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Regulating Chinese workers under Belt and Road

The growing presence of Chinese workers has become a contentious political issue in countries that are subscribing to China’s Belt and Road Initiative (BRI)

Arifi Saiman (The Jakarta Post)
Jakarta
Mon, August 20, 2018

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Regulating Chinese workers under Belt and Road

T

he growing presence of Chinese workers has become a contentious political issue in countries that are subscribing to China’s Belt and Road Initiative (BRI). In some African countries, the problem is fueling anti-Chinese sentiment among the locals.

In Kenya, where some 2.2 million people, or 11.5 percent of the workforce are unemployed, there is growing resistance against Chinese workers. Even in Ghana, where unemployment is a mere 2.4 percent of the 13.6 million workers, the government is insisting that Chinese companies hire local workers.

BRI projects are massive and they create employment. The question is who gets to do the job?

At the last count, around 70 countries had signed up to China’s ambitious plan to link countries under the Silk Road Economic Belt and the 21st Maritime Silk Road (hence BRI). This initiative to bring about greater connectivity involves the construction of infrastructure — seaports, airports, roads, railways and power plants — mostly using Chinese money and Chinese contractors, and often Chinese workers too.

Now five years in the making, the BRI was formally incorporated into China’s constitution in October 2017, and hence it is a constitutional mandate. The BRI is also regarded as Chinese President Xi Jinping’s signature foreign policy initiative.

Many countries are suspicious of a hidden agenda behind the BRI: relieving the pressures of unemployment in China. Officially, some 37.3 million Chinese people are unemployed, representing 4.7 percent of its nearly 800 million-strong workforce. China watchers say the BRI gives China a strategic outlet to ease the unemployment situation.

Indonesia has signed up to the BRI, and President Joko “Jokowi” Widodo took part in the first BRI summit in Beijing in May 2017.

Indonesia has not been spared the controversy about the presence of Chinese workers. And with the country going into a national election next year, the issue of Chinese workers will likely be politicized.

Predictably, their numbers have been wildly exaggerated.

The government said 24,804 Chinese people were registered to work in the country, far from the millions cited by workers’ unions and politicians.

But even if some Chinese workers had entered Indonesia illegally, using the visa-free facility, their number cannot be as large as critics claim. The evidence is simply not there.

Compared to other countries, Indonesia has the lowest rate of foreign worker participation, thanks to its tight laws and regulations on hiring foreigners. In 2017, foreign workers accounted for a mere 0.067 percent of the total workforce in the country. The ratio is 12 percent for Malaysia, 61 percent for Singapore and 96 percent for the United Arab Emirates, all three examples are BRI partner countries.

Chinese companies tend to hire Chinese workers more as a matter of efficiency. That they are productive is beyond doubt, as attested by officials in Sri Lanka, where the issue of Chinese workers has surfaced.

The president of the Chamber of Construction Industry Sri Lanka, Maj. (Ret.) Ranjith Gunathileke, said Chinese workers were four times more productive or efficient than the local workers. Sarath Amunugama, Sri Lanka’s senior minister of the International Monetary Cooperation, said they worked three times harder.

Chinese contractors say they often bring in Chinese workers because of pressure to finish the infrastructure projects on schedule. They would have to pay severe penalties for delays in the project.

The issue of Chinese workers in Indonesia came up during the meeting between President Jokowi and visiting Chinese Prime Minister Li Keqiang in May, who used the occasion to urge Chinese companies operating in Indonesia to give priority to hiring Indonesian workers.

In spite of such assurances, there is still a strong case for a clear government regulation

In Indonesia, the use of foreign workers is stipulated in the contract agreement or the foreign investment licenses that contractors sign.

With Indonesia campaigning to attract foreign investment, it needs to have a clear policy on the hiring of foreign workers coming under these investment projects.

Following the controversy over claims of an influx of illegal Chinese workers, the government this year issued Presidential Regulation No. 20/2018 on the utilization of foreign workers, replacing Presidential Regulation No. 72/2014, facilitating and simplifying the process of hiring expats, including their immigration and work permit papers, but at the same time tightening the monitoring and supervision of companies hiring foreign workers.

Companies and employers must submit a Plan on Use of Foreign Workers (RPTKA). The foreign workers must possess a Restricted Stay Permit Visa (VITAS) and a Restricted Stay Permit (ITAS).

The new intergovernmental institution taskforce is tasked with monitoring foreign workers and ensuring compliance with the regulations and permits.

The new presidential regulation should serve the BRI projects well, for the Chinese contractors and for Indonesia. A more effective monitoring taskforce would detect and prevent violations of the terms of employment of Chinese workers and punish those who break the regulations.

Something Indonesia may want to consider is to follow the example of Algeria in involving a third party in a BRI project. France and China have entered into a partnership for the construction of an airport in Algiers. The triangular cooperation scheme also aims at overseeing the use of foreign workers in the project.

With more BRI projects in Indonesia in the coming years, this cooperation scheme of involving a third party could help prevent the uncontrolled influx of foreign workers.

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The writer is the director of the Center for Policy Analysis and Development on Asia Pacific and Africa Regions at the Foreign Ministry. The views expressed are his own.

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