S. Korean laws ban firms from employing expatriates
JAKARTA (JP): A South Korean diplomat said yesterday his country's employment regulations currently ban large companies, including car-assembly firms, from employing foreign workers.
Bong Hyup Chung, the information and cultural attache at the South Korean embassy in Jakarta, said yesterday that his government only allows small firms in specific industries, such as textile and shoe manufacturing, to hire foreign laborers.
"Indonesian-Korean joint ventures based in Indonesia are permitted to bring in workers from Indonesia but only for training (at the principal company) and not for permanent occupation," Chung told The Jakarta Post.
Chung was commenting on the plans of PT Timor Putra Nasional -- which has been appointed as the sole manufacturer of a so- called national car -- to send Indonesian workers to build its "Timor" sedans at the Kia Motors plant in South Korea.
Chung's statement was confirmed by Minister of Manpower Abdul Latief, who said yesterday that to his knowledge there were presently no Indonesians employed in South Korea.
The government, through Presidential Decree No. 42/1996 issued on Tuesday, has allowed Timor Putra to import 45,000 completely- assembled cars from the Kia Motor plant with special tax and tariff privileges for one year starting this month.
Minister of Industry and Trade Tunky Ariwibowo said the "Timor" car will be built at the manufacturing facility of Kia Motors Corp., which is Timor Putra's partner in the "national car program".
According to the latest decree, cars manufactured overseas partly by Indonesian workers and bearing a national brand name and a local content as specified by the industry and trade minister will be granted the same privileges as the national car.
Under the "national car program" the government granted a three-year tax break to the Timor Putra, on the condition that its cars' local components total 20 percent by the end of the first year of production, 40 percent by the end of the second and 60 percent by the end of the third year.
Promotion Deputy of the Investment Coordinating Board, Sugihono Kadarisman, said earlier this week that Timor Putra will be sending 1,000 technicians to be trained at the manufacturing facility of Kia Motors Corp. in Asan Bay, near Ichon, South Korea.
In a related development Tunky said yesterday he had faxed the copies of Presidential Decree No. 42/1996 and Government Regulation No.36/1996 on the granting of conditional luxury sales tax breaks to locally assembled cars to the Indonesian delegation which is currently meeting with officials of Japan's Ministry of International Trade and Industry in Kuala Lumpur.
He expressed confidence that Japan would not take the issue of Indonesia's national car program to the World Trade Organization in Geneva
The program has drawn sharp criticisms from Japanese and American car manufacturers and the European Commission.
Asked to comment on the Presidential Decree, Herman Z. Latief, chairman of the Indonesian Association of Automobile Industries, said yesterday " what else is there to comment about because the new ruling has gone so far."
"We have run out of tears," Herman said in referring to the privileges granted to PT Timor Putra.
Vice President Try Sutrisno, in a meeting yesterday with members of the Indonesia-Japan Committee of the Indonesian Chamber of Commerce and Industry, said that "small factors" which can be considered as incidental "cases" should not get in the way of Japanese-Indonesian long-term relations.
"Economic relations between the two must be based on long- term, general interests," Try was quoted by Kadin Chairman Aburizal Bakrie as saying. (vin/pwn)
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