The furniture industry is recognised as 1 of the main industries capable to drive the transformation of the manufacturing industry, says Wan Latiff
by SULHI KHALID/ pic by MUHD AMIN NAHARUL
THE country’s furniture exports to the US jumped 20.8% to RM1.55 billion in the first five months of 2019, as American buyers shifting their orders to South-East Asian countries due to the ongoing US-China trade war.
Malaysia External Trade Development Corp CEO Datuk Wan Latiff Wan Musa said furniture exports saw an increase of 9.6% to RM4.14 billion, compared to the corresponding period last year.
The main exports of Malaysian furniture include wooden bedroom furniture, chairs with wooden frames, office furniture and kitchen furniture, he told a press conference in Kuala Lumpur yesterday.
Wan Latiff also urged the industry players to explore the possibilities of transitioning from original equipment manufacturing, to original design manufacturing or original brand manufacturing, as the country has a strong pool of furniture exporters with a niche in manufacturing.
“This is in line with the National Timber Industry Policy (NATIP) that envisaged the annual exports of furniture to reach RM12 billion by 2020.
“The furniture industry has also been recognised as one of the main industries capable to drive the transformation of the manufacturing industry into one that champions Industrial 4.0,” he added.
The direction in NATIP — which was crafted by the then Ministry of Plantation Industries and Commodities and the Malaysian Timber Industry Board — is aimed at ensuring the continued viability of the wood-based industry until 2020.
Wan Latiff also said the country’s exports have become more competitive as a result of the weakening ringgit.
“We are not relying heavily on foreign content and we are not affected much by the appreciation of the US dollar. So, all in all, our products have become competitive,” he said.
Meanwhile, Malaysian Furniture Council president Chua Chun Chai said the country’s furniture manufacturers have exported less components to China as demand from the US increased significantly.
“This may be a result of import diversion among the American buyers, who may be shifting their orders to countries in South-East Asia including Malaysia,” he said.
Based on data released by the Department of Statistics Malaysia, the country posted a declining growth rate of 22.6% to RM119 million in furniture exports to China.
China has been Malaysia’s largest trading partner for a decade, with trade growing from 8.1% to RM313.8 billion.
Last month, Beijing has retaliated to Washington’s decision to increase tariffs on US$200 billion (RM822 billion) China goods in May by increasing tariffs on US$60 billion worth of the US goods.
Other Malaysia’s net exporters for furniture include Singapore with a 8.1% market share, followed by Japan (7.6%), Australia (6.5%) and the UK (4.5%).