Jacob scolded over accusations

Muhammad Nafik, The Jakarta Post, Jakarta

Labor leaders and activists lambasted on Monday Minister of Manpower Jacob Nuwa Wea's recent statement accusing militant trade unions of scaring off investors and undermining the country's business climate.

Dita Indah Sari, the chairwoman of the National Front for Indonesian Workers' Struggle (FNPBI), accused the government of trying to find a scapegoat for its failures to enforce the law and ensure security for investment in Indonesia.

Dita, who was once jailed by the Soeharto administration, also accused the government of fooling the public by making the statement.

"They (the government) try to put the responsibility for the drop in investment on labor action, when it's their failure to uphold the law to ensure a good business climate," she told The Jakarta Post.

Muchtar Pakpahan, chairman of the Indonesian Prosperity Trade Union (SBSI), lashed out at Jacob, once a labor leader, for making what he said was a "misleading statement".

"Workers should not be blamed. I regret the minister's statement, and he is a former labor leader," he told the Post.

Muchtar said that what was true was that the decline in investment and poor business climate was a result of persistent uncertainty in law enforcement and security.

Besides, the government did not have clear economic schemes to lure investors and lift the country out of the prolonged crisis, he said.

Muchtar's deputy, Rekson Silaban echoed the same view, quoting findings from an international labor research report that militant workers did not significantly affect investment or overall business.

"Based on research conducted by the International Labor Organization (ILO) and the Organization for Economic Cooperation and Development (OECD), militant labor action is only a seventh factor in plummeting business," Rekson said separately.

He said political stability, a legal guarantee and investment security were the three most dominant factors in economic development.

Dita said that apart from the country's ambiguous economic regulations, regional autonomy should also be partly blamed as it further supported corrupt practices.

Earlier on Sunday, Jacob said militant labor unions had gone too far, leading to a significant drop in domestic and foreign investment in the country.

He said their actions had rendered the business climate less attractive for investment, with many businesspeople relocating factories to neighboring Asian countries.

Direct foreign investment has plunged drastically in Indonesia. In the first five months of this year, government- approved foreign investment reached only US$1.6 billion, a 60 percent fall from 2001.