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Bonded Logistics Centers Support Textile and Small Industries

Bonded Logistics Centers Support Textile and Small Industries

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Administrator

Administrator

Published At 30 Jul 2019


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3 Minutes

JAKARTA - Bonded Logistics Centers (PLB), as part of the government's economic policy package, remain a mainstay for small industries to obtain raw materials cheaply, easily, and quickly.


A survey on production efficiency before and after PLB establishment, conducted by the Indonesian Small and Medium Entrepreneurs Association (APIKMI) among SMEs in West Java, shows that raw material costs decreased by an average of 11% from Rp15,500 to Rp13,750.


Additionally, PLB ensures sufficient raw material availability. Other impacts include workforce expansion - adequate supplies enable new production units, creating jobs and stimulating local economies through small garment businesses, boarding houses, and food stalls near PLBs. Currently, textile imports via PLB by manufacturers and SMEs amount to 2.7% of national textile imports.


These findings were revealed during a plenary meeting between Customs, the Ministry of Trade, and the Ministry of Industry with associations on Wednesday (July 17, 2019).



The survey results are corroborated by Asep, a garment entrepreneur operating in Soreang, Bandung Regency. He expressed gratitude to West Java Customs for establishing PLB.


"Previously we struggled to source raw materials. With PLB, it's now much easier. The garment business constantly follows changing trends. Reliance solely on domestic market supplies isn't enough," said Asep.


Recent data shows 90% of Indonesia's 97 PLBs serve supporting industries, importing industrial raw materials. The remainder includes air cargo hubs, floating storage, and staple goods PLBs. Customs Director General Heru Pambudi emphasized that PLBs aren't warehouses for garment hoarding or retail: "There are no garments stockpiled in PLBs. You can't directly buy jackets there." PLB contributions show upward trends, with import duties totaling IDR1.57 trillion and import taxes IDR7.48 trillion from PLB inception through July 2019.


Addressing claims that PLBs contributed to flooding textile imports and domestic industry slowdown, Indonesian Logistics Association (ALI) Chairman Zaldy Ilham Masita stated: "It's unfair to blame PLBs for the domestic textile slump. Conversely, PLBs demonstrate government support by bringing raw materials closer and improving logistics efficiency."


Echoing this, Indonesian Bonded Logistics Centers Association (PPLBI) Chairperson Ety Puspitasari affirmed on Friday (July 26) that PLBs support the national textile industry as a strategic government priority: "PLBs fulfill their purpose by supplying SMEs with industrial raw materials, not finished products for domestic retail. Claims about buying handkerchiefs retail at PLBs like grocery stores are false."


Among PPLBI's 48 members and all current operators, most PLBs serve large industries, with only one handling finished alcoholic beverages. Only one e-commerce PLB is registered but hasn't conducted imports. Ety thus dismissed claims about PLB-caused textile product flooding.



As government and industry partners, PPLBI continues supporting domestic industry growth toward making Indonesia an Asia-Pacific Hub: "We welcome skeptics to conduct joint field reviews or directly discuss with PLB operators," Ety concluded.

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