Constraints on Productivity and Investment in Indonesia's Manufacturing Sector : Survey-based Analysis of Business Constraints
Well-functioning markets, adequate infrastructure and simple and clearly defined regulations are some of the characteristics of a growth-enhancing business climate. In Indonesia, some of these elements are missing, which challenges firms' operations. This note discusses the main constraints tha...
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| Format: | Policy Note |
| Language: | English en_US |
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World Bank, Jakarta
2017
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| Online Access: | http://documents.worldbank.org/curated/en/524001468257987954/Constraints-on-productivity-and-investment-in-Indonesias-manufacturing-sector-survey-based-analysis-of-business-constraints http://hdl.handle.net/10986/26716 |
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okr-10986-26716 |
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| recordtype |
oai_dc |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
ACCOUNTING ASIAN BOND MARKET BANK FINANCING BANKING REGULATION BANKING SYSTEM BOND BOND ISSUANCE BOND ISSUANCES BOND MARKET BUDGET MANAGEMENT BUSINESS CLIMATE BUSINESS COMMUNITY BUSINESS CONTINUITY BUSINESS DECISIONS BUSINESS ENVIRONMENT BUSINESS EXPANSION BUSINESS LOCATION BUSINESS REGISTRATIONS BUSINESS REGULATIONS BUSINESSES CAPITAL EXPENDITURE CAPITAL MARKETS CASH FLOW CASH TRANSFERS COLLATERAL COLLECTIVE ACTION COMMODITIES COMMODITY COMPETITIVENESS CONNECTIVITY COPYRIGHT CREDIT HISTORY CREDIT INFORMATION CUSTOM CUSTOMS CUSTOMS CLEARANCE DEBT DEBTORS DEPOSIT DISTRIBUTION NETWORK DOMESTIC BOND DOMESTIC BOND MARKET DOMESTIC MARKET EFFICIENT MARKET ELECTRICITY ELECTRONIC FILING ENTERPRISE SURVEY EXCHANGE RATE EXPENDITURES EXPORT PERFORMANCE EXPORTER EXPORTERS FINANCE CONSTRAINT FINANCIAL CRISIS FINANCIAL INSTITUTIONS GLOBALIZATION GOVERNMENT BOND GOVERNMENT REGULATION GOVERNMENT REGULATIONS HOLDING HUMAN CAPITAL HUMAN RESOURCES INCOME TAX INSPECTIONS INSURANCE INTEREST RATE INTEREST RATE SPREAD INTEREST RATES INTERNATIONAL MARKETS INTERNATIONAL SHIPPING INVENTORY INVESTMENT CLIMATE INVESTMENT LOANS INVESTMENT PROJECTS ISSUANCE JUDICIAL SYSTEM LABOR MARKET LABOR MARKETS LAW ENFORCEMENT LEGAL ENVIRONMENT LEGAL RIGHTS LEGAL SYSTEM LENDERS LEVEL OF CONFIDENCE LICENSE LICENSES LOAN LOAN AGREEMENTS LOCAL GOVERNMENTS MACROECONOMIC CONDITIONS MACROECONOMIC ENVIRONMENT MACROECONOMIC INSTABILITY MACROECONOMIC STABILITY MANUFACTURING MARKET REFORM MARKET SHARE MARKET SHARES MEDIUM ENTERPRISES MICRO LOAN MICROFINANCE ONLINE HELP OPERATIONAL EFFICIENCY OPPORTUNITY COSTS OUTSOURCING PAYMENT SYSTEMS PRIVATE CREDIT PRIVATE CREDIT BUREAU PRIVATE SECTOR PROCUREMENT PRODUCTION PROCESSES PRODUCTIVITY PROFIT MARGINS PUBLIC SPENDING R&D REAL EXCHANGE RATES REGIONAL DUMMIES REGULATORY ENVIRONMENT RELIABILITY REPORTING RESULT RESULTS RETURN SALES SERVICE PROVIDERS STAMP DUTY STARTUPS STOCK EXCHANGE TAX TAX EXEMPTIONS TAX RATES TECHNICAL SKILL TECHNICAL SKILLS TELECOMMUNICATION TRADING TRANSITION COUNTRIES USERS UTILIZATION RATIO VALUATION VALUATIONS WORKING CAPITAL |
| spellingShingle |
ACCOUNTING ASIAN BOND MARKET BANK FINANCING BANKING REGULATION BANKING SYSTEM BOND BOND ISSUANCE BOND ISSUANCES BOND MARKET BUDGET MANAGEMENT BUSINESS CLIMATE BUSINESS COMMUNITY BUSINESS CONTINUITY BUSINESS DECISIONS BUSINESS ENVIRONMENT BUSINESS EXPANSION BUSINESS LOCATION BUSINESS REGISTRATIONS BUSINESS REGULATIONS BUSINESSES CAPITAL EXPENDITURE CAPITAL MARKETS CASH FLOW CASH TRANSFERS COLLATERAL COLLECTIVE ACTION COMMODITIES COMMODITY COMPETITIVENESS CONNECTIVITY COPYRIGHT CREDIT HISTORY CREDIT INFORMATION CUSTOM CUSTOMS CUSTOMS CLEARANCE DEBT DEBTORS DEPOSIT DISTRIBUTION NETWORK DOMESTIC BOND DOMESTIC BOND MARKET DOMESTIC MARKET EFFICIENT MARKET ELECTRICITY ELECTRONIC FILING ENTERPRISE SURVEY EXCHANGE RATE EXPENDITURES EXPORT PERFORMANCE EXPORTER EXPORTERS FINANCE CONSTRAINT FINANCIAL CRISIS FINANCIAL INSTITUTIONS GLOBALIZATION GOVERNMENT BOND GOVERNMENT REGULATION GOVERNMENT REGULATIONS HOLDING HUMAN CAPITAL HUMAN RESOURCES INCOME TAX INSPECTIONS INSURANCE INTEREST RATE INTEREST RATE SPREAD INTEREST RATES INTERNATIONAL MARKETS INTERNATIONAL SHIPPING INVENTORY INVESTMENT CLIMATE INVESTMENT LOANS INVESTMENT PROJECTS ISSUANCE JUDICIAL SYSTEM LABOR MARKET LABOR MARKETS LAW ENFORCEMENT LEGAL ENVIRONMENT LEGAL RIGHTS LEGAL SYSTEM LENDERS LEVEL OF CONFIDENCE LICENSE LICENSES LOAN LOAN AGREEMENTS LOCAL GOVERNMENTS MACROECONOMIC CONDITIONS MACROECONOMIC ENVIRONMENT MACROECONOMIC INSTABILITY MACROECONOMIC STABILITY MANUFACTURING MARKET REFORM MARKET SHARE MARKET SHARES MEDIUM ENTERPRISES MICRO LOAN MICROFINANCE ONLINE HELP OPERATIONAL EFFICIENCY OPPORTUNITY COSTS OUTSOURCING PAYMENT SYSTEMS PRIVATE CREDIT PRIVATE CREDIT BUREAU PRIVATE SECTOR PROCUREMENT PRODUCTION PROCESSES PRODUCTIVITY PROFIT MARGINS PUBLIC SPENDING R&D REAL EXCHANGE RATES REGIONAL DUMMIES REGULATORY ENVIRONMENT RELIABILITY REPORTING RESULT RESULTS RETURN SALES SERVICE PROVIDERS STAMP DUTY STARTUPS STOCK EXCHANGE TAX TAX EXEMPTIONS TAX RATES TECHNICAL SKILL TECHNICAL SKILLS TELECOMMUNICATION TRADING TRANSITION COUNTRIES USERS UTILIZATION RATIO VALUATION VALUATIONS WORKING CAPITAL Ing, Lili Yan Varela, Gonzalo Constraints on Productivity and Investment in Indonesia's Manufacturing Sector : Survey-based Analysis of Business Constraints |
| geographic_facet |
East Asia and Pacific Indonesia |
| description |
Well-functioning markets, adequate infrastructure and simple and clearly defined regulations are some of the characteristics of a growth-enhancing business climate. In Indonesia, some of these elements are missing, which challenges firms' operations. This note discusses the main constraints that Indonesia's manufacturing firms face, shows that these differ depending on the nature of the firm and examines the effect of these constraints on firms' productivity and decisions to invest. It concludes that the poor business climate has substantial costs in terms of firms' productivity and growth. Some broad policy recommendations emerge, and are related to improving credit information, providing microfinance for productive start-ups, improving infrastructure particularly electricity and logistics, incentivizing training, increasing collective action on sharing knowledge, improving tax administration including shortening the time for Value Added Tax (VAT) refunds and duty drawbacks, as well as strengthening law enforcement on business contracts. Addressing these constraints is not merely a task for the Government of Indonesia, but also one for the private sector. It is the Government's responsibility to set clear business regulations, as well as improve the business environment, but it is the private sector's responsibility to take action on sharing knowledge and developing its clusters. |
| format |
Policy Note |
| author |
Ing, Lili Yan Varela, Gonzalo |
| author_facet |
Ing, Lili Yan Varela, Gonzalo |
| author_sort |
Ing, Lili Yan |
| title |
Constraints on Productivity and Investment in Indonesia's Manufacturing Sector : Survey-based Analysis of Business Constraints |
| title_short |
Constraints on Productivity and Investment in Indonesia's Manufacturing Sector : Survey-based Analysis of Business Constraints |
| title_full |
Constraints on Productivity and Investment in Indonesia's Manufacturing Sector : Survey-based Analysis of Business Constraints |
| title_fullStr |
Constraints on Productivity and Investment in Indonesia's Manufacturing Sector : Survey-based Analysis of Business Constraints |
| title_full_unstemmed |
Constraints on Productivity and Investment in Indonesia's Manufacturing Sector : Survey-based Analysis of Business Constraints |
| title_sort |
constraints on productivity and investment in indonesia's manufacturing sector : survey-based analysis of business constraints |
| publisher |
World Bank, Jakarta |
| publishDate |
2017 |
| url |
http://documents.worldbank.org/curated/en/524001468257987954/Constraints-on-productivity-and-investment-in-Indonesias-manufacturing-sector-survey-based-analysis-of-business-constraints http://hdl.handle.net/10986/26716 |
| _version_ |
1764462545276502016 |
| spelling |
okr-10986-267162021-04-23T14:04:37Z Constraints on Productivity and Investment in Indonesia's Manufacturing Sector : Survey-based Analysis of Business Constraints Ing, Lili Yan Varela, Gonzalo ACCOUNTING ASIAN BOND MARKET BANK FINANCING BANKING REGULATION BANKING SYSTEM BOND BOND ISSUANCE BOND ISSUANCES BOND MARKET BUDGET MANAGEMENT BUSINESS CLIMATE BUSINESS COMMUNITY BUSINESS CONTINUITY BUSINESS DECISIONS BUSINESS ENVIRONMENT BUSINESS EXPANSION BUSINESS LOCATION BUSINESS REGISTRATIONS BUSINESS REGULATIONS BUSINESSES CAPITAL EXPENDITURE CAPITAL MARKETS CASH FLOW CASH TRANSFERS COLLATERAL COLLECTIVE ACTION COMMODITIES COMMODITY COMPETITIVENESS CONNECTIVITY COPYRIGHT CREDIT HISTORY CREDIT INFORMATION CUSTOM CUSTOMS CUSTOMS CLEARANCE DEBT DEBTORS DEPOSIT DISTRIBUTION NETWORK DOMESTIC BOND DOMESTIC BOND MARKET DOMESTIC MARKET EFFICIENT MARKET ELECTRICITY ELECTRONIC FILING ENTERPRISE SURVEY EXCHANGE RATE EXPENDITURES EXPORT PERFORMANCE EXPORTER EXPORTERS FINANCE CONSTRAINT FINANCIAL CRISIS FINANCIAL INSTITUTIONS GLOBALIZATION GOVERNMENT BOND GOVERNMENT REGULATION GOVERNMENT REGULATIONS HOLDING HUMAN CAPITAL HUMAN RESOURCES INCOME TAX INSPECTIONS INSURANCE INTEREST RATE INTEREST RATE SPREAD INTEREST RATES INTERNATIONAL MARKETS INTERNATIONAL SHIPPING INVENTORY INVESTMENT CLIMATE INVESTMENT LOANS INVESTMENT PROJECTS ISSUANCE JUDICIAL SYSTEM LABOR MARKET LABOR MARKETS LAW ENFORCEMENT LEGAL ENVIRONMENT LEGAL RIGHTS LEGAL SYSTEM LENDERS LEVEL OF CONFIDENCE LICENSE LICENSES LOAN LOAN AGREEMENTS LOCAL GOVERNMENTS MACROECONOMIC CONDITIONS MACROECONOMIC ENVIRONMENT MACROECONOMIC INSTABILITY MACROECONOMIC STABILITY MANUFACTURING MARKET REFORM MARKET SHARE MARKET SHARES MEDIUM ENTERPRISES MICRO LOAN MICROFINANCE ONLINE HELP OPERATIONAL EFFICIENCY OPPORTUNITY COSTS OUTSOURCING PAYMENT SYSTEMS PRIVATE CREDIT PRIVATE CREDIT BUREAU PRIVATE SECTOR PROCUREMENT PRODUCTION PROCESSES PRODUCTIVITY PROFIT MARGINS PUBLIC SPENDING R&D REAL EXCHANGE RATES REGIONAL DUMMIES REGULATORY ENVIRONMENT RELIABILITY REPORTING RESULT RESULTS RETURN SALES SERVICE PROVIDERS STAMP DUTY STARTUPS STOCK EXCHANGE TAX TAX EXEMPTIONS TAX RATES TECHNICAL SKILL TECHNICAL SKILLS TELECOMMUNICATION TRADING TRANSITION COUNTRIES USERS UTILIZATION RATIO VALUATION VALUATIONS WORKING CAPITAL Well-functioning markets, adequate infrastructure and simple and clearly defined regulations are some of the characteristics of a growth-enhancing business climate. In Indonesia, some of these elements are missing, which challenges firms' operations. This note discusses the main constraints that Indonesia's manufacturing firms face, shows that these differ depending on the nature of the firm and examines the effect of these constraints on firms' productivity and decisions to invest. It concludes that the poor business climate has substantial costs in terms of firms' productivity and growth. Some broad policy recommendations emerge, and are related to improving credit information, providing microfinance for productive start-ups, improving infrastructure particularly electricity and logistics, incentivizing training, increasing collective action on sharing knowledge, improving tax administration including shortening the time for Value Added Tax (VAT) refunds and duty drawbacks, as well as strengthening law enforcement on business contracts. Addressing these constraints is not merely a task for the Government of Indonesia, but also one for the private sector. It is the Government's responsibility to set clear business regulations, as well as improve the business environment, but it is the private sector's responsibility to take action on sharing knowledge and developing its clusters. 2017-05-23T15:14:30Z 2017-05-23T15:14:30Z 2012-09 Policy Note http://documents.worldbank.org/curated/en/524001468257987954/Constraints-on-productivity-and-investment-in-Indonesias-manufacturing-sector-survey-based-analysis-of-business-constraints http://hdl.handle.net/10986/26716 English en_US CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Jakarta Economic & Sector Work :: Policy Note Economic & Sector Work East Asia and Pacific Indonesia |