TEMPO.CO, Jakarta - Amidst the decline of the textile industry, a number of entrepreneurs have expressed concerns about the easy entry of imported clothing into Indonesia, including from China. The Tanah Abang Wholesale Market is known to be a hub for buying and selling these imports. Tempo investigated this issue on Friday, July 12, 2024.

Block A of Tanah Abang Market appeared deserted on that Friday. Many shops were closed when Tempo visited the second floor, which is dedicated to wholesale children's clothing. Suriadi, a 33-year-old shopkeeper, explained that the market only gets truly busy on Saturdays and Sundays. “In the past, it was busy even on weekdays. Now, it's only bustling before Ramadan and Eid,” he said.

Similar scenes were observed in Block F and Block B. Most shopkeepers were seen chatting amongst themselves, occasionally calling out to passing customers. By late afternoon, business remained slow, with Suriadi admitting he had not received an order in a month. He claims the clothes sold wholesale in these blocks are made by home-based confectionery production.

Suriadi acknowledged that sales of downstream textile products in Tanah Abang have dropped since the 2020 pandemic. He believes many consumers have shifted to online shopping platforms. “Our customers from regional areas still shop here, but the numbers have decreased slightly,” he added.

Recently, textile and textile product associations have raised concerns about suspected illegal imports flooding the domestic market. Suriadi confirmed his awareness of the issue but believes it doesn't directly impact wholesale clothing sales. “They (the imports) are usually secondhand clothes (thrifting). So, we don't feel the impact directly.”

Suriadi also pointed out that imported clothes are readily available in the Little Bangkok Block, adjacent to Block A. These clothes are known for their low prices and mall-quality goods. “Whether they're legal or not, I don't know. But they're cheap, and that area is always busy. The Metro Block is also bustling,” he said.

Tempo's visit to Little Bangkok confirmed the stark contrast in activity compared to other blocks. The clientele here was predominantly female.

Little Bangkok Tanah Abang is a new shopping area inaugurated on January 15, 2024. Located on the 1st Floor Metro Bridge (JMTA), it connects Metro Tanah Abang with Block B. Inspired by the popularity of online clothing sales via personal shoppers (jastip) and Thai celebrity endorsements, this area boasts 50 outlets with a more modern aesthetic than the rest of the market. Clothes are displayed neatly, resembling mall shops.

Emerlina, a 30-year-old resident of Tangerang, enthusiastically browsed clothes in one of the Little Bangkok outlets. She found the prices significantly cheaper than those in online marketplaces or traditional markets. “These are imported goods, and the quality still looks new,” she told Tempo. Emerlina purchased three sets of tops for a total of Rp320,000 that afternoon.

Similar clothes in malls could cost up to Rp500,000 per piece, she said. The trader confirmed his goods were imported from China.

Tempo attempted to bargain for flannel shirts at another outlet. “One is Rp65,000, but for wholesale, it's only Rp50,000,” the seller said. When questioned about the origin, the answer remained simple "imported goods from China."

Tempo compared these prices to locally produced flannel shirts sold wholesale at Rp75,000 per piece and Rp100,000 retail.

According to Nandi Herdiaman, Chair of the Bekarya Convection Entrepreneurs Association (IPKB), illegally imported clothes are significantly cheaper than local products, often falling below the production cost of domestic clothing. Nandi also highlighted that clothes with labels in Chinese or Korean characters could be indicators of illegal imports.

Tempo inspected five outlets selling imported products in the Metro Block and Little Bangkok Block. All clothes had labels in Chinese characters. The traders unanimously confirmed they were selling clothes imported from China.

Based on the Trade Minister’s Regulation No. 25 of 2021, imported goods must have Indonesian language labels on the product or packaging. This regulation applies to textiles, building materials, spare parts, and cosmetics. The label must state the origin of the goods, product name, and business identity.

When questioned about the Chinese labels, one trader admitted his lack of knowledge. “This is what we get as it is an imported product,” he said.

Previously, Director of Sogo Indonesia department store, Handaka Santosa, raised concerns about the legality of products sold at Little Bangkok. He questioned the lack of Indonesian labels, suggesting the imported goods might be dubious.

“Check if there's an Indonesian label. If not, how did these products enter Indonesia?” Handaka said during a discussion in South Jakarta on Friday, February 23, 2024.

Handaka shared a similar statement with Nandi. He explained that officially imported products must have labels in Indonesian. Consequently, imported goods without Indonesian labels cannot be legally sold in the domestic market.

Beyond the missing labels, he also expressed concerns about the quality standards of the goods sold at Little Bangkok. He believes that they may not have passed the Indonesian National Standard (SNI) certification.

He assessed that this means the government loses revenue due to the influx of these potentially illegal goods as imported products are subject to fees, including import duties, import VAT, and import safeguards. Therefore, he called on the government to investigate the legality of these products in Little Bangkok, Tanah Abang.

NANDITO PUTRA | RIANI SANUSI | MUTIA YUANTISYA

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