Mandiri Banking Analysis Of Indonesian Textile And Garment Industry

　　 India nxi Mandiri, a sub bank, recently released a report on the textile and garment industry. The international market, production costs and competitive advantages of the industry were analyzed as follows:

(1) the gradual recovery of the international market has not yet benefited the textile industry in Indonesia: the United States is the largest export market for textiles in Indonesia, and the gradual recovery of the US economy will have a positive impact on the development of Indonesia's textile and garment industry. However, this year's assistance is not yet clear, mainly due to the intense competition in products such as Vietnam and Bangladesh.

The analysis shows that every 1% increase in the US economic growth rate will increase the volume of textile imports in Indonesia in the next 3 quarters. The growth rate of textile imports in Indonesia will increase to 1.5%, while the growth rate in Europe will increase by 1% in the next 2 quarters.

The recovery of European and American markets will benefit the export of textile related products in Indonesia. However, due to the increasingly fierce international competition, Indonesia textile related products can get more favorable conditions in the recovery of European and American markets, and the focus is still on the competitiveness of products.

In 2009 and 2013, the market share of Indonesia textiles in the United States was 4.9% and 3.7% respectively, while the European market was 1% and 0.8% respectively, indicating that Indonesia textiles had a low share in the European and American markets. Present Reduce the trend.

(two) a substantial increase in production costs has made the textile industry worse. In recent years, the rise in electricity price, the minimum wage and the depreciation of exchange rate have caused Indonesia textile production costs to increase sharply. The labor cost accounts for 6% and 27% of the production cost of the spinning and weaving industry and the downstream garment industry in the upper reaches of the textile industry.

The cost of electricity in the upper and lower reaches of the textile industry is 25% and 1% respectively, and the price inflation has a greater impact on the textile fabric industry. The Indonesia government has risen again in April 2014. According to the Indonesia Textile Association (API) data, a total of 48 textile enterprises have been directly affected by the price inflation, and have to reduce the employment force, reduce the maximum capacity of the production capacity by about 20%, and increase the price of the terminal garment products by 7 to 10%.

　　 in addition The depreciation of the Indonesia shield will also increase the production cost of the textile industry. The proportion of cotton imports from the main raw materials reaches 99.5%, and even textile products such as dyestuffs are also priced in the US dollar for domestic production. The analysis shows that the depreciation of Indonesia shield will cause an increase of about 6.91% in the textile production in the next quarter. 1%

(three) API estimates that Indonesia's textile exports amount to US $12 billion 900 million this year, of which 60.9% of garments, such as shirts, T-shirts and skirts, account for about 39.1% of fabrics and yarns. In order to maintain the best level of textile exports in Indonesia, Mandiri bank suggests that Indonesia should focus on producing products with competitive edge according to market characteristics.

Based on the relevant economic models, Mandiri bank calculates and recommends that Indonesia should attack the main products in the international market respectively. The products in the US market are priority in yarn, women's wear, children's wear, men's clothing, cotton and other fiber sutures. In the European market, yarns, sutures, men's coats and gloves are the main products, while yarn and suture are the advantages in the Japanese market.

(four) in the conclusion of the report, Mandiri bank suggested that the textile industry in Indonesia should be more concerned about the choice of producing textiles with high quality and competitive advantages and have the opportunity to compete with other textile exporting countries in order to improve the international market share and the overall value of Indonesia textiles.