Indonesia extends safeguard tariffs for 3 years to protect TPT sector

The decision followed the textile and textile product (TPT) sector’s struggle to return to pre-pandemic levels due to declining domestic and export demand and increasing competition.

The sector witnessed a drop in jobs, with the workforce dropping from 3.98 million last year to 3.87 million this year.

Added to the problem is the influx of textiles from abroad, particularly China, prompting government action to protect the industry.

The regulations to protect the sector have been formulated after taking inputs from stakeholders, including relevant ministries, industry associations and trading partners, in line with World Trade Organisation guidelines.

The Indonesian Filament Yarn and Fibre Producers Association said around 30 textile factories have shut down Bandung and Surakarta, causing 10,800 layoffs between January and May this year, up from 7,200 in 2023.

The Confederation of Indonesian Workers reported nearly 50,000 layoffs in the TPT industry from January to early June 2024.

West Java and Central Java, home to the largest concentration of factories in the sector, have seen the highest number of layoffs.

Several companies, however, are reluctant to disclose layoffs to avoid affecting their relationships with banks and buyers, an Indonesian media outlet reported.

Fibre2Fashion News Desk (DS)