Indonesia seeks larger quota for textile exports to the U.S.
JAKARTA (JP): Indonesia will ask for a larger textile export quota from the United States to enable the country's textile industry to absorb jobless workers during the economic crisis, Minister of Industry and Trade Luhut B. Pandjaitan said on Wednesday.
Luhut said he would lobby the U.S. trade representative Robert Zoellick over the larger textile quota during the Asia Pacific Economic Cooperation (APEC) ministerial meeting in Shanghai, China.
APEC's trade ministers will meet in Shanghai for two days starting on Wednesday.
"It's a normal request that could be made by other textile exporter countries," Luhut told reporters after the opening of the Interior and Craft 2001 exhibition by Vice President Megawati Soekarnoputri.
"We will ask for a larger textile quota as it will generate more income for the country and enable us to absorb a larger number of the unemployed," Luhut was quoted by Antara as saying.
The Association of Indonesian Textile Exporters (API) welcomed the government's initiative, but it warned that such a move should be carried out seriously and continuously.
The association's executive director Irwandy Muslim Amin told The Jakarta Post that without strong and persistent efforts, supported by complete and accurate data, the lobbying could be useless.
"Thus far, the American government has paid little attention at any pleas from the Indonesian negotiating teams as they (the teams) did not make an all-out effort and 'simply asked' without knowing what they were really asking," Irwandy said.
According to him, there were two key reasons that Indonesia could present for an increase in the export quota.
First, Indonesia should point out that the country is among the largest importers of American cotton, he said.
"If Indonesia is the largest importer of U.S. cotton, why does the U.S. not give greater privileges to Indonesia?" he said.
According to him, Indonesia imports 30 percent of its total 500,000 ton cotton imports, worth US$1 billion, from the U.S. each year. Australia accounts for 40 percent of the imports.
Second, Irwandy said, the Indonesian team should convince the U.S. that the latter, as a wealthy country, should provide greater help for Indonesia to recover from the protracted economic crisis.
"The Indonesian team must play these two cards carefully. I'm sure that their efforts will be fruitful," he added.
Irwandy explained that the U.S. was a very exclusive textile market compared with other markets.
"Only high-quality textiles with high prices are offered in the U.S. That's why decreasing orders from the U.S. have dealt a major blow to Indonesia's textile exports,"
Irwandy earlier said orders from the U.S. had significantly dropped in the first quarter of this year.
"The decrease in demands from the U.S., Europe and Japan resulted in a 10 percent drop in Indonesian textile exports during the period," Irwandy said last week.
Irwandy said that many textile companies had reduced their production to only 60 percent of capacity, compared with 90 percent last year, due to sluggish export markets.
The U.S., Europe and Japan account for about 45 percent of Indonesia's textile exports, while the so-called "non-quota countries" such as the Middle East, Latin American and African countries take the remaining 55 percent. (03)