Based on a revised piece of legislation regarding construction in Indonesia (law number 2 of 2017), representative of the Ministry of Public Works and Housing Yaya Supriyatna Sumadinata stated that foreign workers are now only allowed to fill certain jobs that require special expertise in Indonesia.
The law revision is meant to increase the local labour force’s competitiveness. However, as quoted by Merdeka, Chairman of the National Joint Implementation Unit Iskandar Z Hartawi said that thousands of foreign workers have been flooding into Indonesia since the nation joined the ASEAN Economic Community. According to him, this has impacted the local construction services industry.
Hartawi said foreign workers are utilizing the priority programme by Jokowi which focuses on national infrastructure. A supposedly massive inflow of foreign workers and products then would cause concern for the government, as it needs to focus on decreasing the nation’s unemployment rate.
Experts and industry stakeholders believe that most Indonesian workers lack the necessary expertise when compared to their foreign counterparts. For this reason, private construction projects usually favour hiring foreign experts with reliable track records. Regardless, to protect its local labour force, the Indonesian government is now limiting the roles that foreigners can occupy on domestic construction projects.
“Foreign workers will be dedicated to certain expertise positions, for example as directors or other specialists,” Sumadinata said as quoted by Tempo.
According to him, the word “expert” refers to someone whose proficiency can’t be found in Indonesia’s labour force, like a tunnel expert, for example. In addition, foreign experts also require recommendations from the Ministry of Public Works and Housing to be allowed to work on local construction projects. This regulation is now applied not only for government projects, but also private projects.
Minister of Public Works and Housing Basuki Hadimuljono also stated that foreign construction workers and companies need to have joint operations with local construction businesses. He said the revision will ensure that foreign parties are only allowed to take role in local projects which cost around Rp.50 billion (US$3.7 million). In other words, foreigners can’t take part in small or medium scale projects.
In principle, the regulation also applies to the ongoing MRT project. Sumadinata explained further that several adjustment must be considered wisely, such as the needs for capital and investment to run the project.
Popular law discussion platform Hukum Online explained that foreign workers will also be required to transfer knowledge and technology to their local partners. It becomes their responsibility once they partner up with local construction firms on local projects. In theory, this would create a balance of knowledge between them and the locals, the government believes.