"Generally, multinational companies can anticipate the labour cost increase in the country," The Chairman of the Investment Coordinating Board (BKPM), Chatib Basr said.
Jakarta (ANTARA News) - The Chairman of the Investment Coordinating Board (BKPM), Chatib Basri, has stated that the government`s plan to raise labourers` wages by 30 to 50 percent will not affect foreign investment in Indonesia.

"Generally, multinational companies can anticipate the labour cost increase in the country," Basri said during the "Indonesia Investment Summit, Beyond Investment Grade" here on Tuesday.

According to him, the policy that will be issued by the Ministry of Manpower and Transmigration is more likely to affect small and medium enterprises, which generally have lower capital.

"It is different for multinational companies. Most of them have `fiscal spare` to provide their employees with wages and benefits that exceed the regional minimum wage," Basri explained.

He argued that foreign investors with big capital do not pay much attention to the amount of minimum wage to be paid since they are more concerned with the issues of security and labour order.

``I think foreign investors are more worried about the anarchist behaviour of unions that force other workers to go on strikes,`` he said.

Basri also said that the government should be able to guarantee security and law enforcement in the country to maintain the growth of foreign investment.

He added that investment is one of the two pillars of the economy that has enabled Indonesia`s gross domestic product (GDP) to register growth in numbers.

"Investment and domestic consumption are two reliable pillars which are expected to encourage economic growth. Actually, export is supposed to be the third pillar, but it is not reliable right now due to the global economic crisis," he explained.

Basri noted that the contribution of direct foreign investment towards economic growth in the first half of 2012 reached 11.2 percent of the GDP.

"Meanwhile, the realization of foreign direct investment up to September amounted to 25.54 billion US dollars, or rose by 27 percent compared to figures from the same period last year," he stated. (*)

Editor: Heru Purwanto
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