RI furniture industry predicted to take off

JAKARTA (JP): Executives here believe Indonesia will become a regional furniture center provided the domestic industry starts using sophisticated technology, instead of traditional machines.

Teguh Tjia, the representative manager of Biesse Asia Pte Ltd, a supplier of Italian woodworking machines, told The Jakarta Post that Indonesia had several comparative advantages, including abundant raw materials and low-cost labor, which would allow it to lead the regional furniture market.

He said the country's furniture manufacturers had not taken advantage of their place in the market because they were reluctant to use sophisticated technology, causing the domestic industry to lag behind other countries'.

"The mind-set of our manufacturers must be changed. They will lose if they still believe furniture is craftmanship. They have to apply a so-called 'scientific furniture', that is furniture produced by sophisticated technology," he said during a break at the Woodworking and Forestry Indonesia '96 exhibition at Jakarta Kemayoran Fairground yesterday.

The exhibition, featuring about 270 participants from several countries, ends Nov. 16.

Two other businessmen taking part in the exhibition, Luciano Checco, the sales and marketing manager of Italy's Autec Asia, and Werner Neubauer, the general manager of the German Machinery and Plant Manufacturers Association, shared his view.

"Indonesia started developing the furniture industry much earlier than its neighboring countries Malaysia and Thailand. Yet, because Indonesian manufacturers fail to maintain the quality of their products, the latter countries have left Indonesia far behind," Checco said.

Poor quality results from traditional equipment, which can't do things like modern machines. They are less precise, he said.

Neubaur cited data from the German Machinery and Plant Manufacturers Association saying that Malaysia and Thailand spent about US$130 million and $115 million respectively on German machines alone in 1995, while Indonesia purchased about $75 million worth of German machines.

"In order to catch up with or even surpass Malaysia and Thailand, Indonesia has to replace their traditional furniture machines with sophisticated machines," Neubauer said.

Tjia said modern technology allowed some countries, like Taiwan, which lacked raw materials, to establish a well- performing furniture industry. Taiwan's total furniture exports amounted to $2.72 billion in 1994, against Indonesian furniture exports of less than $100 million.

Besides domestic furniture manufacturers being reluctant to adopt sophisticated technology, Tjia said, that few businessmen here were interested in the furniture industry because they considered it to be "not prestigious like the car industry" and that it required talented craftsmanship.

Tjia and another exhibitor, Rolf Kamper, managing director of Germany's Siempelkamp, believe the furniture industry's regional center will move to Indonesia because of rising labor costs in Malaysia and Thailand. They said other countries in the region, which had cheaper labor, lacked timber.

"Indonesia should become the center of the furniture industry in the Asia-Pacific region. But, if we are late in replacing our technology, I'm not sure it will happen," Tjia said.

Italy and Germany, two of the world's top producers of furniture machines, are competing to sell to Indonesian manufacturers. The countries were well represented at the exhibition. (jsk)