Companies employing youth get incentives

Companies employing youth get incentives

JAKARTA (JP): Several provincial administrations are now
giving incentives to companies in industrial estates which employ
and offer part-ownership to young people.

Minister of Industry and Trade, Tunky Ariwibowo, and State
Minister of Youth Affairs and Sports, Hayono Isman, said
yesterday the incentives were provided by the local governments
of Semarang, Central Java, and Medan, North Sumatra.

A special youth program is to begin in Medan's Industrial
estate. Semarang will soon have a similar estate.

Yesterday, Tunky and Hayono signed a joint ministerial decree
to encourage companies to participate in the "industrial estate
for youths" program.

Tunky said the program was aimed at recruiting young people to
be entrepreneurs and workers in industrial estates. Those
eligible are young people who have taken up training and
apprenticeship programs in Indonesia or overseas.

The first stage of the program will involve Taiwanese
investors that have relocated their operations from Taiwan to
Indonesia. These companies either operate in Medan's industrial
estate or will soon invest in Semarang's.

So far some 30 Taiwanese companies had proposed joining the
program, he said.

"All the companies are small and medium-sized. Most of them
produce parts and components for the automotive, agriculture and
electronic industries, among others," he said.

Hayono said that apart from the incentives provided by the
Investment Coordinating Board, the companies would also receive
incentives from provincial administrations. These would include
local tax exemptions and simplified administrative procedures.

Hayono said that in the long run, the youths were expected to
become shareholders in the companies.

"They can form joint ventures with foreign firms and at the
same time, occupy the industrial estates," he said.

He said that in the beginning, the youths were expected to
have a 2.5 percent stake in the company while the investor owned
the remaining 97.5 percent.

"They can get the money from their savings or from the
apprenticeship programs they have joined, or they can get a loan
from the firm they work for," he said, adding that the 2.5
percent share was expected to gradually increase.

Hayono said the program was aimed particularly at youths from
middle and low-income families. (pwn)