Indonesia to Implement Minimum Price Rule to Protect Local Products

Government Crackdown on Cheap Imports

The Indonesian government is taking decisive action to protect local businesses from the surge of cheap imports, particularly from China. Minister of UMKM, Maman Abdurrahman, announced that the government is preparing to introduce a minimum selling price regulation for certain imported products ²

. This move aims to level the playing field for domestic manufacturers who are struggling to compete with the low prices of imported goods.

Shift in Used Clothing Traders' Behavior

In a positive development for local businesses, Maman Abdurrahman reported that traders who previously dealt in used clothing imports are now willing to sell local products ¹

. This change comes after the government cracked down on the importation of used goods, which is considered illegal under current regulations. The minister emphasized that importing used goods, including clothing, is prohibited by law.

Economic Rationale Behind the New Regulation

The proposed minimum price rule is designed to address the negative impact of cheap imports on domestic production. Maman highlighted that the influx of low-priced Chinese products is making it difficult for local producers to compete, which in turn threatens the productivity of UMKM ²

. By implementing a minimum selling price, the government hopes to encourage domestic production and create a more favorable environment for local businesses to thrive.

Expected Impact on Local Businesses

The new regulation is expected to have a positive impact on local businesses by reducing the competitive pressure from cheap imports. This move is part of a broader strategy to boost domestic economic activity and protect the interests of Indonesian manufacturers. As the government continues to refine the details of the minimum price rule, stakeholders are hopeful that it will provide the necessary relief to local businesses.