Indonesian Minister of Cooperatives, Ferry Juliantono, announced that the government is working to finalize the National Cooperative Law within this year, emphasizing the importance of this law in strengthening the role of cooperatives as a fundamental pillar of the Indonesian economy.
This statement was made during his remarks in the capital, Jakarta, where he explained that the government is reviewing the current cooperative law, which dates back to 1992, deeming it inadequate for current economic developments.
Details of the New Law
The minister reported that efforts are underway to expedite the preparation of the new law, which has been submitted to the Indonesian Parliament's Economic Affairs Committee (DPR) for discussion in upcoming sessions. He noted that this new law will enhance the role of cooperatives in economic development and make them more aligned with modern market needs.
Among the key proposals included in the draft law is the establishment of a Deposit Guarantee Agency specifically for cooperatives, aimed at increasing the security of funds deposited with these institutions, reflecting the guarantee systems in place in banks.
Background & Context
Historically, cooperatives have played a significant role in the Indonesian economy, contributing to job creation and local development. However, the current law from 1992 is no longer capable of meeting the changing market needs, prompting the government to take serious steps to update it.
The cooperative sector has been vital in promoting economic resilience, especially in rural areas, where cooperatives have been instrumental in providing access to financial services and markets for local producers.
Impact & Consequences
The approval of the new cooperative law is expected to improve the business environment in Indonesia, encouraging more citizens to engage in cooperative activities. It will also help build trust between investors and consumers, thereby enhancing market stability.
Additionally, the introduction of elements such as digitization in cooperative operations will provide a strong boost for innovation and enhance these institutions' ability to compete in the global market.
Regional Significance
The cooperative movement in Indonesia is not only crucial for the national economy but also serves as a model for other countries in the region. By strengthening cooperatives, Indonesia can promote sustainable development and economic equity.
In conclusion, the government's commitment to reforming the cooperative sector reflects a broader strategy to enhance economic resilience and adaptability in the face of global challenges.