The government will set up a "one-stop investment office" for the newly declared special economic zones (SEZs) of Batam, Bintan and Karimun islands, as a first step to making the area a magnet for foreign direct investment.
Immigration procedures and labor permits concerning foreign workers -- along with taxation and customs services -- will be simplified through the integrated investment service, which is expected to be up and running in Batam by September.
Speaking after a meeting Saturday of a Joint Steering Committee for the development of the SEZs, Coordinating Minister for the Economy Boediono said the establishment of the one-stop investment office would be among concrete action taken to fix any remaining bureaucratic snags still hampering investment into the pilot-project area.
"We are taking immediate steps (to develop the SEZs). Even before the meeting, we have been working to set up the integrated investment system," he said. "In the medium-term, we would like the SEZs to be a working model, suitable for application in other areas."
Indonesia and Singapore signed last month a framework agreement on economic cooperation to transform the three major islands of Riau Islands province into SEZs.
A Joint Steering Committee was established for policy-making and oversight, whose members include Boediono, Trade Minister Mari E. Pangestu, Investment Coordinating Board head M. Lutfi, Manpower and Transmigration Minister Erman Suparno, and Finance Minister Sri Mulyani Indrawati.
Singaporean counterparts include Trade and Industry Minister Lim Hng Khiang, Manpower Minister Ng Eng Hen and Singapore Economic Development Agency head Lim Siong Guan.
Singaporean Trade and Industry Minister Lim Hng Khiang said both sides had been working hard to improve the area's investment climate, expecting implementation results over the next three months.
"We are looking at all issues related to how the SEZs can enhance Indonesia's competitiveness in attracting foreign investment.
"First is the institutional framework; second, policies that have to be put in place; third, the regulatory framework according to which the policies are being implemented; fourth is the infrastructure, and fifth is incentives," he said.
Further explaining the one-stop investment office, Trade Minister Mari E. Pangestu said the government was in the throes of integrating the online systems of the tax and customs offices, and would continue to address problematic regulations, as well as looking into possible incentive policies.
"But it is more about creating certainty and consistency, and how to develop the area's bonded zone concept last year to create a better flow of goods for both exports and domestic needs," she said.
Meanwhile, concerning labor issues, Manpower and Transmigration Minister Erman Suparno said his ministry would assign officials at the one-stop investment office to facilitate foreigners applying for their work permits on the spot, rather than having to process them in Jakarta.
The ministry recently issued a decree slashing the processing time for work permits to only a week from two months, although foreigners will still be subject to the country's other labor laws and regulations, Erman said.