The Rapid Revision of the Regional Elections Law Sends Negative Signals to Investors

August 22, 2024, 08.42 PM | Reporter: Arif Ferdianto

ILUSTRASI. Foto udara massa aksi saat berunjuk rasa meolak pengesahan Revisi UU Pilkada di depan Gedung DPR, Jakarta, Kamis (22/8/2024). Unjuk rasa tersebut merupakan bagian dari gerakan peringatan darurat Indonesia yang viral di media sosial setelah DPR bermanuver mengabaikan putusan MK. ANTARA FOTO/Galih Pradipta/tom.

LAW & COURT - JAKARTA. Nailul Huda, the Director of Digital Economy at the Center of Economics and Law Studies (Celios), has raised concerns over the hijacking of the Constitutional Court's decision by the House of Representatives (DPR) regarding the revision of the Regional Election Law (RUU Pilkada).

According to Huda, this hijacking will have repercussions on all aspects, including the economic sphere. He highlighted several key points regarding this issue.

Firstly, President Joko Widodo's (Jokowi) desire to amend the law just a day after the Constitutional Court's decision has left the business world in a state of legal uncertainty.

"In the current situation, investors will be hesitant and may even flee from Indonesia. Business certainty is the key to smooth operations," he told Kontan.co.id on Thursday (22/8).

Secondly, the ability to quickly create regulations if there is interest from the DPR means that businesses need substantial capital if they do not want their interests to be disrupted by DPR members.

He believes that this is what makes Indonesia's Incremental Capital Output Ratio (Icor) expensive.

Thirdly, the Great Indonesia Coalition (KIM) Plus, with its large coalition members, Jokowi and Prabowo are currently curtailing the authority of regional governments (Pemda) to carry out development based on the needs of their communities.

"The authority of the regional government was curtailed after the Job Creation Law was passed. Leaders in the regions are just puppets of the President," explained Huda.

Fourthly, not only authority, regional government funds can be used for central government programs such as free nutritious meals, where central government funds are insufficient.

With this authority, Huda continued, the regional government must align with the central government. However, the spirit of regional autonomy is development based on the needs of each region.

"If development occurs, it will revert to the New Order era. Regional growth will be hindered. The disparity between regions will widen," he concluded.