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Analysis Of The Impact Of Macroeconomic Policies On Textile Industry And Its Products In Indonesia

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  • Iwan Hermawan, SP. MSi

    (Setjen DPR RI)

Abstract

Textile and textiles product play an important role in the Indonesian economy. During the last five years, however, share of these industries and commodities to gross domestic product tend to decrease. The objectives of this study are to analyze factors affecting Indonesian textile and textiles product, and the prospect of Indonesian textile and textiles product in the future. Results of the study show that domestic textile production was affected by world cotton price and wage rate, while the domestic garment production was affected by wage rate in the garment sector. Indonesia»s textile export to world market was influenced by domestic textile price, and Indonesia»s export garment was influenced by exchange rate (Rp/US$). Indonesian textile demand was affected by wage rate and domestic garment demand was affected by income per capita of Indonesia. In general, the prospect of Indonesian textile and textiles product seems not too good. In fact, Indonesian textile and textiles product had depended on high import cotton, investment, and exchange rate. So why, economy policies are still needed to accelerate Indonesian textile and textiles product development.

Suggested Citation

  • Iwan Hermawan, SP. MSi, 2011. "Analysis Of The Impact Of Macroeconomic Policies On Textile Industry And Its Products In Indonesia," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 13(4), pages 357-390, April.
    • Handle: RePEc:idn:journl:v:13:y:2011:i:4e:p:357-390
    DOI: https://doi.org/10.21098/bemp.v13i4.398
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    More about this item

    Keywords

    export; open economy; forecasting; simulation; textile and textiles product;
    All these keywords.

    JEL classification:

    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance

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