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View all search resultsUS tariffs leave footwear firms between rock and hard place
Cost competitiveness is a key concern as local footwear producers face dual pressures from both the regional and domestic markets, as well as a potential influx of cheaper goods from China, industry groups say.
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Shoppers browse the footwear section on Aug. 17, 2020, in the Ramayana department store at ITC BSD in South Tangerang, Banten. (JP/R. Berto Wedhatama)
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ndonesian footwear manufacturers remain hopeful about export prospects, but are also looking for a stronger footing in the domestic market to shield themselves from geopolitical risks. In either case, cost competitiveness is a key concern.
A recent trade deal with the United States has saddled Indonesian exporters with a 19 percent import tariff on goods shipped to the US, the world’s top consumer market and traditionally the largest importer of footwear made in Indonesia.
Almost one month after the new duty took effect, Indonesian exporters and US importers are both feeling the strain.
“With the 19 percent tariff, there have been requests for cost sharing arrangements,” Yoseph Billie Dosiwoda, executive director of the Indonesian Footwear Association (Aprisindo), told The Jakarta Post on Aug. 21.
“We hope [the new tariff] can be further reduced, even to a level lower than that faced by competitor countries,” he added.
Typically, stateside buyers were not covering the full cost but were instead entering into various arrangements to share the burden with Indonesian producers, he said.
Read also: RI races to finalize US trade deals before Aug. 7 tariffs take effect
