncertainty. For this reason, the government realizes that the issuance of the Job Creation Law last year was a priority," he said in a press statement as quoted on Sunday, June 27.

Febrio added that reforms need to be carried out so that Indonesia has the opportunity to grow above six percent.

“Without reform, we will never be able to grow above six percent. Through reforms, there is an opportunity to grow above six percent. This figure is an economic figure which according to a study from Bappenas and the Asian Development Bank will bring Indonesia into a developed country in 2035," he said.

To note, the 2035 period is an important year for Indonesia because at that time Indonesia had begun to experience an aging population or a period of aging in terms of population age. If currently there are still a lot of young people of working age, in 2035 their number will decrease. The population that has begun to age and is no longer productive is actually increasing.

"Growing six per cent before that is very important. That's where the importance of structural reforms," he said.

On the other hand, structural reforms need to be balanced with fiscal reforms. Fiscal reform will be directed at optimizing state revenues, strengthening spending quality (spending better), and creative financing.

He said, fiscal reform efforts need to be carried out to encourage the creation of healthier fiscal management in line with the direction of fiscal consolidation in 2023.

"Fiscal reform must be carried out carefully so as not to have a negative impact on the economy," closed Febrio.