S. Korean laws ban firms from employing expatriates

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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