JAKARTA and several other different cities in Indonesia have witnessed large protests for a number of days now. Protests that generally turned violent, involving 1000’s of individuals from numerous teams, the vast majority of whom are college college students and employees, are anticipated to proceed till subsequent week.
Their anger is over an employment invoice (additionally known as Omnibus regulation) which was launched by the Indonesian authorities within the Home of Representatives in early 2020 and was handed earlier this month.
The invoice seeks to draw funding from inside and outdoors the nation by repealing some rules which can be seen as complicating the operations of enterprise organisations.
Essentially the most controversial facet is the abolition of rules that shield employees’ rights in addition to people who shield the setting. An instance is the abolition of minimal wage guidelines in addition to rules that shield workers from being fired by employers.
As well as, rules that require enterprise organisations to carry out an Environmental Influence Evaluation earlier than commencing with a challenge are additionally relaxed.
After all, these are all carried out due to the strain from trade gamers and buyers who’re going through an more and more difficult enterprise setting.
The extent of competitors in nearly all sectors is intensifying and forcing enterprise organisations to extend their productiveness and competitiveness. Because of this working prices should be diminished, particularly payroll prices.
That is what makes the employees and college students offended as a result of they really feel that the Indonesian authorities is extra involved with the pursuits of enterprise homeowners over the curiosity of employees and the frequent individuals.
The difficulty mentioned above isn’t a brand new difficulty. In actual fact, it has occurred earlier than in lots of different international locations earlier than, particularly within the west.
For instance, in 2006, 1000’s of scholars and employees protested violently in opposition to the French authorities beneath Prime Minister Dominique de Villepin who had proposed a regulation that might make it simpler for enterprise organisations to put off employees with a view to cut back working prices.
It’s because French enterprise organisations have been going through fierce competitors from overseas, particularly from Jap European international locations akin to Poland and Hungary the place working prices are decrease and labour legal guidelines are extra versatile permitting enterprise organisations to simply lay off employees when the financial system slows down and demand for his or her merchandise declines.
It needs to be famous right here that finally the calls for of the protesters have been ignored, and the French authorities went on to move and implement the brand new regulation.
What must be realised is that the enterprise setting around the globe is now going through an environment of utmost or hyper competitors.
The principle issue contributing to this environment is the existence of many organisations working on a big scale in nearly all enterprise sectors.
The present enterprise setting is much like the environment of intense competitors in lots of sports activities, which is the trigger and impact of using steroids by the athletes themselves.
Though the efficiency of athletes is improved, some detrimental results will come up. Amongst different issues, lots of them may have coronary heart issues and die early deaths.
Sadly, now many athletes have resorted to steroids as a result of that has change into a typical apply amongst athletes, and a situation to realize success particularly on the worldwide stage.
Within the enterprise world, the “steroids” are the monetary funds borrowed from the banking sector. After all, these funds will assist organisations function on a bigger scale, with greater ranges of innovation in addition to stronger advertising capabilities.
However when all organisations use the identical technique, which is to develop by borrowing from the banking sector, the extent of competitors shall be fierce.
The scenario is getting worse as a result of cash is now primarily in digital type and now not in bodily type (solely 3% of the cash provide is in bodily type).
This example makes it simpler for the banking sector to create new cash, which is then loaned out to the enterprise sector. Because of this, the quantity of loans to the enterprise sector has elevated quickly and the extent of indebtedness of corporations retains rising.
Ultimately nearly all enterprise organisations are saddled with enormous money owed. That is what forces them to search out methods to scale back prices as a lot as attainable. In any other case, they must relocate their operations to international locations the place labour and environmental legal guidelines are extra relaxed.
The Indonesian authorities is conscious of this risk and due to this fact needed to conform to their needs and solutions for the Omnibus regulation to be handed.
In actual fact, enterprise organisations are additionally victims of the monetary system that squeezes them with debt burden in addition to creating a really difficult enterprise setting.
To make sure that they will survive and be financially wholesome, they in flip should squeeze their workers and interact in processes that threaten the setting.
The individuals and the employees really feel that the scenario is unfair to them and are understandably offended on the authorities which is perceived to be conspiring with enterprise organisations which can be oppressing them.
The individuals don’t realise that the reason for the scenario that oppresses them is actually not the Indonesian authorities alone but in addition the banking sector that’s placing strain on the enterprise organisations.
In actual fact, Indonesian society itself can also be at fault for permitting the banking sector to develop quickly over the previous couple of a long time. Because of this, all events are in a state of stress and distress, particularly the working class.
Sadly, primarily based on what had occurred in France in 2006 in addition to in another international locations, it is rather probably that their efforts shall be in useless and the Indonesian authorities will proceed to implement this regulation.
It’s because the federal government has no different different to make sure that funding inflows will improve and the Indonesian financial system will proceed to develop sooner or later, for the `survival ‘of the federal government itself.
In response to stories, the Indonesian Ulema Council (MUI), has additionally determined to help the scholars and employees in opposing the Indonesian authorities on this difficulty.
MUI, being very educated on Islamic issues ought to realise that the reason for the issue is the failure of the Indonesian group basically to limit the event of the debt-for-profit trade which is opposite to Islamic teachings.
Due to this fact, along with voicing opposition to the brand new regulation, MUI ought to concentrate on efforts to teach the Indonesian group concerning the risks of the debt-for-profit (or Riba) trade as a long-term resolution.
MUI additionally wants to extend its academic efforts to vary the essential values of Indonesian society in order to not focus solely on materials progress and financial growth. Such materialistic values are the primary issue within the growth of the Riba trade in Indonesia, particularly in current a long time.
Failure to determine the foundation reason behind the issue will imply that the issue is not going to be solved.
Though this regulation will be certain that investments will improve and Indonesia’s financial system will develop, particularly when the Covid-19 pandemic ends, will probably be adopted by a rise in stress and distress amongst extraordinary individuals, as is occurring in different international locations, together with in Malaysia.
Protests and demonstrations in opposition to the federal government is not going to change this unhappy scenario. In actual fact, it is rather probably that they may finish in a number of weeks attributable to fatigue among the many protesters themselves.
What can change the scenario in the long term is a change within the primary values of the Indonesian society to create a much less materialistic society, and in addition a better consciousness of the threats from the event of the debt-for-profit trade, and ensuring it doesn’t proceed to oppress the society there.
Prof Mohd Nazari Ismail is from the College of Enterprise and Accounting, Universiti Malaya. The views expressed listed below are solely the author’s personal.