Deregulation needed to boost textile exports<\/p>\n
JAKARTA (JP): Deregulatory measures, simplification of
\nprocedures and heightened productivity are needed to increase
\ntextile exports, an industry spokesman says.<\/p>\n
A deputy chairman of the Indonesian Textile Association (API),
\nChamroel Djafri, said that efficiency improvements would become
\nmore important in the coming decade. This was because quota
\nsystems adopted by a number of major importers under the Multi-
\nFiber Arrangement (MFA) will be gradually eliminated within 10
\nyears, as per last month's conclusion of the GATT negotiations in
\nUruguay.<\/p>\n
The elimination of the quota system will increase competition
\namong textile exporters to penetrate formerly protected markets
\nin industrial countries, he said.<\/p>\n
"In 1993, the growth of our textile exports was practically
\nzero," he said. "Textile exports will continue leveling off in
\nthe coming years if we do not address factors which have
\nincreased production and marketing costs."<\/p>\n
According to the Central Bureau of Statistics, Indonesia's
\ntextiles and textile products exports increased by 19.6 percent
\nto 692,357 tons last year from 578,726 tons in 1992 and by two
\npercent in value to US$6.18 billion from $6.06 billion.<\/p>\n
Textiles and textile products are the country's second biggest
\nearner of foreign exchange after oil and gas. Last year's exports
\nof oil and gas reached $8.74 billion, down by 8.6 percent from
\n10.67 billion in 1992.<\/p>\n
Gradual elimination<\/p>\n
Chamroel said the gradual elimination of quota systems will
\naffect Indonesia's textile exports because its traditional
\nimporters may buy more products from newly emerging exporters,
\nsuch as Pakistan and Bangladesh, which can offer lower prices.<\/p>\n
Sjahrir, chairman of Padi & Kapas Foundation, said the
\ninefficiency of the government's bureaucracy, the inconsistency
\nof policies issued by different government institutions and stiff
\nimplementation of ruling on minimum wages have also affected the
\ntextile industry.<\/p>\n
The tough, new enforcement of minimum wage laws, which
\nrequires textile manufacturers to raise their minimum daily wage
\nfrom Rp 2,600 (US$1.20) to Rp 3,800 per day, has forced many
\ntextile factories to close down, he said.<\/p>\n
Chamroel said the hike of minimum wages is considered too high
\nby textile producers because the productivity of their workers is
\ngenerally low.<\/p>\n
The deputy made his comments during a seminar on the General
\nAgreement on Tariffs and Trade (GATT) yesterday. (01)<\/p>",
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