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Indef warns of illegal textile imports through PLBs
The newly revised textile import regulation still allows loopholes for unscrupulous importers to smuggle raw textile materials into the local market through ILBs, says Indef
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Customers examine textile products at Mayestik market, Jakarta. Many local textile producers have closed their factories because of the influx of smuggled cheaper imported products. (JP/Wienda Parwitasari)
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llegal imports of raw textile materials are still able to enter the Indonesian market through bonded logistic centers (PLBs) despite the issuance of stricter import regulations, causing a serious problem for local producers, an industry observer has warned.
Esther Sri Astuti, a program director at think tank the Institute for Development of Economics and Finance (Indef) acknowledged that the Trade Ministry had issued Regulation No. 64/2017 recently to impose stricter controls on the import of raw textile materials through the PLBs. However, because of poor enforcement, imported raw textile materials were still being smuggled into the local market through the PLBs, which are only supposed to receive imported raw materials for the production of export-oriented products.
The newly revised textile import regulation still allows loopholes for unscrupulous importers to smuggle raw textile materials into the local market through PLBs, she said on Oct. 30.
She said that through 2017 until 2018, there had been a 192.21 percent surge in the volume of imported textiles through the PLBs, which accounted for 12.07 percent of the country’s total textile imports.
As imported products are often up to 40 percent cheaper than domestic products, many local producers are unable to compete leading to factory closures.
Read also: Government mulls plan to impose temporary duties on imported textile products
Esther added that undervaluation of the imported products was also rampant, causing major losses to the government’s import tax revenue of Rp 456.34 billion (US$32.6 million) last year.
