INDONESIA: Almost 300 permanent workers at a motorcycle plant in Indonesia are facing losing wages and their jobs after a major shareholder in the company was charged with fraud and fled the country.

PT Kymco Lippo Motor Indonesia is a joint-venture between 75 per cent majority shareholder Kwang Yang Motor Company (Taiwan) and 25 per cent shareholder PT Lippo (Indonesia). Production at the plant began to drop in September 2008 and stopped completely in October 2008. Management informed the workers, members of IMF-affiliate Federasi Serikat Pekerja Metal Indonesia (FSPMI), the stoppage was due to a problem with the supply of parts.

However, when a parts supplier filed legal proceedings against the company for failure to settle payments due, PT Lippo discovered that the Taiwanese management was mismanaging the company. The High Court in Jakarta later found the Taiwanese partner guilty of fraud and ordered damages for a sum of US$20 million in favour of PT Lippo and, pending the full settlement of the damages, the court ordered that company President Mr. Su Kou Chang be remanded in prison. Before the court order could be executed, the President of the company fled from Indonesia.

The company's operation stopped completely in October 2008 and the 300 workers have been locked out since then. The workers continued to receive their wages until April 2009. The Department of Labour at Bekasi, Indonesia has ordered the company to pay the workers but the Indonesian shareholder has refused to comply with this order and the Taiwanese majority shareholder has absconded.

The FSPMI issued a notice to the local shareholder that if this industrial dispute is not settled soon it would proceed to auction off the assets of the company and pay the workers their due compensation. IMF Regional Representative Arunasalam delivered messages of solidarity during a visit to the plant in July.Jul 30, 2009 – Anita Gardner

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