The Quiet Reform in Indonesia’s Immigration System: Part 2

In the second of this two-part blog series, Senior Manager Alfred Chong and Senior Business Immigration Consultant Raga Rasuanta continue their conversation with Mr. Philo Dellano, Managing Partner of PNB immigration law firm and local co-counsel partner in Indonesia. They outline the immigration reforms Indonesia has implemented as a result of the COVID-19 pandemic, discuss the possibility of the Digital Nomad Visa and more. For an overview of the recent evolution of Indonesia’s immigration system, read the first part in our series here.

Pandemic-accelerated Reforms

Due to the COVID-19 pandemic, we have seen even more reforms than before. For example, an online electronic Visa (e-Visa) application was implemented at the height of the COVID-19 pandemic in 2020 (the authorities probably accelerated the implementation because of the need of social distancing). Not only do business visitors no longer need to visit the Indonesian Consulates/Embassy to submit visa applications, even work permit applicants no longer need to get their entry visas (VITAS) endorsed in their passports at the Indonesian Consulates abroad.

Previously, a visa label had to be endorsed by the Indonesian Consulate before the foreign national could enter Indonesia, under the new system, the e-Visa will be issued directly to the applicant by e-mail. This has reduced the overall processing time by at least three to five business days (i.e., the time it would previously take the Consulate to process the visa application). It is particularly convenient for foreign nationals residing in locations where there is no Indonesian Consulate (who may otherwise have had to travel to another country or city to apply for their visa).

On this note, Philo agreed that this was a welcome upgrade to the immigration system, as it both allowed for a more convenient process for foreign workers to enter (without having to first visit the Indonesian Consulate) and was a logical evolution, given the safe-distancing measures required during the pandemic.

Also, as travel restrictions were imposed during the pandemic, the government allowed the conversion of short-term visas to long-term stay permits while the foreign nationals remained in Indonesia (i.e., as an in-country conversion) which was not allowed prior to the pandemic. As international flights almost ground to a halt, the government accelerated the implementation of such reforms, which have had lasting impacts (as well as some benefits) to this day.

Digital Nomad Visa?

As the COVID-19 pandemic has been gradually brought under control in 2022, there has also been chatter (particularly with the Tourism and Creative Economy Ministry) to implement a so-called Digital Nomad Visa. Due to the pandemic, foreign visitor arrivals to Indonesia dropped from 6 million in 2019 to just 1 million in 2020, and further dropped to 51 (reported visitors, at least) in 2021. The government has indicated its goal for the tourism industry to contribute up to eight percent of GDP from the current four percent. This is an ambitious target, meaning Indonesia would need to attract about 20 million visitors.

We have seen media reports that the Tourism and Creative Economy Minister proposed implementing a long-term visa valid for up to five years (which supposedly would be the “digital nomad visa”) and even the Coordinating Minister for Maritime Affairs and Investment commented that the government would soon issue the visas. However, it seems that the digital nomad visa program has not progressed as fast as what the industry would prefer; there has not yet been an announcement from the Ministry of Law and Human Rights (which has oversight over the Directorate General of Immigration).

At this stage, the plan to implement the digital nomad visa seems to be in the discussion stages, at best. Further coordination and consultation with other ministries will certainly be needed, for example on the pros and cons of the digital nomad visa, before its implementation. In speaking with Philo, he is also doubtful that the Digital Nomad Visa will be implemented soon.

Beyond the Pandemic

As we move out of the COVID-19 pandemic, we have seen a surge in international travel and business activities. Companies are eager to send their foreign national employees to resume projects which have been delayed by the pandemic. Despite the developments above, obstacles remain. 

Currently, companies applying for work permits for their employees outside Indonesia are still required to provide a recommendation letter from a relevant government agency, usually the Ministry of Maritime Affairs and Investment or the Indonesia Investment Coordinating Board (BKPM). This is likely a temporary requirement and as we remobilize out of the pandemic, we should expect to see the eventual removal of the recommendation letter requirement.

“I think after the pandemic, we won’t have to apply for the recommendation letter, because it is the opposite of President [Joko Widodo, Jokowi]’s intention to simplify the licensing processes, including work permits for foreign workers. Because if we continue to require the recommendation, it will be too bureaucratic and it will take time,” said Philo.

President Jokowi has been credited with pushing for much of the reforms that Indonesia has implemented since he assumed the Presidency in 2014 (including the streamlining of the work permit processes specifically). As Indonesia comes out of the COVID-19 pandemic and resumes its high growth, we are hopeful that the trajectory made in the improvements to the immigration systems and processes will continue. Furthermore, as Indonesia heads into the next Presidential Election in 2024, we would certainly hope that the reforms already made continue well beyond President Jokowi’s Presidency.

Need to know more?

For further information and advice on this topic, please contact Senior Manager Alfred Chong at [email protected] and Senior Business Immigration Consultant Raga Rasuanta at [email protected]. This blog was published on 22 September 2022, and due to the circumstances, there are frequent changes.

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