Association upbeat about furniture export growth
JAKARTA (JP): A furniture association executive voiced optimism on Monday that the country's furniture exports would meet the government's growth target of 9.75 percent to reach a value of US$1.8 billion this year despite a low growth of 2 percent and 3 percent in the first half of the year.
Chairman of the Indonesian Furniture Club -- which groups furniture-makers, traders and bankers -- Yos S. Theosabrata said that his optimism was based on confidence that the country's political situation would become more stable under the newly installed President Megawati Soekarnoputri.
"We do have momentum now with the new President. This momentum has to be maintained," he said.
He said that the market had been responding enthusiastically to the election of the new President, citing the strengthening of the rupiah against the greenback.
The rupiah significantly strengthen to Rp 10,230 to the dollar on Monday from Rp 11,150 on Friday.
Yos added that the furniture sector would grow as long as the new President could provide stability, strengthen the rupiah and keep it stable.
"If all this happens, investment in this sector will increase, and I'm sure we will be able to boost exports to meet this year's target," he told The Jakarta Post after the opening of a furniture expo at the Jakarta Fairground in Kemayoran.
He added that demand for exports remained strong, but the industry had not be able to significantly boost exports due to the country's political uncertainty.
He added that many buyers had postponed placing orders for Indonesian furniture because they feared they would not receive them.
Some of the buyers also shifted their orders to other countries such as Malaysia or China, which are Indonesia's furniture competitors, Yos said.
He also said that due to the weak rupiah, many companies in the furniture industry delayed replacing old machines, making the companies less efficient than their Malaysian and Chinese competitors.
"Our machines are now about seven to eight years old, while Malaysian firms' machines are only four years old, and Chinese firms have even newer machines that are between two and three years old," he said.
According to the Central Bureau of Statistics (BPS), last year Indonesian furniture exports totaled $1.64 billion, with most furniture being sold to the U.S, Japan, the Netherlands, Germany, England, Belgium, Australia, Singapore and Spain.
Meanwhile, Yos said, the furniture machinery expo, which will be held for four days through Thursday over a 10,000-square-meter area, would feature the latest furniture styles and the latest machines from producers around the world.
Yos said that about 300 machine producers including from Japan, China, Italy, Germany, Taiwan, Austria, France and Denmark were participating in the expo.(05)