Great opportunities await the Indonesian textile industry with the planned finalization of the Indonesia-European Union Comprehensive Economic Partnership Agreement (IEU-CEPA), targeted for completion in September 2025. This agreement is expected to significantly boost exports of national textile products, particularly filament yarn, to the European market.
According to Redma G. Wirawasta, Chairman of the Indonesian Filament Yarn and Fiber Producers Association (APSyFI), the current value of filament yarn exports to the European Union is approximately US$50 million. With the implementation of the IEU-CEPA and the elimination of tariffs ranging from 5% to 7% currently imposed, export values are expected to double.
In addition to the benefits of tariff elimination, the readiness of the domestic industry is also a key driving factor. Redma emphasized that yarn producers have met the certificate of origin (COO) requirements, which are the primary requirement for exporting products to the European market. Because the main raw materials are sourced domestically, the COO does not pose a significant obstacle. In fact, with the enactment of this COO regulation, the domestic downstream textile industry has the potential to be encouraged to use more local raw materials.
Outside the European market, APSyFI also responded positively to the reduction in reciprocal tariffs from the United States. Previously subject to an additional tariff of 32%, it has now been reduced to 19%. While still a burden, this reduction is considered to provide better competitive space, especially compared to competing countries such as Vietnam and Bangladesh, the latter of which still faces tariffs of up to 35%.
Meanwhile, Redma believes that access to textile goods from the United States to the Indonesian market will not pose a direct threat. Instead, US products are more complementary. In fact, Indonesia can take advantage of this opportunity to import primary raw materials such as cotton, which cannot yet be produced domestically.
With industrial readiness and the support of strategic trade agreements, the future of Indonesian textile exports to global markets, particularly Europe and the Americas, looks increasingly promising.