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Jakarta Post

Koreans relocate factories due to RI’s high labor costs

  • Ridwan Max Sijabat

    The Jakarta Post

Jakarta   /   Mon, January 21 2013   /  08:55 am

A number of Korean investors have closed down their factories and relocated them to other countries due to the increase in labor costs in the country, a senior executive of the Indonesian Employers Association (Apindo) has said.

Apindo’s secretary-general, Suryadi Sasmita, said the Korean companies had shut down their Indonesian factories as their requests to be exempt from paying the new minimum wage had been refused.

“These investors that employ hundreds of workers each, have left because they face difficulties in paying their workers in accordance with the new minimum wage, and with severance pay to dismissed workers,” he told The Jakarta Post.

More than 400 labor-intensive companies had submitted an official request to governors in Banten, Jakarta and West Java to be exempt from the minimum wage hikes due to financial difficulties, but only 10 percent of t...