KBN Cakung; The Twilight of the Bonded Zone in Jakarta

PT Kawasan Berikat Nusantara (KBN) was established in 1986. It was designed as an export processing zone. Due to tax incentives and customs exemptions, the garment and ready-to-wear industry quickly dominated the area.

At its peak, approximately 80% of the total industry in KBN was engaged in the garment and ready-to-wear sector, employing tens of thousands of workers, mostly women. The area became a prime location for investors from South Korea, Taiwan, and China to build large-scale garment factories.

Garment products from KBN Cakung were exported to various global brands in the United States and Europe. This made KBN one of Jakarta’s largest non-oil and gas foreign exchange earners from the 1990s to the early 2000s.

However, 10 years later, things changed. The increase in the Jakarta Provincial Minimum Wage was used as an excuse by companies to lay off thousands of workers, moving their factories to areas with much cheaper labor in West and Central Java.