The government's plan to establish a State-Owned Enterprise (SOE) in the textile sector has received a response from the Indonesian Filament Fiber and Yarn Producers Association (APSyFI). APSyFI Chairperson Redma Gita Wirawasta stated that the plan was the result of a government study involving industry associations, and therefore was not a sudden policy.
According to Redma, establishing a textile SOE could be an alternative to deepening the national industrial structure. However, these steps must be accompanied by comprehensive improvements to the business climate. He emphasized the importance of improving trade policies, providing incentives that can increase overall industrial competitiveness, and simplifying and making bureaucratic processes more transparent, particularly in the licensing process.
The establishment of a textile SOE is a directive from President Prabowo Subianto, with planned funding of US$6 billion allocated through Danantara. Redma believes that in addition to being used directly for SOEs, the funds can also be used as investment triggers for the private sector, thereby encouraging further investment of up to US$60 billion.
APSyFI stated that it is not concerned that the presence of state-owned textile companies will compete with existing yarn and fiber producers. Redma believes that with proper regulation, fair competition will be created between state-owned enterprises and the private sector. In fact, he hopes that the existence of state-owned textile companies will help the government better understand the unfair competition experienced by the industry in the face of dumped and illegal imports.
On the other hand, Paramadina University economist Wijayanto Samirin expressed a different view. He believes the government needs to be cautious in implementing this plan because state-owned enterprises will enter a sector that has historically been considered more efficiently managed by the private sector. He believes that if taken incorrectly, the establishment of state-owned textile companies could potentially increase the risk of layoffs, especially if they become direct competitors with existing textile producers, whose condition is still fragile.
The government itself emphasized that the rationale for establishing state-owned textile companies is related to the textile and garment industry's position as the frontline in facing the risks of tariff policies from the United States. Coordinating Minister for Economic Affairs Airlangga Hartarto stated that Indonesia once had state-owned textile companies and is now planning to revive them, with US$6 billion in funding support from Danantara.
Airlangga also highlighted the persistent weakness in the national textile industry's value chain, particularly in yarn and fabric production, dyeing, printing, and finishing processes. He expressed his hope that the establishment of a new state-owned textile enterprise (SOE) would drive industrial modernization and deepening, thereby sustainably strengthening the competitiveness of the national textile industry.