The Indonesia's textile industry
Textile and garment are one of the most export priorities for Indonesia. In fact, these industries have been a darling for the country’s export for the last 3 decades and it continues to contribute to the country’s export earnings. Every year, textile and garment products share about 15% on average for the total export figures.
Currently, being on top 15 of global textile producers, Indonesia sees itself on the 9th ranking of the garment industry and on the 11th of the largest upstream textile manufacturers. Everyday, the business engages with the world’s 4th largest spinning yarn totaling of 7.85 million of the needles spin throughout the country.
Indonesia views textile as a massive –workers – driven industry though most of the textile factories have been using some advanced machineries. Now, the industry absorbs about 15% of the country’s total manufacturing workforce. Constantly changing in fashion style coupled with high growth population are strong reasons for textile market development both at home and abroad.
Comparing to others, the textile industry in Indonesia is considered almost complete from the upstream to the downstream sides. The supply of raw materials was also plenty with local content with acounted for about 66% in 2011. To put it another way, the textile industry has shown its strength, which might support the goal in the medium and the long term export.
There are dozens of the textile industry performers, which considered as the major player both in the upstream or in the downstream categories, some of them even become a partner of the world textile and textile product principals, which constantly out Indonesia as their production base to serve the demand both from American and European markets.
To embrace the future growth, the country’s textile association has issued the roadmap of textile industry. One of the important matters is that the industry requires an investment for as much as IDR 60 trillion to reach the vision of the 2015. It also set the next 5 years; the country’s textile export would hold 2.9% of the global market share, 88% of local market share and 16% in the Southeast Asian.
As an investment destination for textile producers, Indonesia holds a number of significant advantages. Competitive labor costs, political stability, availability of raw materials and industrial land are attracting investors who are seeking feasible alternatives to China’s rising wages.
For the immediate future, the textile manufacturers in Indonesia are planning to become one of the world’s giant’s textile producers, especially for the export market in some traditional and non–traditional countries. In 2015, the export proceeds from this industry are expected at USD 19 billion or IDR 171 trillion.