Indonesia’s Bureaucracy Among Worst in Asia: Survey

Jakarta Globe, June 02, 2010

India, Indonesia and the Philippines have Asia’s most inefficient bureaucracies, with red tape a constant blight to citizens and deterrent to foreign investment, a survey said Wednesday.

Regional financial centres Singapore and Hong Kong have the most efficient bureaucracies, according to the survey of expatriate business executives by the Political and Economic Risk Consultancy (PERC).

Government bureaucracies in some Asian countries have become “power centres” in their own right, allowing them to effectively resist efforts toward reforms by politicians and appointed officials, the Hong Kong-based firm said.

Indonesian President Susilo Bambang Yudhoyono’s failure to carry out reforms contributed to the resignation last month of respected finance minister Sri Mulyani Indrawati, who accepted a senior position at the World Bank, PERC said.

“Despite President Susilo’s strong election mandate, he lacks the power to really shake up Indonesia’s bureaucracy,” the consultancy said.

Ranking 12 key countries and territories on a scale from one to 10, with 10 as the worst possible score, the business executives in the survey rated India as having the region’s most inefficient bureaucracy.

India had a score of 9.41, followed by Indonesia (8.59), the Philippines (8.37), Vietnam (8.13) and China (7.93).

Malaysia was in sixth place from the bottom with a score of 6.97, followed by Taiwan (6.60), Japan (6.57), South Korea (6.13) and Thailand (5.53).

Singapore was ranked has having the most efficient bureaucracy, with a score of 2.53, followed by Hong Kong with 3.49.

PERC said 1,373 middle and senior expatriate executives took part in the survey carried out earlier this year.

Singapore was also number one and Hong Kong was in third place globally in the World Bank’s latest survey on the ease of doing business, which covered 183 economies.

In India, “politicians frequently promise to reform and revitalise the Indian bureaucracy, but they have been ineffective in doing so — mainly because the civil service is a power centre in its own right,” PERC said.

Dealing with India’s bureaucracy “can be one of the most frustrating experiences for any Indian, let alone a foreign investor,” it added.

Bureaucratic red tape is both a “serious problem” in China and India, “but the differences in the political systems of these two countries have made inertia much worse in India than in China,” it said.

In the Philippines, the government “goes through the motion” of addressing problems of bureaucratic red tape “but nothing has really made a dent in the problem,” PERC said.

“Illegal fixing is well-entrenched in the Philippine bureaucracy,” it said, referring to people called “fixers” who offer to facilitate transactions with government offices for a fee and often in collaboration with corrupt employees.

Agence France-Presse