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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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Alarm in Textile Sector PDF Print E-mail
Written by Maizer   
Monday, 15 July 2019

The condition of Indonesia's manufacturing industry is reportedly experiencing tremendous expansion. At least that was announced by Bank Indonesia (BI) regarding the national manufacturing index.

 

However, in the midst of this optimism, there was anxiety. News of lethargy came from the textile sector, which was one of the biggest contributors to labor.

 

Changes in behavior?

 

On a more micro-scale market, news of the decline came from the domestic market. Although not wanting to admit clearly, to the media, the Chairperson of the Indonesian Shopping Center Management Association (APPBI), Stefanus Ridwan, acknowledged that there had been a decline in the stretch of business in shopping centers, especially in the International Trade Center or ITC. He admitted, at this time the ITC was no longer as attractive as it once was.

 

The decline in business performance is claimed to only occur in ITCs located in DKI Jakarta alone. The association claims, changes in consumer behavior patterns are the culprit.

 

"If there is no decline outside Jakarta, because they are still accepted by shops, even if they are only stalls. For them it's still okay. Which in big cities, demands are getting heavier. If there (out of town), the purpose is to buy goods. He has enjoyed it. Jakarta doesn't enjoy it anymore, "said Ridwan.

 

Complaints from traders and ITC owners are indeed increasingly echoing. Strangely, this condition occurred when they had the opportunity to get cheaper merchandise with a flood of imports, especially textiles. Is this valid evidence that there has been a decrease in purchasing power? No one has dared to make sure.

 

Interestingly, the textile industry, especially yarn and fiber producers, have started to reduce production since the beginning of the year. The reason is clear: sluggish demand as a result of the flood of imported products that have soared since last year.

 

Redma added, manufacturers reduced production capacity by 15-20% because demand in the downstream sector was reduced. The needs in the user sector are mostly filled with imported products. It can be seen from the increase in consumption of apparel, but the absorption of domestic yarn and fiber products did not experience growth.

 

The fabric manufacturing sector, which is the industry of users of yarn and fiber, has fallen due to the flood of imports. Redma said that currently the level of production utilities in the weaving, knitting and dyeing sectors is only at the level of 40%.

 

 

It was so worrying, the Indonesian Fiber and Yarn Filament Association (APSyFI) dared to estimate that the trade balance of the textile and textile products (TPT) industry would be deficit in the next 3 years. According to Redma Gita Wirawasta, Secretary General of APSyFI, looking at the trade performance of the TPT sector from 2007 to last year, the average export growth was only 3.1%, whereas import growth reached 12.3%. TPT surplus continued to erode from US $ 6.7 billion to US $ 3.2 billion.

 

 
		
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