Just when I thought Indonesia’s new laws for employing foreigners was going to kill off all foreign investment into the country, the government has back pedaled (at least a little) on tough new regulations they implemented four months ago.
One of the new regulations was that a company had to hire 10 Indonesian employees for every foreigner – that is now back to the old ratio of 3 Indonesian employees to one foreigner.
Other points include:
– Non resident commissioners and directors are no longer required to obtain a work permit
– Temporary work permits are no longer needed for attending meetings and providing training. Except for some sensitive work like conducting audits and commercial movie production. Machinery installation and after sales service still requires a temporary work permit.
I should add that the widely report Indonesian language requirements for foreign workers were never implemented.
Of course it is great to see that the government has realized that their laws were over restrictive and have done something about it, but how many companies in the meantime have decided to close shop, move operations or invest in another country entirely.
I can understand the government wants to protect local jobs, but what can they do if the local expertise does not exist?
A full listing of the changes can be found here (in Indonesian) http://jdih.naker.go.id/data_puu/permen_35_tahun_2015ok.pdf
More information here:
Photo credit: https://www.flickr.com/photos/d10n2000/181429758