CCPIT Organized A Delegation Of Textile And Garment Entrepreneurs To Indonesia For Investment Investigation And Exchange

At present, the international political and economic situation is complex and changeable, the global industrial chain supply chain is deeply adjusted, and China's textile and clothing industry is facing fierce international competition and multiple uncertainty challenges. In order to speed up the construction of a new pattern of high-quality development, deepen the cooperation between China and Indonesia in the textile industry, and promote the deepening and implementation of the joint construction of the "Belt and Road", the Textile Industry Branch of the China Council for the Promotion of International Trade (CCPIT), in conjunction with the China Printing and Dyeing Industry Association, the China Knitting Industry Association, and the China Textile Planning Research Association, Organize an entrepreneur delegation to Indonesia to carry out investment research and industry exchange activities from April 22 to 28, 2025 。

The delegation was led by Liu Lihua, Secretary General of CCPIT, Feng Dehu, President of China Textile Planning and Research Association, Ding Sijia, Director of the Industry Department of China Printing and Dyeing Industry Association, and 30 senior executives from the upstream and downstream of the textile and clothing industry chain. Participating enterprises include Dongdu Textile Group, Beide Garment Group, Xinruibei Biotechnology, Weifeng Textile, Zhejiang Jiaming Dyeing and Finishing, Jianye Textile Group, Ningbo Hailide, Guangdong Textile, Yincheng Textile, Jinhengchang Textile, Tianliyuan Garment, Yuanxin Industry, Huansi Wisdom, Xiamen Jianfa Living Materials, Henan Bonny, Shaoxing Heyuan, Baoxi Group, Everest Information Technology Zhejiang balderdash accessories, etc.

　　 Convene joint working meeting

On April 22, after arriving in Jakarta, the delegation first held a joint working meeting with the Indonesian Ministry of Investment and Downstream Chemicals (BKPM), the Indonesian Textile Association (API) and the Indonesian Association of Industrial Zones (HKI). The meeting was presided over by Cahyo Purnomo, Director of the Department of Southeast Asia, Middle East and Africa Affairs of the Ministry of Investment and Downstream Development of Indonesia, and the heads of local investment bureaus in Indonesia participated in the meeting via video.

Secretary General Liu Lihua introduced the development status of China's textile industry to Indonesia, the exploration and practice of building a modern textile industry system in recent years, and exchanged views on the prospects of deepening cooperation in the textile industry between the two countries. Danang Girindrawardana, executive director of the Indonesian Textile Association, pointed out that as the eighth largest textile and clothing exporter in the world, Indonesia's textile industry has huge development potential. At present, Indonesia's upstream textile raw materials mainly rely on imports from China, and there will be strong demand for product localization in the future. He expected to strengthen investment cooperation with Chinese textile enterprises to achieve common development.

Sanny Iskandar, chairman of the Indonesian Association of Industrial Zones, introduced the development process of industrial parks in Indonesia to the delegation. He said that since the 1970s, the development of Indonesia's industrial parks has gone through four stages, from the initial state-owned parks as the leader, to allowing private parks to participate, to promoting the construction of modern parks, and now into the smart ecological industrial park 4.0 stage driven by digital and green transformation. At present, the Association has 118 park members, distributed in 24 provinces, of which 53% (by number) are located in Java Island, mainly focusing on high-tech, labor-intensive and downstream manufacturing industries. In 2009, the Indonesian government issued regulations requiring new factories to settle in the industrial park. Sanny Iskandar suggested that Chinese textile enterprises give priority to industrial parks in Central Java, East Java, North Sumatra, South Sulawesi and other provinces with a large number of labor resources and relatively low wage levels. The Association will help to find suitable parks, service applications and related procedures, and help the smooth implementation of investment projects.

Image source: HKI

"China and Indonesia have always maintained close high-level exchanges to provide political guarantee and strategic guidance for the development of bilateral relations. As the largest economy in Southeast Asia and the fourth most populous country in the world (280 million people), Indonesia has signed 35 free trade agreements, including RCEP, with its GDP accounting for 36% of ASEAN's total. ”Cahyo Purnomo, Director of Indonesia's Ministry of Investment and Downstream Chemicals, introduced to the delegation. In terms of attracting foreign investment, Singapore, Hong Kong, China and mainland China will be the main source countries/places of foreign investment in Indonesia in 2024. From 2020 to 2024, China's direct investment in Indonesia will amount to US $31.8 billion, involving 37000 projects, with an average annual growth rate of 31%. Among them, Indonesia's textile industry has attracted the seventh largest amount of investment in various industries, attracting a cumulative investment of 480 million dollars from Chinese enterprises over the past five years. Director Cahyo Purnomo also made a detailed introduction on the business environment, investment process, preferential policies, etc. that the delegation enterprises care about.

　　 Investigate the industrial parks in West Java and Central Java

Indonesia's textile and clothing industry is highly concentrated on Java Island, especially West Java and Central Java, which are the core regions of Indonesia's textile and clothing industry. With relatively complete industrial chains and labor advantages, Indonesia has become the first choice for investment in labor-intensive industries. The delegation made a field visit to some key industrial parks in Java.

　　 Karawang International Industrial City（KIIC）： Located in Karawang County, West Java Province, it has been jointly developed and operated by Itochu Corporation of Japan and Indonesia Kingo Group since 1992. The park is close to the Jakarta metropolitan area, with 72% of the working age population, convenient sea, land and air transportation, and stable supply of water, electricity and other infrastructure. At present, the park has attracted many multinational enterprises from automobile, electronics, consumer goods and other industries.

　　 Suryacipta City of Industry： Invested and established by PT SuryaciptaSwadaya in 1990, it covers an area of 1400 hectares in Karawang County. At present, 155 world-famous enterprises involved in automobile manufacturing, electronics, medicine, building materials and other industries have settled down. In 2020, Suryacipta will launch the Subang Smartpolitan integrated town project in the Supang region, covering an area of 2717 hectares, which will be developed in four stages. Located in the heart of West Java, Supang is the future industrial corridor. Subang Smartpolitan can directly reach the expressway toll road, Patimban International Port and Kertajati International Airport, and the labor supply is sufficient. In 2023, the population of the region will be 909000, and the minimum wage will be about 1600 yuan. According to the investment manager of the park, a Jiangsu fabric enterprise has invested and built a factory in Subang Smartpolitan.

　　 Kawasan Industri Kendal： Located in Semarang, the capital of Central Java Province, jointly developed by Singaporean Sembcorp Group and Indonesian Jababeka Group, it covers 2200 hectares and is the largest international standard comprehensive industrial park in central and western Indonesia. The park is 25 kilometers away from the Semarang deep-water port, 20 kilometers away from the international airport, and one hour direct flight from Jakarta. It is located in the hinterland of 33 million people in Central Java. The park is equipped with special power plants, water purification supply stations, sewage treatment plants and other key facilities, providing stable and reliable energy and water resources for the settled enterprises. Relying on the competitive labor cost (minimum wage of 1300 yuan/month) and the preferential policies of the special economic zone in import and export tariffs, value-added tax and other aspects, Kendal Industrial Park has attracted investment from enterprises such as electronics, textile and clothing, automobiles, food, medical equipment, furniture and so on. During the period, the delegation also held an experience exchange discussion with a Chinese textile enterprise in the park.

　　 Jatengland Industrial Park（JIPS）： Located in Tammu County, Central Java Province, 45km away from Semarang Port, it is an industrial park invested by Indonesian private companies and a foreign investment area designated by the Indonesian government. The overall planning of the park is 300 hectares. Since its operation in 2013, 22 Chinese funded leading enterprises such as China Liansu, Huafeng Jian'an and Sailun Group have successively settled in. It is understood that the Honggang Textile Indonesia Project of Huagang Group has also settled in JIPS Industrial Park. The Group has established Fuhua Textile Co., Ltd. in Indonesia to build a comprehensive large-scale modern textile factory integrating R&D, weaving, post-treatment and trade. General Manager Lin Xiuxi had a warm exchange with the delegation. He said that the project would complete the survey, site selection and land purchase in 2023 and start construction in June 2024. At present, the factory construction is progressing in an orderly manner. It is expected to be put into operation in June this year. After the completion of the project, it will fill the gap in the manufacturing of high-end functional chemical fiber knitted fabrics for Indonesia, which will help enterprises further improve their international competitiveness and sustainable development capabilities.

On April 25, the delegation arrived in Semarang and was warmly received by the Central Java Investment Promotion and One Stop Approval Bureau (DPMPTS of Central Java). At the reception, the principals of investment attraction of Wijayakusuma Industrial Park and Grand Batang City made detailed introductions respectively. Wijayakusuma It is a mature comprehensive industrial park in Semarang City, covering an area of 250 hectares. Its leading industries include warehousing and logistics, high-end textiles, furniture, food, etc. Grand Batang City Batang Industrial Park is the largest state-owned special economic zone supported by the Indonesian government. It is designated as a national strategic project, covering an area of 4300 hectares, and is also an important part of the cooperation between China and Indonesia in "two countries, two parks".

In addition, during the investigation in Jakarta, Indonesia Vip International Industrial Park (WIP) head also introduced the main situation of the park to the delegation. The park will plan five major industrial blocks, including textile dyeing and finishing, and invest in the construction of photovoltaic power stations. Phase I of the park plans to build a water purification plant with a daily net water volume of 40000 tons and a sewage treatment plant with a daily sewage treatment capacity of 35000 tons, which is expected to be put into use before December 2025.

　　 Visiting famous Indonesian enterprises

　　 PT Pan Brothers Group Founded in 1980, it is the largest garment manufacturer in Indonesia, mainly producing functional, sports and fashion garments, and exporting products to the United States, Europe, Asia, Africa and other countries and regions. At present, the company has 15 factories (7 of which are located in Central Java) with 25000 employees. The delegation visited the factory in Banten Province adjacent to Jakarta, which is also the earliest and oldest factory of Pan Brothers. Mr. Boedi Satrio, General Manager of Business Development and Investor Relations, introduced the basic business of the company. He said that at present, the company's customers are mainly ARC'TERYX, LULULEMON, ADIDAS, DECKERS, LOWA, LACOSTE, MUJI, etc. The fabrics used are mostly purchased from China. The delegation visited the cutting workshop, sewing workshop, finishing workshop and washing laboratory. Ms. Anne Patricia Sutanto, vice president of the company, and the business team communicated with the members of the delegation, and the atmosphere was warm.

　　 PT GISTEX Founded in 1975, the company is a local Indonesian textile enterprise with a vertically integrated production system from yarn, weaving, knitting, dyeing and finishing to garment manufacturing, and has established long-term cooperation with international brands. Gistex's monthly production scale is 2500 tons of yarn, 3 million yards of woven fabric, 4.5 million yards of printed and dyed fabric, and 500 tons of knitted fabric. Enterprises use SAP production management system to improve production efficiency; Adhering to the sustainable development strategy, our products have obtained various international quality and environmental protection certifications; There are two sewage treatment plants with treatment capacity of 150 m3/h and 400 m3/h. It has 55 hectares of land resources (60% of which have been developed) and perfect public facilities, which can support the construction of new construction projects in the future. The delegation was divided into three groups to visit the production workshops at different links of the enterprise, and everyone greatly appreciated the operation and management of the factory.

　　 Survey summary

In recent years, China Indonesia cooperation has maintained a strong development trend. As the representative emerging economies in the global southern camp, the strategic mutual trust between the two countries has been continuously strengthened, and cooperation in infrastructure, trade and investment, people to people and cultural exchanges and other fields has continued to make new progress. As one of the important manufacturing sectors in Indonesia, the textile and clothing industry is attracting the attention of global investors with its young population structure, abundant labor supply, internationally competitive comprehensive cost advantage, open and good trade and investment environment, and rapidly expanding domestic demand market and other favorable factors.

During the period from 2018 to 2025, CCPIT organized three enterprise delegations to Indonesia for field visits. Through the establishment of an exchange platform, the two countries' industrial circles improved understanding, strengthened resource docking and deepened production capacity cooperation. In the latest survey, the enterprise delegation had a deep understanding of the investment environment and policies of Java's key industrial parks. The Indonesian government provided corporate income tax exemption periods ranging from 5 to 20 years and land use rights of up to 80 years to attract foreign investment. Through simplifying administrative procedures, improving infrastructure and other measures, the overall investment environment was constantly optimized.

At the same time, it should be noted that the textile industry investment in Indonesia still faces multiple challenges. At present, there is still great uncertainty in the global economy. The international economic and trade situation has brought fluctuation risks to export-oriented industries such as textiles and clothing. At the same time, Indonesia's local infrastructure has weaknesses, especially insufficient logistics efficiency and high costs, which also requires investors to respond prudently. In this context, China's textile enterprises need to make reasonable plans, fully evaluate the advantages and disadvantages of different regions, and formulate forward-looking investment strategies to grasp the development opportunities and achieve long-term development.

(Source: International textile production capacity cooperation)