WEDNESDAY, JULY 17, 2019, KUALA LUMPUR: Malaysian furniture exports recorded a significant growth in the first five-month this year, with an increase of 9.16 per cent to reach a value of RM4.14 billion, compared to the same period last year. This is indicative of the industry’s growing importance for Malaysia’s overall trade performance.
Among the main exports of Malaysian furniture include wooden bedroom furniture, seats and its parts, bedroom wooden furniture, kitchen wooden furniture and metal furniture. Major export destinations were recorded with Malaysia’s traditional markets such as the United States (US), Japan, Singapore, Australia and the United Kingdom (UK). Other emerging markets for the industry that recorded substantial growth were Canada (increased by 25.7 per cent), the Philippines (13.9 per cent) and the United Arab Emirates (6.8 per cent).
It is key to note that in the first five months of 2019, the total furniture exports to the US were valued at RM1.55 billion, registering a double digit growth of 20.8 per cent compared to the same period in 2018. This may be a result of import diversion among the American buyers, who may be shifting their orders to countries in the Southeast Asia.
Despite the global trade uncertainties, the Malaysian government through its agencies like MATRADE and Malaysia Investment Development Authority (MIDA) continue to ramp up the local manufacturing capabilities and attract foreign investors that are catalysts in boosting Malaysian furniture exports.
According to MATRADE’s Chief Executive Officer YBhg. Dato’ Wan Latiff Wan Musa, Malaysia has a strong pool of exporters in the furniture industry with a niche in manufacturing. They however must explore the possibilities of transitioning from Original Equipment Manufacturing to Original Design Manufacturing or Original Brand Manufacturing.
“This is important as the development of more local brand names is key to enhancing Malaysia’s country branding and further promotes our country as a hub for this region. This is in line with the National Timber Industry Policy (NATIP) that envisaged the annual export 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 Industry 4.0,” Wan Latiff said.
According to Mr Chua Chun Chai, Chairman or Export Furniture Exhibition (EFE) and former President of the Malaysian Furniture Council (MFC), the improved export performance among the local manufacturers has a direct impact to the local Small and Medium Enterprises (SMEs) in the industry too. “Since early of the year we noticed that the enhanced export performance has benefitted the 500 local SMEs in the industry too. As manufacturers increased their productions, there is a need for them to source for materials from the local SMEs. In the long run, such synergy in performance will expedite the growth of the industry and will benefit the community too,” Chua said.
In ensuring the continuity of this industry’s prospects, MATRADE will strengthen its collaboration with industry players such as the MFC. Currently, MATRADE is working with the MFC through the EFE. Through the collaboration, MATRADE coordinated its signature business matching called the International Sourcing Programme (INSP). The INSP which was held at EFE 2019 from 9 to 12 March 2019 saw the participation of 100 Malaysian furniture manufacturers and 40 foreign buyers from more than 20 countries such as India, China, Hong Kong, Indonesia, South Korea, Argentina and UK. Over 400 business meetings took place at the INSP and RM7.95 million of export value was generated from the initiative.
“The initiative has proven to be a great platform for local manufacturers to establish trade collaborations and commercial opportunities with the foreign buyers without spending a hefty travelling cost. It also gave them an edge to pitch their brands in their home country,” said Wan Latiff. The global buyers attending the INSP were sourced from MATRADE’s 46 trade offices
Moving into 2020, MATRADE and EFE will collaborate to match Malaysian manufacturers with global buyers at the 16th edition of EFE set to take place from 9-12 March 2020 at KLCC. Next year, the exhibition will expand by 42.8 per cent in size, from 35,000 sqm to 50,000 sqm, to accommodate more local manufacturers. One of the event’s key highlights is “The Buyers’ Introduction Program (BIP)” which provides a complimentary 4-day 3-night accommodation to new and qualified international buyers.