The Coordinating Minister for the Economy Airlangga Hartarto revealed the cause of the collapse of textile and garment factories in the country. Namely, due to policies in the United States (US) and European markets which impose import duties on Indonesian products. Meanwhile, products from other countries, such as Bangladesh or Vietnam, are not subject to import duties. In fact, these two countries are RI's competitors in the textile sector. "Indonesia has an industry, especially textiles and garments, in the American and European markets subject to import duties of between 12% -17%, and this is not imposed on countries such as Bangladesh or Vietnam," said Airlangga, (12/7/2023).

However, Airlangga said, the government sees that if trade barriers can be reduced, then Indonesia's exports can have the capacity to increase in the future.

"Therefore, Indonesia is concentrating on completing a comprehensive economic partnership agreement (CEPA) with the European Union and it is hoped that this can be signed, so the market will be more open," he said.

"Likewise with America, we are currently discussing the Indo Pacific Economic Framework where the other pillar discusses trade facilitation," continued Airlangga.

Of course, continued Airlangga, some of the trade carried out by the government hopes that barriers in these countries can be reduced.

As is known, since the end of 2022, waves of layoffs in the national textile industry have continued to ripple. Plus, factories are laying off workers or cutting hours. It didn't stop there, it was reported that a number of textile factories had to close.

Wave of Layoffs Lurking

Meanwhile, Secretary General of the Ministry of Manpower (Kemnaker) Anwar Sanusi revealed that waves of layoffs (PHK) were still stalking the domestic textile industry.

According to him, until May 2023, there were 18,333 domestic workers affected by layoffs. Meanwhile, there were 20 companies that reported being in trouble.

"From our data that came to the Ministry of Manpower, there were around 18,333 who had been laid off until May 2023. And, according to reports, there are nearly 20 companies experiencing difficulties," said Anwar, Wednesday (12/7/2023).

"The manufacturing sector is quite dominant, there are other sectors. In fact, the threat is labor-intensive industries. There are various kinds of garments, textiles, and so on," he said.

The Ministry of Manpower, said Anwar, responded to the report by immediately preparing mitigation measures.