Indonesia’s textile industry is in crisis due to widespread factory shutdowns and major job cuts. President Joko Widodo orchestrated a crucial meeting with top cabinet officials on June 25, 2024, with this meeting team aiming to forge solutions for the disruptions crippling this vital economic sector.
Trade Minister Zulkifli Hasan reported on the discussions, stating, “The meeting discussed complaints from (players of) the textile industry who had to shut down their business or conduct mass layoffs.” The severity of these issues has prompted the government to reevaluate and potentially reinstate key regulatory measures.
Central to the government’s strategy is the proposal to reactivate Minister of Trade Regulation Number 8 of 2024, amending the preceding Regulation 36 of 2023 concerning import policies. This initiative, championed by Industry Minister Agus Gumiwang Kartasasmita, is designed to stem the tide of layoffs across various sectors, including textiles, apparel, electronics, footwear, and ceramics. Hasan elaborated, that the application of these regulations across diverse industries aims to buffer against further economic disruptions.
Kartasasmita has been an assertive proponent of bolstering international trade barriers, advocating for the implementation of Safeguard Measures and Anti-Dumping Import Duties. These protective measures are deemed crucial for shielding domestic businesses from the influx of low-priced imports that undermine local production.
Kartasasmita highlighted the compounded challenge of global trade restrictions, which prevent the absorption of Indonesian textile products abroad, leading to surplus production. He further noted that the resulting oversupply prompts other nations to offload their excess goods into less protected markets, including Indonesia, exacerbating the local industry’s woes.
Supporting Kartasasmita’s analysis, Finance Minister Sri Mulyani stressed the destructive impact of dumping on the domestic textile sector and called for unwavering enforcement of domestic industrial protection policies.
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