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Indonesian Furniture Makers Mapping Out Strategy for China
Arti Ekawati | May 20, 2010

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As many domestic companies struggle to cope with a flood of cheap imports from China, small-scale makers of specially designed wood furniture are mapping a strategy to double their exports to their larger trading partner this year by targeting Chinese retailers.

“This year we will join the Shanghai International Furniture Expo, which will be held on June 2-4. During the exhibition, instead of searching for end-buyers for our products, we will focus on getting local retailers as partners to market our products after the exhibition,” Ambar Tjahyono, chairman of the Indonesian Furniture Industry and Handicrafts Association (Asmindo), said on Thursday in Jakarta.

Ambar said he was confident that Chinese retailers would be interested in Indonesian furniture, which had superior design and wood quality. Asmindo has projected that the value of such exports to China this year would more than double, to $20 million from $9 million last year.

The local furniture industry, which has traditionally relied on exports to the United States and the European Union, was hit hard by the global recession and the implementation of the China-Asean Free Trade Agreement, which took effect on Jan. 1.

The furniture industry was among the sectors that pleaded with the government to seek a delay in implementation of the trade deal.

Ambar said 5,000 workers in Solo, one of the country’s centers of furniture making, had already lost their jobs because of the economic downturn and the free-trade agreement.

Deputy Industry Minister Alex Retraubun said creative industries had a better chance of surviving the trade deal.

“We have to be more creative to cope with this global situation, since avoiding it will not be preferable,” he said.

In 2009, that total export value of Indonesia’s furniture products was recorded at $2.24 billion, a 14.6 percent decrease from 2008. This year, Asmindo expects to increase export value by 15 percent compared with last year.