Jababeka plan to build fashion city in Kendal to boost Indonesian textile

The Jababeka Industrial Estate is the first modern Indonesian eco-industrial estate and jointly developed with ProLH GTZ under a technical cooperation program collaboratively established by Indonesia’s Ministry of Environment and the Republic of Germany is planning to turn Kendal in Central Java into a “fashion city”.

Jababeka president director SD Darmono said on Wednesday that his company would build a textile complex in the small city to provide space for textile and garment manufacturers to develop their businesses.

At the textile complex, there will be garment factories that will be close to textile factories, a trade center and design training centers, he told reporters after a closed-door meeting with Industry Minister Saleh Husin.

While Bandung, West Java, has long been known as one of the country’s garment and textile hubs, in the near future Kendal in Central Java may feature prominently on the fashion map.

Currently known by locals as a city of santri (Islamic students) for its ubiquitous Islamic boarding schools, Kendal may be transformed into a fashion city integrating all aspects of the textile and garment industry as a result of the plan.

A bonded warehouse is also expected to be set up near the complex, functioning as a location to stockpile raw materials for garment manufacturing.

Industry Ministry director general for industrial estate development Imam Haryono said that he applauded the plan to build the fashion city as it would help boost the quality of Indonesian textiles and textile products.

The number of upper- and middle-income people is growing, and they are now looking for quality. Instead of shopping in Singapore or Europe, they want to persuade them to shop for local products that are similarly good in design and quality.

He added that it was the right time for Indonesia, which had a track record of excellence in textile and textile products, to build its own fashion center.

Most Indonesian textile and textile products are currently exported overseas, with Asia-Pacific, the US and Europe being the major markets. The country’s textile and textile products sales increased from $8.6 billion in 2005 to $12.7 billion in 2014. This, however, is well behind Vietnam, which booked an incremental increase from only $5.3 billion in 2011 to $26.2 billion in 2014.

Indonesia’s textile industry is regarded as the sector that would gain the most benefit should the country join the US-led Trans-Pacific Partnership (TPP) as its products would be subject to a zero-tariff in the US market and other TPP countries.

The zero-tariff would, however, apply to textile products whose materials were sourced only from the trade pact’s members.

Jababeka is set to start construction of the fashion city in the middle of this year on a 100-hectare site in partnership with Singapore based Sembawang Corp. Ltd. It had been previously reported that the textile complex would be built inside the Kendal Industrial Estate (KIK), which covers an area of 2,700 ha.

Jababeka has already acquired 630 ha of land worth Rp 400 billion (US$29.8 million) for the textile cluster, and that will be increased according to the number of tenants. The KIK is 51 percent owned by Jababeka and the remaining 49 percent is owned by Sembawang Corp.