A New Phase in Indonesia’s War on Used Clothing Imports
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JAKARTA, Investortrust.id — The Indonesian government has entered a new phase in its battle against used clothing imports, a trade officially banned for years but still thriving in local markets. The renewed crackdown aims to dismantle the network of importers behind the flow of secondhand apparel that has undercut domestic textile producers and raised health concerns.
The prohibition is rooted in Trade Ministerial Regulation No 40 of 2022, which amended Regulation No 18 of 2021 on prohibited exports and imports. Article 2 paragraph 3 explicitly bans imports of secondhand goods—including bags, sacks, and clothes—citing their negative impact on the domestic economy, especially micro, small, and medium enterprises (MSMEs), and potential health hazards.
Violators face up to five years in prison and fines reaching Rp 5 billion. Businesses that fail to comply with licensing requirements may also face administrative sanctions such as written warnings, product recalls, temporary suspension, warehouse closures, or license revocation.
To enforce these rules, the government in mid-2024 created a special Illegal Imports Task Force through Trade Ministerial Decree No 932/2024, initially led by then-Trade Minister Zulkifli Hasan. His successor, Budi Santoso, continued the policy, frequently destroying seized secondhand clothing—known locally as balpres—worth billions of rupiah. Yet, despite repeated crackdowns, the trade has persisted and even grown.
According to the Central Statistics Agency (BPS), imports under the HS code 63090000 reached US$ 1.31 million, or 1.09 million kilograms, from January to July 2025—nearly matching the entire value of 2024 imports, which totaled US$ 1.5 million with a volume of 3.86 million kilograms.
Finance Minister Purbaya Yudhi Sadewa recently reignited the fight, pledging to prosecute importers and impose monetary penalties instead of merely destroying contraband.
“For years, when we destroyed the goods, the state ended up spending money. We gained no revenue and even had to pay to feed people in prison. So we’ll change that—importers will now face fines,” Purbaya said at the Finance Ministry headquarters.
The Indonesian Filament and Fiber Producers Association (APSyFI) welcomed the move, calling it essential to restore the competitiveness of the domestic textile and garment industry.
“It’s a very good policy, and it’s the importers who must be punished,” APSyFI Chairman Redma Gita Wirawasta told Investortrust.id on Sunday, Oct 26, 2025. “If enforced seriously, it could help the industry recover and achieve stronger performance.”
The call for strict enforcement also came from Indonesian Chamber of Commerce and Industry (Kadin) Vice Chairman Saleh Husin, who described the crackdown as “a fair protection for local industries that have long been forced to compete with ultra-cheap used imports.”
He added that the illegal trade has long distorted domestic pricing, eroded profit margins, and created uncertainty for compliant businesses. “Firm action can finally create a level playing field for lawful enterprises,” Saleh said.
From an industrial standpoint, the policy could revive demand for locally made clothing, reduce dependence on imports, and trigger a new wave of investment and job creation in the textile and garment sector.
However, the move also raises concern among small traders who depend on the thriving thrift market. “Many rely on this business because it requires low capital and steady demand from lower-middle consumers,” Saleh noted.
He urged the government to accompany the enforcement with a transition program—providing capital support, vocational training, and partnerships with domestic textile producers—to prevent widespread economic displacement.
“Without such assistance, the ban could cause social resistance and deprive thousands of small traders of their livelihoods,” he warned.
Saleh emphasized that long-term success depends not only on law enforcement but also on strengthening the competitiveness of Indonesia’s textile ecosystem. “The government must improve raw-material pricing, logistics efficiency, energy costs, and skilled labor availability. Enforcement alone is not enough; a healthy business climate is what will allow domestic products to compete naturally,” he said.
“If implemented comprehensively, this policy will not only protect the industry from unfair practices but also serve as a turning point for strengthening Indonesia’s industrial resilience,” Saleh concluded.