RI faces two million more jobless post-Oct. 12

Fabiola Desy Unidjaja, The Jakarta Post, Jakarta

Indonesia may get hit with another two million jobless people, as the Oct. 12 terrorist strike in Bali had reduced job opportunities, the government said on Thursday.

Coordinating Minister for Social Welfare Jusuf Kalla said that Indonesia's unemployment rate could jump by as much as two million people in the next few months as layoffs, mainly in the tourism sector, were imminent.

"We're predicting the worst, which is, that up to two million people might lose their jobs considering the declining tourist arrivals," Kalla told reporters following a Cabinet meeting. "In Bali alone unemployment may rise by 600,000," he said.

The bombing at two of Bali's busiest nightclubs claimed nearly 200 people, mainly foreigners, prompting fears that the bomb was the handiwork of the alleged terrorist group, al-Qaeda.

A number of Western governments and Japan responded by issuing harsh travel warnings for Indonesia, despite repeated safety assurances by officials here.

Bali accounts for about one third of Indonesia's average annual tourism revenue of US$5 billion.

A World Bank report on Wednesday predicted tourism arrivals would plummet by 20 percent over the next year, citing a similar incident in Egpyt when the killing of tourists at the tourist site Luxor in 1997 dragged tourism down by 17 percent.

Kalla added that handicrafts makers in neighboring East and Central Java would also feel the pinch as they supply some 70 percent of souvenirs sold in Bali.

Furthermore, analysts said the impact would go beyond Bali and its supporting industries, since the holiday island is seen as the gateway to other tourist spots around the country. This means tourists who normally visit Bali first before traveling to other islands here may not come at all.

Indonesia's unemployment total stands at about 38 million.

The rise in unemployment could also come from an overall weaker economic outlook after the Bali bombing.

Coordinating Minister for the Economy Dorodjatun Kuntjoro- Jakti said the government needed "emergency funds" from foreign donor countries to support the economy well into 2003.

"We have to call for an ad interim meeting of the Consultative Group on Indonesia (CGI) immediately, as we need extra money to stimulate economic growth for the next six months," he said.

Dorodjatun was referring to Indonesia's main creditor countries under the CGI, which met earlier this month to discuss a possible loan of "several hundreds of millions of dollars" in helping it cope with the Bali fallout.

To dispel the security fears at Indonesian tourist sites, Kalla said the government would ask for additional security measures in and around tourist sites.

The government is pinning its hopes on more domestic travelers to offset the foreigners, and Kalla said to entice people to travel it was planning to issue a regulation to enable longer weekends.

Several holidays, he explained, could be moved to either Friday or Monday to create longer weekends.

Coordinating Minister for Political and Security Affairs Susilo Bambang Yudhoyono said security around strategic installations, public utilities and transportation hubs remained tight.

"The antiterror desk, which will coordinate, monitor and synchronize all government policies on terrorism, would be activated before Nov. 15," Susilo added.