WORLD TRADE  
ORGANIZATION  G/SG/N/8/IDN/9 
G/SG/N/10/IDN/9 
G/SG/N/11/IDN/8 
12 April 2011 
 (11-1811) 
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 PURSUANT TO ARTICLE 12.1(C) 
OF THE AGREEMENT ON SAFEGUARDS 
 
NOTIFICATION PURSUANT TO ARTICLE 9, FOOTNOTE 2  
OF THE AGREEMENT ON SAFEGUARDS 
 
INDONESIA 
 
(Bleached and unbleached woven fabric of cotton
) 
   The following notification, dated 10 April 2011, is being circulated at the request of the 
Delegation of Indonesia. 
 
_______________ 
 
 
 Pursuant to Article 12.1 (b) and (c) of  the WTO Agreement on Safeguards ("WTO 
Safeguards"), the Republic of Indonesia notifies on the findings and the imposition of a safeguard 
measure on imports of bleached and unbleached woven fabric of cotton under HS codes: 
5208.11.00.00, 5208.12.00.00, 5208.13.00.00, 5208.19.00.00, 5208.23.00.00, 5208.29.00.00, 5208.11.00.00, 5208.12.00.00, 5208.13.00.00, 5208.19.00.00, 5208.23.00.00, and 5208.29.00.00, for 
a period of three (3) years by the issuance of Minister of Finance's Decree number: 
58/PMK.011/2011
1 dated 23 March 2011, promulgated in th e Berita Negara of the Republic of 
Indonesia Number 163 on the same date.   It is requested that this notification under Article 12.1 (b) and (c) of the WTO Agreement on 
Safeguards be brought to the notice of Members. 
 
A. B
ACKGROUND  
 On 22 June 2010, The Indonesian Textile Indus tries Association (API) on behalf of its 
members filed an application with Indonesi an Safeguards Committee (Komite Pengamanan 
Perdagangan Indonesia/ KPPI) requesting for a safe guards measure against imports of bleached and 
unbleached woven fabric of cotton. 
 
                                                      
1 A copy of the relevant resolution (PERATURAN MENTERI KEUANGAN NOMOR 
58/PMK.011/2011 - in Indonesian only) has been submitted electronically.  To consult this document please 
contact Ms. Budd (hilary.budd@wto.org) or Ms. McGrath (judith.mcgrath@wto.org) of the Rules Division. G/SG/N/8/IDN/9 
G/SG/N/10/IDN/9 G/SG/N/11/IDN/8 
Page 2 
  
   The domestic industry claimed to suffer from a serious injury caused by the significant 
increased volume of of imports of the subject goods . The claim based on the information covering the 
period 2007 to 2009, which showed that imports of bleached and unbleached woven fabric of cotton, 
in terms of volume, increased significantly cau sing a serious injury to domestic industry. 
 
1. Initiation of investigation 
 After examining a request made by the domestic  industry, the investigating authority decided 
to initiate an investigation, and individual notice sent to all known interested parties and concerned 
government agencies. The Government of Indonesi a notified members of the WTO through the WTO 
Secretariat, which is issued the notificat ion on the 16 July 2010 (G/SG/N/6/IDN/12).  
 
2. Subject goods 
The subject goods are: 
 
1. Woven Fabrics Of Cotton Containing 85 per cent Or More By Weight Of Cotton, weighing 
not more than 200 gram/m2 under HS codes 5208.11.00.00, 5208.12.00.00, 5208.13.00.00, 
5208.19.00.00, 5208.23.00.00, and 5208.29.00.00;   
2. Woven Fabrics Of Cotton Containing 85 per cent Or More By Weight Of Cotton, Weighing 
More Than 200 gram under 5209.29.00.00; 
3. Woven Fabrics of Cotton containing less than 85  per centby weight of cotton, mixed mainly 
or solely with man-made fibres, weighing not more than 200 g/m2 under HS codes 5210.11.00.00;   
4. Woven Fabrics of Cotton containing less than 85 per cent by weight of cotton, mixed mainly 
or solely with man-made fibres, weighing more than 200 g/m2 under HS codes 5211.11.00.00, 5211.12.00.00;  
5. Other woven fabrics of cotton under HS codes 5212.11.00.00. 
3. Period of investigation 
 The period of investigation covers  calendar years 2007 until 2009.  
 
4. The domestic industry 
 The investigating authority confirmed that the domestic industry subject to investigation 
represents the majority of the subj ect goods produced in Indonesia. 
 
5. Hearing 
 In accordance with Article 3.1 WTO Agreem ent on Safeguards, during the investigation 
period, the investigating authority has provid ed opportunities to importers, exporting countries 
delegation, and domestic industry, to submit th eir evidence and comments.  In this regard, the 
investigating authority received the following comments from The Indonesian Textile Industries 
Association (API), the Embassy of Malaysia; and Taipei Economic and Trade Office. 
 
  G/SG/N/8/IDN/9 
 G/SG/N/10/IDN/9 
 G/SG/N/11/IDN/8 
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  B. I
NFORMATION ON INCREASE IN IMPORTS  
 An analysis of the increase in imports to Indo nesia of the subject goods has been carried out 
over the period from 2007 to 2009 in absolute term. The investigation authority found that the import 
of the subject goods has increased considerably in that period.  
  Table 1 indicates that imports rose significantly, from 7,953 tons in 2007 to 17,128 tons in 2008. The surge of imports continued in 2009, when  the level of imports reached 26,153 tons or 
equivalent 52.7 per cent compared with 2008.  
 
Table 1:  Volume of Imports of the subject goods  
Description Unit 2007 2008 2009 
Imports tons 7,953 17,128 26,153 
   Source :  Statistics Indonesia 
 
C. UNFORESEEN DEVELOPMENT  
 The unforeseen rapid decline in global demand a nd excess supplies in textile sector of certain 
major suppliers resulted in a significant increased of  import of the subject goods to Indonesia being an 
important market in the region for those major suppliers.   Moreover, the commitments of the Government  of Indonesia to eliminate import tariffs for 
the subject goods under a number of FTA  Agreements has transferred th e domestic market to be more 
open and induced significant increased volume of im port of the subject goods, which put the domestic 
industry into a more vulnerable situation. Would th is situation had been predicted, the subject goods 
would be excluded from these agreements. 
 
D. E
VIDENCE OF SERIOUS INJURY AND EFFECT OF INCREASED IMPORTS  
 
 In order to make a determination of serious injury to the domestic industry of the subject 
goods, the investigating authority made an evaluation of all relevant factors having a bearing on the 
stated of the domestic industry. The following eval uation has been based upon data provided by the 
domestic industry, result of the on-site verifica tion, and other information available to the 
investigating authority: G/SG/N/8/IDN/9 
G/SG/N/10/IDN/9 G/SG/N/11/IDN/8 
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  Table 2: Indicators of Serious Injury
 
YEAR NO. DESCRIPTION UNIT 
2007 2008 2009 
1 National Consumption Index 100 101 99 
2 Volume of Imports Ton 7,953 17,128 26,157 
3 Market Share of the Domestic 
Industry Index 100 83 76 
4 Market Share of Imports Index 100 225 350 
5 Domestic Sales of the Domestic 
Industry Index 100 84 76 
6 Production Index 100 87 76 
7 Capacity Utilization Index 100 97 89 
8 Inventory Index 100 176 251 
9 Profit/Loss Index (100) (127) (214) 
10 Employment Index 100 85 70 
11 Productivity Index 100 100 100 
 
(i) While the National Consumption index increas ed from 2007 to 2008, but decreased slightly 
in 2009, the volume of import had increased 115 per cent from 2007 to 2008 and 52.7 per cent from 2008 to 2009. At the same time the market share of import increased significantly, while the market share of th e domestic industry decreased steadily during the 
same period due to the continues decrease of the domestic sales. This condition has resulted 
in significant decreased of domestic production and increased in inventory. 
(ii) The decreased in market share and domestic sales caused significant financial losses to the 
domestic industry during the period of investiga tion, in which the biggest loss was in 2009. 
Due to the financial losses the domestic industr y had to layoff substan tial number of labours. 
Because of the decline in production offsite by the reduction in the number of employment, 
the productivity relatively remained unchange d. Meanwhile capacity utilization fell by 
3 indexed points in 2008 from 2007, and further decreased by 8 indexed points in 2009.  The 
reduction in capacity utilization from 2007 onwa rds reflected the decrease in production. 
 Referring to the above-mentione d examination of information concerning the condition of the 
domestic industry and the development of volume of imports during the period of investigation, the 
investigating authority found that the domestic i ndustry suffered a serious injury as a result of the 
increased volume of imports of the subject goods.  E. O
THER FACTORS THAT MAY CONTRIBUTE TO INJURY  
 In order to ensure that injury  is only caused by increased impor ts, the investigating authority 
also examined the following other known factors: 
  G/SG/N/8/IDN/9 
 G/SG/N/10/IDN/9 
 G/SG/N/11/IDN/8 
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  1. Competition Among Domestic Industries 
 From the result of investigation, it is found that while the national consumption decreased 
from 101 indexed points in 2008 to 99 indexed points in 2009, the market share of applicant and non-
applicant domestic industries also fell significan tly, from 83 indexed points in 2008 to 76 indexed 
points in 2009 for the applicant domestic industries.  As for non-applicant domestic industries, the market share fell from 111 indexed points in 2008 to 89 indexed points in 2009. This condition 
confirmed that the market share of applicant do mestic industry was not taken by non-applicant 
domestic industries. 
 
2. Production Capacity 
 The investigating authority found that many  of the domestic industry has revitalized and 
renewed the machineries in order to boost prod uctivity and production capacity. Consequently the 
domestic industry has the ability to fulfil national co nsumption. However due to the decline in sales, 
capacity utilization also decreased . Based on the fact, the investig ating authority confirmed that 
production capacity of the domestic industry is not a factor that caused serious injury. 
  Based on findings on the above-mentioned factors,  the investigating authority confirmed that 
there are no other factors than increased imports that have caused serious injury to the domestic 
industry. 
 
F. C
ONCLUSION OF THE FINDING AND CAUSAL LINK 
 
 As the result of the investigation referred in point B, C, and D, the investigating authority 
confirmed that increased volume of imports of th e subject goods have caused serious injury to the 
domestic industry that produced the like products.  
 G. D
ESCRIPTION OF THE SAFEGUARDS MEASURE  
1. As the investigating authority has found that the increased volume of imports of the subject 
good caused a serious injury to the domestic industry,  it is decided that a safeguards measure to be 
imposed on imports of bleached and unbleached  woven fabric of cotton under HS codes: 
5208.11.00.00, 5208.12.00.00, 5208.13.00.00, 5208.19.00.00, 5208.23.00.00, 5208.29.00.00, 
5208.11.00.00, 5208.12.00.00, 5208.13.00.00, 5208.19.00.00, 5208.23.00.00, and 5208.29.00.00. 
2. In order to provide ample period of time for th e domestic industry to recover from the serious 
injury and to induce adjustment, progressive liberal ization of a safeguards measure in the form of 
specific duty will be imposed for 3 (three) years, as follows: 
Table 3: Definitive Safeguards Measure  
Period Specific Duty 
23 March 2011 – 22 March 2012 Rp. 116,800/Kg 
23 March 2012 – 22 March 2013 Rp. 109,500/Kg 
23 March 2013 – 22 March 2014 Rp. 102,200/Kg 
 
3. Pursuant to Article 9.1 WTO Agreement on Safe guards, the Safeguard Measure shall not be 
imposed against the subject goods originating from de veloping countries with a market share of less 
than 3 per cent of total volume imports or collectively do not exceed 9 per cent of the total volume G/SG/N/8/IDN/9 
G/SG/N/10/IDN/9 G/SG/N/11/IDN/8 
Page 6 
  
  imports of bleached and unbleached woven fabr ic of cotton under HS codes: 5208.11.00.00, 
5208.12.00.00, 5208.13.00.00, 5208.19.00.00, 5208.23.00.00, 5208.29.00.00, 5208.11.00.00, 5208.12.00.00, 5208.13.00.00, 5208.19.00.00, 5208.23.00.00, and 5208.29.00.00.  
4. Below is the list of developing countries ex cluded from the measures as they exported less 
than 3 per cent of total imports to Indonesia (A rticle 9.1 of the WTO Agreement on Safeguards).  
List of Developing Countries excluded from the measures
 
COUNTRY COUNTRY 
Albania Djibouti 
Angola Dominica 
Antigua and Barbuda Dominican Republic 
Argentina Ecuador 
Armenia Egypt 
Bahrain, Kingdom of El Salvador 
Bangladesh Fiji 
Barbados Former Yugoslav Republic of Macedonia (FYROM) 
Belize Gabon 
Benin Georgia 
Bolivarian Republic of Venezuela Ghana 
Bolivia, Plurinational State of Grenada 
Botswana Guatemala 
Brazil Guinea 
Brunei Darussalam Guinea Bissau 
Burkina Faso Guyana 
Burundi Haiti 
Cambodia Honduras 
Cameroon India 
Cape Verde Jamaica 
Central African Republic Jordan 
Chad Kenya 
Chile Kingdom of Saudi Arabia 
Colombia Kuwait 
Congo Kyrgyz Republic 
Costa Rica Lesotho 
Côte d'Ivoire Macao, China 
Croatia Madagascar 
Cuba Malawi  
Democratic Republic of the Congo Maldives 
  
 
 
  G/SG/N/8/IDN/9 
 G/SG/N/10/IDN/9 
 G/SG/N/11/IDN/8 
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  COUNTRY COUNTRY 
Mali Saint Vincent & The Grenadines 
Mauritania Senegal 
Mauritius Sierra Leone 
Mexico Solomon Islands 
Moldova South Africa 
Mongolia Sri Lanka 
Morocco Suriname 
Mozambique Swaziland 
Myanmar Tanzania 
Namibia Thailand 
Nepal The Gambia 
Nicaragua Togo 
Niger Tonga 
Nigeria Trinidad and Tobago 
Oman Tunisia 
Pakistan Uganda 
Panama Ukraine 
Papua New Guinea United Arab Emirates 
Paraguay Uruguay 
Peru Viet Nam 
Philippines Zambia 
Qatar Zimbabwe 
Rwanda  
Saint Kitts and Nevis  
Saint Lucia  
  
 
 
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