Jokowi SVLK Statement Triggers Controversy

Jakarta (Antara Bali) - Cancellation of the Timber Legality Verification System (SVLK) on furniture and handicraft would be a threat to Indonesia's export performance, furniture industrialists said  
The European Union would reject Indonesian timber products without SVLK label, Widayati Soetrisno from the Indonesian Association of Furniture and Handicraft Industries (Asmindo) said  here on Friday.

President Joko Widodo (Jokowi) was quoted earlier as saying that SVLK would not be applied to furniture and other small handicraft industries.

"Last year, the country's export of furniture of timber products were valued at US$1.8 billion  and 40 percent of which were to the EU," said Widayati Soetrisno, a member of the association in regulation studies and relations of inter agencies.

Widayati said if SVLK is cancelled or no longer obligatory for  furniture and handicraft, exports would be closed to the EU and other countries requiring certificate of the legality of the timber.

SVLK is part of the campaign against illegal logging to reduce forest destruction.

In addition to the EU, many buyers from other countries including the United States, Japan and Australia have demanded certificate to guarantee the legality of the products, that they are not made of illegally procured timber.  
"Around 10 percent of buyer from Australia have also required  SVLK label," Widayati said .

She said among Asmindo's members, 300 companies already have SVLK,  and those holding the license of registered exporters for forestry products are around  850 companies "Exports would be easier with SVLK  especially to the EU," she added.

Based on data from the Timber Legality Information System (SILK) in 2014, exports of furniture with SVLK document grew 21-132 percent.

Earlier on Friday, Forestry and Environment Minister  Siti Nurbaya Bakar asked furniture makers not to oppose the SVLK regulation .

Siti said the SVLK is a label to confirm that Indonesian  products are made of legally procured timber not through illegal logging.

Indonesia may suffer big losses if SVLK is not made effective, she said, adding many consumers would likely reject products without legality certificate.

She said  a trading house of legally procured logs would be opened that small industries would have better access to supply of timber basic material, she said.

"The trading house would be a hub  or timber trading center to ensure supply for small industries," she said.

She went on to say SVLK would save Indonesian timber industries from difficulty in international market.

The Forestry Independent Observers Networks (JPIK) also urged the government to maintain SVLK regulation both on small and large industries.

SVLK system would give added value and ensure that business players would comply with forestry regulation JPIK spokesman  Mardi Minangsari said..

"It is very unfortunate if furniture and other handicraft products are exempted from the system. It would damage the system, which has taken a long process of a decade to prepare it " Mardi said.

He  said by cancelling SVLK the government would break its commitment of reform in the forestry  and timber sector, which has been beset by illegal practices and corruption from the upstream to downstream sectors.  

Muhamad Kosar from the Forest Watch Indonesia, said it would be a step backward  and hurt the competitiveness of Indonesian timber products if President Joko Widodo cancelled the  SVLK  regulation
However, small furniture makers of the Indonesian Association of Furniture and Handicraft (AMKRI) said SVLK, which was originally to be made effective early 2015, had hampered exports of their products .

AMKRI chairman Sunoto said President Joko Widodo agreed to cancel  SVLK on small industries  and that the system should be applied only to upstream industries.

Apparently in a bid to cope with the controversy over SVLK,  the  trade ministry, forestry and environment ministry and industry ministry have agreed to simplify SVLK for small industries. (WDY)