JAKARTA — A new government directive requiring companies to hire 10 Indonesians for every expatriate is raising alarm among businesses and compounding concerns about the Joko Widodo administration’s growing protectionism. New labour rules, announced on June 29 by the Ministry of Manpower and Transmigration, were followed three weeks later by the introduction of higher import duties on a variety of consumer goods, such as clothes, carpets, cars, alcohol, tea and coffee. Boston University’s Emeritus Professor Gustav Papanek, who has studied the Indonesian economy for more than five decades, said the stiff new regulations are not the best way to go about reshaping employment conditions. F “Indonesia needs to attract three times as much foreign direct investment as it attracts now, not discourage people,” Papanek said.
JAKARTA – Indonesia’s government hopes to double infrastructure spending in the coming year. China recently established a new regional infrastructure investment bank. “China can bring both finance and project skills to Indonesia,” said Peter McCawley, an infrastructure focused economist at Australian National University. “In the last 20 years, China has shown a truly astonishing ability to construct infrastructure investments within China.”