February 28, 2025 | 09:46 am
TEMPO.CO, Jakarta - Chairperson of the National Economic Council (DEN) Luhut Binsar Pandjaitan announced a promising prediction that 100,000 jobs are expected to be created in the textile and footwear industries. This opportunity emerged after a global apparel company expressed interest in tripling its orders from Indonesia over the next three years.
Luhut did not disclose the specific name of the apparel company planning to increase its product purchases from Indonesia. However, he stated that this offer emerged during meetings with global representatives from companies like Adidas and Nike, alongside the Indonesian Footwear Association, held last week.
"They are optimistic about Indonesia, especially amidst the U.S.-China trade war and the saturation of the Vietnamese industry," stated Luhut through his Instagram account on Wednesday, February 26, 2025.
However, he acknowledged that fulfilling these orders faces several hurdles: land acquisition, permit approvals, wage issues, and the challenge of illegal imports stemming from overproduction in China. He reported these concerns to President Prabowo Subianto and is coordinating with relevant ministries. He noted that Prabowo has directed concrete actions to address these obstacles.
The former Coordinating Minister for Maritime Affairs and Investment further asserted that Indonesia has quietly become a preferred destination for the relocation of textile and footwear industries over the past year. Once considered a sunset industry due to widespread layoffs, this sector now employs nearly 4 million workers, with 2.9 million engaged in the ready-to-wear sector.
Skills training in this sector is rapid, providing opportunities for high school graduates and fostering the growth of small and medium-sized enterprises (SMEs).
According to Luhut, investments in this sector have also seen significant growth. In 2024, he revealed that foreign direct investment (FDI) reached US$903 million, marking a 107 percent increase from the previous year. Meanwhile, domestic investment (PMDN) reached Rp7 trillion.
Luhut asserted that job creation in the textile and footwear industry is also remarkable. DEN's research indicates that every US$20-30 million invested in a ready-to-wear clothing factory can generate 6,000 to 9,000 jobs. To date, he stated that this industry has created 3.98 million jobs.
"I expect a strong synergy between the government, the industry, and the academics so that we can create a highly competitive industrial ecosystem. This way, Indonesia will not only be a production site but also a center for the future growth of the industry," said Luhut, who previously served as the Head of the Presidential Staff.
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