The fashion industry competition in the global arena is said to be getting tougher. The difference in production costs is alleged to be the cause of the lack of competition in the domestic fashion industry compared to several competing countries.
Center of Reform on Economics (CORE) economist Mohammad Faisal said a number of countries such as Vietnam, Cambodia and Bangladesh have emerged as competitors for Indonesia. The factor, said Faisal, is that the production costs in this country are relatively lower than the domestic industry.
"The competition in the world fashion industry is getting tougher because other countries are already competitive with Indonesia. Starting from lower labor wages for the textile industry as the main ingredient of fashion clothing products," he said.
In addition, he continued, the price of textiles as the main source of clothing products in Vietnam, Cambodia and Bangladesh is relatively lower compared to Indonesia.
"For example, in Bangladesh, logistics are placed in an industrial area close to the port so that costs can be cut," he continued.
Referring to BPS data, exports of Indonesian fashion products have experienced a significant decline. The total export value of products such as clothing, jewelry, watches and footwear as a whole has decreased since 2019.
The decline occurred in 2019, when the export value of the four main fashion products fell from US $ 727 million to US $ 664 million. The impact of the Covid-19 pandemic then exacerbated the export conditions of Indonesian fashion products.
Last year, BPS noted that the export value decreased for the same four products. In 2020, the export value for clothing, footwear, jewelry and watches is only US $ 651 million.
In connection with these conditions, domestic fashion product industry players are asked to be able to expand the market by observing the developing trend.
According to Faisal, Indonesian fashion products not only prioritize exports to traditional destination countries such as the United States, Japan and Germany. But it also targets countries with Muslim populations that are considered quite prospective to be targeted in the future.