Stirred by a likely boost in demand from countries like the US and Japan, Indonesian textile manufacturers see their exports rising by six percent to US$ 13.4 billion during the current year, Indonesian Textile Association (API) has said.
Registering a year-on-year fall of six percent, Indonesia’s textile and apparel exports for 2012 stood at US$ 12.6 billion, against 2011’s exports of US$ 13.2 billion. However, backed by good demand, the industry eyes a recovery this year.
Exports to the US, Indonesia’s biggest textile export destination, is expected to rise by four percent from last year’s exports of US$ 5 billion, mainly on account of bulk orders from US brand owners, API Chairman Ade Sudrajat said at a media briefing in Jakarta.
During the initial 10 months of 2012, Indonesia’s textile exports to the US dipped three percent from 2011’s corresponding period to US$ 4.4 billion. However, Indonesia’s exports to the US got a boost thereafter owing to the zero-duty benefit extended by the US to developing countries like Indonesia as a part of the generalized system of preferences (GSP).
API also foresees a considerable rise in orders from Japan, as Indonesia has already tapped a 70 percent rise in its textile exports to that country post implementation of the Indonesia-Japan Economic Partnership Agreement in 2008, the API chief said.
Indonesia’s textile exports to Japan for first 11 months of 2012 grew by 16.3 percent to ¥91.9 billion or US$1.05 billion.
In spite of all the positivity, Indonesian textile makers do not expect much growth in domestic market as they continue to face fierce competition from imported goods.
Over the past few years, there has been a major rise in Indonesia’s textile imports from China, Mr. Sudrajat said.
China’s textile exports to Indonesia rose by almost 82.3 percent to US$ 4.45 billion during 2007-2011, while its garment exports surged by 34.4 percent to US$ 350,000 during the period, he said.
The association also expects the prices of a wide range of textile and textile goods to rise by 10.3-16.7 percent, as most of the textile firms in the country are concentrated in the areas like Banten and West Java, which have been hit by sharp rise in minimum wages and also by 15 percent hike in energy tariffs.
