The Ministry of Industry (Kemenperin) will soon release a Minister of Industry Regulation (Permenperin) related to border import supervision as the implementation of limited prohibitions (lartas) on 8 priority subsectors, including the downstream textile industry. As is known, the 8 commodities that will be subject to stricter border import controls are ready-made clothing, children's toys, electronics, footwear, cosmetics, finished textile goods, traditional medicines and health supplements and bags. Plt. The Director General of the Chemical, Pharmaceutical and Textile Industry (IKFT) of the Ministry of Industry, Taufiek Bawazier, said that his party would implement changes to import control regulations from Post Border to Border as a 'shield' from the flood of foreign products in the domestic market.
"[Post Border becoming a Border] is positive, ideally upstream, midstream and downstream should be regulated because it is impossible if it is only regulated upstream or raw materials, so it needs to be integrated," said Taufiek on the sidelines of the Ministry of Industry's Working Meeting, Wednesday (11/10/2023).
On the one hand, the upstream and intermediate textile industry still requires imports to meet domestic supplies of raw materials, although on the downstream side imports of finished goods must be limited to maintain the competitiveness of local products.
Taufiek said, if downstream product trade is not regulated, it will be easy for foreign markets to enter and fill the domestic market. Because, currently there is no supervision in the form of a Post Border which is considered too free without barriers.
In this case, the barrier in question is border control by Customs officers in the customs area. So, before imported goods enter and expand in the domestic market, there will be a number of instruments such as Import Approvals (PI) and Surveyor Reports (LS).
"Whether the product is the same or not, what type it is, the volume is all limited. So, the context here is volume. If previously it was post border and there were no barrier instruments, that means the volume was free," he said.
Taufiek believes that if Post Border continues to be carried out amidst the current flood of foreign products, small and medium industries (IKM) will lose competitiveness and will not be able to build competitiveness in their own country. In fact, industry is the largest taxpayer. So, protection in the form of regulatory improvements will be regulated so that industries producing finished goods have proper governance and the industry is given barrier instruments.
"We're not talking about protecting, but this is best practice because if it's not regulated like that then the pricing will definitely be way off. We just import the raw materials from that country, that country produces downstream products domestically. So, the comparison isn't fair," he explained. .
According to Taufiek, a barrier in the form of Border Traffic Control is the most efficient tightening measure because it limits the volume of entry of imported products. He emphasized that this does not mean that imports of finished goods are not permitted. This is because the need for products produced domestically does not necessarily meet the demand for export and domestic markets. However, regarding the volume of import restrictions on goods in question, he said this would depend on supply and demand. "So if national demand is calculated by calculating production minus exports plus imports, usually plus or minus economic growth, that is national demand," he said.
Furthermore, Taufiek hopes that the government's move to divert Border Post to Border can control the rate of imported goods into the country. This monitoring instrument was also carried out to revive traditional markets, as well as regulate marketplace governance. At least, there are 100 harmonized commodity (HS) codes identified as being in a disruptive context.
