H

andicraft producers in Bali are struggling to stay in business, as the global financial crisis takes hold on the resort island.

Ketut Jaya Sugita, a producer of the W.H. Shoes brand of leather footwear, said recently his business was hard hit by the current economic climate, with exports to key markets in the United States, Canada, the Netherlands and Australia down significantly.

Sugita said he was currently getting most of his business from the domestic market.

"It's been like this for the past 10 months and I've still got no orders from overseas," he said.

He added that previously, he used to export 70 percent of his products overseas, while the domestic market making up only 30 percent of his business.

"Now everything's changed. I don't know when the crisis will end," he said.

W.H. Shoes produces thousands of leather shoes and sandals that sell for Rp 80,000 (US$8) to Rp 90,000 a pair in the local market, and for $10 to $12 a pair for overseas markets.

"We should be patient. There are always ups and downs in business. Just wait and see. But for sure, we'll always maintain our quality," Sugita said.

Since the crisis struck last year, Balinese handicraft producers have been among those hardest hit in the country.

Data from the Bali Statistics Agency show exports from the province to a number of countries have dropped by 13 percent to only $61.428 million in the first quarter of 2009, compared to $70.89 million in the same period in 2008.

The agency also revealed significant export drops for certain products, including jewelry, non-knit garments, knit products, textiles, wooden items and cotton. Footwear exports also saw a disappointing drop of 33.39 percent.

Kadek Kerta Rusmana Yasa, a producer of wooden statues, was similar downcast, saying he had to reduce his production and adapt to the needs of the local market.

He no longer exports his statues and other wooden items.

"We still get some orders that are adequate to meet our overhead," Yasa said.

Panudhiana Khun, chairman of the Bali branch of the Indonesian Businesspeople's Association, admitted the majority of handicraft and garment producers in Bali now relied mostly on the domestic market.

"Bali still gets a lot of visitors, and this is good for the business because overseas markets are directly affected by the global economic downturn," he said.

In the garment industry, Bali faces stiff competition from other local producers from Bandung, West Java, and other areas that produce cheaper products of similar quality.