T

he Indonesian government plans to require imported wood-based products to comply with the local certification system so that they will no longer need pre-shipment inspection.

Trade Ministry director-general for foreign trade Bachrul Chairi said on Friday the requirement to comply with local certification would be carried out via mutual recognition agreements (MRA) on the wood product trade.

'€œWith the MRA, we acknowledge the legality system in our trading partners and so do they. By doing this, our local exporters may also have better access to foreign markets,'€ he told reporters.

The plan was expected to take place early next year and apply to all sourcing countries, Bachrul added.

At present, Indonesia'€™s import of wood-based products mainly comprise furniture from a few countries, including China, Thailand, Italy and Norway.

Indonesia, home to the world'€™s third biggest tropical forest after the Amazon and Congo basins, introduced the timber legality verification system (SVLK) in 2003, mainly to fight illegal logging, and later made it mandatory in 2010. The certificates under the system ensure that local timber and timber products are legally-harvested.

In September, Indonesia inked a voluntary partnership agreement with the European Union (EU), which acknowledged that all timber and timber products from the country must comply with the EU'€™s timber regulation put into effect earlier in March.

Without the recognition, the products are freed from mandatory due diligence, thereby cutting business costs and time significantly.

The agreement may boost Indonesian timber exports by US$1.8 billion and $2 billion next year, according to an estimate of the Trade Ministry.

In another development, Bachrul said the government mulled delaying the implementation of the local timber legality verification system on small and medium enterprises (SMEs). The measure was taken because a large number of SMEs still faced significant hurdles to acquire certificates, such as high costs.

'€œIf we don'€™t consider relaxation, we may lose around $1 billion in timber exports a year,'€ he said.

Bachrul added the delay would last a year to give more time for small business entities to comply.

Indonesian Furniture Entrepreneurs Association (Asmindo) chairman Ambar Tjahyono responded positively to the plan, saying the move would be favorable for SMEs that were currently struggling to obtain the certification.

Out of 400 Asmindo members that sold their furniture overseas, 75 percent still faced difficulties obtaining the certificates.