Govt to address problems faced by textile companies
Govt to address problems faced by textile companies
JAKARTA (JP): The government has agreed to look into complaints raised by textile and garment companies that its wage policy could mean disaster for the country's main export industry.
Leaders of the Association of Indonesian Textile Industries, led by Secretary-General Benny Sutrisno and chairman of its Jakarta chapter Haryadi Sukamdani, visited the Ministry of Manpower yesterday to discuss the problems with Suwarto, the Director General for Industrial Relations and Labor Standards.
Their presence was an unusual sight in the ministry more accustomed to visits by complaining workers.
Suwarto told The Jakarta Post after the meeting that his ministry will soon establish a team including representatives of employers, workers and the government to discuss the issue.
The government will also consult university experts.
The team would look into why textile and garment companies have problems meeting the government's wage regulations and hopefully come up with some solutions, he said.
He stressed, however, that the government would not sacrifice the interests of the workers. "They (the companies) must also understand the condition of the workers," he said.
Employers have voiced their objection to the 10 percent daily minimum wage hike set by the government, effective next month, and also to a ruling issued in January compelling them to pay workers hired on a daily basis a salary based on 30 days of work.
Garments and textiles make up Indonesia's number one export industry outside of the oil and gas sector, but its role has been declining in the last three years. In 1995, the industry earned Indonesia US$5.4 billion in foreign exchange revenues, down from $5.8 billion in 1994 and $6.2 billion in 1993, according to official statistics.
Industry analysts warn that Indonesia is losing out to newcomers in the world markets, such as China and Vietnam, and that wage increases at home are eating away at the country's competitive edge.
Benny Soetrisno of the textile association argues that such labor-intensive industries are very sensitive to wage policy changes.
He said the changes in government policy are compounding the problems faced by his members, who are struggling in the face of fierce international competition.
The government in January announced that it is hiking the minimum wages in all 27 provinces by an average of 10 percent effective April 1. The daily minimum wage in Jakarta will be increased to Rp 5,200 from Rp 4,600.
Soewarto said that so far the Ministry of Manpower has not received any formal requests from textile and garment manufacturers to be exempted from the wage changes, a concession sometimes granted to companies experiencing financial difficulties. (rms/03)