Indonesia's textile exports expected to surge 15 percent

JAKARTA (JP): The value of Indonesia's exports of textiles and textile products is expected to rise by about 15 percent to US$3.43 billion in the first semester from $2.98 billion in the corresponding period of last year, the Indonesian Textile Association said on Monday.

The association's secretary-general, Irwandy Muslim, told The Jakarta Post that the increase would be generated by foreign buyers' decisions to speed up their imports before the June 7 general election.

"Most foreign buyers increased their orders for deliveries during the first five months of this year because they want deliveries to be completed before the general election," he said.

Foreign orders for winter clothes, usually placed in September, have been filed, he added.

Exports in January reached $416.4 million, an increase from $395 million in the same month last year.

But Irwandy said the increase in orders in the first semester would not result in lower exports in the second semester of this year.

"Orders will likely slow down in June but it will increase again in the months after the elections, especially if the general election runs smoothly," he said.

He said many companies had secured orders from foreign buyers for the next six months.

"Some buyers are still optimistic because political upheavals of a worse scale also happen in several other parts of the world," he said.

Irwandy said most of Indonesia's traditional buyers would remain loyal.

"They acknowledge that the quality of our fabrics is one of the best in the world. If they want to buy from other sellers they have to bear additional costs for checking their quality to ensure that it is at least as good as ours," he said.

He attributed the export increase also to new Indonesian players in the international market.

"Many textile producers which previously mainly concentrated on the domestic market, which is now depressed, have started promoting sales overseas. They are aggressively looking for new markets, especially countries which do not impose quotas," he said.

Irwandy said Indonesia's exports of textiles and textile- related products reached about $7.8 billion last year, a slight increase from $7.3 billion in 1997.

Indonesia's textile exports have been shipped to 130 countries this year, compared to 85 countries in 1990, Irwandy said, adding that the most important markets are Europe and the United States.

Irwandy predicted that Indonesia's textile exports could reach between $10 billion to $12 billion after the turn of the century.

The association projects exports to reach $8 billion this year.

"But this will depend on the government's ability to provide adequate trade financing," Irwandy said.

The government plans to establish an export financing agency to help exporters, but no information was immediately available as to when this agency would open. (gis)