Orders for textile products down by half<\/p>\n
JAKARTA (JP): Local textile companies said yesterday export
\norders for textile and textile-related products had dropped by 50
\npercent due to the country's political uncertainty.<\/p>\n
One of the executive heads of the Indonesian Textile
\nAssociation, Lili Asdjudiredja, said most of the orders for
\nSeptember and October, for delivery in January next year, had
\nbeen canceled.<\/p>\n
\"Even recently, some of the orders for May and June, which
\nwould be shipped in September, have been canceled.\"<\/p>\n
He did not disclose the value of the canceled orders, but said
\nit was a huge amount.<\/p>\n
Many of those which canceled their orders were European and
\nAmerican firms, he added.<\/p>\n
Lili said international buyers were worried that the local
\nexporters would not be able to meet the time of delivery.<\/p>\n
They were afraid shipments would not be on schedule or that
\nthe delivery would be halted due to further social unrest.<\/p>\n
They were also concerns their goods might be looted during
\ntransportation if riots reoccurred.<\/p>\n
\"These people (buyers) saw riots here on TV, and they are
\nafraid of arson and more riots.\"<\/p>\n
Jakarta was hit by four days of widespread looting and arson
\nstarting May 14, which resulted in at least Rp 2.5 trillion in
\nproperty damage and several days of crippled economic activities.<\/p>\n
Distribution<\/p>\n
Lili said the textile industry did not suffer much destruction
\nof its production facilities, but most losses were incurred from
\nthe halted distribution prompted by fears of mob violence.<\/p>\n
Last year, exports of textile and textile products dropped by
\n19.64 percent to US$5.27 billion, after enjoying a 13.87 percent
\nrise to $4.64 billion in the first eight months of the year.<\/p>\n
Lili said the association considered current high interest
\nrates -- part of the government's tight monetary measures -- a
\nburden to the exporters.<\/p>\n
For example, an average 58 percent interest rates of Bank
\nIndonesia's promissory notes and 70 percent lending rates bit
\ninto the exporters' revenues by 15 percent, he said.<\/p>\n
A rise in fuel and power tariffs only contributed 3 percent to
\n4 percent of the revenues, he said, referring to the government's
\nmove early this month to raise the tariffs as part of the
\neconomic reform.<\/p>\n
Lili said the new trade and industry minister Rahardi Ramelan
\nhad vowed to take inventory of all the problems involving
\nexports, including banking, seaports and transportation. (das)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/orders-for-textile-products-down-by-half-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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