War in Iraq throttles Indonesian textile shipments to Middle East
By Furniture Today Staff -- Furniture Today, March 31, 2003
Jakarta, Indonesia — The United States' war in Iraq has stopped Indonesian textile shipments to the Middle East and will affect prices elsewhere in the world, according to a story published by Asia Pulse.
Benny Sutrisno, chairman of the Indonesian Textile Assn., said that distribution of textiles to the Middle East was affected by the presence of foreign soldiers in Qatar, and stopped altogether when the U.S. military strike began.
Indonesia's exports of textiles and textile products to the Middle East account for 15% of the nation's total production.
In addition, shipments bound for Europe have been diverted to sail around South Africa instead of through the Suez Canal, which will add a week to the trip and a $300 increase in freight costs per container.
Sutrisno said the war also will push up other expenses. The cost of transportation by air had already increased 5% and the cost of insurance by 15%, he said.
"Several buyers in the U.S. have also canceled their orders," he said. Others in the Middle East, Europe and the United States have delayed their orders, but he did not know how many.
Sutrisno said that if the war lasts until June — for a full quarter — it could reduce Indonesia's national textile production by as much as 20%.
Indonesia produced 2.1 million tons of textiles and textile products in 2002, with 15% of the volume exported to the Middle East and 23% to the United States, with other exports going to Europe and Asia.
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