Affraid of Chinese timber products
ASEAN-China FTA becomes hot topic among business timber entities talks. More Indonesian businessman are worrying about Chinese products that will flood Indonesia’s markets because of the agreement. Chinese products are known as cheaper, mimic and some of them are below-average quality.
The ASEAN-China FTA agreement was signed about ten years ago in Cambodia, enabling member countries to make necessary years of preparations. Why businessman still worrying on Chinese product?
According to an association of wood products exporter, furniture producers are not ready to face the competition from Chinese producers. The fear expressed is that furniture imports into ASEAN countries from China could capture a major slice of the domestic market.
There are 314 tariff items from eight sectors listed under the FTA. Association of Indonesian Furniture and Handicraft Exporters (Asmindo) is said to have been lobbying the Indonesian authorities to modify or suspend at least 5 of the 12 tariff items listed within the furniture sector. Imports currently account for around 30% of the domestic market and this could grow as imports become cheaper as tariffs are removed
Indonesia’s wood products industry seems at the sunset era. As reported by ITTO, exports of Indonesian timber products, especially sawnwood and plywood, have been on a decline since 2003, when exports were over 5 million cubic metre However, exports in the following year fell to 4.5 million cubic metre; to 3.5 million cubic metre in 2005; 3 million cubic metre in 2006; 2.9 million cubic metre in 2007, and 1.68 million m3 in 2008. Total exports for year 2009 only managed to reach 1.2million cubic metres up to November 2009. The decline of Indonesia wood industry challenges the authority to manage its forestry sector as well as combating deforestation issues.
However, there are two keys why Chinese timber products found everywhere, china has diversived its wood industry and has improved its valued added through technology.
Some reactions on the agreement also found here and here.
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absulutetly agree , bro:)
yes, it’s consequence of globalization. as i know, actually, China’s raw material for furniture and wood product came from Indonesia. But they have great technology, so can produce more cheaper wood product than ours. It’s so terrible when our wood industry going down.
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This is the impact of globalization. Like or dislike all bussines people should me any action to do the best.
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