Finance Minister is intensifying its crackdown on illegal imports by focusing enforcement efforts at entry points rather than retail markets. Minister Purbaya Yudhi Sadewa believes that curbing supply at ports will naturally reduce the circulation of illicit goods, especially secondhand clothing and bags. The strategy aims to protect legal micro, small, and medium enterprises (MSMEs) and revitalize the domestic textile industry.
Key Facts & Background
- Policy focus: Enforcement against illegal imports will concentrate on port entry, not market-level sales.
- Targeted goods: Primarily secondhand clothing and bags (balpres) deemed illegal under trade regulations.
- Responsible agency: Directorate General of Customs and Excise (DJBC), under the Ministry of Finance.
- Regulatory status: No new Ministerial Regulation (PMK) issued yet; enforcement based on existing laws.
- Planned actions:
- Fines for illegal importers
- Blocking access to import activities for identified offenders
- Tightening enforcement based on field conditions
- Policy rationale:
- Previous enforcement yielded limited fiscal benefit
- New approach aims to generate state revenue and deter repeat violations
- Economic objective:
- Support legal MSMEs, especially in the textile and textile product (TPT) sector
- Stimulate job creation and domestic production
- Stakeholder response:
- Minister of MSMEs Maman Abdurrahman supports the move, calling it a positive step for local businesses
- Emphasis on closing entry points for harmful imports to protect domestic market integrity
Strategic Insights
By targeting supply chains rather than retail outlets, the government aims to disrupt the flow of illicit goods at its source. This approach is both pragmatic and preventive—reducing enforcement complexity while minimizing consumer backlash. It also aligns with global best practices, where border control is the first line of defense against trade violations.
The focus on secondhand clothing and bags reflects broader concerns about the impact of illegal imports on domestic industries. These goods, often sold at prices below production cost, undermine local manufacturers and distort market competition. For Indonesia’s textile sector—home to thousands of MSMEs—this poses a serious threat to sustainability and employment. By curbing illegal imports, the government is creating space for legal producers to regain market share and rebuild consumer trust.
Finance Minister Purbaya’s emphasis on economic benefit is particularly noteworthy. Rather than viewing enforcement solely as a punitive measure, he seeks to make it fiscally productive—through fines, deterrence, and improved compliance. This reflects a more nuanced understanding of trade governance, where regulation serves both legal integrity and economic strategy.
The absence of new regulations suggests a flexible, field-driven approach. While this allows for rapid response, it also raises questions about legal clarity and consistency. To ensure long-term effectiveness, the government may need to codify enforcement protocols and strengthen inter-agency coordination, especially with the Ministry of Trade and other stakeholders.
The policy’s success will depend on execution. Blocking known offenders and tightening port inspections are critical steps, but they must be supported by data integration, risk profiling, and digital tracking. Public-private partnerships with logistics providers and port operators could enhance transparency and speed. Moreover, consumer education is essential to shift demand away from illegal goods and toward locally made alternatives.