New regulations issued by the Government of Indonesia could have a significant impact on the tobacco industry, resulting in large-scale layoffs and economic repercussions, especially for tobacco farmers and small and medium-sized enterprises (SMEs). Experts are calling for solutions that do not affect the industry while protecting public health.
Indonesia’s new tobacco rules could hit the industry hard
As reported by Detik News on September 4, 2024, the Indonesian government issued Government Regulation (PP) No. 28 of 2024 as a detailed description of the implementing regulation of Law No. 17 of 2023 on Health.
Daniel Johan, a member of the Fourth Committee of Indonesia’s National Representative Council (DPR), warned that the implementation of the new regulation could have a huge impact on ordinary people.
Experts warn of mass layoffs
In a statement on Tuesday (3), Daniel mentioned that the new regulations could lead to mass layoffs and retrenchment of tobacco farmers and small and medium-sized enterprises (UMKM) economic impact. He emphasized that the government’s policy should protect the youth and the industry because if the new regulations lead to factory closures, a large number of layoffs will increase, leading to a more serious unemployment problem.
In addition, Section 435 of the new regulation states that all individuals who manufacture or import cigarette and vape brands must comply with the requirements for standardization of package design and text. According to Daniel, this regulation could lead to a decrease in the demand for raw materials.
He further noted that the tobacco industry involves many workers and that many will lose their jobs if factories close. He called for a “win-win” solution to control cigarettes to ensure public health without jeopardizing the economic stability that depends on the industry.
Daniel pointed out that Article 28 could lead to new social conflicts because of the possibility of “catch-all clauses” in the implementation of regulatory measures, which would be particularly detrimental to the tobacco industry, especially tobacco farmers, who are currently in a difficult situation.
