The fate of ASEAN (Association of Southeast Asia Nations) after Cold War (1947-1991) underwent the tough era. Crisis by crisis attacked ASEAN at that time. ASEAN’s tough era is started by economy crisis in the mid-1997. In Indonesia, the crisis in this period is a toughest having attacked the stability of Indonesian economy. This crisis happened suddenly when domestic economic growth rate arose rapidly reaching average growth around 7 percent per year during 1990-1996 and internal and external condition which is conducive enough. The extreme crisis was caused by the fall of the rupiah exchange rate against the US Dollar. Then it continued the environment crisis being caused by forest fires in several parts of Indonesia, specifically in Sumatra and Kalimantan between 1997-1998. Besides, the crisis of humanity and security rised in Timor Timur after the defining of notion in August 31st 1999. The crisis of leadership also rised after the stepping down of President Soeharto from his regime of power at May 21st 1998 and the crisis being caused by ASEAN members’ expansion into 10 countries in 1999.
Based on those crisis, in this period ASEAN’s relevance started to be questioned. ASEAN got various critics coming from both internal and external due to the decline of ASEAN’s relevance as international organization. ASEAN had been assumed by various circles as not effective organization and even called as organization starting to go down (sunset organization).
To answer the challenges, in The Ninth ASEAN Summit in Bali at November 7th 2003, ten ASEAN’s leader namely Indonesia, Malaysia, Singapore, Brunei Darussalam, Thailand, Philipine, Vietnam, Cambodia, Myanmar and Laos agreed on the establishment of ASEAN Community or Bali Concord II. In the establishment of ASEAN Community, there are three pillars of cooperation that have been agreed namely ASEAN Economic Community (AEC), ASEAN Political-Security Community (ASPC) and ASEAN Socio-Cultural Community (ASCC). ASEAN Community’s programs are one of agreements among the leaders of South East Asian countries for future regional integration which will facilitate new cosmopolitan.
The establishment of AEC is in line with ASEAN Vision 2020 (based on 2007 agreement) in economy sector aiming to transform ASEAN into stable, prosperous, and competitive region by the equity of economic development, reduced poverty, and the gap of social-economy.
To strengthen ASEAN Community agreement, in the Thirteenth ASEAN Summit in Singapore (2007), entire ASEAN members signed ASEAN Charter that aims: ”Commited to intensifying community building through enhanced regional cooperation The ASEAN Security Community, The ASEAN Economic Community, and The ASEAN Socio-Cultural Community.”
AEC’s achievment through the creation of single market and production base is aimed for expansion effort through regional integration to reach omptimum economic scale. The steps of liberal integration and strengthening ASEAN itself become strategies to reach overall or individually strong competitiveness. AEC is also expected to be able to make ASEAN stronger in facing international negotiation. Through economic integration process, ASEAN will be a region liberating both good and service trading and flow of production factors (capital and labor).
AEC also aims to increase ASEAN countries’ competitiveness at international level and to be able to compete with economic power of Asian countries such as China, India and Japan in alluring the entry of foreign investment. 2015 is a significant milestone at ASEAN’s integration agenda when economically ASEAN region had got significant progress and prosperity.
One of supporting pillars in establishing AEC is employement aspect. The presence of AEC will make ASEAN as large region that will give the widest opportunities for anyone wanting to work and will give chances and also challenge to job seekers’ future. They will have freedom and simplicity to choose place to work according to the skills they have. Therefore, with the excellence of ASEAN working age is expected being able to compete with global labor market so that it can boost the development of ASEAN economy in the global arena.
Nonetheless, besides the employement opportunity, there are challenges alsi in AEC 2015 that is noteworthy. One of the challenges faced by Indonesia now is weak quality of human resources. Based on Badan Pusat Statistik data per August 2016, the weekness of labor force which most of them passed elementary school still around 52 million people or equal with 43% Indonesian labor force. This thing must be particular attention to the Indonesian government to escalate Indonesian education quality. Another obstacle is high unemployed rate reached 5,61% in 2016.
With the presence of AEC, foreign labor coming from neighboring countries are free to enter Indonesia. Indonesian society right now is facing with global environment whether they want it or not have to be faced because global environment will affect on Indonesian society either directly or indirectly. In terms of facing global competition, competent human resource is the significant aspect that must be utilized as much as possible. The abundace of Indonesian labor force shoud be balanced by quality of labor in order that this huge opportunity can be beneficial for Indonesian economy. Therefore, Indonesia is able to catch up with other countries, specifically in ASEAN.
In AEC Blueprint, it is generally called that to support continuity of good, service and invesment trading made in accordance with general regulations by host countries, hence it is needed labor mobility or entry facility for the movement of labor. In this term, ASEAN will facilitate visa publishing and employment pass for professional labors and skilled labors working in sectors related to international trade and investment activities in the ASEAN region.
To support service integration, ASEAN is doing various initiatives in employement field. One of which is the establishment of Mutual Recognition Arrangements MRA. MRA is an agreement recognized by entire ASEAN countries to admit one another and to accept some or all aspects of the result of the assesment such as test result in the form of certificate. This condition is reached by reducing good and service non-tariff barrier. According to Tullao and Cortez, the MRA establishment aimes to create accreditation procedures and mechanisms to reach similarity and to admit international difference in terms of education, training, experience, and license requiremets for professional practice.
So far, ASEAN has agreed eight professional sectors included in MRA namely engineering services (2005), tourism services (2005), architect services (2007), nursing services (2006), surveying services (2007), medical/doctor services (2008), dentist services (2008) and accountant services (2008).
Based on this background, the writer is interested in researching about Indonesian labor problems in term of facing economy liberalitation. Therefore, this research titled “THE POLICY IMPLEMENTATION OF INDONESIAN GOVERNMENT TO ESCALATE LABOR COMPETITIVENESS IN ASEAN ECONOMIC COMMUNITY”.
Problem of Research
1. How does policy of Indonesian government escalate labor competitiveness face ASEAN Economic Community?
2. What is determinant sector of Indonesian service and labor competition?
Purpose of Research
1. Explaining quality of policy having been done by Indonesian government to escalate the competitiveness of Indonesian labor in facing ASEAN Economic Community integration.
2. Defining determinant factors of Indonesian service and labor competitiveness.
Advantage of Research
Academically, yield of research is expected to be able to add knowledges about implementation of Indonesian labor policy in ASEAN Economic Community. The author also expected that yield of research is able to be a thought contributution scientific literature in Faculty of Social and Politic State Islamic University of Jakarta.
To distinguish author’s study with other studies, it needs literature reviews that are useful to make sure position and significance in the context of overall broader research. The author found one of journals titled “Menakar Pengaruh Masyarakat Ekonomi ASEAN 2015 Terhadap Pembangunan Ekonomi Indonesia” written by Atep Abdurrofiq. In his journal Atep explained that with its demographic adventage, Indonesia is very likely to get the biggest profitfrom more than 600 millions of ASEAN population. AEC opens opportunties for investors around ASEAN with an asumption that Indonesia is a potential market so Indonesia economic growth will significantly go forward. Besides, Indonesia is als able to enlarge their invesment in ASEAN regions so that production and economy capability are getting better. Nevertheless, this condition can be contra-productive. AEC agenda is predicted that it is able to bring out exploitation risk. Big scale exploitation of nature resources probably happens because Indonesian regulations is not really binding so that ecosystem destruction will happen because of foreign companies in Indonesia. Therefore, according to Atep, exploitation risk must be anticipated by particular regulative restrictions such as violation of foreigners to afford and to own the land, banning on foreigners to employ the locals less than 60 percent of total workers, and other regulations which can exploit public interest so that AEC will be opportunities for national economic progress.
Atep’s writing explains that with following AEC agenda, Indonesian environment would be damaged because of the arrival of foreign companies to indonesia. Hence, Atep tries to give solutions by making strict laws to environmental protection in order that market liberalization does not give negative impact to the environment. In the other side, the author focuses on study to the impacts or consequences of economy accepted Indonesia in its participation in AEC. The author describes how Indonesian labor prospect will be and what Indonesian government should do to reach ASEAN Vision.
The next literature review the author took is a study written by Puji Nia Rachmatika titled Analisis Kesiapan Indonesia dalam Menghadapi Kerjasama ASEAN-China Free Trade Area (Tinjauan Terhadap Daya Saing Industri Tekstil Indonesia). This study analyzes the readiness of Indonesia in textile competition sector in facing ASEAN-China Free Trade Area (ACFTA). Purpose of the research is to analyze how readiness of Indonesia faces ACFTA especially in textile industry. From this research, Puji found that Indonesian textile industry is facing various supporting obstacles affecting competitiveness such as labors problem, expensive energy, unconducive infrastructure, the lack of rejuvenation of textile machinery government’s policies and regulations and coordination among departements become the cause of unhealty indonesian textile industry and it has not been able to compete with China in ACFTA. In labor factor, Indonesian weaknesses are high labor cost and lack of competitiveness in terms of the national textile industry. To answer those challenges, It nees human resources and high labor expertise. It can be reached with the establishment of formal education institution, centre of craftsmanship, technical training, and marketing. The difference between Puji’s study and the author’s sudy is level of research area. The author reviews the readiness of Indonesian labor in facing AEC in terms of labor sector. In this work, the author explains Indonesia’s preparations in terms of human resources and regulations applied by the government.
The author also found literature review related with this study about labor market in the book titled Pasar Tenaga Kerja Indonesia: Kasus Sektor Konstruksi written by Kartini Sjahrir. This book tries to answer question namely about migration and rural area, urban area and construction sector and role of Indonesian government in changing rural area and urban area. This book specifically describes government policies in developing rural area and urban area. For the improvement of rural area, New Orde Era government did self-sufficiency in rice proclaimed since the 1970’s which has been able to escalate rce production. The development also happened in urban areas where the development affected to the labor migration from rural area to urban area. In his work, the researcher found the development urban center had been able to create jobs, especially for unskilled labor for example in transportation sector, becak rider can have net income around Rp 5.000 per day. Also in trading sector, travelling salesman (pedagang keliling) can earn very well around Rp 6.000 per day. Those facts prove that urbanization affected to the rising of better wage offer especially for unskilled labors. Rural areas are main source of labor supply for construction sector in urban area. Wage earned by construction labors is relatively higher than that of by them worked in either the rice fiedls or sugar cane plantations. From Kartini’s study, the author delves that migrasi has had positive impact for economu specifically giving high wage to unskilled labor. In AEC also happens labor exchanges from member countries so that labor market pattern in New Orde Era can be repeated so that both sides are able to get advantages from AEC policies.
In terms of labor liberalization, the author found study result titled Pemetaan Pekerja Terail Indonesia dan Liberalisasi Jasa ASEAN being done by ASEAN Study Center Faculty of Social and Politic cooperating with Badan Pengkajian kementerian Luar Negeri Republik Indonesia. This study was done by Makmur Keliat, Ph. D, Asra Virgianita, MA, Shofwan Al-Banna, Ph. D, and Agus Catur Aryanto S.Sos. Focus of this study is labor liberalization in one of AEC agendas namely Mutual Recognition Arrangements (MRA). This research reviews eight sectors having been agreed MRA. This research found facts that if we see the trade balance of services, Indonesia continously has large deficit. Import value of service is doubled of export value of Indonesian services. In many sectors, the entry of migrant workers is deemed necessary as the gap between the needs of professionals in a sector is not sufficient for domestic professionals. From eight MRA sectors, generally the quantity of human resources in almost whole sectors have a shortage of professional workers. This problem is caused by the lack of professional labor distribution whose majority of human resources are concentrated in Java especially Jakarta. In the other side, migrant workers also are not sure to resolve this problem because precisely it will gain competition in a tight competition. So, it can be concluded that Makmur and colleague’ study is highly relevant with this research so that it helps the author to develop this research. By the journey of AEC, This study is expexted being able to prove new findings about Indonesian labor and developing study which have been done by Makmur and colleagues.
Method of Research
This research uses descriptive-analytical method which is study to find a fact with accurate interpretation and anlysis is intended for testing hipothesis and conducting deeper interpretation in relations. The research uses literary study such as documents having been collected to know how far research science has developed and how far the conclussion can be found and degeneralitation having been made so that the situation is able to be obtained.
Research data sources are collected from literary research such as textbook, journal, bulletin, and annual review which discuss about ASEAN relation and Indonesian politic. Data sources are also collected from direct interviews with policy actors such as Edo Amrullah as a head of law firm of Employement Minister and Aris Hermanto As a head of Stabdard Kompetency Division. The author also interviewed Arsis Arif Mundayat as an ASEAN human right reasearcher. This study is based on Academic Guidence of Fakulty of Social and Politic.
Systematic of Research
In Chapter I, the author explains background of problem and question of problem, advantages and aims of research, literature review as author’s reference to related studies method of research and systematic of research.
In Chapter II, the author explains theoritical framework as conceptual foundation in dissecting study that will be written.
In Chapter III, the author focuses on general description of development started from Selayang Pandang ASEAN until the establishment of ASEAN Community. Then the author explains generan description of ASEAN Economic Community, economy condition, labor and ASEAN human resource. At the last, in this chapter the author expalins about the concept of labor liberalization.
In Chapter IV, the author conducts a analysis about Indonesian government’s policies in escalating labor competitiveness in ASEAN Economic Community.
In the last Chapter, the author redescribes finding from Chapter IV to conclude overall form the findings of research and describing recommendations for next study.
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