Rini establishes new crisis center to help businesses

Rini establishes new crisis center to help businesses

Adianto P. Simamora, The Jakarta Post, Jakarta

The Ministry of Trade and Industry has set up a crisis center to
help resolve the various problems faced by businesses here, a
move which could help prevent existing investors from fleeing the
country.

It will be chaired by Minister of Trade and Industry Rini M.
Soewandi herself and consist of members drawn from the business
sector, top officials from the relevant government institutions
and the police.

The crisis center, to be officially launched on Monday, will
be located on the 12th floor of the ministry's offices.

"The crisis center is aimed at supporting businesspeople in
doing business here. We will collate all their complaints and try
to seek a solution as expeditiously as possible," Rini told
reporters on Friday following a meeting with business
associations.

Rini said that in the near term, the crisis center would focus
on resolving long-standing problems, particularly those
concerning labor conflicts, smuggling and security issues.

Many have said that the these problems have caused foreign
investors to shun the country, and even existing businesses have
reportedly been considering moving their operations to other
countries in the region.

The significant drop in foreign direct investment (FDI) during
the first half of this year as well as declining exports have
been mainly attributed to these problems.

Last month, Rini said that labor conflicts were one of the
major factor causing the dismal export performance as foreign
buyers shifted their orders to other countries due to fears that
local exporters could face problems in meeting delivery
schedules.

"I see the labor issue as something that must be resolved as
quickly as possible," Rini said.

She was referring to ministerial decree No. 150/2000 on labor
affairs, which had been overly protective of workers at the
expense of employers.

In order for Indonesia's economy to grow at a respectable rate
of around 6 percent per year so as to be able to absorb the huge
numbers of unemployed, exports and investment must be pushed as
the cash-strapped government can no longer be expected to pump
prime the economy. A continuing decline in exports and investment
would also depress consumer spending, the main driver of this
year's estimated 4 percent economic growth.

"Regaining investment is very vital for the recovery of our
economy and creating more new jobs," Rini said.

But Rini said that without fixing the labor problems, any
government policies to attract new investment and boost exports
would be ineffective.

Rini also said that curbing rampant smuggling would be a top
priority for the center.

"But we cannot go alone, we have to go hand-in-hand with other
ministries and businesspeople in resolving this problem," she
said.

The crisis center would focus its antismuggling effort on top
commodities including textiles, electronics, footwear, sugar,
logs and crude palm oil.

Many parties have long complained that poor law enforcement,
graft and collusion have allowed smuggling to flourish in
Indonesia, especially in the five years since the economic crisis
hit the country.