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Textile industry warns of production halt following import restrictions
Countries supplying Indonesia with mono-ethylene glycol (MEG), a material to produce polyester, have halted their shipments until they receive clarity regarding permits from the government.
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Workers complete the production of knitwear at the Rajong Binong Jati Center, Bandung, West Java, on June 6, 2020. (Antara/Raisan Al Farisi)
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everal polyester factories in Indonesia are at risk of ceasing production, as firms struggle to secure raw materials due to the government’s import restrictions, according to the Association of Indonesian Spun and Filament Yarn Producers (APSyFI).
APSyFI secretary Farhan Aqil said the restrictions were due to Trade Ministerial Regulation (Permendag) No. 36/2023, which stipulates changes to import supervision, from after the goods arrive in the country as previously, to before arrival now.
The association said the regulation hindered the procurement of mono-ethylene glycol (MEG), a raw material to produce polyester, 90 percent of which is imported.
“The situation has caused alarm for 11 polyester businesses and could halt production within a month or two,” Farhan said, as quoted by Bisnis on Wednesday.
Read also: Waves of lay-offs sweep Indonesia’s export-oriented industries in 2023
Farhan went on to say that the country currently has only one producer of MEG, and it is unable to supply the entire upstream industry.
Meanwhile, countries supplying Indonesia with MEG have halted their shipments until they receive clarity regarding the permits from the government, he said.
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