Surakarta workers face dismissal
Kartika Bagus C., The Jakarta Post, Surakarta
Thousands of workers employed in more than 40 textile companies in Surakarta, Central Java, face the threat of mass dismissal amid decreasing textile orders and fierce competition with other textile-producing countries, according to industry executives.
Udoko, chairman of the local chapter of the Indonesian Employers Association (Apindo), said that besides decreasing demand for Indonesian textile products in the international market, the United States had "embargoed" six categories of textile product from Surakarta as Indonesia had reached the import quota limit set by the two countries.
"Besides the decreasing demand for textile products, a possible failure to lobby the U.S. government to lift the quota restriction will certainly have a negative impact on employment in textile factories in the town," he said here on Saturday.
Udoko said several textile companies had dismissed part of their workforce and placed some of their stock in their warehouse because of the state of the market.
"For example, PT Sabatext Sragen has dismissed 800 workers over the last two months, while PT Sari Warna Asli (SWA) is considering laying off 1,100 of its 11,000 workers," he said.
He added that SWA had accumulated 12 million yards of textile while PT Dan Liris and PT Batik Keris had in stock 16 million yards of their product, due to the absence of buyers.
"Most employers have given up and are waiting for a miracle to save their businesses," he said, adding that this complaint had nothing to do with the local administration's plan to raise minimum wages in the province.
Handiyanto, chairman of the local chapter of the Indonesian Textile Association (API), said producers had lowered their prices to compete with foreign textiles in the domestic market.
"We are now in fierce competition with China, South Korea, Thailand and Australia, which have dumped their products here to gain entry into the domestic market," he said.
Handiyanto, also president of Dan Liris, acknowledged the textile sector was the worst hit by weakening global trade following the devastating terrorist attacks in the U.S. on Sept. 11.
Yowono, a financial consultant of PT Sritex in Sukohardjo, near the town, said the recent anti-U.S. sentiment in Surakarta has also affected the textile market.
"Many foreign buyers have declined to come to Surakarta because of recent anti-U.S. demonstrations in the town," he said.
He added that workers employed in the printing division of textile factories in the town had been laid off because of the buildup of stock.