Taiwan threatens to freeze labour imports from Indonesia,

Taiwan threatens to freeze labour imports from Indonesia, Philippines

TAIPEI (AFP): Taiwan may freeze labour imports from Indonesia and the Philippines if the two countries refuse to go along with a cut in minimum wages for workers they send to the island, a labour official said Friday.

Taiwan this month slashed the minimum monthly wage of foreign workers from 15,840 Taiwan dollars (US$457.59) to 13,340 dollars, a 16 percent reduction.

Taiwanese authorities said the 2,500-dollar reduction was to offset employers' costs in providing food and board for their imported workers.

The new measures did not apply to domestic helps which accounted for about one-third of total foreign labor force here.

S.H. Chen, director of labor standards department, told AFP that the effect of the wage cut would be mitigated by a reduction in fees imported workers pay to manpower agencies to place them with Taiwanese employers

The brokerage fees shouldered by an alien worker was reduced by 6,000 dollars in Taiwan and another 6,000 dollars in the country where he comes from.

Currently, a foreign worker has to pay his Taiwanese broker a lump sum of 30,000 dollars.

Thailand and Vietnam had agreed the new terms but Indonesia and the Philippines were holding out, he said.

Now Taiwan is willing to make concessions by further lowering the brokerage fees to as low as 10,000 dollars later this month to win support from Indonesia and the Philippines, Chen said.

"If they still refuse to accept the new terms, we will have no choice but either scale back their quotas (of labor import) or freeze their labour supply all together," he said.

Taiwan suspended the import of Filippino workers in the manufacturing and construction sectors from June to December last year, a move widely seen as retaliation for Manila's suspension of a bilateral aviation agreement between Taiwan and the Philippines.

Local employers are expected to save a minimum combined 526 million dollars a month from the wage reduction.

The new policy has raised concerns that employers will opt for foreign workers over local ones and worsen the already all-time high jobless rate. Taiwan's unemployment rate reached a record 4.92 percent in July.

Last year, Taiwan started scaling down the number of foreign workers in the manufacturing and construction sectors by 15,000 a year in order to create more jobs for local people.

Since earlier this year, foreign workers have been banned from new major public projects.

Taiwan's total foreign workforce -- mostly from Thailand, the Philippines, Indonesia and Vietnam -- stood at 326,261 in July, down 3,351 from a month earlier.