The Indonesian government has responded to the global economic crisis by introducing incentives for a number of sectors, including the leather and footwear sector. It has given the sector Rp52.5 billion ($4.8 million) to repair and update its tanning machinery and duties on imported machinery have been cut by 10%. Duties on machinery produced locally have been cut by 15%.

According to the Leather Tanning Association, around 200 workers employed in the leather industry have been laid off as a result of the economic downturn, with at least three large leather producers having to close altogether. Leather and footwear exports reportedly fell 40% during the first quarter of the year.

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