The coordinating Board of Investment (BKPM) kept drumming up investors in automotive components to invest in Indonesia On the occasion of investment Marketing Campaign in Japan on July 28 – 30 last, Head of BKPM Franky Sibarani held a one on one meeting with 3 automotive component companies in Japan. The 3 companies were interested to invest in Indonesia, but they were concerned about wages formation formula which was unpredictable in Indonesia. The was BKPM press release received on Monday (3/8).
Franky stated that as labor intensive industry, the case of workers’ wages really affected their business. One of the automotive component industry stated they planned to expand their investment worth USD 72 million to increase production output by 47% and the investment would need workers numbering 10,000 people.
The three components questioned about the Government’s step now finalizing the formula of wages increase effective for 5 years. BKPM also suggested the 3 companies to probe on the possibility of investing in Central Java or East Java, where wages was not as high that in West Java.
Franky stated that he would make automotive component industry as one of the focus of marketing because it absorbed labor well, export orientated and minimized import of component needed by the national automotive industry. he reminded that after vising one of the aitoi component factory in Central Java, PT Semarang Autocamp Manufacturing Indonesia (PT SAM) in June 25 last that the company had obtained data of business expansion in Jepara where 3,00 workers would be employed.
Meanwhile the products made, i.e. wiring harness, was marketed at home and abroad (76% exported and 24% domestic) Export was USD 123 million while domestic sales was USD 32 million.
BKPM data showed that total investment realization in transportation industry in Semester 1/2015 was Rp.14.92 trillion. The amount increased by 35% against investment realization of the same period of 2014 at Rp.10.97 trillion. (SS)
Business New - August 7, 2015