Surakarta workers face dismissal

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.