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Indonesian textile exporters urged to take benefit of US GSP
07
Nov '11
Indonesian Government has urged textile exporters in the country to take full benefit under the Generalized System of Preferences (GSP) of the United States.

According to Gusmardi Bustami, Director General for International Trade Cooperation, Ministry of Trade, less than 20 percent of all domestic products exported to the US have availed the benefit of GSP facility to the US market.

He revealed that around 3,000 kinds of goods are included in the GSP facility, but Indonesian companies have used it only for about 500 kinds of products. Hence, the number of items exported under the preferential treatment needs to be increased.

GSP plan is designed to promote economic growth in the developing countries like Indonesia by providing preferential duty-free entry of wide-ranging agricultural and industrial products in developed countries, to enable the developing countries to have a competitive advantage in the overseas market.

Under the GSP scheme, Indonesia exported US$ 1.9 billion worth of duty-free goods to the US in 2010. Indonesia's total exports to the US during the year were valued at US$ 14.27 billion with the textile and garment exports taking a major share, along with footwear and electronics.

Several textile products out of the 3,000 kinds of products allowed under the GSP were unable to take advantage of the facility as these products crossed the net limits of US$ 150 million, Mr. Bustami informed.

He added that some products that largely depend on imports for their manufacture are also unable to take advantage of the facility as local producers are required to use at least 60 percent of domestically sourced materials to avail the facility.

Ade Sudrajat, Chairman of Indonesian Textile Association (API) emphasized on disseminating information about the GSP facility more widely among the local producers so they can inform their buyers in the US regarding the same.

The US is the leading export destination for Indonesian textile items and it accounted for 36 percent of the country's total textile exports worth US$ 11.2 billion in 2010.

Fibre2fashion News Desk - India

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