Indonesia: Government to offer SVLK subsidies

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Airlangga Hartarto, Minister of Industry, has indicated that the government will provide incentives for small and medium sized wood product and furniture manufacturers so they can secure SVLK certification, a measure aimed at building greater capacity in the domestic industrial sector.

Other support will include easing regulations and duties on imported raw materials used in manufacturing especially for export.

In welcoming the plan by government the Chairman of the Association of Indonesian Forest Concessionaires (APHI) attention should also be given to marketing not just production.

He said there is a need for a coordinated effort between entrepreneurs and the ministries of Environment and Forestry and Industry to address promoting Indonesian wood products to international market.

Support for the subsidy initiative was also voiced by the Chairman of the Association of Indonesian Sawn Timber and Wood Producers (ISWA) who said SVLK certification adds credibility to the legality of Indonesian wood products. The Association reminded the government that SVLK certification is an expensive exercise and suggested the level of subsidy be greater than that given in 2015.

While also welcoming the initiative of government the Secretary General of the Association of Indonesian Furniture and Handicraft Industries (HIMKI), Abdul Sobur, reiterated that SVLK certification of both upstream and down-stream industries is inefficient as it doubles up the cost of certification.

His argument is that up-stream certification is enough as automatically the products that are manufactured automatically satisfy legality requirements. He pointed out once again that certification for downstream industries using certified raw material undermines competitiveness.

In related news, Zulfandi Lubis Executive Director of Indonesian Forestry Certification Cooperation (IFCC) has warned that awareness of the importance of SVLK certification in Indonesia is not widespread. He claimed that most companies only apply for certification when it is requested by the market or by an end-user.

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