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Jokowi urges businessmen to take advantage of trade war
President Joko “Jokowi” Widodo has encouraged the private sector to seize upon the opportunity to fill gaps in export demand caused by escalating trade tensions between economic giants United States and China
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span>President Joko “Jokowi” Widodo has encouraged the private sector to seize upon the opportunity to fill gaps in export demand caused by escalating trade tensions between economic giants United States and China.
During the last two days, Jokowi has held a series of meetings with executives from the Indonesian Chamber of Commerce and Industry (Kadin), the Indonesian Young Entrepreneurs Association (Hipmi) and the Indonesian Employers Association (Apindo), as well as the Indonesian Shopping Centers Tenants Association (Hippindo) to request “concrete” feedback and suggestions from the private sector on economic policies.
Jokowi said the escalating trade tensions between the US and China should not be seen only as a threat to the Indonesian economy and urged the businesses to tap into previously unseen opportunities in such a situation.
“Do not see it [the trade war] as a big problem. I think we can seize opportunities amid the trade war and you, ladies and gentlemen, are at the forefront of harnessing these opportunities,” Jokowi said in a meeting on Wednesday with Kadin and Hipmi executives in the State Palace.
The International Monetary Fund (IMF) recently said in its latest World Economic Outlook (WEO) that global trade growth had sharply slowed in 2018 and further slowdown was expected this year, taking into account the impact of the trade tensions and as a correction from high global trade growth in 2017.
As an example, Jokowi called on businesses to seize opportunities by expanding their production capacity for their products to penetrate US markets to fill the demand left by Chinese goods hit by higher tariffs.
Trade Minister Enggartiasto Lukita said in Jakarta on Thursday that higher tariffs slapped by the US on imported goods from China could potentially pave the way for Indonesian exports, such as textiles and footwear, to fill the demand in the US market.
Jokowi said he “had no burden” in his second and final term, signaling that he will push for more difficult structural reform compared to the previous term. He added that he hoped he would swiftly follow up on the feedback from businesspeople after the Constitutional Court decision on the April 17 presidential election dispute, which was filed by rival ticket Prabowo Subianto and Sandiaga Uno.
Speaking after a separate meeting with Jokowi on Thursday, Apindo chairman Hariyadi Sukamdani suggested the government amend the 2003 Labor Law in particular to better reflect the current labor market landscape and conditions.
“The government should look [to amend] our Labor Law. [The Labor Law] does not reflect the current needs and conditions [of the labor market],” said Hariyadi in Jakarta on Thursday, adding that multiple requests for judicial reviews of the law also reflected the necessity for the amendment.
Revising the Labor Law would hopefully attract greater investment in the country’s labor-intensive industries and create more jobs, said Hariyadi, thereby increasing competitiveness amid high competition from neighboring peers such as Vietnam, Myanmar and Cambodia.
Hariyadi said Jokowi told the businesspeople in Thursday’s meeting that the government would make efforts in the next six months to review the Labor Law.
Kadin chairman Rosan P. Roeslani, who met Jokowi on Wednesday, also urged the government to revise the Labor Law, saying that high severance payments as stipulated in the law were among a number of factors deemed discouraging for foreign investors looking to invest in the country.
