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Jakarta Post

Timber legality How much would it cost?

  • Andreas D. Arditya and Benni Yusriza

    The Jakarta Post

Jakarta   /   Tue, April 15, 2014   /  12:25 pm
Timber legality How much would it cost?

Green product: SVLK-certified products are on display at the WWF SWICTH-ASIA booth at the International Furniture and Craft Fair Indonesia (IFFINA) in Jakarta.

When it comes to using illegally obtained timber to make furniture, things have changed in Indonesia '€” for the better.

'€œIndonesia has come very far in the last few years, compared to 10 years ago when it had a very bad image when it came to illegal logging,'€ said Colin Crooks, deputy head of the European Union'€™s delegation to Indonesia, Brunei and ASEAN, at a recent event in Jakarta.

'€œIndonesia is now seen as a market leader for legality and sustainability of timber.'€

One furniture expert, Fabianus, seems to agree.

'€œOur biggest problem in the furniture industry is lack of innovation,'€ Fabianus said at a recent competition to promote furniture made from certified timber.

Clearing the way for local furniture makers to see business growth, the Indonesian government and the EU recently signed an agreement that will likely make Indonesia the first wood-producing country to send certified timber to Europe.

The European Parliament ratified in March the EU-Indonesia Forest Law Enforcement, Governance and Trade Voluntary Partnership Agreement (FLEGT-VPA), after it was signed by officials in September.

The agreement, intended to ensure that only legally sourced timber and wood products are allowed into EU markets from partner countries, offers important acknowledgment for Indonesia.

It stipulates that whole timber and timber products certified under Indonesia'€™s domestic Timber Legality Verification System (SVLK) can be considered to have been harvested legally under EU rules and to have complied with the union'€™s timber regulations, which became effective last year.

Indonesia is the first nation to have such an agreement ratified by the European Parliament.

While the Indonesian government must continue to work to ensure that the SVLK is implemented effectively, some local craftsmen and businesses are wary that applying for certification might push their balance sheets into the red.

'€œThe SVLK costs us more than Rp 25 million [US$2,190] to get, depending on what product we are producing,'€ said Bibi Fatmawati of Yogya Indo Global exports, which exports around 500 cubic meters of wood products a month to Europe.

Bibi said that cost would bar many smaller enterprises from obtaining SVLK certification.

'€œThe government should help with cutting the costs for SVLKs or at least provide subsidies for small and medium enterprises [SME].'€

WWF Indonesia'€™s director of policy and transformation, Budi Wardhana, said that a lack of standard costs for the certification had been a major non-technical hurdle.

'€œBusinesspeople are being charged various prices for the certificate without clear rationale.'€

According to Budi, most local entrepreneurs would be able to obtain verification, disregarding the expense. '€œThey only need a little time to understand the system and they will comply quickly.'€

A low number of SVLK assessors also seem to be a stumbling block for the government in rolling out SVLK certification, according to Budi.

'€œI can'€™t say there aren'€™t any, but I wish the government would deploy more assessors,'€ Budi said. '€œThe verification process itself is quite simple and can be done quickly, but there are many enterprises out there.'€

The Trade Ministry postponed mandatory SVLK certifications in January for a year so businesses could comply with the program'€™s requirements.

Out of around 3,500 SMEs producing timber and timber products, only 637 have SVLK certificates, according to the ministry.

Budi said that improving the SVLK certification process would be good for Indonesia. '€œThe market for wooden furniture in the world, for example, is around $112 billion, and Indonesia has so far only contributed a very tiny fraction of that,'€ he said.

Under the agreement, local timber producers with SVLK certifications would get licenses exempting their forest products from a mandatory due diligence process '€” cutting verification time significantly and allowing for a speedier release of Indonesian timber at European import gateways.

Indonesia exported about $10 billion in timber and timber products last year. Accounting for $1 billion, the EU is the third-biggest export destination for Indonesia'€™s timber shipments, after Japan and China.

Crooks said that he remained optimistic that Indonesia could conclude the SVLK compliance process in due time.

According to Crooks, officials needed to focus on developing consistent standards for the SVLK and FLEGT-VPA, on capacity building for local officials and businesses and on developing a complete chain of accountability from the forest to the factory to shipping.

Crooks remained upbeat. '€œI don'€™t see them as major obstacle to conquer for Indonesia.'€

'€” Photos by Benni Yusriza

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