VZCZCXRO3738
PP RUEHCHI RUEHCN RUEHDT RUEHHM
DE RUEHJA #1248/01 1781032
ZNR UUUUU ZZH
P 261032Z JUN 08
FM AMEMBASSY JAKARTA
TO RUEHC/SECSTATE WASHDC PRIORITY 9396
INFO RUEHZS/ASSOCIATION OF SOUTHEAST ASIAN NATIONS
RUEHBY/AMEMBASSY CANBERRA 2690
RUEHWL/AMEMBASSY WELLINGTON 2783
RUEHKO/AMEMBASSY TOKYO 2149
RUEHUL/AMEMBASSY SEOUL 4694
RUEHBJ/AMEMBASSY BEIJING 5164
RUEHKA/AMEMBASSY DHAKA 1040
RUEHLM/AMEMBASSY COLOMBO 1079
RUEHPB/AMEMBASSY PORT MORESBY 3859
RUEHPT/AMCONSUL PERTH 0915
RUEHHK/AMCONSUL HONG KONG 2769
RHEHNSC/NSC WASHDC
RUEAIIA/CIA WASHDC

UNCLAS SECTION 01 OF 03 JAKARTA 001248 
 
SIPDIS 
 
DEPT FOR FOR DRL/ILCSR (MMITTELHAUSER), G/TIP FOR STEVE 
STEINER, EAP/MTS, EAP/MLS 
DOL FOR ILAB (RRIGBY, BSASSER) 
 
E.O. 12958: N/A 
TAGS: ELAB EIND ETRD PHUM PGOV ID
SUBJECT: CHILD LABOR PARTICIPATION IN NORTH SUMATRA,S PRAWN 
INDUSTRY DRIVEN BY SCHOOL FEES 
 
REF: A. JAKARTA 1097 
     ¶B. JAKARTA 1057 
 
JAKARTA 00001248  001.2 OF 003 
 
 
¶1.  This cable was coordinated with Embassy Jakarta. 
 
¶2. (SBU) Summary:  Child labor is a persistent feature of 
North Sumatra's prawn industry. While the low level of 
economic development is one component of the problem, the 
sharp difference between junior high and senior high school 
fees - and the inability of many families to pay the higher 
rates - is a key factor determining when youth enter the 
labor market and a driving force in child labor. Mission is 
working with NGOs and the International Labor Organization 
(ILO) to address this issue.  End Summary. 
 
Background 
----------- 
 
¶3. (U) Located on Medan's northern edge astride the Deli 
River, the districts of Marelan and Amperan Perak were among 
the first large-scale plantation districts in Sumatra. 
Beginning in the latter half of the 19th century, investors 
there cleared the jungle and established vast tobacco and 
sugar cane and later rubber and oil palm estates. Built on 
uninhabited land, these early plantations were powered by 
imported labor from Java and, to a lesser extent, China and 
India.   Plantations like these fueled North Sumatra's early 
growth, and the then-world renowned "Deli" tobacco made the 
region a household name among cigar aficionados in the first 
half of the 20th century.  To this day, the region's 
plantations are among the country's most profitable and 
productive, and Deli tobacco wraps some of the world's 
priciest cigars and is ground up for use in American snuff 
and chew. 
 
¶4. (U) Throughout much of the 20th century, new and expanding 
plantations absorbed the region's growing population. By the 
1980s, however, the land for new plantations was gone, new 
job opportunities dried up, unemployment rose, and incomes 
fell.  More and more workers from this area sought jobs in 
Medan's industrial parks while others, as their ancestors did 
a century before, signed up with labor brokers hoping to 
obtain work abroad. According to local inhabitants, after the 
plantations, work in the industrial parks - particularly the 
prawn processing plants -- is the most important source of 
employment. 
 
Labor Conditions 
--------------------- 
 
¶5. (U) On June 19, Medan Principal Officer traveled to 
Amperan Perak and Marelan to investigate reports of 
exploitive child labor in the prawn processing industry. He 
interviewed more than three dozen workers, including a dozen 
child and former child workers, as well as the parents of 
several current and former child workers. The visit was 
coordinated by the influential child advocacy and anti 
trafficking NGO Yayasan Pondok Rakyat Kreatif (YPRK).  This 
report is based on those interviews. 
 
¶6. (U) Every morning at 6:00 am, at least 30 large busses 
carry approximately 1000 workers from Amperan Perak to the 
prawn factories in the Medan industrial estate.  The estate 
is home to 5 major prawn factories (two also processing crab 
and cuttlefish); each employs 500 to 1000 workers.  Output 
from the factories is exported to Singapore, Hong Kong, 
China, and Japan. 
 
¶7. (U) The vast majority of workers in these factories are 
female. They work seven days per week starting at 7:30 a.m., 
though actual work hours are determined by the volume of 
product to be processed. Most days, workers finish up by 
around 4:30 p.m., board the buses, and return to their 
villages by 6 p.m. Several weeks per year, however, the 
volume of prawns to process is so great that employees may be 
 
JAKARTA 00001248  002.2 OF 003 
 
 
required to work until approximately 10 p.m. There are also 
occasional days when lack of supply means they are able to 
complete their work around 2:30 p.m. 
 
¶8. (SBU) The factories make the legally dubious claim that 
these workers are contractors and that they are not required 
to provide paid leave or benefits, including severance pay or 
social security. The factories do, however, pay for 
work-related injuries and home to work transportation, and 
female workers who become pregnant are permitted to work as 
long as they are comfortable doing so and may return several 
months after giving birth. Pay is determined by the amount of 
product processed.  While the specifics vary from factory to 
factory, in most cases employees are organized into groups of 
6 or 8 and are paid their share of the group's total output. 
Workers prefer this system because it prevents potentially 
large fluctuations in their income when their output is 
reduced because of weakness or illness. On an average month, 
workers expect to receive IDR 700,000 - 900,000 (USD 75 - 
100) for their labor, an amount close to the USD 90 monthly 
minimum wage.  All workers regardless of age and gender are 
compensated using the same formula. 
 
¶9. (U) Workers in the prawn factories complain that they are 
forced to handle cold, semi-frozen shrimp for hours at a time 
and that they must lift heavy crates. Several workers 
reported that on any given day, 3-4 workers will faint from 
exhaustion at each factory.  They described this as an 
improvement over several years ago when as many as a dozen 
workers routinely passed out per day. Workers invariably told 
Consulate Medan that they were happy with their jobs and 
wages and that they enjoyed the social aspects of the job. 
Spouses and parents of workers said that they were proud that 
their family members had obtained respectable, high-paying 
jobs. 
 
Prevalence of Child Labor 
---------------------------------- 
 
¶10. (U) Child labor has been present in the prawn factories 
from the beginning. Several long-term employees estimated 
that their factory might employ as many as two dozen workers 
aged 16-17 at any one time. A number of employees said they 
were aware of cases where "large" 15-year olds had been 
employed, all agreed that this was exceptionally rare.  A 
couple of employees said they had heard that a 14-year old 
was once hired, but that they did not know when or in which 
factory.  Many more workers aged 20-25 reported that they 
began work when they were 16 or 17 years old. 
 
¶11. (U) School fees appear to be a key factor determining 
when a youth will enter the labor market and driving force in 
child labor. Numerous current and former child workers said 
that they dropped out of school not to look for work, but 
because the cost of attending senior high school was sharply 
higher than junior high. Had the costs remained constant 
across grades or had their families been able to afford the 
higher fees, they said, they would have remained in school. 
Several parents of child workers confirmed this point. 
Parents and workers also said they felt lucky that the youth 
had obtained work in the factories. Not only was the salary 
relatively high and the work constant, particularly compared 
with work on the plantations, they said, but there was 
greater prestige associated with the factory jobs. 
 
¶12. (SBU) Oktaviana Perangin-Angin, the director of YPRK, has 
worked for more than a decade on labor, child, and 
trafficking issues. In other cases she has worked on, such as 
the once notorious fishing platforms of northern Sumatra, she 
said the working conditions were so exploitive that the 
solution was easy: expose the exploiters and force them to 
change their ways or close down. In this case, however, there 
is no easy solution. Pressuring the companies to eliminate 
the underage workers would not improve their condition, she 
said, but could make it worse, particularly if it pushed them 
 
JAKARTA 00001248  003.2 OF 003 
 
 
into the hands of traffickers or if it merely delayed their 
entry into the work force by a year or two. The best answer, 
she believes, is to improve the plight of all the workers in 
the factories by promoting safe and healthy working 
conditions and that they receive the benefits to which they 
are legally entitled. 
 
¶13. Consulate Medan is also working with YPRK and local 
officials to discuss ways to encourage communities and 
families to keep children in school.  Labatt will also raise 
this issue with the ILO. 
HUME