The Indonesian Garment Industry: Past Performance and Future Challenges

This article attempts to analyze the developments and challenges faced by the garment industry in Indonesia. The results of this analysis show that for the last three decades the garment industry has been able to grow and develop with sufficient certainty. Because of this, the role of the industry in creating revenue and employment has increased significantly. Furthermore, this industry has also emerged as one of the primary export sectors in Indonesia. Yet, the analysis in this article also shows that at the same time changes have occurred in economic regulations and global trade, such as the removal of the MFA system, which have made the business climate increasingly competitive, and thus future development in this industry will face serious challenges. In order for the garment industry to continue to grow and develop in the future, this article recommends that businesses in the industry increase their technological and marketing skills. In addition, the government must be skilled in creating conducive macro economic conditions and industry policy, both of which are important determinants in achieving growth and development in the garment industry.