SPEECH BYYB DATO’ SRI DOUGLAS UGGAH EMBAS

MINISTER OF PLANTATION INDUSTRIES AND COMMODITIES MALAYSIA

LAUNCHING OF EXPORT FURNITURE EXHIBITION (EFE) 2014

MALAYSIA AGRO EXPOSITION PARK SERDANG (MAEPS)MONDAY, 5 AUGUST 2013

YBrs. En. Richard KoChairman, EFE Expo Sdn BhdPresident Malaysia Furniture Entrepreneur Association

YBhg. Dato Edmond ChewPresident Kuala Lumpur and Selangor Furniture Entrepreneur Association

YBrs. En. Sunny TerPresident Malaysia Furniture Industry Council

YBhg. Dato Mohd Arif OthmanChief Executive OfficerMAEPS Management Sdn Bhd

Dato’-Dato’, Datin-Datin, Distinguished Guests

Ladies and Gentlemen,

A very good afternoon and Salam 1Malaysia.

I would like to take this opportunity to express my appreciation to the organisers, EFE Expo Sdn. Bhd. and the Malaysia Furniture Entrepreneur Association (MFEA) for the invitation to officiate the official launching of Export Furniture Exhibition 2014 or popularly known as EFE 2014. It is indeed an honour to officiate an important event for the furniture fraternity.

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2. I understand that EFE 2014 is the 10th in its series organised by MFEA to further promote the development of furniture industry. In this context, I also wish to congratulate MFEA on its success in organising EFE 2013, which was held in March this year at this same venue.

Ladies and gentlemen,

3. The wood-based sector is an important component of timber industry. Over the years, the wood-based sector has undergone major changes and it is now a major exporter of processed and finished wood products, in particular furniture products. In 2012, Malaysia’s furniture export was valued at RM8 billion, an increase of 4.3% compared to RM7.67 billion in 2011. This is very encouraging despite the challenging external environment, in particular with the economic slowdown in major importing markets.

4. The furniture sector has contributed towards making Malaysia as one of the world’s largest producer and exporter of furniture. Malaysia is currently ranked as the 8th largest global furniture exporter. This has been achieved through concerted and relentless efforts on the part of industry players and facilitative measures by the Government towards ensuring resilience of the industry. Notwithstanding these, it is also pertinent on the part of the industry to discharge leadership role towards ensuring competitiveness and relevance in the global supply chain.

5. Despite such commendable achievement, we are aware of the various challenges faced by the wood-based industry. The Ministry has initiated a number of programmes including sufficient supplies of raw materials and skilled workers for the furniture industry. Through the promotion of forest plantation, we encourage replanting of old and unproductive rubber trees with fast growing timber species and provide soft loans to entrepreneurs who can increase the areas for forest plantation. Under the Forest Plantation Development Programme, it is targeted to plant 375,000 hectares by 2020, which is envisaged to contribute 5 million cubic meters of raw materials for the downstream industries annually.

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6. In addition, the Government has also implemented liberal wood import policy and encouraged research and development (R&D) on the utilisation of bio-composite and other alternative materials. These measures taken collectively are expected to facilitate the growth of the timber industry towards achieving export value of RM53 billion by 2020, with export of furniture products valued at RM16 billion.

Ladies and gentlemen,

7. Malaysia is committed towards sustainable forest management (SFM) by adhering to its own Malaysian criteria and indicators which are recognised by the Programme for the Endorsement of Forest Certification schemes (PEFC). We are actively promoting the green image of the timber industry through the Malaysian Timber Certification Scheme (MTCS). This scheme ensures that the Malaysian timber products are produced from sustainable and legal sources.

8. In addition, the major importing countries have legislation or considering measures to ensure only legally harvested timber products are imported. These include the Lacey Act in the United States and the Australian Illegal Logging Prohibition Act 2012. Malaysia is also currently negotiating with the European Union (EU) on the Voluntary Partnership Agreement (VPA) under the EU-Forest Law, Enforcement, Governance and Trade (FLEGT). This VPA is aimed at further ensuring environment conscious consumers in the EU that timber products imported from Malaysia are manufactured using legally produced timber. Conclusion of the VPA will also allow Malaysian manufacturers to export timber products to the EU and enjoy greenlane treatment.

Ladies and gentlemen,

9. In this modern era, furniture production is not made from wood fully. Notwithstanding this, I also hope that the industry will continue to produce furniture products that are market oriented, as well as focus on improving production technology and productivity. In terms of design, we need to explore innovative measures to strengthen the design and image of furniture products exported from Malaysia. In this context, I

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wish to applaud EFE for organising the design competition during EFE 2013. This event had provided opportunity to showcase newer designs which has potential for commercialisation. I hope that this competition will be continued in EFE 2014, as it provides the platform to promote the development of design in Malaysia.

10. I would also like to urge the furniture industry to factor in new developments in the market, in particular relating to green policies. There has been a growing trend to produce eco-friendly and market green products, in line with growing global demands for environmentally friendly products. In the light of this, it is important for manufacturers to focus and produce products along the line of eco-friendliness. I would also urge the manufacturers to continue developing sustainable material and methods to take advantage of the market shift towards ‘green furniture’. A balance between economic growth and sustainability is important to ensure long-term growth of the furniture industry.

Ladies and gentlemen,

11. The furniture industry is currently confronted with a number of issues. These include addressing labour shortages. The furniture industry is reliant on foreign labour and this poses difficulties if the sources of foreign labour declines in the future. The furniture sector while aware of this consequences, need to implement measures to ensure accelerated reduction on foreign labour. In this regard, the Government will continue to facilitate labour requirements for the industry through consultations with the furniture associations. However, I wish to urge manufacturers to accelerate their mechanisation and automation efforts and improve on design and accelerate branding.

12. A trade platform such as EFE provides opportunities to Malaysian furniture manufacturers to showcase the latest designs and developments in the furniture industry. In addition, this event also provides the window to strengthen existing business relationship and explore new business areas. In this context, it is pertinent that Malaysian furniture manufacturers continue focusing on innovation, design, improve manufacturing technique and adjust their marketing strategies.

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Ladies and gentlemen,

13. I am optimistic that the 10th Export Furniture Exhibition 2014 will continue to create opportunities for Malaysian furniture manufacturers and its related industry players to expand your market internationally. The EFE international fair is an excellent platform for industry players to showcase and brand your finest quality and designs to capture the attention of the global buyers. Emerging markets are important drivers for global recovery and remain the key growth engines of global wealth. I encourage industry players to continuously explore and tap into emerging markets in our bid to strengthen our market positions.

On this note, I have great pleasure to officially launch Export Furniture Exhibition 2014.

Thank you.

Kementerian Perusahaan Perladangan dan Komoditi5 August 2013

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