G/SG/N/8/IDN/25  
G/SG/N/10/IDN/25  
3 March  2020 
(20-1660) Page: 1/7 
Committee on Safeguards  Original:  English  
 
  
NOTIFICATION UNDER ARTICLE 12.1(B) OF THE AGREEMENT ON  
SAFEGUARDS ON FINDING A SERIOUS INJURY OR THREAT  
THEREOF CAUSED BY INCREASED IMPORTS  
NOTIFICATION OF A PROPOSAL TO IMPOSE A MEASURE  
INDONESIA  
Yarn (Other Than Sewing Thread) of Synthetic and Artificial Staple Fibres  
The following communication, dated 28 February 2 020, is being circulated at the request of the 
delegation of Indonesia . 
 
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Pursuant to Articles 12.1(b) of the Agreement on Safeguards, the Government of  the Republic of 
Indonesia submits a notification on finding serious injury or threat thereof, to the domestic industries 
producing "Yarn (Other Than Sewing Thread) of Synthetic and Artificial Staple Fibres" and a 
notification of proposed safeguard measure s. This notification contains all pertinent information 
relating to the proposed safeguard measures in accordance with Article 12.2 of the Agreement on 
Safeguards and an offer of consultations pursuant to Article 12.3 of the Agreement on Safeguards.  
A. GENERAL BACKGROUND  
1  INITIATION OF INVEST IGATION  
On 12 September 2 019, an application for a safeguard measure was received by the Investigating 
Authority from the Indonesian Textile Association/ Asosiasi Pertekstilan Indonesia  (API) hereinafter 
referred as "the Applicant", against the importation of the product under investigation . After 
examining the properly documented application, the Investigating Authority concluded that there 
was a sufficient evidence to justify the initi ation of a safeguard investigation.  
Subsequently, on 1 8 September 2 019, the Investigating Authority initiated a safeguard investigation 
on the import of "Yarn (Other Than Sewing Thread) of Synthetic and Artificial Staple Fibres" . The 
commencement of the in vestigation was announced in the Bisnis Indonesia newspaper on 18  
September 2 019 and the Ministry of Trade's website on 1 9 September 2 019. (G/SG/N/6/IDN/32)  
2  PERIOD OF INVESTIGAT ION 
The period of investigation covers 2016 to 2019 (January -June).  
3  MAJOR PROPORTION  
The total production of the Applicant is 50.14 % of the total domestic production of the Subject Good . 
Therefore, it represents a major proportion as required by Article 4.1(c) of the WTO Agreement on 
Safeguards.  G/SG/N/8/IDN/25 • G/SG/N/10/IDN/25  
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  4  PROVISIONAL SAFEGUAR D MEASURE  
On 5 November 2 019 through the Minister of Finance Decree (PMK) No. 161/PMK.010/2019, the 
Government of the Republic of Indonesia stipulates the imposition of provisional safeguard measure 
on the importation of "Yarn (Other Than Sewing Thread) of Synthetic an d Artificial Staple Fibres" 
under Harmonized System (HS) code 5509.22.00, 5509.32.00, 5509.51.00, 5509.53.00, 
5510.12.00 and 5510.90.00, in accordance with the 2017 Indonesian Customs Tariff Book (BTKI), 
with specific tariff of Rp. 1,405/kg  for 200 days co mmenced from 9 November 2 019 to 
26 May 2020. (G/SG/N/7/IDN/3/Suppl.1 -G/SG/N/11/IDN/19/Suppl.1)  
5  VIEWS AND COMMENTS O F THE INTERESTED PAR TIES  
In accordance with Article 3.1 of the WTO Agreement on Safeguards, during the process of 
investigation, the Investig ating Authority has provided opportunities to all interested parties, to 
submit their views, evidences, comments, and responses concerning the investigation . In light of 
the aforementioned, the Investigating Authority has held public hearings on 3 0 Septemb er 2019 and 
13 February 2 020. 
B. INFORMATION ON WH ETHER THERE IS AN AB SOLUTE INCREASE IN I MPORTS OR AN 
INCREASE IN IMPORTS RELATIVE TO DOMESTIC  PRODUCTION  
In the light to provide evidence whether there is an absolute increase in imports or an increase in 
imports relative to domestic production, the Investigating Authority has analyzed import data of the 
Subject Goods during the period of investigation.  
1  ABSOL UTE INCREASE IN IMPO RTS 
Table 1 . Volume of Imports  
Description  Unit Year Semester  Trend  
(16-18) 
  2016  2017  2018  2018  
(Jan-Jun) 2019  
(Jan-Jun)  
Volume  of Imports  Ton 10,036  15,846  20,922  9,966  7,364  44.38  
Source : Statistics Indonesia/ Badan Pusat Statistik (BPS).  
The volume of imports increased each year from 10,036 ton in 2016 to 15,846 ton in 2017 or by 
57.89 % and increased again to 20,922 ton or by 32.03 % in 2018 . During the period of 2016 -2018 
imports increased in absolute terms wit h a trend of 44.38 %. 
Table 2 . Volume of Imports per Semester  
Description  Unit Semester  Trend  
(Jan-Jun  
16-19) 
  2016  
(Jan-Jun) 2017  
(Jan-Jun) 2018  
(Jan-Jun) 2019  
(Jan-Jun)  
Volume  of Imports  Ton 4,821  6,750  9,966  7,364  18.06  
Source : Statistics Indonesia/ Badan Pusat Statistik (BPS).  
Although the volume of imports decreased in the period of 2018 (January -June) to 2019 (January -
June), but in fact, the volume of imports in January -June period for the last 4 years (2016 -2019) 
increased significantly with a trend of 18.06 %. The volume of imports in 2019 (January June) 
amounted to 7,364 tons is far higher than the number of imports in 2016 (January June) and 2017  
(January June) . Therefore, the decline in the period 2019 (January -June) is considered as a  
temporary decline and there is concern that if there is no measure imposed, the volume of imports 
will re -increase in the future and will further aggravate the injury suffered by the Applicant.  G/SG/N/8/IDN/25 • G/SG/N/10/IDN/25  
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  2  RELATIVE INCREASE IN  IMPORTS TO TOTAL DO MESTIC PRODUCTION  
Table 3. Volume of Imports, Total Domestic Production, and Relative to Total Domestic 
Production  
Description  Unit Year Semester  Trend  
(16-18) 
  2016  2017  2018  2018  
(Jan-Jun) 2019  
(Jan-Jun)  
Volume of Imports  Ton 10,036  15,846  20,922  9,966  7,364  44.38  
Total Domestic 
Production  Index  100 100.71  101.83  100 94.16  0.41 
Imports Relative to 
the Domestic 
Production  Index  100 156.78  206.74  100 78.48  43.79  
Source : Statistics Indonesia and as verified by Investigating Authority.  
As seen in Table above, there was a surge increased in imports relative to the national production 
during the investigation period, from 100 indexed points in 2016 to 156.78 indexed points in 2017, 
and continued to increase to 206.74 indexed points in 2018 . During 2016 -2018, imports relative to 
the national production was increased with trend of 43.79 %. Even though imports relative to the 
national production decreased during the period of 2018 (January -June) to 2019 (January -June), 
but it is considered as a  temporary decline and there is concern that if there is no measure imposed, 
the volume of imports will re -increase in the future and will further aggravate the injury suffered by 
the Applicant.  
3  IMPORTS FROM MAIN CO UNTRIES  
Table 4 . Imports Shares  
Country  2018  
 Volume (Ton)  % 
China  14,104  67.41  
Thailand  2,697  12.89  
Turkey  1,575  7.53 
Vietnam  1,050  5.02 
India 659 3.15 
Other Countries  837 3.99 
Source : Statistics Indonesia/ Badan Pusat Statistik (BPS).  
From the table above, the biggest shares of import in 2018 was the People's Republic of China, which 
its shares of import in 2018 accounted for 67.41 %. Other countries with share of imports above 3 % 
during 2018 are the Royal Kingdom of Thailand (12.89 %), the Republic of Turkey (7.53 %), the  
Socialist Republic of Vietnam (5.02 %), and the Republic of India (3.15 %). 
4  UNFORESEEN DEVELOPME NT 
The increased imports of the Subject Goods from the exporting countries was unforeseeable, this is 
caused by the over -production in China in 2015 -2017 and the  impact of trade wars between China 
and the United States (US) in 2018 and 2019 which led to a shift in Chinese exports from the US to 
other countries and aggravate the surge in imports from China in Indonesia.  
Based on the China Statistical Yearbook 2016 -2019, the yarn industry in China experienced a 
significant increase in production followed by an increase in production capacity and productivity 
during the 2015 -2017 periods . The excess production in China which was a carryover from previous 
years had an impact to the unforeseeably increase of the exports of Subject Goods from China 
throughout the world, caused a surge increased in imports of Subject Good in Indonesia.  
The trade war between US and China in 2018 and 2019 also had a significant impact on the  rapid 
supply of imported goods from China, especially for yarn, fabric, and other textile derivative 
products . As a result of imposing high tariffs on these goods, producers in China diverted their G/SG/N/8/IDN/25 • G/SG/N/10/IDN/25  
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  exports unforeseeably from the US to other countries that  have large markets, one of which is 
Indonesia, causing a surge increased in imports of Subject Good in Indonesia.  
C. EVIDENCE OF SERIO US INJURY OR THREAT THEREOF CAUSED BY IN CREASED 
IMPORTS  
In a view to determine the existence of serious injury or threat of serious injury that is caused by 
increased imports, the Investigating Authority has analyzed and made an evaluation of all relevant 
factors in an objective and quantifiable natures . The following analyses are based on data provided 
by the Applicant, whi ch has been verified by the Investigating Authority.  
1  EVIDENCE OF SERIOUS INJURY OR THREAT OF SERIOUS INJURY  
Table 5 . National Consumption, Volume of Imports, and Market Shares  
No. Description  Unit Year Semester  Trend  
(16-18) Growth  
(Semester 
18-19) 
   2016  2017  2018  2018  
(Jan-Jun) 2019  
(Jan-Jun)   
1. National 
Consumption  Index  100 103.10  99.27  100 91.49  (0.36)  (8.51)  
2. Volume  of Imports  Ton 10,036  15,846  20,922  9,966  7,364  44.38  (26.11)  
3. Applicant's Domestic 
Sales  Index  100 104.83  94.06  100 92.95  (3.01)  (7.05)  
4. Non-Applicant's 
Domestic Sales  Index  100 95.03  92.54  100 94.17  (3.80)  (5.83)  
5. Imports' market 
share  Index  100 153.15  209.99  100 80.77  44.91  (2.00)  
6. Applicant's market 
share  Index  100 101.68  94.75  100 101.60  (2.66)  0.75 
7. Non-Applicant's 
market share  Index  100 92.17  93.22  100 102.93  (3.45)  1.26 
Source : Statistics Indonesia and as verified by the Investigating Authority.  
The table above shows that the national consumption is relatively stable from 2016 -2018 with a 
trend of 0.36 %. Meanwhile, the volume of imports experienced a surge increase with a trend of  
44.38 % in the same period . The market share of imports in the same period also significantly 
increased with a trend of 44.91 % resulting in the decline of the Appl icant's and Non -Applicant's 
market share.  
On the contrary, in the period of 2018 (January -June) to 2019 (January -June) the market share of 
Applicant and Non -Applicant slightly increased while the market share of imports declined . The 
decline in the period 2019 (January -June) is considered as a temporary decline and there is concern 
that if there is no measure imposed, the market share of imports will re -increase significantly and 
re-erode the market share of Applicant in the future.  
Table 6 . The Applicant's  Indicators of Injury  
Unit: Index  
No. Description  Year Semester  Trend  
(16-18) Growth  
(Semester 
18-19) 
  2016  2017  2018  2018  
(Jan-Jun) 2019  
(Jan-Jun)   
1. Production  100 101.27  102.02  100 94.56  1,01 (5,44)  
2. Domestic Sales  100 104.83  94.06  100 92.95  (3,01)  (7,05)  
3. Productivity  100 107.26  111.75  100 97.40  5,71 (2,60)  
4. Utilization Capacity  100 101.27  101.91  100 93.30  0,95 (5,44)  
5. Loss (100)  (180.23)  (77.09)  (100)  (52.82)  13,38  47,18  
6. Employment  100 94.42  91.30  100 97.09  (4,45)  (2,91)  
7. Inventory  100 113.58  119.09  100 120.50  9,13 20,50  
Source : As verified by the Investigating Authority.  G/SG/N/8/IDN/25 • G/SG/N/10/IDN/25  
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  As shown in Table 6, the performance of the applicant can be seen as follows:  
a) Production experienced a slight increase with a trend of 1.01% from 100 indexed points in 2016 
to 101.27 indexed points in 2017 and increased again to 102.02 indexed points in 2018 . As 
oppose, in the period of 2018 (January -June) production decreased from 100 indexed point to  
94.56 indexed point in the period 20 19 (January -June).  
b) Domestic Sales in 2016 was 100 indexed points increased to 104.83 indexed points in 2017 and 
then decreased significantly to 94.06 indexed points in 2018 . During 2016 -2018 the domestic 
sales of the Applicant decreased by a trend of 3.01 %. In the period of 2018 (January -June) the 
domestic sales experienced further  decrease from 100 indexed points to 92.95 indexed points 
in the period of 2019 (January -June).  
c) Productivity in 2016 was 100 indexed points, increased to 107.26 indexed points in 2017 and 
111.75 indexed point in 2018 . During 2016 -2018 the applicant's productivity has increased with 
a trend of 5.71 %. However, in the period of 2018 (January -June) productivity decreased from 
100 indexed points to 97.40 indexed points in the period of 2019 (January -June).  
d) Utilization Capacity has slightly increased from 100 indexed points in 2016 to 101.27 indexed 
points in 2017 and 101.91 indexed points in 2018 . During 2016 -2018 the applicant's utilization 
capacity is relatively stable with a  trend of 0.95 %. On the contrary, in the period of 2018  
(January -June) Utilization Capacity decreased significantly from 100 indexed points to  93.30 
indexed points in the period of 2019 (January -June).  
e) The Applicant experienced a financial loss each year w ith a trend of 13.38 %. The biggest financial 
loss occurred in 2017 amounting  to minus 180.23 indexed points or by 80.22 % compared to the 
previous year . The loss occurred was because the Applicant had to sell their product below 
production costs as a result  of pressures from imported goods that flooded the domestic market . 
Although in the period of 2018 (January -June) -2019 (January -June) the Applicant's losses were 
reduced, the Applicant still sold its goods below the production cost.  
f) The Applicant's employm ent significantly decreased from 100 indexed points in 2016 to 94.42  
indexed points in 2017 and 91.30 indexed points in 2018 . Moreover, the Applicant's employee 
experienced further decreased from 100 indexed points in the period of 2018  (January -June) to 
97.09 indexed points in the period of 2019 (January -June).  
g) Inventory increased during 2016 -2018 with a trend of 9.13 %. Moreover, in the period of 2018  
(January -June) to 2019 (January -June) Inventory experienced further increased by  20.50 %. 
h) Based on the expl anation above, it can be concluded that during the investigation period, the 
Applicant experienced a threat of serious injury  based on the Applicant's performance that 
indicated a downward trend in domestic sales and employment, as well as increased financ ial 
losses and inventory.  
2  OTHER FACTORS THAT M AY CONTRIBUTE TO INJ URY 
In order to ensure that the serious injury or threat of serious injury is only caused by increased 
imports, the Investigating Authority has examined the following other known factors:  
 a) Technology  
Based on the results of the investigation, the Applicant already has the latest technology in producing 
the Subject Good . This argument is supported by the fact that the Applicant's machinery is able to 
produce sophisticated goods that are us ed as materials for any kind of fabrics . This shows that the 
threat of a serious injury suffered by the Applicant is not caused by technology.  
 b) Quality  
The quality of goods produced by the Applicant has met the international standards such as LRQA  
ISO 9 001: 2015 and OEKO -TEX certificate . Thus, in terms of quality, goods produced by the G/SG/N/8/IDN/25 • G/SG/N/10/IDN/25  
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  Applicant are able to compete with imported goods because they already met the internationally 
recognized standards.  
 c) Production  Capacity  
Table 7 . Percentage of the National Consumption compared to the Domestic Production 
Capacity  
Description  Year Semester  
 2016  2017  2018  2018  
(Jan-Jun) 2019  
(Jan-Jun) 
National Consumption to the 
Domestic Production Capacity (%)  42.57  43.91  42.33  42.11  38.29  
Source : Statistics Indonesia and as verified by the Investigating Authority.  
As shown in Table above, national consumption was contributing not more than half of the domestic 
production capacity . Therefore, the domestic production capacity is more than enough to me et the 
national consumption . In fact, a threat of serious injury suffered by the Applicant is not because the 
idle in production capacity, but because of the imported goods have flooded the domestic market 
resulting in many production capacities not fully utilized.  
Based on the facts of a) to c) above, it can be concluded that during the period of investigation there 
were no other factors that caused a threat of serious injury to the Applicant besides increased volume 
of imports of the Subject Goods.  
3  CAUSAL LINK  
The Investigating Authority has examined all relevant factors having a bearing in the Applicant 
situation, and came into a conclusion that threat of serious injury suffered by the Applicant mainly 
caused by significant increased volume of impor ts and not due to the other factors, as follows:  
a) There was a surge increase of Subject Good in absolute terms in 2016 -2018 with a trend of 
44.38 %. Likewise, in the period of 2016 (January -June) to 2019 (January -June) there was an 
increase in the number of imports with a trend of 18.06 %. 
b) There was a surge increase of Subject Good in relative terms in 2016 -2018 with a trend of  
43.79 %. 
c) Imports' market share has increased with a trend of 44.91 % in 2016 -2018 and in the period of  
2018 (January -June) to 2019 (Janu ary-June) the imports' market share was decrease by only  
2.00%. 
d) The Applicant's market share decreased with a trend of 2.66 % and the Non -Applicant's market 
share has also decreased with a trend of 3.45 % during period of 2016 -2018. Meanwhile, in the 
period of 2018 (January -June) to 2019 (January -June) the market share of the Applicant and 
Non-Applicant relatively stable.  
e) Downward trends in domestic sales, employment, increased losses, and increased inventories.  
f) There were no other factors that caused a threat of serious injury besides increased imports of 
the Subject Goods.  
D. DESCRIPTION OF TH E PROPOSED SUBJECT G OODS  
Yarn (Other Than Sewing Thread) of Synthetic and Artificial Staple Fibres, under Harmonized System  
(HS.) codes 5509.22.00, 5509.32.00, 5 509.51.00, 5509.53.00, 5510.12.00, and 5510.90.00.  G/SG/N/8/IDN/25 • G/SG/N/10/IDN/25  
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  E. DESCRIPTION OF TH E PROPOSED MEASURE  
In a view of the aforementioned findings, a safeguard measure has been proposed in form of specific 
tariff duty with description, proposed date of introduction, and e xpected duration of the measure as 
follow:  
Table 8 . The Proposed on Safeguard Measure  
Year Measure  
Period I  
(27 May 2 020 – 8 November 2 020) Rp. 1,405 /Kg  
Period II  
(9 November 2 020 – 8 November 2 021) Rp. 1,192 /Kg  
Period III  
(9 November 2 021 – 8 November 2 022) Rp. 979 /Kg  
In a view of the aforementioned conclusion of the causal link, the Investigating Authority has 
proposed to the Government of the Republic of Indonesia to impose a safeguard measure on the 
importation of the Subject Goods for thr ee periods.  
The imposition of the safeguard measure will be carried out in accordance with the Article 2.2 and 
Article 9 of the WTO Agreement on Safeguards.  
The non -confidential version of the Final Report of this investigation, can be found in the website of 
the Indonesian Safeguard Committee : www.kppi.kemendag.go.id  
F. CONSULTATIONS  
Members who have a substantial interest of the Subject Goods, shall submit a written request of 
consultation within a period of 7 days from the date of circulation of t his notification . All written 
requests must be sent both in written letter and in electronic format, and must indicate the name, 
address, email  address, phone and fax number of the Members.  
In Accordance with Article 12.3 WTO Agreement on Safeguard, the Go vernment of the Republic of 
Indonesia is open for consultation in order to provide opportunities for those Members, consultation 
is scheduled to be held no later than 2 0 March 2 020. 
The contact information for correspondence is:  
DIRECTORATE OF MULTILATERAL NEGOTIATION, MINISTRY OF TRADE  
Jl. M.I. Ridwan Rais No.5, Building 2, 9th floor, Jakarta 10110  
Phone : (62-21) 3840139  
Fax: (62-21) 3840139  
Email: dit.multilateral.ppi @kemendag.go.id  
 
 
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