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mall-scale businesses that work with wood, such as handicraft producers in Bali and furniture makers in Jepara, East Java, will be able to get their products certified now that the government is subsidizing those who join its certification program.

The government has allocated Rp 3 billion (US$316,856.78) from the state budget to help small-scale producers obtain Timber Legality Verification System (SVLK) certification, Forestry Minister Zulkifli Hasan said in Jakarta on Wednesday.

“Small-scale producers can participate and establish a cooperative to apply for group SVLK certification. The government will bear the expense and is ready to disburse the funds soon,” he announced after launching the Timber Legality Verification Information System.

The government introduced the SVLK in 2010 as part of a move to curb rampant illegal logging in the country. The certification is mandatory and has been applied in industrial forest concessions (HTI), production forest concessions (HPH) and community plantation forests (HTR).

The SVLK provides Indonesian producers greater access to the global market as it guarantees buyers that the wood and wood-based products originate from legal practices and are sourced in an environmentally friendly manner.

The SVLK also bears more significance because Indonesia signed an agreement on legal timber trade with the European Union (EU) in May 2011.

Under the Voluntary Partnership Agreement (VPA), Indonesia will see its timber and timber products considered legal upon entering EU countries, as the VPA is recognized by the new EU Timber Regulation, slated to take effect in March 2013.

However, budget restraints have often hampered small-level producers from getting the SVLK as the process can cost tens of millions of rupiah.

Helga Kumontoy of the Indonesian Furniture Industry and Handicraft Association (Asmindo) said her organization welcomed the government’s subsidy decision, adding that none of Asmindo’s 2,000 members were certified.

“More than 80 percent of our members are small-scale industries. It is not easy or cheap for them to process it, but it is crucial to obtain the SVLK because European Union countries are some of our largest customers,” she said.

Last year, Asmindo recorded that 30 percent of its furniture exports valued at $531 million went to
the US.

The second-largest export destination is Japan with $245 million, followed by the Netherlands with $95 million, Germany with $92 million and the United Kingdom with $86 million.

Rio Rovihandono of the Multistakeholder Forestry Program (MFP), a bilateral cooperation between the ministry and the UK’s Department of International Development (UKAID), said there was actually no official fee set up for the certification process.

“The auditor company and its client determine the fee themselves. It depends on several things, such as location. As most of the auditor companies are based in Jakarta, the cost will increase if they have to send their auditors to places outside the capital,” he said.

So far, certification fees have ranged from Rp 28 million to 40 million, Rio added. (tas)