Jokowi Orders Luhut To Formulate Sanctions For Ministries, BUMN, And BUMD Spending On Imported Products

President Joko Widodo attended the Opening of "Business Matching" Domestic Products at Istora Senayan, Jakarta, Wednesday (15/3/2023) (ANTARA)

JAKARTA - President Joko Widodo will sanction government agencies in ministries/institutions, regional governments, and State-Owned Enterprises/Regional-Owned Enterprises (BUMN/BUMD), who shop for imported products to procure goods and services.

President Jokowi also ordered the Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan to formulate the form of the sanction.

"If still buying, whether state-owned enterprises, regional-owned enterprises, provinces, districts, cities, ministries/institutions, they are still trying to buy imported products from state budget funds, regional budget funds, the sanctions have already been formulated, please formulate the Coordinating Minister, let us all work with 'reward' and 'punishment'," said President Jokowi in the Opening of "Business Matching" of Domestic Products at Istora Senayan, Jakarta, Antara, Wednesday, March 15.

The President wants rewards and sanctions against government agencies that run the Increased Use of Domestic Production (P3DN) program.

In addition to sanctions, the President ordered incentives in the form of performance allowances (tukin) for agencies that spend the most on domestic products.

"I have ordered the Minister of Administrative and Bureaucratic Reform for the so-called tukin. When this is entered, everyone will be enthusiastic. We will link it with the purchase of domestic products at the ministries, districts/cities, and provinces," said the Head of State.

On the previous occasion, the Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan proposed disincentives for agencies that did not meet domestic spending targets.

"Therefore, we agreed for the Minister of Home Affairs and the Minister of Administrative and Bureaucratic Reform, and the Minister of Finance to check directly on the e-catalog shopping field in districts, cities, provinces, and ministries. This is important. And we propose disincentives for institutions that do not carry out the program this," said Luhut.

The Government Goods/Services Procurement Policy Institute (LKPP) targets 95 percent of procurement of goods and services by ministries/agencies, and local governments at the provincial, district/city levels, to BUMN and BUMN using domestic products in 2023. In 2022, product procurement in the country only reached 78 percent.