Improved competitiveness in export products urged
JAKARTA (JP): President Soeharto warned yesterday that Indonesia could not continue to rely on cheap labor as a competitive edge for its export products.
"We have no choice but to develop industries which are highly competitive and reliable. Indonesian-made products must be able to compete both on the domestic and international markets," he said in a ceremony to open the 1995 Indonesian Product Exhibition at the Jakarta Fairgrounds here yesterday.
The government recently announced hikes in the minimum wages ranging from 10 percent to 35 percent in 19 of the country's 27 provinces.
Since the announcement was made, the Ministry of Manpower has continued to attempt to persuade companies to comply with the new wage system.
The ministry also has reprimanded companies which are reluctant to abide by the new rules, threatening to withhold their development permits and bank credit.
Currently the minimum daily wage in Jakarta is Rp 4,600 (US$2.1).
The President, who was accompanied by Mrs. Tien Soeharto and Vice President Try Sutrisno and his wife, said that it was the duty of the business people and the government to make the industry competitive, supported by sufficient supplies of raw material and progressive technology.
Both business people and the government, he said, should accelerate the development of industries which rely on skilled labor, high technology and environmentally-sound practices.
The exhibition, which will take place until Aug. 27, involves 1,150 companies and government offices.
Minister of Industry Tunky Ariwibowo in an earlier briefing with reporters said that the exhibition is located on an area measuring 30,000 square meters, of which 3,000 square meters is allocated for small-scale businesses.
The exhibition, expected to attract executives of 350 foreign companies from 43 countries, is also aimed to boost business transactions and contacts and, in turn, increase Indonesia's exports.
Queen Beatrix from the Netherlands is expected to tour the exhibition during her 10-day visit to Indonesia beginning on Aug. 21. Her entourage will include Dutch Economics Minister G.J. Wijers and 60 Dutch business people.
According to the chairman of the exhibition's organizing committee, Sudwikatmono, the display is participated in by 696 private enterprises, nine government ministries, 44 state-owned firms, 11 provincial and regency-level government offices and two associations.
The products exhibited include those produced by small-scale industries, textiles and textile-based items, office appliances and construction equipment. (pwn)