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Why Didn't Colonial Indonesia Have a Competitive Cotton Textile Industry?*

Published online by Cambridge University Press:  30 October 2012

PIERRE VAN DER ENG
PIERRE VAN DER ENG*
Affiliation:
Research School of Management, ANU College of Business and Economics, The Australian National University Email: [email protected]
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Abstract

This paper quantifies the consumption and production of cotton textiles at different stages of processing in Indonesia during the Dutch colonial era (1820–1941). It discusses the main factors that impeded the development of an internationally competitive cotton textile industry, and concludes that production in the industry increased significantly in Java during 1820–71, and again during 1874–1914 and 1934–41. However, most activity involved finishing of imported cotton cloth to suit local preferences. Spinning and weaving increased only marginally, as domestic production was precluded by the high-labour intensity of small-scale production, marginal local raw cotton production, and competitive international markets for yarn and cloth. Unfavourable and fluctuating real exchange rates discouraged investment in modern spinning and weaving ventures until trade protection and technological change in small-scale weaving caused rapid growth of domestic production after 1934.

Type
Research Article
Information
Modern Asian Studies , Volume 47 , Issue 3 , May 2013 , pp. 1019 - 1054
Copyright
Copyright © Cambridge University Press 2012

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Footnotes

*

I would like to thank Kaoru Sugihara, Kōzuke Mizuno, Anne Booth, A.J.H. Latham, Jan Luiten van Zanden, Jeff Williamson, and Gregg Huff, as well as two anonymous referees for their comments on previous versions of this paper.

References

1 The paper refers to Indonesia, rather than the Dutch East Indies or colonial Indonesia, comprising the geographical area that became the independent state of Indonesia after the First World War.

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32 Algemeen Handelsblad, 3 April 1830.

33 There is an extensive literature on all these failed efforts to increase raw cotton production and establish cotton purchasing and ginning operations in Indonesia from the colonial era until recent years. See, for example, Broersma, R. (1931). ‘Kan in Indië loonende katoennijverheid worden gevestigd?’, De Bergcultures, 28, pp. 761–62Google Scholar; Dijkstra, J.F. (1907). ‘Katoen’, Tijdschrift voor Nijverheid en Landbouw in Nederlandsch-Indië, 74, pp. 607–19Google Scholar; Elson, R.E. (1994). Village Java under the Cultivation System 1830–1870, Allen and Unwin, Sydney, pp. 74Google Scholar, 249, 275 and 461; Heersink, C. (1999). Dependence on Green Gold: A Socio-Economic History of the Indonesian Coconut Island Selayar, KITLV Press, Leiden, pp. 129–30Google Scholar; Paerels, B.H. (1950). ‘Katoen’, in Van Hall, C.J.J. and Van de Koppel, C.De Landbouw in de Indische Archipel, Deel III, Van Hoeve, The Hague, pp. 40–46Google Scholar; Spoon, W. (1932). ‘Beoordeling van katoen uit Ned. Oost Indië’, Berichten van de Afdeeling Handelsmuseum van het Koloniaal Instituut No.73, De Bussy, AmsterdamGoogle Scholar; Sulistiyo, and Mawarni, A. (1991). Kapas: Kajian Sosial-Ekonomi, Aditya Media, Yogyakarta, pp. 23–32Google Scholar; Treub M. (1904). ‘Rapport van den Directeur van ‘s Lands Plantentuin betreffende de katoencultuur in Nederlandsch Indië’, Javasche Courant, 13 September 1904, Appendix; Tromp de Haas, W.R. (1903). ‘Terugblik op hetgeen in Nederlandsch-Indië gedaan is nopens de katoencultuur’, Teysmannia, 14, pp. 541–62Google Scholar; Van Breda de Haan, J. (1914). Overzicht van hetgeen werd verricht ter bevordering van de katoencultuur in Nederlandsch Oost-Indië in 1913, Kolff, BataviaGoogle Scholar; Van Hall, C.J.J. (1939). Insulinde: De Inheemsche Landbouw, Van Hoeve, Deventer, pp. 72–73Google Scholar; Van Setten, D.J.G. (1911). ‘Eenige gegevens voor de katoencultuur in Nederlandsch-Oost-Indië’, Mededeelingen Uitgaande van het Departement van Landbouw, No. 14, Kolff, BataviaGoogle Scholar; Veth, P.J. (1865). Bijdragen tot de Kennis van de Voornaamste Voortbrengselen van Nederlandsch Indië: III Het Katoen, Fred Muller, Amsterdam, pp. 41–44 and 54–58Google Scholar; Vink, G.J. (1932–33). ‘Ruim honderd jaar ervaring met de bevordering van de katoencultuur in Nederlandsch-Indië’, Landbouw, 8, pp. 245–63Google Scholar.

34 Van Limburg Brouwer, J.L. (1863).‘Verslag van de verrichtingen der Nederlandsch-Indische Katoenmaatschappij’, Tijdschrift voor Nederlandsch Indië, 1, pp. 292–99Google Scholar; De Locomotief, Samarangsch Handels en Advertentie-Blad, 2 February 1866.

35 Van Hall, Insulinde, p. 72.

36 Vink, ‘Ruim honderd jaar’, p. 261; Paerels, ‘Katoen’, pp. 39–40.

37 Matsuo, H. (1970). The Development of Javanese Cotton Industry, Institute of Developing Economies, Tokyo, pp. 4–5Google Scholar; Heersink, Dependence on Green Gold, p. 48; Van der Kraan, ‘Anglo Dutch rivalry’, p. 38; Elson, Village Java, p. 276.

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42 Rouffaer, De Voornaamste Industrieën, p. 11; Changing Economy, Vol. 8, p. 153; Elson, Village Java, pp. 10, 249 and 272–77.

43 Elson, Village Java, p. 276; Heersink, Dependence on Green Gold, pp. 47–50 and 128–31.

44 Van der Kraan, ‘Anglo Dutch rivalry’, p. 38; Elson, Village Java, pp. 10, 249 and 276.

45 Van der Kraan, ‘Anglo Dutch rivalry’, pp. 58–60; Elson, Village Java, p. 276.

46 Rouffaer, De Voornaamste Industrieën, pp. 11–12; Huender, Overzicht, p. 66.

47 Rouffaer, De Voornaamste Industrieën, p. 11.

48 Oki, A. (1979). ‘A Note on the history of the textile industry in West Sumatra’, in Van Anrooij, F.et al.Between People and Statistics: Essays on Modern Indonesian History, Nijhoff, The Hague, pp. 148–49Google Scholar; Het Nieuws van den Dag voor Nederlandsch-Indië, 17 November 1902.

49 Rhyne, ‘Social and Political Changes’, p. 317; Hasselman, Algemeen Overzicht, pp. 135 and 137.

50 Hasselman, Algemeen Overzicht, p. 137.

51 Fievez de Malines van Ginkel, F.M. and Meijer Ranneft, J.W. (1926). Verslag van de Economischen Toestand der Inlandsche Bevolking 1924, Kolff, Weltevreden, Vol. 1, pp. 166–67Google Scholar.

52 It is not clear whether this was for part-time or full-time work. Matsuo, Development, pp. 16–17 offered a hypothetical example to illustrate that the returns to weavers must have been very low, even if they used imported cotton yarn. Other sources confirm this impression, for example, Van Warmelo, W. (1938). De Ontwikkeling van de Kleine Handweefnijverheid in het Madjalaja-Rayon, Departement van Economische Zaken, Batavia, p. 2Google Scholar.

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54 Van Warmelo, De Ontwikkeling, pp. 2–3.

55 De Jonge, J.A. (1968). De Industrialisatie in Nederland tussen 1850 en 1914, Scheltema en Holkema, Amsterdam, pp. 117–20Google Scholar. Indonesia was therefore never of prime importance to the Dutch textile industry as a whole, although it was significant to some individual producers who specialized in the production of textiles required in Indonesia. The Dutch textile industry easily survived Indonesian independence and declining exports to Indonesia. It even expanded production during the 1950s, because it managed to take advantage of the enormous growth in international demand. See Kockelkorn, H. (1989). ‘Conjuncturele ontwikkeling van de Twentse katoenindustrie, 1925–1965’, Textielhistorische Bijdragen, 29, pp. 95–121Google Scholar. However, it failed to maintain competitiveness in its main market: the Netherlands. The demise of the Dutch textile industry in the 1970s was not due to the deterioration of relations with Indonesia, but to rising production costs, which triggered an international relocation of the textile industry.

56 Lindblad, ‘De handel’, p. 294, note 47, and pp. 297–98, notes 84 and 90.

57 Colonial officials did not articulate an explicit policy stance on this issue throughout the colonial period, but it was an argument in the 1930s, for instance in 1937, when political guidelines for industry policy were developed (see Versluys, J.D.N. (1949). Aspecten van Indonesië's Industrialisatie en Haar Financiering, Wolters, Groningen, p. 14Google Scholar), and also in 1938, when a group of senior officials of the colonial government considered whether to continue or scale down the trade policies that had been put in place since 1934 (see Van Oorschot, De Ontwikkeling, p. 55).

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59 Rouffaer, De Voornaamste Industrieën, pp. 7 and 22–23. A discussion of the development of the batik industry in Java can be found in Vuldy, D. (1987). Pekalongan: Batik et Islam dans Une Ville du Nord de Java, École des Hautes Études en Sciences Sociales, Paris, pp. 104–62Google Scholar.

60 Huender, Overzicht, p. 67.

61 Hasselman, Algemeen Overzicht, p. 137.

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63 Rhyne, ‘Social and Political Changes’, p. 317.

64 Changing Economy, Vol. 8, pp. 69–74.

65 Fievez and Meijer Ranneft, Verslag, Vol. 1, p. 163.

66 Matsuo, The Development, pp. 80–84.

67 Economisch Weekblad voor Nederlandsch-Indië, Industrienummer 1941, p. 169.

68 Sugiyama, ‘The Expansion’, pp. 63–65; Post, P. (1996). ‘Chinese Business Networks and Japanese Capital in South East Asia, 1880–1940: Some Preliminary Observations’, in Ampalavanar Brown, R.Chinese Business Enterprise in Asia, Routledge, London, pp. 154–76Google Scholar.

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71 The origin of the Institute was the experimental use of penal labour in the Glodok prison in Batavia in 1911 with self-produced handlooms based on old designs of Dutch and British-Indian looms. In 1916 the looms were brought to the Cirebon prison, where Director G. Dalenoord had established a weaving shop in 1919 using penal labour. Dalenoord experimented by improving weaving technology and continued his experiments from 1920 as the Institute's first director until he joined the NV Preanger Bontweverij in Garut in 1934; see Kroese, W.T. (1979). Het Begin van de Industrialisatie van Indonesië: De Stichting van de Preanger Bontweverij (PWB) te Garut, Koninklijke Textielfabrieken Nijverdal-ten Cate NV, Hengelo, pp. 14 and 20Google Scholar.

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81 Rothe, ‘Industrieën’, pp. 7 and 23.

82 Timmermans, ‘Ontwikkeling’, p. 43; Keppy, ‘Hidden Business’, pp. 65–72.

83 Van Warmelo, ‘Ontstaan’, p. 21.

84 Wirodihardjo, De Contingenteeringspolitiek, p. 153.

85 Timmermans, ‘Ontwikkeling’, p. 43; Rhyne, ‘Social and Political Changes’, p. 74; Changing Economy, Vol. 8, p. 154.

86 Telkamp, ‘Aangepaste Technologie’, pp. 233–34.

87 Van Warmelo, De Ontwikkeling, pp. 4–5.

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93 Rothe, ‘Industrieën’, pp. 16–17; Het Nieuws van den Dag voor Nederlandsch-Indië, 29 January 1938.

94 Telkamp, ‘Aangepaste Technologie’, p. 235.

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97 Sitsen and Kroese mention plans for spinning plants in Semarang, Kudus, and Pasuruan, which would have brought total capacity to 160,000 spindles. Sitsen, Industrial Development, p. 47; Kroese, W.T. (1947). ‘De Ontwikkelingsmogelijkheden voor de Nederlandsch-Indische Katoenindustrie’, Mededelingen van het Departement van Economische Zaken, No. 5, Archipel, Jakarta, pp. 23–24Google Scholar.

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104 Calculated from Nationaal Archief, 2 October 1921, Collectie De Vriese, nos. 132 and 133, containing residential reports on annual cotton production and/or harvested area in Java.

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106 Paerels, ‘Katoen’, pp. 26 and 31–32.

107 The British seized control of Java in 1811 and started importing British cotton cloth (see Van der Kraan, ‘Dutch Anglo rivalry’, pp. 43–44). Trade continued uninterrupted after the return of Dutch rule in Java, but regular import statistics only start in 1822.

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