Abstract
The furniture industry is the most labor-intensive and the most important forest industry for small and medium-sized enterprises (SMEs) in Indonesia. Power imbalances among actors participating in furniture value chains jeopardize the sustainability of the furniture industry. Regional and global trade agreements could worsen the situation of SMEs. From 2008 to the present, participatory action research (PAR) was conducted on furniture value chains in Jepara District to develop a ten year strategic roadmap. The multi-level governance (MLG) involves complex interactions of state, private and civil society actors at various levels, and institutions linking higher levels of social and political organization. The multi-year roadmap process facilitated a more complex approach to MLG which led to a better understanding of how policies work as instruments of governance within systems of power and authority. The roadmap process strengthened small-scale producers' bargaining positions and improved trust with local government authoritiesto achieve sustainable development goals.
Highlights
Furniture making is the most labour-intensive industry in the forestry sector
This paper describes the development of a roadmap for the furniture industry in Jepara District, central Java, Indonesia
The lack of a concerted strategic plan for a local furniture industry was raised by various actors including government, small and medium-sized enterprises (SMEs), large enterprises (LEs), non-governmental organizations (NGOs) and community colleges despite earlier national initiatives
Summary
Furniture making is the most labour-intensive industry in the forestry sector. In 2011, the global furniture trade accounted for US$ 135 billion, or about 1% of the world trade in manufactured goods. 54% of furniture exports are from developing countries (ITTO 2006). All middle-income countries, e.g. Indonesia, Malaysia and Brazil show strong comparative advantages in terms of labour and material costs and solid timber material provisions. Their competitiveness index has declined slightly in recent years (Han et al 2009). Purnomo et al (2009) revealed that overseas actors enjoyed more value added than domestic actors, and finishing and exporting companies make a bigger profit than small and medium-sized enterprises (SMEs) and tree growers
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