The Government continues to spur the footwear industry which is able to absorb massive labor force. Industrial development is done in order to boost exports and market share of domestic shoe products in the global market. The Ministry of Industry recorded that foreign exchange generated by the footwear industry is worth USD 4.11 billion or 2.33% of total national exports in 2014. In terms of employment opportunities, this industry contributed job opportunities for 643 thousand people which is equivalent to 4.21% of the workforce in the manufacturing industry.
In addition to footwear, the government also spurs other labor-intensive industries, i.e. textiles and food & beverage industries. “This proves that the government wants labor-intensive industries that the government wants labor-intensive industries that employ a workforce in large numbers to be continuously growing,” said Industry Minister Saleh Husin while attending the launch of “Labor-Intensive Investment for the Absorption of Indonesian Workers” program in Balaraja, Banten, on Monday (October 5).
The program held by the Investment Coordinating Board (BKPM) was conducted at PT Adis Dimension Footwear plant and was attended by President Joko Widodo. On that occasion, the President affirmed his optimism that the Indonesian economy will continue to improve in line with the realization of domestic and foreign investment, as well the launch of economic policy stimulus package. “There are many opportunities in our country that can be turned into investment that creates jobs,” said President Jokowi.
Keep Realizing Investments
The market share of Indonesian footwear products in the world market was 2.85% in 2014 and was ranked 6th after China, Italy, Vietnam, Germany and Belgium. This shows that the footwear industry likely to continue to increase exports. Head of BKPM, Franky Sibarani, said that the government would like to communicate to the public and investors that when there is rampant news about layoffs, there are many labor-intensive companies who continue to implement realization of investment projects and absorb workers.
There are 16 companies that consist of 11 labor-intensive Foreign Investment (PMA) companies and 5 domestic investment (PMDN) companies in West Java and Central Java. Labor absorption reached at least 121,285 people in 5 years (2015-2019). The total value of investment plan is worth IDR 18.9 trillion and total realized investment worth IDR 11.4 trillion (until September 2015) with a total estimated value of exports amounted to USD 1.3 billion.
Companies engaged in the leather industry, leather goods and shoes, are, among others PT Pou Yuen Indonesia, Chang Shin Reksa Jaya, Adis Dinamika Sentosa, Feng Tay Indonesia Enterprises, Parkland World Indonesia, Selalu Cinta Indonesia, and Seng Dam Jaya Abadi. While those engaged in the textile industry are Sri Rejeki Isman, Jaya Perkasa Textile, Rayon Utama Makmur, Nesia Pan Pacific Clothing, Eco Smart Garment Indonesia, Delta Merlin, Dunia Textile, Delta Merlin Textile, Apparel One Indonesia and Jaya Perkasa Textile. For the food and beverage industries, namely PT Kaldu Sari Nabati Indonesia. “Labor-intensive industry operators still need new workers, such as a garment factory in Boyolali. They are in shortage of 12 thousand employees,” said Industry Minister Saleh Husin.
Ministry of Industry also continues Machinery/Equipment Restructuring Program for Textile & textile product Industry, footwear and leather tanning industries. This step was taken given the positive response from the industry and other stakeholders. “The program is in the framework of accelerating the improvement of industrial performance and labor absorption,” said Director general of Chemical, Textile and Miscellaneous Industries at the Ministry of Industries at the Ministry of Industry, Harjanto. Availability of raw materials is also facilitated by sitting up a logistics base for cotton, leather raw material centers and encouraging investment in dyestuffs and auxiliary material industries. (E)
Business News - October 9, 2015