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APSyFI: The national textile industry is headed for a trade deficit, 2018 exports grow 1% and imports grow 14% (yoy).--IKATSI: The growth of the national textile industry is still hampered by floods of imports, Indonesia needs a clothing security law.

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Home arrow Latest News arrow Textile and Logistics Association Response to Increase of Imported Apparel

Textile and Logistics Association Response to Increase of Imported Apparel PDF Print E-mail
Written by Maizer   
Wednesday, 15 May 2019
As Trade Facilitator and Industrial Assitant, Customs has issued various incentives in the form of procedural and fiscal facilities, one of which is facility of a Bonded Logistics Center. One of the objectives of PLB was to support the domestic industry by providing fiscal facilities for import of raw materials that could support the industry.


Then responding to news that stated that the number of imported apparel from China, Chairman of the Indonesian Logistics Association, Zaldy Masita, said that so far there has been no Bonded Logistics Center (PLB) that distributes imported clothing from China.


"One of the objectives of  PLB was formed with the aim of supporting domestic industry by providing fiscal facilities for the import of raw materials that could support the industry, so that it would not be possible to be given permission to put apparel into the PLB," said Zaldy.


Apparel may still be included in PLB finished goods and PLB e commerce, but until now PLB finished goods are still specific to MMEA and PLB e commerce. MMEA and PLB e commerce itself have not yet been operational.


He also explained that to support small and medium enterprises there is a Small and Medium Industries (IKM) PLB which is one of its functions as a channel for domestic and small-scale industrial raw materials. Expenditures from PLB to IKM also adhere to the provisions of the trade system that apply in Indonesia.


While the Head of Customs Communication and Publication Subdirectorate Deni Surjantoro also explained the provisions on the import of raw materials through the PLB. "Raw materials can be imported directly through the PLB or by general importers for the final destination to IKM. If it is carried out by a general impotir, it is required to have a letter from the Ministry of Trade which contains the IKM data and the number and types that may be imported or quota. The quota held by the IKM is issued by the Ministry of Trade, which coordinates with the Ministry of Industry, "he said.


Zaldy added that with the PLB, the textile industry should feel helped because the cotton PLB which is main raw material of extile industry is the first type of PLB to be launched and provides enormous savings and competitive advantages for the textile industry both large, medium and SME industries. Zaldy also requested that the Ministry of Industry also check the parts related to the textile industry where the textile industry during 2019 grew very well for exports and increased capacity from textile factories to meet export needs.


Chairman of the Indonesian Textile Association (API) Ade Sudrajat said that the issuance of imported goods from PLB still follows the regulations issued by the Ministry of Trade, such as applying SPI (Import Agreement) and limiting the number and types of goods that can be imported (quota), so the goods that enter theoretically remain under control and are in accordance with national industrial needs.


Meanwhile, responding to the entry of imported clothing suspected through PLB e-commerce, Zaldy said that up to today there has been no PLB e-commerce operating according to the permit issued by the Directorate General of Customs and Excise. "So, clothing that is discussed and circulating in Indonesia at this time can be ascertained not from PLB e-commerce," he said.


On another occasion, PT Uni Air Cargo, an Indonesian e-commerce actor, Eko Prasetyo said that e-commerce is a global practice that we cannot avoid at this time. In 2016, the potential of e-commerce transactions in Indonesia reached USD 20 billion and could potentially grow to USD 130 billion by 2020. In fact, 2 of 4 Indonesian unicorns are startups in field of e-commerce. "International trade through e-commerce is the most efficient, fast and profitable for consumers," he said.


However, this makes the state must provide appropriate treatment for the practice of e-commerce. Consumers will make every effort to find the most profitable loopholes, either by utilizing the deposit services or using the value splitting services to fulfill the requirements of getting a de minimus, USD 75.


Seeing this condition, the Government through PLB e-commerce seeks to provide solutions to support e-commerce while ensuring domestic industry growth and state revenues. With PLB e-commerce, the imported goods will be subject to a flat rate of 7.5% as well as the scheme of importing shipments, but the provisions of the minimus of the shipment are not enforced. Thus, all goods released from domestic e-commerce PLB warehouses are subject to import duties and taxes in the context of imports.


The existence of the PLB which was built on March 10, 2016 is the realization of the Economic Policy Package volume II which is expected to reduce national logistics costs, accelerate dwelling time in ports and attract investment for national economic growth.

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