Haris Fadhil and Indra Komara, Jakarta – Indonesia Corruption Watch (ICW) has strongly criticised a statement by Presidential Chief of Staff Moeldoko who said that the Corruption Eradication Commission (KPK) could be hindering investment. Although he has since clarified his statement, ICW says that Moeldoko’s logic is misguided.
“It’s a statement and logic that is misguided if we’re talking about the existence of the KPK and investment”, said ICW Political Corruption Coordinator Donal Fariz on Monday September 23.
Fariz believes that Moeldoko’s statement that the KPK could obstruct investment would only be true if the government wants doggy or dirty investment.
According to Fariz, investors that arrive from law-abiding countries are instead concerned with the KPK being weakened and the evidence of this is the investment funds which have flowed out of Indonesia since the revisions to the KPK Law.
“The other day 1.5 trillion rupiah of capital left Indonesia when the DPR [House of Representatives] ratified the KPK law revision. So saying the KPK is disrupting investment is in fact a misguided logic. Except if this government loves investment which is doggy or dirty investment. If investors comes from countries that are clean, prudent and obey good governance they in fact are very worried about the KPK being weakened”, he said.
Fariz said that investors who come from clean and law-abiding countries are concerned about the invisible costs which they will have to pay. These invisible costs are things like deposits or bribes for government officials in Indonesia.
“They worry that with a weakened KPK there will be many invisible costs each time they invest in developing countries such as Indonesia, for politicians, rogue law enforcement officials, rogue regional heads, these are examples of the invisible costs which are often paid by investors. The KPK has indeed been the antithesis of this dirty investment”, said Fariz.
Earlier, Moeldoko was responding to the polemic for and against the recent revisions to the KPK law, saying that many people agree with the revisions.
“The results of a survey showed that most people agree with the revisions to the UU KPK. That’s how it is”, said Moeldoko at the Presidential Palace in Central Jakarta on Monday.
He said that the survey was carried out by a mass media outlet. He also said that the KPK could hinder the government’s drive to attract investment. “The KPK could hinder investment efforts”, said Moeldoko.
Moeldoko then denied that the revisions to the KPK Law had weakened the institution. “Perhaps those who say it’s been weakened don’t yet understand it as a whole. Yes. In what way has it actually been weakened? Like the supervision, what institution isn’t allowed to be supervised? It’s like that right”, he said.
Later on, Moeldoko clarified his remarks saying that the revisions provide more legal certainty, including for investors. Up until now, he said, the KPK has worked based on Law Number 30/2002 on the KPK which before the revisions had gaps resulting in a lack of legal certainty and the potential to hinder investment.
“So what I meant was not that it’s the KPK which is hindering investment. But the KPK working based on the old law which still lacked legal certainty, and this had the potential to hinder investment”, said Moeldoko in a written release.
The DPR ratified the revisions to the KPK Law at a plenary meeting on Tuesday September 17. Under the new KPK Law, the KPK will have a supervisory board which has the power to approve or deny authorisation for phone taps, raids and seizures, and no longer refers to the KPK leadership as investigators or prosecutors. (haf/haf)
[Translated by James Balowski. The original title of the article was “ICW Kritik Keras Moeldoko Sebut KPK Bisa Hambat Investasi: Logika Sesat!”.]