Indonesia pledges to open labor market next year

Rendi A. Witular, The Jakarta Post, Jakarta

Indonesian managers at all levels may soon find themselves competing head-on with their foreign peers for jobs here as the government says it will fully open the nation's labor market as required under its World Trade Organization (WTO) obligations.

The government is to start opening the door to job seekers from countries grouped in the Association of Southeast Asian Nations (ASEAN) next year, and in 2008 for those from outside ASEAN, Minister of Manpower and Transmigration Fahmi Idris said on Monday.

"We have prepared all the necessary procedures for labor liberalization under the WTO agreement signed in 2001," Fahmi said at the State Palace.

"Indonesia will be branded an uncooperative nation if it fails to abide by the WTO agreement, which would have serious economic consequences," he added.

Based on WTO rulings, Indonesia should have liberalized its labor market in 2003. However, the government won a delay in implementation until the end of this year.

According to the ministry, nations such as the U.S., Japan, Panama, Switzerland, Australia, New Zealand, Taiwan, Singapore, Norway, Hong Kong, Korea, Canada, India, China and the countries of the European Union are interested in exporting their professionals and managers to Indonesia.

This also means that Indonesian professionals and managers will be allowed to seek jobs in those countries.

The countries in question have identified managerial level jobs in several sectors, such as energy, mining, finance, tourism and telecommunications, and the professional sectors, such as medicine, law, accounting and engineering, as being of particular interest to their nationals.

These countries have asked that the government revoke the Economic Need Test (ENT) ruling -- a policy that enables a country to limit or exclude foreign workers.

With Indonesia's managers and professionals being generally lacking in skills and knowledge as compared to their foreign counterparts, liberalizing the labor sector could well mean higher unemployment for graduates here.

Fahmi also said the government was currently preparing to set up a national certification agency for local workers to equip them with adequate skills and certificates, which would in turn help them seek jobs overseas.

"The agency should be set up this month or next month ... Other countries should also set up similar agencies so that their workers can obtain the same sort of certificates so as to make them eligible to work here," said Fahmi.

The agency would not only function as a certificate issuer for managerial and professional workers, but also for medium and low- skilled workers such as sailors, nurses, drivers, construction workers and housekeepers, he added.

Figures from the ministry show that some 55 percent of the country's labor force has only an elementary school education, while only 5 percent have graduated from high school or university.