JCI: Imports hinder local woodworking manufacturing counterparts

shahennews

Jordan’s woodworking and furniture sector is facing a lack of protection against foreign imports, which have reached significant levels despite the competitiveness of local products in terms of quality and prices, according to the Jordan Chamber of Industry (JCI).

A report obtained by the Jordan News Agency (Petra) on Monday revealed that foreign products accounted for 43 percent of the country’s furniture and woodworking market, posing a major challenge to the competitiveness of the national product both locally and regionally.

The woodworking and furniture sector is considered one of the most important industrial sectors in Jordan, closely linked to the construction and urban sectors. Its products are utilized in restaurants, hotels, schools, hospitals, and various economic activities.

The report highlighted that the sector is labor-intensive, employing 8,500 workers, with the majority being Jordanians, constituting over 90 percent of the total workforce. The sector comprises 2,140 establishments spread across the kingdom, with an investment volume of nearly JD300 million.

In terms of productivity, the sector is recognized as one of the leading sectors, characterized by high added value and skilled labor with artistic and creative abilities. Its production amounts to around JD321 million, representing 1.8 percent of the total industrial production in Jordan, with an added value accounting for 40 percent of the total production.

Exports from the woodworking and furniture sector reached approximately JD34 million in 2022, contributing 0.45 percent to the kingdom’s total industrial exports. The sector’s products reached more than 70 countries worldwide, encompassing over 60 different product types.

Saudi Arabia ranked as the largest importer of Jordanian furniture products, accounting for 31.7 percent, followed by Iraq with 13 percent of the sector’s total exports.

The report emphasized that the woodworking and furniture sector is a highly skilled craft sector, with over 95 percent of establishments being craft-based. Skilled labor plays a crucial role, characterized by high skills, precision, and creativity, contributing to the sector’s excellence and enhanced competitiveness in local and international markets.

Initially, the furniture industry in Jordan started with small workshops, but it has expanded to include a chain of large-scale production facilities meeting a significant portion of the local market’s needs and catering to export markets. Additionally, the sector is interconnected with other sectors, providing a rich environment for investment and entrepreneurship.

The report highlighted that the furniture industry in the kingdom keeps pace with the latest designs and trends in targeted markets. New designs and techniques are developed to satisfy consumer preferences, incorporating the latest technologies and advanced equipment to meet international quality standards. Moreover, the sector utilizes high-quality wood and raw materials, enabling Jordanian products to enter the export market.

The sector faces several challenges, according to the report, including issues with importing raw materials, insufficient availability of resources to support the production process, and high production costs, particularly energy expenses, which account for 60 percent of the sector’s total production volume.

Other challenges include the absence of financing programs and incentives specifically targeting the sector, as well as the lack of advanced marketing and promotion programs and systems. These factors significantly limit the product’s access to international markets, alongside complexities related to registration and multiple regulatory authorities.

However, the report also highlighted several potentials and opportunities for the sector in foreign markets, estimating the value of untapped export opportunities at around $31 million in various countries worldwide.

North America has emerged as a promising market for Jordan’s woodworking and furniture sector, offering clear export opportunities. The demand for high-quality and distinctive furniture designs in North America presents a significant avenue for Jordanian exporters to capitalize on.

To penetrate foreign markets effectively, the report recommends that Jordanian furniture manufacturers explore partnerships and collaborations with local distributors and retailers. Establishing strong networks and distribution channels will facilitate the introduction of Jordanian products to a broader customer base.

Additionally, the report urged that participation in trade exhibitions and specialized fairs focused on furniture and interior design can serve as platforms to showcase the sector’s capabilities and attract potential buyers.

Addressing the challenge of high production costs is also crucial, by exploring renewable energy options and implementing energy-efficient practices to reduce costs and bolster the sector’s competitiveness in the global market.

//Petra// RZ