Tk 300 billion furniture industry needs policy backup to boost exports: Stakeholders

Businesses, academicians, and experts on Monday opined that the country's Tk 300 billion furniture industry needs proper policy support to have a strong presence in the global market.

They recommended bond facilities, reduction in duty on raw materials, training, and testing and designing facilities to make the sector truly competitive.

Furniture was declared the product of the year by the chief adviser, but the sector, despite having immense potential to be a major foreign-currency earner, is yet to get the necessary support from the government, they said at a seminar titled "Bangladesh Furniture Industry: Unlocking Export Potential".

The event was organised by the Export Promotion Bureau (EPB) in association with the Bangladesh Furniture Exporters Association (BFEA) at the Bangladesh-China Friendship Exhibition Centre in Purbachal on Monday.

Commerce Adviser SK Bashir Uddin was the chief guest at the seminar presided over by EPB Vice Chairman Md Anwar Hossain.

BFEA Director Dewan Atif Rashid presented the keynote, which shed light on the furniture sector's challenges and prospects of the country and was followed by a panel discussion.

The pool of panellists included Chairman and Managing Director of Hatil Furniture Selim H Rahman, who is also the BFEA general secretary, Chairman and CEO of PRAN-RFL Group Ahsan Khan Chowdhury, National Board of Revenue (NBR) Member (Customs, Export, Bond and IT) Moazzem Hossain, Executive Director of private think tank RAPID Dr M Abu Eusuf, Dean of School of Design at BRAC University Professor Dr Fuad H Mallick, Professor of Materials and Metallurgical Engineering Department at Bangladesh University of Engineering and Technology (BUET) Dr Ahmed Sharif, and Deputy Chief Conservator of the Forest Management Wing under the  Forest Department Moinuddin Khan.

The commerce adviser assured full support for the furniture sector, but at the same time reminded that the government alone cannot be made responsible for addressing all the challenges.

"Both the government and the private sector should mobilise all their resources and efforts to formulate an action plan so that the true potential of the furniture industry can be unlocked," he said.

Uddin also expressed his sheer optimism that with proper implementation of the action plan devised by both the government and the industry, furniture exports could be raised to $1 billion by 2030.

He made it clear that free trade agreements (FTAs) cannot be a panacea for resolving the sector's challenges as there are many flip sides of FTAs, adding the country needs to be cautious about inking FTAs.

In this connection, he argued that signing FTAs with countries like China and those in the European Union would not be of much benefit as they are already providing Bangladesh duty-free access to their markets.

To some extent, this can impact the industry negatively as they will have the scope to export finished products in a bigger way after getting the FTAs signed, the adviser warned.

He also said businesses need to get rid of the tendency to abuse bond facilities and achieve true competitiveness by raising productivity. "We are ready to provide everything."

Uddin noted that the sudden surge in furniture export by Vietnam resulted from the manufacturing migration from China to there.

Assuring the present government's commitment to the industry, he said the white paper revealed how the economy was highly criminalised during the previous regime.

Keynote presenter Rashid said the local furniture market size is estimated at Tk 300 billion that generated employment for nearly 2.5 million people.

"Considering the potential of the export market, the Bangladeshi furniture sector could multiply its contribution to the national gross domestic product (GDP) seven or eight times in the next five years if the barriers are addressed," he said.

He mentioned that several factors, such as affordable labour costs, design adaptation capability, growing local market, and geographical location, give Bangladesh great advantages.

"However, there are some pressing challenges too. Maintaining international compliance, absence of certification, higher manufacturing costs, limited automation, and absence of country branding as a furniture exporter are some of the adversities," Rashid explained.

Referring to Vietnam's success, the keynote speaker said Bangladesh could also expand its international furniture market manifold.

Highlighting the opportunities, he said the global eco-friendly furniture market is expected to reach $90 billion in 2030 from $36 billion in 2020.

At the same time, the modular furniture market is projected to go up to $28 billion in 2028 from $16 billion in 2020, said Rashid.

On behalf of BFEA, he suggested the government take necessary steps, including proper implementation of the already-adopted policies on duty and bond facilities, capacity enhancement, and measures for standardisation, certification, commercial campaign, and branding.

In this connection, he pointed out that some sections of the National Export Policy 2024-27, the Import Policy 2021-24, and the National Tariff Policy 2023 stipulate providing bond facilities for sectors, such as furniture, that have strong export potential.

RAPID's Eusuf said all export-oriented sectors should get equal facilities for their raw material imports to diversify the country's export basket.

He suggested preparing to cope with the challenges that would emerge from the least developed country (LDC) graduation and enhancing country branding.

Underscoring the need to follow eco-friendly manufacturing practices, he said, "The whole world now follows ESQ, which stands for environment, society, and quality."

BFEA General Secretary Rahman urged the government and stakeholders to provide a time-bound roadmap to help boost the furniture sector.

NBR Member Hossain said the country's economic development must not depend on a single sector.

The export-oriented sectors are required to lower their production costs to be competitive in the international market, he said, adding the NBR is working with this aim.

He also felt the government should not provide special facilities for a special sector at the cost of others.

BRAC University's Professor Mallick highlighted the importance of design education that could help various sectors, including furniture.

BUET Professor Sharif said the Bangladeshi manufacturing sectors largely depend on the copy-paste concept. "We may survive with copy-paste, but cannot lead."

Forest Management Wing's Khan said the concept of certification for wooden products is not very old in the country.

The Forest Department has the capacity to provide green certification and the matter is being incorporated into the next forest policy, he added.

PRAN-RFL Group's Chowdhury said furniture as well as other sectors that aim to widen the export market must get similar government facilities like China and Vietnam while importing raw materials.

Seeking the required support like duty-free imports and bond facility for the furniture sector, he said it could create huge employment opportunities.

"We cannot beat Vietnam if we do not get the raw materials at fair prices," he said, seeking duty rationalisation for the imports of materials.

He also pointed out that the assumption of the US presidency by Donald Trump paved the way for expanding Bangladesh's export volume as it is assumed that there would be a "Trump tax" on certain countries.

"We missed the opportunity to take advantage of the Trump tax during his first term. Now we have to make the best use of it," Chowdhury observed.

EPB's Hossain said the bureau would try its best to pursue the authorities concerned to incorporate the industry's recommendations into government policies.

He also stressed the need for a comprehensive and collective collaboration between the government and the industry so that the $1 billion export target can be achieved by 2030.

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