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Studies on Indonesian Textile and Garment Industry

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Studies on Indonesian Textile and Garment Industry
STUDIES ON INDONESIAN TEXTILE AND GARMENT INDUSTRY: CURRENT SITUATION, CHALLENGES, GOVERNMENT’S POLICIES AND PROSPECTS
Wu Chongbo
ABSTRACT Since the beginning of the 1970s’, the ethnic Chinese in Indonesia shifted their investment from business to manufacturing, textile and garment industry was one of their focus, now 90% of the Indonesian textile and garments industry are run by the ethnic Chinese in Indonesia. This paper intends to probe the Indonesia’s textile and garment industry entitled “Analysis on Indonesia’s Textile and Garment industry: Current Situation, challenges, Government’s Policies and Prospects”. The paper is divided into three parts: 1, Profile of Indonesian Textile and Garment industry; 2, the reasons why Indonesian textile and garment industry facing difficulties; and 3, Indonesia government’s policies towards textile industry and prospects. Key words: Indonesia Textile and Garment Industry Difficulties and Prospects

Textile and Garment industry is one of the most significant sectors that give directly contribution to the economic growth in Indonesia. The Textile and Garment industry is not only absorbing many workers but also giving the biggest foreign exchange compared with other sectors.

1, Profile of Indonesian Textile and Garment industry
According to the data from Department of Industry and Trade that the number of textile and Garment industry in Indonesia was about 88 companies in 1987, and over 2000 in 1992, in 2003, it reached to 2654. The geographical distribution of the Indonesian textile industry is highly concentrated on the island of Java, and in particular in West Java. Almost 90% of the textile industry is located in Java, and 54.8% are concentrated in West Java alone. For the garment industry, high concentration is to be found in West Java, Jakarta and Batam Island, the latter being a free trade zone. About half of the country' textile production goes into the world market. The textile and s Garment industry as a whole

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