Reuters Scoop on Recycling Leads to Indonesian Backlash Against Second-Hand Clothing

In July 2022, Reuters journalists wanted to see how a much-vaunted recycling programme in Singapore was faring. It was being headed by state agency Sport Singapore and Dow Inc. The programme, launched in July 2021, had kindled a lot of interest in that it promised to "harvest the rubberized soles and midsoles of donated shoes, then grind down the material for use in building new playgrounds and running tracks in Singapore." It was a novel idea, and the public were reported to have donated tens of thousands of shoes.

The journalists picked up a pair of blue Nike sneakers, and placed a bluetooth tracker inside one of the shoes. It was synced to a smartphone, for real-time location tracking. In a matter of weeks, the pair was found to have reached Batam Island in neighbouring Indonesia. The reporters wanted to see if this was an aberration: they put trackers in 10 more pairs. But none of these shoes made to anywhere close to any of the Singapore playgrounds.

All the tagged shoes landed up at the premises of a Singaporean second-hand goods exporter, and made their way to Indonesia. Reuters journalists were physically able to recover three pairs from Indonesian capital Jakarta and Batam. Four had travelled to locations that were deemed too remote.

The exhaustive Reuters story was published on 25 February, leaving Dow Inc and the Singapore government red-faced. As also others, who had washed themselves green with the feverish publicity over the programme: French sporting goods retailer Decathlon SA; banking giant Standard Chartered plc; local waste management firm ALBA W&H Smart City Pte Ltd (Alba-WH); and firm responsible for shredding the donated footwear BT Sports Pte Ltd.

The Indonesian industry ministry was the first to react, issuing an assertive statement titled "dismantling the scandal of illegal imports of used shoes." The ministry promised to increase checks at ports to intercept illegal second-hand shoe shipments. "This incident shows that the illegal import of used shoes is carried out in an organised manner and misuses social projects," Industry Minister Agus Gumiwang Kartasasmita was quoted as saying. "The practice of illegal importation of used shoes must be stopped because it has a bad impact on the domestic footwear industry."

The industry ministry's announcement was followed by the President's directive, and a spate of news reports on the government's crackdown on second-hand apparel and footwear.

• The country's National Statistics Agency reported a phenomenal jump in the import of second-hand clothing: imports rose 277.75% from 8 tonnes in 2021 to 26.22 tonnes in 2022. In monetary terms, used clothes imports in 2022 were worth $272,146, up 518.5% over $44,000 a year earlier.
• All this happened in spite of a ban on import of such apparel and footwear since 2015 under the Prohibition of the Import of Used Clothing regulation. But since penalties had not been stipulated in black and white, illegal imports remained rampant and widespread.
• Hasan Trade immediately announced a crackdown on thrift shops that sold imported second-hand clothing. The prime target for the crackdown was also revealed: the popular thrifting area in Central Jakarta, Pasar Senen. The minister also spoke of a bulk of these clothes being infested with fungus, and that these only brought in fungal diseases.
• The SME ministry spoke of deceptive tactics being deployed. The Deputy Minister for SMEs, Hanung Harimba, declared that a big chunk of the used clothes being imported were not being declared so, and were instead being bundled together with new clothes. "We do not want this country to end up as a landfill. I want (everyone) to move in unison (and perceive this practice) as harmful. This measure must be conducted together," he underlined.
• The Indonesian E-Commerce Association too announced that online shopping platforms in the country would blacklist and take down sellers who sell imported second-hand clothes.
• The Directorate-General of Customs and Excise (DGCE) of the Ministry of Finance was reported to have carried out 278 prosecutions against 7,881 used clothing consignments between January 2022 and February 2023. Several entry points for illegally imported used clothing were identified. The main ones were Dumai port, Belawan port and Batam port.
• On 20 March, Hasan oversaw the destruction of over 800 bundles of imported second-hand clothes at a warehouse complex in East Java.
• Raids continued. Over 500 bales of illegal secondhand apparel were found inside cards in Jakarta. An importer, who was arrested, was reported to be importing these items through Alibaba.com. Police and customs officials in Jambi area seized over 130 bales that were destined for a thrifting market. Some of the bales were labelled 'Made in Korea'.
• Also towards the end of March, Hasan and Masduki made a bonfire of over 7,300 bales of imported used clothing. The market value of the used clothing destroyed was about 80 billion rupiah ($5.3 million).

The crushing blow that the Indonesian government's wants to deal on import of second-hand clothing is not without consequences. Though one of the major drivers of this crackdown is the need to protect small enterprises in the country, a sudden closure of outlets selling such goods would also mean loss of livelihoods for tens of thousands of sellers.

At a press conference later in March, Masduki and Hasan announced that the Indonesian government was planning to put sellers of imported used clothes in touch with domestic producers, so that the former would not lose their source of income. "We already have 12 producers that are willing to become the suppliers for those who formerly sell imported used clothing. These producers have good products with competitive prices," Masduki said.

Traders who have already taken and sold illegally imported used clothing are still being allowed to sell off the remainder of the products. The SME ministry is reported to be working on a settlement solution scheme for these sellers. Measures include a hotline for local substitute products and access to financing. The ministry has been busy holding stakeholder meetings.

However, precious little can be found on what end-buyers of used clothing have to say.

Gisela, a freelance translator from South Jakarta who has been a thrifter since 2005, told the Jakarta Post: "People who come from low-income families choose to buy second-hand clothes because they can’t afford to buy new, whereas the middle-income group goes thrift shopping because they want to find rare or branded items that aren’t locally produced. It’s a very niche market."

A freelance writer, Anindya Miriati Hasanah, who has opted for second-hand clothes since she was a senior high-school student, told the Strait Times that she was well aware that her purchase decisions might have a negative impact on local producers, but argued: “But on the other hand, if the clothes made by our producers do not match with what we like to wear, why should we buy them?"

The young are an influential group of stakeholders. A study published in December 2022 had concluded: "The complexity of how the younger generation interpret the practice of thrifting goes much deeper than simply that buying and selling used goods is purely a matter of economic considerations. This study found that the practice of thrifting has many layers of meaning, ranging from thrifting as a way of life and a strategy in dealing with economic challenges, to a means to express issues of identity and individuality, community ownership, and social responsibility toward the environment."