Indonesia's textile industry: orders decline in European and American markets

An economist at Indonesia’s Danamon Bank said that Indonesia’s export-oriented industries will be affected by the sluggish demand caused by the global economic slowdown, and commodities exported to overseas markets will face price declines. Industries that rely on imported raw materials for production may suffer from dollar liquidity and trade financing issues. Industries that rely more heavily on imported bulk raw materials are more likely to be affected, such as pharmaceuticals, textiles and clothing, electronics, shoemaking, and paper products. Industries that use local raw materials or sell them to the local market, such as cement, edible oil and sugar, are less susceptible to impact. Economic analysts also pointed out that industries that rely on imported raw materials and intermediate products will be affected by exchange rate fluctuations. Conversely, industries that use local materials or domestic demand are less susceptible to exchange rate fluctuations. The Indonesian Textile Association (API) said that due to the economic slowdown in the European and American markets, orders from Europe and the United States began to decline in September this year and may gradually decrease in the next few months. At present, the association has lowered its original export growth target for this year from 24% to 20%, and set the export growth target for next year at 5%. A person from the Indonesian Electronics Industry Association (GABEL) said that global economic uncertainties are gradually affecting consumer willingness, and global demand may decrease in the next year, especially in the European and American markets.