Capital Sector Policy and Its Impact on the Rattan Furniture Industry

Before 1986, Indonesia was the largest exporter of rattan raw material in the world, while the national rattan processing industry at that time was not yet developed.

 

Since 1986, namely with the issuance of Decree of the Minister of Trade No. 274 / KP / X / 1986 concerning the ban on the export of rattan raw materials, the national rattan processing industry experienced very rapid development, which increased from only 20 companies to 300 companies.

 

Meanwhile, the rattan processing industry abroad (Taiwan and Europe) whose raw materials rely on supplies from Indonesia has experienced bankruptcy and shifted its business to Indonesia, especially in the Cirebon area.





In a further development when the export of rattan raw materials reopened in 2005, namely with the issuance of the Minister of Trade Decree No. 12 / M-DAG / PER / 6/2005 concerning Provisions on the Export of Rattan,

the national rattan processing industry has been stunted and the business activities have become sluggish, resulting in unemployment, bad credit, reduced foreign exchange earnings, and decreased contribution of the national rattan processing industry in GDP formation.

 

On the other hand, in competing countries such as China, Taiwan, and Italy, the rattan processing industry has revived and developed very rapidly.

 

PROBLEMS FACED BY THE RATTAN PROCESSING INDUSTRY, AMONG OTHERS

 

Raw material

The national rattan processing industry is experiencing difficulties in obtaining raw materials that have caused, among others, the rattan export policy and the rampant smuggling of rattan abroad.




Production of mastery of finishing technology is still behind and the design of processed rattan products is still determined by overseas buyers (job orders).

 

Marketing

The still weak market intelligence, resulting in limited export market information.

 

Development Strategy

To overcome the problems faced by the rattan processing industry, the following strategies are developed:

 

Reviewing the policy on the export of rattan raw materials and increasing eradication of rattan smuggling abroad.





Increased market intelligence capabilities, by optimizing the functions of the Atperindag and diplomatic representatives abroad, actively participating in prestigious rattan product exhibition events abroad.

 

Follow-up Policy

To revive the national rattan processing industry, it needs support from all parties (stakeholders) to work together synergistically by prioritizing national interests above personal, group, or sectoral interests.

 

It is necessary to review the Rattan Export Provisions contained in Minister of Trade Regulation No. 12 / M-DAG / PER / 6/2005, in the context of ensuring the continuity of supply of rattan raw materials in the country, as well as increasing the competitiveness of rattan finished products abroad.

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