Indonesia’s textiles industry is on the rise, but a number of issues threaten to unhinge it. A global pandemic, foreign ownership, the US-China trade war and the lack of coherent policies are one of the many issues that will not only break an industry, but also endanger the livelihoods of Indonesian textile workers and their families.
What is Fast Fashion and how is Indonesia Involved
‘Fast Fashion’ refers to clothing designs which move speedily from fashion events to stores to meet new trends. Fast fashion allows the public to consume these products at an affordable price, but in the United States or Australia, we find that a majority of these products are not manufactured in either of these countries. These products are commonly manufactured in China or Bangladesh, but in recent years, Indonesia’s textiles exports have grown exponentially.
In terms of rankings, Indonesia is among the top ten textile-producing nations in the world and is the 12th largest textile and apparel exporter, with a majority of their products being exported to the United States, the Middle East and the European Union (Mordor Intelligence).
In spite of all that, Indonesia’s textiles industry is under threat due to the escalating trade wars between the United States and China (Textile Focus). The US is currently the largest market for Indonesian textiles and apparel (36 per cent) whereas the Middle East stands at 23 per cent and the European Union at 13 per cent (Textile Focus). These trade war tensions can potentially unhinge Indonesia’s textiles industry, thus Indonesia has turned to Australia in hopes they’ll become their largest market.
As of 5 July 2020, Indonesia and Australia currently operate under the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA). This agreement unlocks a vast amount of potential between the two nations, fostering economic cooperation between businesses, individuals and communities (DFAT IA-CEPA). While this agreement is extremely beneficial to both countries, a blind eye is potentially turned to the horrendous work practices of Indonesia’s manufacturing industries as well as the country’s lack of desire to establish better policies to protect their workers.
Policies and Workers
The lack of coherent policies combined with foreign owned factories have caused numerous issues for Indonesian textiles workers. Many have lost their jobs prior to the pandemic, but COVID-19 has only exacerbated the issue.
4.2 million people are currently employed in the textiles industry (StraitsTimes). A majority of them are women who work to support their family. While the pandemic is a threat to the workforce, the rising presence of automation can wipe out millions of jobs (HuffingtonPost). The new machinery is safer to use, which results in less workplace injuries, but when machines can produce more products, it gives factory owners even more reason to terminate their employees. In spite of these threats, women still continue to work for poor wages as there is very little support available for them if they were to quit.
In the case of a worker being dismissed, most countries offer severance pay based on the number of years worked. Indonesia’s laws, however, barely meet the minimum pay requirements. Since 2018, the law only recognises compensation of one month’s salary or each year worked up to a maximum of nine months (Equal Times). The law also states only ten months of long service leave will be paid as well (Equal Times). Indonesia’s unwillingness to establish better policies have caused grief for textiles workers and in spite of the union’s assistance, securing these payments after being dismissed is often a long and unsuccessful journey.
Another policy issue is the distribution of textiles factories. There are major disparities when it comes to production. The Balinese industry manufactures Batik clothing, but this product has cultural significance and is considered niche marketing. The Javanese region, however, consists of high end, low-quality production factories (Institutions&Economics). In 2015, 47 textiles factories were relocated from West Java and Banten to Central Java as this region offers an inexpensive production environment (Modor Intelligence).
This is deeply problematic as workers must either make the move in order to maintain their employment or face dismissal and end up in financially dire circumstances as a result.
The solution we’re given to these issues is to buy locally and be ethically conscious, but that isn’t always an option for low-income earners of the US or Australia nor is it a viable solution for the textiles workers either. There are numerous steps that can be taken such as: holding retail chains accountable for workplace practices and wages, establishing better policies for this industry and encouraging a stronger presence for unions so that workers can get the help that they need in these turbulent times.