- VIVAnews/Anhar Rizki Affandi
VIVAnews - The government acknowledged that toys and furniture are products that have been severely hit by the rapid imports of China-made goods.
"China terrifies us, especially on toys and furniture products," said Director General of the International Industrial Cooperation of Industry Ministry Agus Tjahajana Wirakusumah.
Other local products outshined by the invading Chinese products are textile, garment and electronic goods. "It is even worse as toys and furniture manufacturers have to do layoffs," he said.
Agus explained that Indonesia’s incompetitiveness against China has been evident since 2010. The blow was harder due to China-ASEAN Free Trade Area (CAFTA), which increased the invasion of Chinese products in the country.
"Particularly for textiles, we are rock-solid in the upper middle class. Yet, we didn't make it in the lower middle class. The hit is mostly apparent in small- and medium-sized enterprises," said Agus.
China's products, said Agus, target the lower-middle class who are very fond of low-priced products. "Although the quality is not good, the lower-middle class prefer (the Chinese products) because they’re cheap. For the upper-middle class, they select the unique products, they know the quality," said Agus.
Chinese companies, said Agus, dare to compete with local companies although the Indonesian government has imposed import duty on certain products.
"For China, however high import duties are, they can handle it, especially now that there is CAFTA, the tariff can come to zero percent," he said.
Since 2010, imported products from China that have been subjects to zero percent of import duties have reached 80 percent of the total imported Chinese products.
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