Criticism Greets Indonesia's Ban on Foreigners for Certain Posts
Dion Bisara & Anita Rachman | March 12, 2012
The government came under fire over the weekend after it released a ruling banning foreigners from occupying 19 types of positions in Indonesian-owned companies.
The ruling from the Ministry of Manpower and Transmigration, dated Feb. 29, was released on Saturday. It was attacked for apparent ambiguities and listing positions including chief executive officer as being off-limits.
But Manpower and Transmigration Minister Muhaimin Iskandar said the position, listed in Indonesian as kepala eksekutif kantor (executive head of office), had been mistranslated as chief executive officer.
"CEO is not like the president director. With CEO, I mean the head of the administration and personnel, or HRD. Once again, it is not the president director, it is only the chief officer for human resources," Muhaimin said.
According to the regulations, positions that are off-limits to foreigners are, among others: personnel director, industrial relation manager, human resource manager, personnel development supervisor, personnel recruitment supervisor, personnel placement supervisor, employee career development supervisor and personnel administrator.
Listed as number nine is "chief executive officer."
Sofjan Wanandi, chairman of the Indonesian Employers Association (Apindo), and James Filgo, a senior member of the American Chamber of Commerce in Indonesia, reacted by accusing the government of trying "to micromanage" the private sector.
Sofjan raised the concern that the new regulation would hamper foreign investment. Rather than try to micromanage the private sector, Sofjan said, the government should work to make the bureaucracy more effective and efficient.
"Why should they invest if they cannot put their men in the company," Sofjan asked.
Filgo also said the government appeared to be in the business of managing private industry, and called on the latter "to address issues such as this very quickly with the government before it destroys efforts to achieve global competitiveness for Indonesia."
Chris Wren, executive director of BritCham, said the new regulations gave "cause for concern, and we are seeking further clarifications." Reyna Usman, director general of labor placement and development at the ministry, specified that the regulation was not retroactive.
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