Indonesian Government Issues Emergency Regulation on Job Creation

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The Indonesian government has released Emergency Regulation (Perpu) Number 2 of 2022 on Job Creation, announced by Coordinating Minister for Economic Affairs Airlangga Hartarto on Friday (30/12/2022) at a press conference with Coordinating Minister for Political, Legal, and Security Affairs Mahfud MD and Deputy Minister of Law and Human Rights Edward Omar Sharif Hiariej at the Presidential Office in Jakarta.

"The Perpu Number 2 of 2022 has been issued today and dated December 30, 2022," said Airlangga.

Airlangga emphasized that the issuance of the Perpu was considered in response to urgent needs in anticipation of global conditions, both in terms of economics and geopolitics.

"The government needs to accelerate its anticipation of global conditions, including those related to the economy, as we face a global recession, rising inflation, and the threat of stagflation," said Airlangga.

On the geopolitical side, he added, the world is facing the Ukraine-Russia war and other unresolved conflicts.

"And the government, of course all countries, is facing crises in food, energy, finance, and climate change," he added.

Airlangga also stated that Constitutional Court Decision Number 91/PUU-XVIII/2020 on the Job Creation Law greatly affected the behavior of businesses both within and outside the country. On the other hand, the government continues to strive to attract investment as one of the keys to economic growth. Therefore, the existence of this Perpu is expected to provide legal certainty, including for business actors.

"Next year, because we have set a budget deficit of less than 3 percent, which relies on investment. So next year, we are asked to target Rp1.200 trillion in investment. Therefore, it is important to have legal certainty. So, of course, with the issuance of Perpu Number 2 of 2022, it is expected that legal certainty can be filled and this becomes the implementation of the Constitutional Court Decision," he said.

The issuance of this Perpu, continued the Coordinating Minister for Economic Affairs, is in line with legislation and based on Constitutional Court Decision Number 38/PUU-VII/2009.

Further, Airlangga stated that Indonesian President Joko Widodo has consulted with the Speaker of the Indonesian Parliament Puan Maharani regarding the issuance of the Perpu.

"Earlier, the President has consulted, has spoken with the Speaker of the Parliament and in principle the Speaker of the Parliament has been informed about the Perpu on Job Creation," he concluded.

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