Thu, 11 Aug 1994

U.S. sees progress on Indonesian labor front

JAKARTA (JP): The United States, which is currently reviewing the trade privileges it grants to Indonesia, says that Jakarta has made some progress on the question of workers' rights.

The U.S. embassy said in a brief statement yesterday that its government is continuing to hold dialogs with Jakarta on the question of whether or not to extend the Generalized System of Preferences (GSP) to Indonesia.

"We do not expect any announcement to be made while this dialog is continuing," it said. "We note there has been some progress since last January but as the Indonesian government acknowledges, more needs to be done."

The United States had been expected to make its decision by Aug. 15 when the current six-month review ends, but Indonesian officials now say that Washington may have decided to postpone its ruling pending the enactment of the new regulations regarding the GSP in September.

Officials privately said that they expect a favorable ruling given repeated pronouncements by Washington of the increasing importance of Indonesia to U.S. trade ties.

The first six-month review ended on Feb. 15 at which time Washington decided to grant another six months.

Washington has threatened to cut Indonesia out of its GSP, a facility which grants duty free status to selected products, unless the Indonesian government improves the condition of workers in the country, particularly on the questions of wages, their right to organize and also the employment of child workers.

Some US$650 million worth of Indonesian exports to the United States, or 14 percent of the total, are entitled to the facility.

Over the past year, the government has hiked the minimum wage levels, revoked a decree allowing companies to summon the military during strikes and adopted several other measures designed to improve the workers' welfare.

The government however continues to insist that only unions affiliated with the All Indonesian Workers Union (SPSI) are allowed to represent workers in disputes with management.

Minister of Manpower Abdul Latief yesterday said the government continues to furnish Washington with all the information regarding the conditions of workers in Indonesia.

Asked about Indonesia's position on the matter, Latief, who is himself a former businessman, said; "Of course we want the GSP facility to be continued."

He added however that the nation would be prepared if Washington decided to end the GSP.

Asked whether his recent trip to the United States had anything to do with the GSP negotiations, he replied: "I went there for a medical check-up." (emb)