Indonesia needs to overhaul its labour laws and remove foreign ownership restrictions to help raise economic growth to levels that would have an impact on poverty, Angel Gurría, head of the Organisation for Economic Co-operation and Development, said on Thursday.

Mr Gurría was in Jakarta to release the OECD’s first comprehensive study of the Indonesian economy. Its report recommended Indonesia introduce a mechanism linking increases in local fuel prices to world energy markets, with a view to obviating politically motivated adjustments and eventually wiping out all subsidies.