Indonesian textile exports face new hurdles

Indonesian textile exports face new hurdles

JAKARTA (JP): The joining of Austria, Finland and Sweden to
the European Union (EU) at the beginning of this year has
hampered Indonesia's textile exports to the three countries,
Minister of Trade Satrio B. Joedono said.

He told newsmen in a new-year press gathering at his office
yesterday that the joining of the three countries has caused new
import barriers for textiles, including those from Indonesia.

Joedono specified that some of the new barriers are higher
import tariffs and the introduction of a quota system for
textiles.

"After entering the EU, the three countries automatically
adopt all EU regulations, including the quota system. This will
disrupt the already good relationship between textile exporters
here and importers in the three countries," Joedono said.

The Ministry of Trade called on Indonesian textile exporters
dealing with importers in the three countries to report
themselves to the ministry for quota allotment.

Textile exporters who have already acquired import quotas to
the 12 old members of the EU are automatically able to export
their textiles to the three new members beginning this year.

Austria, Finland and Sweden officially joined the EU on Jan.
1, 1995, bringing to 15 the total number of union members.

In 1992 Indonesia exported 1,642 tons of textiles and textile-
related products worth US$ 17.1 million to Austria, 660 tons
worth $4.7 million to Finland and 1,731 tons worth $23.78 million
to Sweden. Indonesia's total textile exports in 1992 stood at
$5.96 billion, which increased to $6.06 billion in 1993. During
the January-August period of last year, exports of those products
reached $3.84 billion.

Failure

According to the Indonesian Textile Association, Indonesia's
export of textile products under category 23, staple fiber and
waste, to EU countries increased by 43 percent in 1993, making
Indonesia the largest textile supplier to the EU, whose total
textile imports exceeded 50,000 tons.

However, in negotiations last month with the EU Commission to
revise the existing quota, Indonesia failed to seek a quota of
20,000 tons per annum of category 23 for Indonesian textiles.

The EU proposed 12,500 tons -- and a further 1,000 tons after
Austria, Finland and Sweden entered the EU -- but Indonesia did
not accept it.

Director General of Foreign Trade Djoko Moeljono said
yesterday that the negotiations will resume again very soon.

Minister Joedono noted that Indonesia will seek the highest
possible quota in the next negotiations. "If we get a high quota,
we can ensure the continuity of textile exports to European
countries, although the export growth will be limited by the
quota system."

Under the new General Agreement on Tariffs and Trade, which
officially came into affect on Jan. 1 this year, a quota system
will be phased out within five years and changed with a tariff
system.(rid)