Posted by: mel | December 25, 2009

ASEAN furniture producers request FTA suspension

Jakarta Post | Jakarta | Business | 25 December 2009

Furniture producers in Southeast Asian countries are still not ready to face the full implementation of the free trade agreement (FTA) with China, worrying that China’s cheap products would devastate furniture industry in the region which has not been completely recovered from the global economic downturn.

Ambar Tjahjono, the chairman of the Association of Indonesian Furniture and Handicraft Exporters (Asmindo), said Thursday that furniture businesses in all ten member countries of the ASEAN (Association of Southeast Asian Nations) had common understanding over the threats of the ASEAN-China FTA.

“Like us in Indonesia, furniture producer associations in ASEAN, especially Thailand, Philippines, Vietnam, Myanmar and Malaysia, are now lobbying their governments to find ways to suspend the free trade implementation with China on furniture products,” Ambar said.

He said that the representatives of furniture industries associations in the region had several times met to discuss on the China FTA issues.

There are 314 tariff posts from eight sectors regulated under the FTA. The Asmindo, Ambar said, had been lobbying Indonesian authorities to modify or suspend five of 12 tariff posts linked with the furniture sector.

Ambar acknowledged that China’s cheap and low-quality products would bring a serious threat to domestic market. “They would ruin the prices. We are not ready yet to face them,” he said.

Ambar said that the FTA would slice domestic furniture market up to 50 percent.

He said that foreign expansion to domestic furniture markets currently stood at about 30 percent but it would definitely boost if after the full implementation of the FTA.

“Most imported furniture products come from China, Thailand and Vietnam,” Ambar said. (bbs)

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