The Ministry of Industry has proposed a number of safeguard rates for imported garment products. The goal is to protect the national textile and textile product (TPT) industry from the invasion of imports that put pressure on domestic industry players, especially small and medium industries (IKM).
"Currently, the process is still a recommendation from the Ministry of Trade to the Ministry of Finance. There is still one more stage at the Ministry of Finance, which can only be stipulated by the minister," explained Elis Masitoh, Director of the Textile, Leather and Footwear Industry of the Ministry of Industry.
The Ministry of Industry proposes a variety of safeguard rates for garment products. For example, for casual tops, such as t-shirts, a tariff of IDR 27 thousand is proposed for each imported product that comes in.
"So, when there is a casual boss from China, you name it, entering at a price of Rp. 20 thousand, subject to a safeguard of Rp. 27 thousand, the price that enters Indonesia becomes Rp. 47 thousand," said Elis.
With this regulation, Elis stated that the domestic industry was able to produce similar types of clothing at a lower price, namely Rp. 40 thousand. As a result, domestic industries can compete with imported products.
Then, the Ministry of Industry proposed a safeguard tariff of Rp.63 thousand per piece for outer products such as jackets. This is the highest safeguard taif proposal compared to other garment products.
In fact, the Ministry of Industry had previously proposed a safeguard tariff for the outer of IDR 79 thousand per piece. However, this proposal was rejected, especially from global companies that have been circulating in Indonesia.
"If the price (outer) increases for global brands, Zara for example, whose initial price is IDR 1.5 million, then increases to IDR 1,579,000 it will definitely not have an effect. But if you head to head with the price of Chinese products, now it will have a big effect," added Elis.
In addition, the Ministry of Industry has proposed a safeguard tariff for headwear or hijab products of IDR 19,800. Elis said the onslaught of hijab imports from South Korea had to be anticipated.
The problem is, the price of imported hijabs without safeguards is only Rp. 2,000 per piece. This is what puts pressure on the IKM sector.
"The price of imports is IDR 2,000, while the hijab products in Zoya or El Zatta are IDR 78 thousand. So, how do you want to buy domestic products if the imported products only cost IDR 3,000 to IDR 6,000," said Elis.
Meanwhile, the Ministry of Industry is proposing a safeguard tariff for robes of Rp. 59 thousand. This is the government's effort to realize Indonesia's ideals as a center for the world's Muslim clothing.
"Apart from that, many of the robes and canals are produced by domestic IKMs," said Elis.
Elis stated that his party proposed a safeguard tariff with a fixed price and not a percentage for garment products.
This is considered to be more targeted than the tariff which is calculated as a percentage.
"Using the percentage for garments is difficult because the cheap ones will still be charged with low prices, while the expensive ones, for example sportswear products, will get very high, even though we have not been able to produce them domestically," said Elis.
He added that the determination of the amount of the proposed safeguard tariff was the result of a formulation of the difference between the average import price and the domestic selling price.
"The average import price, then the domestic selling price. Well, the difference between the domestic selling price and the average import price is calculated how much the difference is, that's the tariff," Elis concluded.