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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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Association Urges Government to Consistently Apply Policies to Maintain the Growth of TPT Industry PDF Print E-mail
Written by Maizer   
Thursday, 19 March 2020
The condition of the textile and textile product industry (ITPT) in the last two months has begun to show progress where there is no increase in the number of companies that have closed down or reduced their employees. This is a positive impact of the implementation of temporary safeguard duties (BMTPS) and the closure of a number of Bonded Logistics Centers (PLB).

 

However, there is still homework to be done by the government and associations so that industrial performance improvement is achieved.

 

A number of textile PLBs still operate on the basis of PERMENDAG 77 2019 where the activity is counterproductive to efforts to advance the industry. In addition, the weak supervision of incoming goods has further exacerbated the situation as monitored by national media investigations.

 

"To maintain the momentum of improvement, we encourage the government to firmly stop the flow of TPT (HS 50-63) goods through PLB and immediately revise PERMENDAG 77 2019," said Secretary General of the Indonesian Filament Fiber and Yarn Producers Association (APSyFI) Redma G. Wirawasta.

 

According to him, the imposition of BMTPS should be appreciated, but its implementation is still ineffective due to leakages. On the other hand, industry players are still waiting and seeing because they are doubtful of the government's commitment to permanent safeguards (temporary safeguards will end this March).

 

The combination of the above makes producers daring to increase their production utilization so that production utilization still stops at around 50%. Small and Medium Industries (Convection) that produce apparel are the hardest hit because imports reoccur in the momentum leading up to the feast which is an important period of annual sales.

 

In addition, the Indonesian Textile Association (API) strongly criticized the relaxation of imports of the TPT sector, which was pursued by a number of parties. Existing import facilities have disrupted the stability of the industrial chain where there are incentives that encourage import activities.

 

"Relaxation will only worsen the current state of the economy in which a decline in public consumption reduces the domestic market so that if flooded with imports it will hit hard on local production," said Jemmy Kartiwa as Chair of the National Management Agency (BPN) API.

 

Related to this, Jemmy continued, his party suggested that incentives be given to domestic producers as a stimulus to increase production activities which would directly drive the economic chain. Incentives can be in the form of eliminating temporary VAT from upstream to downstream of ITPT to encourage increased production in order to meet domestic needs.

 

As information, over the past 10 years the national textile industry has been burdened by rising production costs such as electricity, gas, employee wages, logistics costs and other fees as well as environmental regulations that are more stringent than other countries, thereby increasing the burden of industrial costs.

 

Unfortunately the regulation is only sharp inside because various policies and facilities are actually provided for imports that disrupt local products in the domestic market. This condition causes industries to drop out one by one and move into importers and traders, thereby distorting new investment in the textile industry.

 

"We expect the consistency of economic policy from the government to continue to support the industry by making the domestic market a guarantee of the local market. In parallel, efforts to increase competitiveness to improve cost efficiency must continue to be made so that the textile industry can make a sustainable contribution to national GDP while competing in the market. global, "concluded Redma.

 

 
		
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