Businesses in Jakarta Begin Moving to Semarang

TEMPO.CO, Semarang - Businesses in Jakarta, Bogor, Depok, Tangerang and Bekasi (Jabodetabek), have started to develop factories in Semarang, Central Java. Some factories have submitted operation permits to the Semarang regional government since the end of 2014. "They moved [to Semarang] because the wages are lower compared to Jakarta," said Nurjannah, Head of the Semarang Industrial and Trade Agency on Wednesday, January 14, 2015.

For 2015, the minimum wage for Jakarta is set at Rp 2.7million per month. Meanwhile in Semarang, the minimum wage is set at Rp 1.6 million per month. Despite objections expressed by businesses, Governor Basuki "Ahok" Tjahaja Purnama, insisted on increasing minimum wage and allow entrepreneurs to seek other places if they wish to hire workers with cheaper wage.

According to Nurjannah, since the end of 2014, many entrepreneurs have conducted surveys in Semarang and gather information about licensing process and factory operation. She added that at least two investors are ready to build a factory in the Wijayakusuma Industrial Area with an investment value reaching up to Rp 100 billion.

Chairman of the Central Java Industrial Area Mohammad Djajadi, confirmed that many businesses are considering to move their factories from Jakarta to Semarang.

EDI FAISOL