July 13, 2024
Industry

Vietnam Faces Indonesian Trade Sanction Threat

The Vietnam Trade Office in Indonesia has issued a cautionary notice to Vietnamese businesses regarding potential trade sanctions, particularly targeting textiles and garments, amidst challenges faced by Indonesia’s textile industry.

Indonesia has seen a decline in export orders and the closure of many textile factories, leading to significant job losses. Key sectors for Vietnam in the Indonesian market include textiles, footwear, and electronic goods, which collectively contributed US$1.5 billion in export turnover, representing 30% of Vietnam’s total exports to Indonesia last year.

Comparatively, these sectors face competitive pressures from other production hubs like China and Malaysia. As a result, the Vietnam Trade Office anticipates Indonesia may consider trade defence measures not only against Chinese products but also potentially extending to goods from other countries, including Vietnam.

To prepare for potential sanctions, the trade office advises Vietnamese businesses and export associations to closely monitor market developments. They should engage with relevant units of the Ministry of Industry and Trade and the Vietnam Trade Office in Indonesia to develop proactive strategies.

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