Indonesia launching US$6 billion state-owned firm to shield textile industry from US tariffs, rising imports

[JAKARTA] Indonesia plans to establish a new state-owned enterprise (SOE) focused on the textile and garment sector, a move aimed at strengthening the industry against external shocks, including US tariff risks and the flood of Chinese textile imports in recent years.

Coordinating Minister for Economic Affairs Airlangga Hartarto announced on Wednesday (Jan 14) that the company will be directly managed by Danantara, the country’s sovereign wealth fund, with an initial funding allocation of up to US$6 billion.

The funds will be directed towards capital equipment procurement, adoption of new technologies and export expansion initiatives. However, he did not specify the company’s expected launch date.