Wednesday, May 27, 2009

Furniture Clusters in Pakistan-2


There are about 300 units (including shops) in Gujarat associated with this sector. The sector breakdown shows that majority of the sector is based on 225 to 250 micro units, 40 to 50 small units and 5 medium sized units. There are approximately 7,000 to 8,000 people directly employed in this industry. Gujarat is well known for its top quality furniture all over Pakistan. A few units are exporting furniture to different countries including, UK, USA, Saudi Arabia, Middle East etc. The total export of Furniture from Gujarat was about US$ 4.5 million. (Directorate of Industries). However, due to limited production capacity these firms are not able to fulfill the large export orders and hence can not compete vigorously in international markets. China and India are the major competitors. Their prices are less and quality is better.


Furniture items produced in Sindh comprise of chairs, tables, musical instruments and other items like doors and windows. During the last decade, the units have started diversifying their products into office and kid’s furniture, which is designed more trendy designs. At present there are two main clusters of small furniture manufacturers in Karachi, i.e. Manzoor Colony and Akhtar Colony. There are some 1,200 to 1,300 units in these clusters that have employed almost 6,000 to 7,500 people.
The machinery used includes four basic tools/ machines for furniture making. The average wood requirement of each of these units is around 150 to 200 cubic feet per month. Wood is purchased by unit owners and seasoned naturally. This market mostly caters to the needs of the domestic market and because of the poor finishing/polishing quality the furniture manufactured here is not exported.
Two smaller clusters in Patelpara and Liaquatabad are also engaged in the manufacturing of low quality (MDF and Keekar wood) furniture. Almost three hundreds small/micro units are operating in these areas. Ayshamanzil, Arambagh, Nursery, Liaquatabad and Manzoor Colony are some of the major furniture retail markets in Karachi selling hardwood, steel, MDF furniture. The prices of raw material fluctuate tremendously and quality raw material is scarce. Seasoned quality rosewood trades at around Rs 650 to Rs 850 per cubic ft. American Oakwood and Burma teakwood can be purchased at a price of Rs 2,400 and Rs 3,200 respectively in this market.
Lacquer work is another powerful traditional craft of Sindh. These items have grown popular over the time period. However, furniture items are simple in design. Articles such as table lamps, chairs and sofa sets produced by Lacquer industries of Hala in Hyderabad district and Kashmir in the Jacobabad district are very popular.
Moreover, these areas are also in close proximity from retail markets. Majority of the wooden furniture manufacturing units are classified as small and medium sized having small and specified production. Most of the manufacturers do not have the complete manufacturing facilities to manufacture the complete range of products. The orders are sub contracted to independent workshops for manufacturing. This reduces the capital cost of the manufacturer but increases the quality control cost.

Furniture Clusters in Pakistan-1

There are some furniture clusters working in different countries in Pakistan.


The Lahore cluster is basically based on the traders of wooden furniture. There are more than 1,500 retail shops trading in MDF furniture, office, bedroom and living room furniture. However, in the last decade this market has diversified its product range to all kinds of furniture articles. These traders usually purchase furniture in semi-finished form from Chiniot and polish and upholster it in their workshops. However, there are around 100-200 small cottage sized workshops in Lahore are engaged in wooden furniture manufacturing. There profit margins are quite high as all the value addition is done in Lahore according to the requirement of the customers.
Majority of these manufacturing units use low-tech machinery which are either locally made or are second hand imported machines. However, some furniture manufacturers have established a production line based on new modern machinery and seasoning kiln facilities. On average each manufacturing facilities employs 5 to 20 workers depending on its scope of work.
At present there are around five large clusters of furniture markets within Lahore i.e. Fortress Stadium, Gulberg, AIlama Iqbal Town, Ferozepur Road and Multan Road. These markets mostly cater to the needs of the domestic market. Because of the poor finishing quality and inferior packaging the exports are not existent or negligible.


Although Chiniot wooden furniture industry is approximately 150 to 200 years old, but still remained at cottage sized scale. There are almost 3,000 to 4,000 manufacturing units in Chiniot, which use primitive technology and techniques for manufacturing. Around 40,000 people are directly employed by this industry. The demand for this kind of furniture is increasing in the international market.
Chiniot is a major cluster engaged in the manufacturing of handmade wooden carved furniture. The basic raw material used for hand carved furniture is Sheesham wood, which is under an attack of an unknown kind of disease. This has resulted in a shortage of raw material and increase in its price.
The stakeholders can be categorized into manufacturers, craftsmen, traders, timber merchants, exporters, transporters and financial institutions. The number of skilled craftsmen is declining, which is creating severe shortage in the industry. The semi-finished items (Kora) are sold to all major cities throughout Pakistan. Direct export from this industry or cluster is negligible.

Tuesday, May 26, 2009

Some Recommendations for the Furniture Producers

Enforcement of the rule of law and good governance on timber cutting and trade. Eradicate illegal and rent-seeking behaviors of Forestry Department officials, if such misconduct is proven.

Sustainable raw materials. A plan is needed to create and develop a sustainable source of wood raw materials. Forestry/reforestation programs should ensure a stable source of low cost raw materials, and to the extent possible maintain or improve ecological conditions, enhance the community income and employment, etc.

Product quality. The quality of furniture is determined by professionalism in the handling of raw materials, production techniques and manufacturing process. Due to insufficient skills and facilities, as well as the lack of quality standards and agencies conducting inspections, quality is bound to suffer. Quality enhancement and Standardization is thus needed, and all furniture manufacturers should preferably adhere to the quality management system (ISO).

Design. Creation of easily accessible design libraries in each major furniture cluster of the country would disseminate effectively new designs. The items collected could include trend reports, contemporary design books, consumer magazines, mail-order catalogues, trade publications, raw material samples, etc. Training programs and exchange of foreign designers can be an integral part of this design upgrading.

Human resources. Even if labor force is abundant, lack of technical capabilities can hinder competitiveness. Public support to vocational training for workers in factories is recommendable, in order to reduce direct training expenses of enterprises, and for managers to allow them to professionally grow with their businesses.

Market information. Access to information on market characteristics (for example trends in distribution, retail success stories, and new furniture marketing concepts) and market access (tariff and non-tariff barriers) is often very difficult. It would thus be useful to centralize this information (into Furniture Exporters’ Association level) for regular distribution.

Marketing activities. The furniture industry should focus on marketing activities in key markets (the United States, Japan, the European Union, and the Gulf). A concerted action should include exhibitions; websites; international trade fairs; in-depth market analyses, etc. Special encouragement may be warranted for importers and retailers’ buyer’s groups to visit Pakistani factories or Permanent Exhibition Halls. Marketing efforts in the booming Gulf markets should be intensified.

Potential Benefits of Global Value Chains for the Developing Countries-Furniture

Furniture firms across Asia are becoming partners in global value chains (GVC). It can be an important catalyst in learning and adapting more advanced technologies. It can also enhance the managerial and business development processes. The benefits of trade liberalization that are accompanied by the establishment of international supplier chain arrangements between firms in the industrial and less developed countries are estimated 10-20 times larger than those without such networks.
There are at least the following mechanisms on how furniture industry in developing countries can improve their position by engaging in GVCs:

· Adherence to “just in time” global networks requires the improvement of efficiency in transports and communication infrastructure and for a stable business environment.

· GVCs can enable firms to enter global production networks more easily, allowing them to benefit from globalization, climb the technology ladder, and gain wider access to international markets.

· GVCs provide firms with a wide spectrum of options to operate in global markets with a view to staying competitive.

· GVCs offer a way for local enterprises in developing countries to engage in international markets at their own level of capability.

Critical Success Factors & Elements for Furniture Industry

A focused furniture sector strategy would help in allocating resources to where success can be reached.

Pakistan will not be competitive in mass furniture segments. Authenticity and material knowledge should be made to work for the competitiveness of “niche” or “ethnic” furniture for the higher end of the market. Good example: the Philippines.

Good value for price, timely deliveries and proper after-sales service are needed for keeping competitive at the special niches like antique/traditional ethnic furniture markets.

New furniture collections will have to be created at shorter intervals in order to keep pace with market opportunities.

Creating original designs and attractive branding are necessary for moving to higher price points. Design should provide real added value to the product. Brand should be the flag to catch the attention of buyers.

Avoid using wood raw material that comes from illegal or unsustainable sources, as products thereof are subject to trade barriers and retailer resistance.

The following social safeguards can be added here

· Avoid the reputation of inferior social conditions and child labor (not really an issue due to strictly regulated labor rules in Pakistan).

· Refer to the ILO basic working condition convention on occupational health and safety measures as a guideline.

As far as the social or labour conditions are concerned, no buyer’s local code of conduct can be imposed on a developing country producer as a mandatory measure. No such mechanism exists by international law. On the other hand, many of buyers’ groups and large retailers set similar “voluntary” agreements on a bilateral basis: their main interest is, however, not to become under the stigma of retailing “sweat-shop” products.

Elements of success

Pakistan should look at other successful role models when figuring out a certain set of success elements for developing the furniture industry and trade. Peninsular Malaysia is one of the world’s leading exporters of furniture from the tropical region, greatly thanks to its success in rubber wood development. Important lessons could be learned from the Malaysian experience, even though success factors cannot be repeated as such. Even in Malaysia this has not been the case in Sarawak and Sabah, which have not yet joined the Peninsula’s success story in adding value to their timber.
One disclaimer is, however, that even Malaysia has been over-using its domestic wood resources in the past. Easy money was made by exporting logs and sawn wood to the big Asian markets. Only the last ten years have raised the country to the main league of furniture exporters.

Federation of Pakistan Chambers of Commerce & Industry -FPCCI

The Federation of Pakistan Chambers of Commerce & Industry (FPCCI) ( ) was originally formed in 1949 by Mr. G Allana, with headquarters in Karachi but its membership then was confined to a limited number of bodies. The Federation of Pakistan Chambers of Commerce & Industry (FPCCI) is the supreme among all trade and industrial bodies in the country. It enfolds all chambers and all country-wide associations representing specific trades and/or industries. Indeed, it is compulsory for all chambers and associations of commerce and industry to become members of the federation.
Being federal in its constitution, the federation takes up only such issues and matters as concern the country's trade and industry as a whole; in other words, the interests of all chambers and associations put together, e.g. economic planning, investment schedules, tax policy, money and credit transport and communication, export promotion, organization of general trade missions to foreign countries, receiving general trade missions form abroad etc. Matters concerning specific trades and/or industries (e.g. cotton or steel) or individual firms and companies are left to associations and local and regional chambers.
The head office of FPCCI is based in its own building, the Federation House, spread over an area of 11,666 sq. yards in a posh locality of Karachi, Clifton, over-looking the Arabian Sea. FPCCI has zonal offices in Lahore and Peshawar, which mainly deal with the provincial governments. FPCCI has a branch office in Islamabad to liaise with the federal government.

FPCCI offers the following services:

· Trade promotion

· Cooperation agreements

· Bilateral trade committees

· Standing committees

· Exhibitions

· Export trophy awards

· Arbitration

· Pakistan Shippers’ Council (PSC)

· Pakistan International Freight Forwarders’ Council (PIFFC)

· Trade delegations

· Pakistan's trade missions abroad

· International symposia/seminars/workshops

Small and Medium Enterprise Development Authority - SMEDA

The premier institution of the government of Pakistan under the Ministry of Industries, Production and Special initiative, SMEDA ( ) was established in October 1998 to take on the challenge of developing small and medium enterprises (SMEs). With a futuristic approach and professional management structure it has its focus on providing an enabling environment and business development services to small and medium enterprises. SMEDA is not only an SME policy-advisory body for the government of Pakistan, but also facilitates other stakeholders in addressing their SME development agendas.
SMEDA’s head office is in Lahore. There are regional offices in Lahore, Karachi, Peshawar and Quetta.

SMEDA offers the following services:

· Assistance in raising finance

· Financial advice

· Project identification

· Business plan development

· Technical advice

· Marketing advice (branding, labeling, packaging, distribution, promotion, etc)

· Company incorporation, export registration and regulatory advice

· Sales tax, custom duty, excise duty, etc

· Training and development

· Information services (library, databases, project briefs, pre-feasibilities)

· Business matchmaking

Monday, May 25, 2009

Trade Development Authority of Pakistan - TDAP

In late 2006 the Trade Development Authority of Pakistan (TDAP) ( ) succeeded the Export Promotion Bureau (EPB) as the primary agency engaged in the promotion and boosting of export. Since EPB's inception in 1963 as an attached department of the Ministry of Commerce, it has continued to facilitate exporters in overcoming difficulties faced by them on the supply and demand side of exports.
On the demand side, TDAP helps exporters to participate in exhibitions abroad and sends delegations to export markets with a view to exploring new markets and developing the traditional markets. On the supply side, TDAP has established over 32 training institutes and projects in various export sectors to train necessary manpower that can manage the export trade and industry professionally, meeting the requirements of the export markets. Export promotional activities are carried out in co-ordination with trade bodies at home and Pakistan's trade missions abroad. TDAP has its head office in Karachi, the city which is also a main industrial and commercial centre and a major export outlet of the country. TDAP has a staff of around 800 of which close to 600 are permanent.
Services provided by TDAP are as follows

· Export facilitation committee

· Resolving problems in exports

· Simplification of procedures

· Export procedures handbook

· Establishing buyer-seller contacts

· Fax on demand and the website

· Interface with chambers/trade associations

· Settlements of trade disputes

Regulatory services include the following

· Formulation of proposals for the trade policy

· Implementation of the trade policy

· Textile quota management

· Registration of importers/exporters

· Registration of export contracts

· Determination of minimum export prices

· Issuance of GSP certificates

Functions of TDAP are listed below


· Market Research

· Fairs and Exhibitions - local and international

· Trade delegations

· Overseas and local publicity

· Participation in trade-related events

· Expo Centre - holding of exhibitions

· Facilitation through trade officers abroad

· Seminars/conferences/workshops


· Publication of trade inquiries/opportunities

· Library

· Export intelligence bulletin

· Counseling

· Year Book - statistics

Human resource development

· Training institutes

· Seminars on ISO 9000 and 14000


· Social sector concerns

· Environmental concerns

Shortcomings at Company Level to Export-2


Much of the value of furniture is made in the design phase. Manufacturing or carving is supposed to transform a drawn design into a functionally and/or aesthetically performing product. Proper design training is non-existent.
Design capacity in Pakistan is declared as being very fragile and mostly based on ancient traditional ones (sold “as they are”), or copied designs from buyer’s photographs or magazines. Usually detailed design or technical drawings are not deployed to convey the design onto wood components.
Clear and uncomplicated are the words currently used to describe the wooden household furniture fashion. Rustic or country designs have fallen out of style in the last couple of years. Asian themes appear to be appreciated, what may be a positive notion for Pakistan. But reddish, shiny lacquer finishes are a past trend to a large extent. The interpretation of such current design trends should be expedited in Pakistan, if a modernization of furniture trends is sought for.
Function also continues to influence design at market as LCD/plasma TVs are incorporated into home entertainment and bedroom pieces. Taller dressers offer better viewing of the TV from the bed. Home entertainment centers are made with taller TV carts to raise the unit to a better viewing height and allow more storage underneath.

Finishing and lacquering

Finishing tends to be a common bottleneck for furniture coming from developing countries. The quality of final polishing of carvings needs to be improved, as well as the consecutive painting and lacquering. It should be understood that these work processes are none less important than the actual carving. On the contrary, a bad finish can lower the value of the product, and downgrade unnecessarily the carver’s skilled input. Too much variation in blending the colors, paints and solvents is routinely observed. These should follow controlled standard procedures for uniform quality.
Matte finishes are currently well accepted in decorative small furniture items (so-called occasional furniture). But in larger household furniture items the situation is more mixed. Antiquated or natural (visible grain patterns) surfaces have been in fashion in the recent years, and this trend has certainly not been marked by all producers. The shiny or satin lacquered surfaces are still the common norm in many producer countries, but pretty much out-dated in the overseas markets.
Closely linked with the former observation is the technical inadequacy of some key equipment. For instance, if the compressors used for spraying the lacquer is too weak, no proper finishing quality can be achieved. Brush-painting consumes more lacquer and should be avoided. Human health is a growing concern in wood lacquers, and it should be taken seriously into account by exporters to Europe, for example.

Shortcomings at Company Level to Export-1

These comments are made on the basis of documentation received from Pakistan, and from literature and previous studies.

Raw material recovery

Raw material recovery rate needs to be better monitored. It is not only affected by drying defects or fungal diseases of wood, but also if over-sized stock of wood is used, if the log form is difficult to saw, or if basic machining is of inferior quality.


Air-drying in the open is commonly used in dry and warm countries. It yields well-seasoned wood with a relatively long drying period (easily 6-24 months depending on country/condition/type of timber). The downside is that it locks up capital idle for that period, and makes it difficult to respond to new market opportunities quickly enough. Production planning can be very difficult if drying periods are lengthy or unpredictable.
It is imperative to use timber that has attained the equilibrium point of moisture content, preferably below 10%. This will help avoiding structural weaknesses of furniture and chairs, and other excessive rejects during production. Less customer reclamations will be received as a consequence.

Tool maintenance and its impact on quality

Tool maintenance is a crucial part of the wooden craft profession, because it enables efficiency and consistent quality in the work. There is reportedly some degree of negligence in this aspect in Pakistan. Tool maintenance often seems to be the responsibility of an individual worker rather than the company.
It has to be remembered that the raw material characteristics also influence tool wear. As wood density and extractives content rises, greater amounts of processing time, energy and tool wear are consumed. Tool material, tool design and tool geometry are the principal criteria to be watched. These may have to be changed if the common wood raw material is replaced by another type of wood.

Access to market information

Broadly speaking, Pakistani furniture firms suffer from a poor access to up-to-date market information. Non-systematic gathering of such info leads easily into inability to assess its reliability and put it into proper use. Therefore, the importance of a continuous flow of market information flow cannot be emphasized too much. Its collection and dissemination is an activity of its own, which requires external resources and dedicated staff to be beneficial for the industry.

Possible Solutions for the Shortcomings and Obstacles

At company level

In-house training programmes should be organized. This will create awareness among the employees and equip them with the latest skills and techniques. This will improve the quality of labor and as a result, better quality furniture would be produced.

At country level

EPB/TDAP should give attention to this sector by organizing exhibitions, seminars, inviting delegates from abroad for the exchange of knowledge. Until now, the exhibitions organized have produced no results. The participation fee for these exhibitions should be minimum. More incentives should be given for participation. Proper marketing should be done before the exhibition. No fee should be involved in putting up stalls. Without proper planning by EPB/TDAP, the majority lose great opportunities. EPB/TDAP should also do market surveys and stop the Forest Department from stealing wood and exporting it illegally. The newsletters and other advertising done by EPB/TDAP is not enough.

Labor law should be introduced which would put restriction that no company can take way other company’s labor by offering good options. Some of them are also moving abroad.

Re-plantation of forests should take place; this would reduce the cost of production.

Display houses should be made in various exporting countries where Pakistani furniture can be displayed. In this way, the foreign buyers can get a chance to physically see, feel and check the product. In addition, the exporters will not have to make a lot of effort in putting up shops.

The government should pay attention to potential big empty places ideal for setting up workshops such as the Bin Qasim Industrial Zone. This would definitely solve the problem of less space for storing furniture.

SMEDA, Chamber of Commerce and Industries and APFEA should pay special attention.

Loan facilities should be given. The rates of loans should be reduced so that every exporter can benefit from it and have more running capital.

The government should import the latest machinery for furniture exporters. Duties should be reduced to a minimum. This would greatly help in improving production.

Saturday, May 23, 2009

Shortcomings to Export

At company level

Focus on HR training: Companies have never given attention to this front. Training HR would have a very positive impact on not only the quality of product but also each worker would get paid according to his capabilities.

Work on job security of their workforce. In order to remove discontent of labor force, companies should give them all possible rights

Focus on improving quality of raw material.
Currently, the quality of material is not good. A lot of time and efforts are taken to search for good quality wood. In this way, order does not reach on time and the buyer has to face a lot of dissatisfaction even before receiving the shipment.

At country level

Reconciliation of export policies: The government has shown no interest in this sector. Every company is suffering in a different manner. End result: loss of million of dollars.

Qualified individuals should be given full chance to stay in Pakistan by opening all kinds of opportunities rather than creating an atmosphere for them to shift abroad

There should be one-window operation to reduce the delay in the finalization of settlements

The government should monitor the market. It should check material and give attention to prices. Raw material (wood, boards, etc.) should be available at reasonable prices. As a result, good quality and cheap material would be available for exporters.

The government should penalize exporters producing poor quality furniture. This would help in eliminating exporters producing low quality furniture and the image of Pakistani companies would improve.

Obstacles to Exporters

At company level

Raw material is diseased; its cost is high and it is of sub standard. As a result, low quality of furniture is produced. Companies have to suffer severe loss.

Quality of labor is deteriorating, as they do not get proper training. Consequently, the quality of work produced is low.

This wood is very important, there’s no replacement. As a result, sales are affected and importing is done at a large scale in order to meet this need. It costs four times more.

Transportation rates are increasing. Where previously a company would have sent 4 containers, it ends up sending only two. Diesel/petrol rates have also increased.

Lack of space is a problem. Because of small area, less pieces of furniture are produced. There’s 40% loss and as a result all opportunities are lost. If more material is produced, it is wasted because there is no space for its storage

At country level

Government departments follow red tapism, blackmailing, bribery, corruption, taxation and have lengthy procedures for exporters. Companies as a result are affected badly.

No proper guidance is given to companies regarding financial incentives given by the government. The attitude of banks is very bad and they have cumbersome procedures for loans. As a result, companies have no knowledge and they fail to make use of finance facilities. In addition, the government is not providing any subsidy.

No incentives given by the government to make use of the latest technology. As a result, all companies are using traditional methods and the quality of furniture is much below the level of global furniture, especially for “Seasoning” which requires latest machinery, but unfortunately the natural method is used, which is very time-consuming. Some exporters use the wood that has moisture in it. This results in bad piece of furniture in the end. Sometimes due to moisture, it breaks down even after delivery, which ruins the image of Pakistani furniture industry.

Material from China is being used commonly. The government itself is promoting this trend. Local market is decreasing, while no efforts are being made by the government to improve this situation.

Customs examination done is very severe, whereby furniture is broken/torn for inspection. As a result all material has to be made again. A huge loss is incurred on the companies. Some companies give money and get their material cleared from the Customs. In this process, even the poor quality material reaches foreign buyers and the image of the whole industry is destroyed.

Problem in basic utilities. Load-shedding is a major problem. Furthermore, gas rates are on the rise.

Friday, May 22, 2009

Potential Furniture Export Markets

Following is the list of those markets where there seems to be potential for growth of Pakistani furniture export.

United States of America: USA, the first export destination of Pakistan, (16% in value) is among the biggest furniture importers of the world. However, Pakistan’s share of exports is much below than even one percent of the US market. It stands nowhere as compared to other exporters to the USA. China, Canada, Mexico, Italy and Taiwan, which have more than 76% of the United States market. The tariff is zero. There is definite potential for growth for Pakistan.

United Kingdom: The United Kingdom is a big import market (applied tariff is 0%). The UK is Pakistan’s second major export destination (16% in value). However, its market share with us is much less than even 1%. Here again building on our presence (albeit very small) and utilizing our knowledge of this market, there should be good prospects of increasing our share.

United Arab Emirates: UAE (applied tariff is 5%) is at present the third largest export market for Pakistani furniture (15% in value). Despite this fact Pakistan’s share in its imports is below 1% countries like Italy, Malaysia, China and Indonesia have secured major share in UAE’s market with rapid rate of growth of their exports. Pakistan should more intensively focus on prospects in this market with which it is well familiar and which is in the region, offering the advantage of low transportation cost.

Saudi Arabia: Saudi Arabia (applied tariff is 5%) is the sixth largest export destination for Pakistan (3% in value). But Pakistan’s share in its imports is again nominal (below 1%). China, Italy, USA, Malaysia and France are having more than 75% of Saudi Arabian market. Here again, there is potential for growth and need for concerted efforts to optimize the opportunities offered by this market.

Afghanistan: Pakistan is Afghanistan’s top supplier of wooden bedroom and lounge furniture. 26% of Afghanistan imports of wooden furniture are from Pakistan. Pakistan should not lose a market that is one of the major destinations of its exports and is geographically so proximate.

Third parties’/Countries’ Access to other Markets (Threats/Competition)

There is great potential for increasing exports. Pakistani furniture exports represent at best a nominal share in the world exports, but there is a great potential to improve. After the conclusion of Uruguay round and consequential enhancement in the quantum and quality of liberalization, Pakistan has been enjoying better market access. Elimination of quantitative restrictions and reduction in tariffs should prove exceedingly helpful. Under these circumstances Pakistan should seek the benefits of its cheap production factors e.g. lower wages, and cheaper raw material. If the raw materials or furniture parts are required for a finished product, importers in Pakistan should be facilitated by undertaking greater promotional and facilitation efforts on the part of the TDAP. The tariff applied for imports of furniture parts and accessories is comparatively high i.e. 25%. Mechanism should be adopted to ensure duty free import of components used in the finished product instead of obliging exporters to claim duty drawback that is an inefficient way of providing relief.
There is clear need to improve compliance with the WTO agreements. To compete in international market Pakistani exporters will have to become more careful about compliance with SPS and TBT. Pakistani furniture products have been reportedly banned by some countries on the ground that those products were not properly rounded at the edges resulting in the risk of injury to their users. Our exporters have to be also careful about termite treatment that uses chlorpysifos.
Many opportunities have become available after the conclusion of the WTO Agreements and consequential trade liberalization. Needless to say, Pakistan is not alone in the field and competition is really intense. We have to adopt a sound strategy and vigorously follow up trade promotion plans. Two factors have been taken into consideration while identifying opportunity offering markets: (i) size of the market, and (ii) degree of presence of Pakistani products. The size of the market has been given greater weight because we should aim at substantial increase in exports that would be possible only in bigger markets.

Thursday, May 21, 2009

Pakistan’s Access to Other/New Markets (Opportunities)

Sustained growth in export earnings has taken place. In the first year, when the WTO regime became operational, export earnings amounted to US$3.142 millions. Thereafter there has been a sustained growth and the values of exports for the year 2004-05 are US$12.3 millions. Though, it can not be claimed that WTO is the only factor underlying this growth yet it can be assumed that the liberalized WTO regime has made a contribution to better export performance. A study of tariff structures in various countries have shown that at present a large number of countries have either lower tariff rates or even zero tariff. The WTO regime has indeed improved market access for Pakistan’s furniture industry.
Information as to tariff rates in markets of our ten major buyers would help us to appreciate the extent of opportunities available to Pakistan.
Market Access is not a problem for Pakistan for furniture products. Statistics in the table above show that the market access is not a problem as such for the Pakistani furniture. The main constraint experienced by Pakistan is that of supply side lack of capacity. Under the WTO liberalized import regime, Pakistani exporters need to concentrate on the markets like OECD countries particularly the EU, where applied tariff is 0%. Although EU is one of the largest furniture importing markets in the world, yet Pakistan’s market share there is less than 1%. Only 30% of the Pakistani exports are destined for EU (Source: ITC Product Map). It would be worthwhile to make efforts to increase flow of exports to the EU. This, of course, would require a radical change in the strategy particularly in terms of range of products and design that are in demand by the EU buyers. We must learn to produce what is liked and required abroad and at competitive prices.

Other Countries Access to Pakistan

Pakistan exports are higher than its imports at this point in time. Total exports of wooden furniture for the year 2005 amounted to US$12.3 million while imports were US$10.3 million. The MFN duty applied by Pakistan to the imports of different furniture products is 25%.14
Rapid growth of imports is taking place. A rapid growth of imports under the WTO liberalized import regime has taken place. Market share of main furniture exporting countries in Pakistan’s economy is increasing with a rapid pace. For example the export growth of China in the furniture sector to Pakistan is 278% between 2004 and 2005. According to industries’ sources the arrival of Chinese furniture has hit the local office furniture by 70% and the sales of locally manufactured household furniture have declined by 30%.

There is not much of a threat at present to the furniture industry. Whether, liberalization of trade has posed a threat to the furniture industry of Pakistan? There is prima facie not much of a threat to this industry at present though the industry’s sources have a negative perception of the situation. Our tariff rates are relatively high. Further, Pakistan’s bound rates are much higher than the applied tariff rates. In appropriate cases the affected industries can always approach the National Tariff Commission which provides an institutional mechanism for trade remedial action. However, these rates are likely to come down after an accord, if any, on NAMA (Non-Agricultural Market Access) under DDA. The malpractice of under invoicing and misdecaration have to be, however, checked to ensure such types of imports, having unfair competitive advantage, do not pose a threat to the domestic furniture industry.
One can not hope for a closed economy in a globalized world. In the world of liberalized trade one can not expect a closed economy and should not be upset about the flow of imports. However, the rate of growth in imports should be a matter of some concern as it constitutes a potential threat indicating a need for working on price competitiveness, quality enhancement of our products and stopping malpractices regarding valuation of imports. The Government of Pakistan should also seriously consider the demand of local manufacturers to decrease the import duties on the raw material including chipboard, adhesive, wood, foam and other related items to compete the foreign items at home.

Trade Conditions of the Pakistani Furniture Sector

Market access for Pakistan has improved and also for its trading partners. As a result of the WTO agreements, market access for the Pakistani furniture in industrial countries’ market has improved as tariffs have come down. Further, there is now protection available to Pakistan against any discriminatory treatment in our trading partners’ markets.
Pakistan has also opened its market substantially, among others, in respect of furniture including the wooden furniture to foreign suppliers. Since 1998 the import regime of Pakistan has been significantly liberalized through reduction in tariffs, rationalization, and removal of import quotas, import surcharges and regulatory duties. The un-weighted (i.e. simple) average statutory tariff has come down from 47.1% in 1997- 98 to 14.4% in 2006- 07.
The process in fact started in 1988 after the agreement on Structural Adjustment Programme was concluded with the International Monetary Fund (IMF). Unilateral, liberalization has been in the case of Pakistan the principal avenue of liberalization of trade. Of course, Pakistan has been complying with all its commitments under the WTO. The net actual liberalization on the part of Pakistani Furniture has been much more than multilaterally required in our WTO agreements. Some experts are of the view that we should not have unilaterally tariffs reduced such a steep extent.
Competition has led to reduction in prices. Increasing competition in the world has also helped in reducing prices and improving quality of inputs i.e. improving import sourcing. This is of special significance because production structure of the furniture industry has undergone a significant change. Factories from dozen of countries now participate in the different stages of global furniture chains, manufacturing components and ready-to-assemble (RTA) components for finished furniture for globally outsourcing buyers’ groups and retailer chains.
New tougher requirements are being adopted. Pakistani furniture makers have now entered an era of increasing competition, as opening up of trade impacts both exports and imports. New tougher requirements for producing domestic, furniture according to stricter standards and more elaborate designs are being progressively adopted. The WTO system is dynamically evolving. The WTO regime is not static but is dynamically evolving. Currently, MTN are taking place on the Doha Development Agenda (DDA). The way these negotiations proceed and the ultimate agreement reached will influence the landscape of international trade (though at the moment the prospects of a satisfactory outcome are not bright).

Tuesday, May 19, 2009

Agreement on safeguards

This agreement disciplines initiation of emergency safeguards measures by laying down requirements for safeguard investigations. These have to be transparent as well as oblige the Member countries to follow established rules and practices. The criteria for serious injury caused or threatened to be caused has been also laid down. The agreement also sets time limit on all safeguard actions (4 years) and addresses “grey area”, measures by providing that the members must not seek/take or maintain any voluntary export restraints, orderly marketing arrangements or any other similar measures. An import “surge” that triggers action under this agreement is defined it to be a real increase in imports i.e. an absolute increase or an increase in the import share of a shrinking market (even if the import quantity has not increased). Relevance of the furniture sector
This agreement can be used wherever any importing country finds that there has been a surge in imports, causing injury to the domestic industry. Affected parties are well advised to approach the Government of Pakistan for remedial steps in such a case.
By the same token, the exporting country can always show that action under safeguards provisions is not transparent or does not meet the criteria of serious injury or threat of serious injury.

Agreement on subsidies and countervailing measures of Furniture

This agreement disciplines use of subsidies and also regulates the actions that can be taken by the countries to counter effects of subsidies. A country can have recourse to the WTO’s dispute settlement mechanism and seek the withdrawal of the subsidy or the removal of its adverse effects. Another alternative is to launch its own investigation and charge extra duty (known as “countervailing duty”) on the goods in question to nullify effects of subsidy given by our trading partners. The agreement defines a subsidy and also introduces a concept of a specific subsidy i.e. a subsidy available only to an enterprise/group of enterprises. The discipline applies only to specific domestic or exports subsidies.
The agreement deals with the following two types of subsidies:

Prohibited subsidies: Requiring recipients of subsidies to achieve certain exports targets, or to use domestic goods instead of imported goods in their manufacture. Such subsidies (trade distorting) can be challenged in the WTO’s dispute settlement mechanism. In case, it is found that the prohibited subsidies have been given, the respondent country will be ordered to withdraw those immediately. In case the respondent fails to comply, the complaining country can levy countervailing duty on such subsidized products after following the prescribed procedure.

Actionable subsidies: This category is less objectionable than “prohibited subsides”. Here a complaining country has to demonstrate that the subsidy has an adverse effect on its interests. The agreement defines three types of damage that can be caused by this class of subsidies (i) Domestic industry of the importing country is being hurt (ii) Rival exporters from another country may be hurt when the two compete in third markets (iii) Domestic subsidies in one country can hurt exporters trying to compete in the subsidizing countries’ domestic market.

Exception: Subsidies given by LDCs/developing countries with GNPs of less than US$1000 per capita per year are exempted from subsidy regime.
Relevance of the furniture sector Imports into Pakistan
In case prohibited and actionable subsidies are given to promote export of the furniture, affected interests in Pakistan can request the National Tariff Commission to impose countervailing duties. Exports from Pakistan
On the other hand if allegations are made by importing country about subsidies (trade distorting) on the part of Pakistan, this agreement provides the exporter with wherewithal to show that countervailing duty should not be imposed. Should the matter require reference to the WTO, the Ministry of Commerce would have to be approached.

Antidumping –For Furniture Industry

Article VI of the GATT 94 finds the practice, of sale of products of a foreign country at less than the normal value of the products in the exporting country (called dumping) objectionable if the price level causes or threatens material injury to an established industry in the importing country or materially retards the establishment of a domestic industry. Article VI (2) of the Agreement permits a country to offset or prevent dumping by levying on the concerned product antidumping duty not greater in amount than the margin of dumping. The margin of the dumping is the price difference determined in accordance with the Article VI (1).
Under the antidumping agreement, a country is allowed to act in a way that would normally infringe the GATT principles of binding a tariff on MFN basis because antidumping actions means “charging extra import duty” on a particular product from a particular exporting country. Detailed procedures have been laid down on how antidumping cases are to be initiated, how their investigations are to be conducted and the conditions for ensuring that all interested parties get an opportunity to present evidence.
Normally, antidumping measures expire five years after the date of imposition, unless an investigation shows that ending the measures would lead to injury. Anti-dumping investigations are required to end immediately in cases where it is determined if the margin of dumping is insignificantly small (defined as less than 2% of the export price of the product). Likewise, proceedings must end if the volume of dumped imports is negligible. The agreement lays down that the member countries must inform the WTO about all preliminary and final antidumping actions promptly as well as report on investigations twice a year.
This agreement is important both for importers and exporters of furniture. If actionable dumping takes places in the Pakistani market, one can have recourse to the National Tariff Commission for seeking relief. If necessary the Government of Pakistan also can, on the basis of Anti-dumping Agreement, agitate the matter in the dispute settlement system of the WTO. The Ministry of Commerce, Government of Pakistan is the concerned agency.

Sunday, May 17, 2009

Agreement on Technical Barriers to Trade (TBT)

Every WTO member, while allowing imports, has the right to adopt standards considered by it to be appropriate for human, animal or plant life or health or for the protection of the environment or for prevention of deceptive practices. The TBT seeks to assure that regulations, standards, testing and certification procedures do not create unnecessary hurdles to trade. However, with a view to preventing excessive diversity, TBT encourages member countries to use international standards where these are appropriate but it does not oblige them to change their levels of protection in the process.
TBT contains a code of good practice for the preparation, adoption and application of standards. It lays down that procedures used to determine whether a product conforms with the national standards have to be fair and equitable. It does not approve of any methods that would give domestically produced products an unfair advantage. It also encourages countries to accord recognition to each other’s testing procedures. To help the stakeholders to know about the latest standards in the prospective markets, all WTO members are required to establish a national enquiry point.
The TBT gives decisive advantage to industrial countries as they have superior technologies and do follow more rigorous and higher standards. On the contrary, Pakistan being a developing country has yet to progress to those relatively sophisticated standards. In particular, there are not enough laboratories. This puts Pakistan at a disadvantage. Relevance for the furniture sector:
There can be genuine concerns about safety features of the furniture exported form Pakistan e.g. it has rough edges that can cause injury, or its design is defective or it has failed to use fire retardant material as required by the consumers.
There is also the possibility that protectionists interests in importing countries may insist on laying down unrealistic standards which might have the effect of obstructing trade. In such cases, Pakistani exporters may be well advised to plead that the arbitrary standards have been creating unnecessary hurdles to trade and constitute a violation of the TBT Agreement.
There are various government institutions through which awareness regarding environmental standards and regulations can be/should be disseminated regularly to the export sector. These include the Ministry of Commerce, Ministry of Industries and Ministry of Environment, Trade Development Authority of Pakistan and Provincial Department of Environment Protection. The lack of such information can lead to loss of markets. The Ministry of Commerce may also consider including a trade and environment section in the cell that deals with the WTO and draw on the relevant expertise from the other ministries.

Saturday, May 16, 2009

Trade Related Aspects of Intellectual Property Rights (TRIPS)

Trade Related Aspects of Intellectual Property Rights (TRIPS)
Many countries entered into international agreements (non WTO) to protect creative ideas and new knowledge by giving the creators of these knowledge based assets (called “intellectual property rights”):

• The right to prevent others from “using their inventions, designs or other creations

• To use this right to negotiate payment for their intellectual property (IP) rights.

However, protection given to IPRs (by several international agreements) was found to be inadequate. This was particularly true as to the level of protection, implementation and enforcement. It was, therefore, agreed to develop new internationally agreed rules. The result was the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) negotiated in the Uruguay Round of MTN that sought to reduce distortions and impediments to international trade through promoting effective and adequate protection of intellectual property rights.
The Agreement spells out the way that basic principles of trading order and other intellectual property agreements should be applied. The “MFN” and national treatment requirement have constituted key elements of the architecture of the agreement on the TRIPs. This Agreement has also required members to comply with pre-existing agreements governing IPRs. It was explicitly provided that nothing in the TRIPs Agreement shall derogate from existing obligations as spelled out in the Paris Convention, the Berne Convention, the Rome Convention and the Treaty in respect of Integrated Circuits.
The TRIPs Agreement markedly narrowed the gaps in the manner these rights were recognized, protected and enforced among trading nations. It also provides for settlement of disputes through the WTO dispute settlement system. Pakistan, in compliance with the TRIPS Agreement, has enacted new legislation (IPO law) as well as effected amendments in the existing laws relating to patents, copyrights and Trademarks.
The TRIPs Agreement is directly relevant for the furniture sector.

Protection of designs and trademarks

• Furniture designs can now be protected through getting them registered under the Industrial Designs Ordinance (2000). The furniture industry should seriously consider registering any innovative and special design so these be fully protected.

• The well-established companies would be also well advised to get their trade marks protected.

• The quality of protection has significantly improved. By the same token the furniture industry in Pakistan cannot copy some one else’s designs or trade marks. Pakistani furniture manufactures and exporters will be well advised to comply with the provisions of the TRIPs Agreement.

• Exporters if wrongly accused of violation of some one’s IPRs should take full advantage of protection provided by this Agreement.

Tuesday, May 12, 2009

Furniture Clustering and networking

• The international market outlook studies indicate that wooden household furniture fashions will remain volatile: what is “in” this year may vanish the next year. The basic problem is that while investments should be planned long-term, furniture markets and fashions live on a faster lane. New collections will have to be created at shorter intervals in order to keep pace with the market’s tastes. This essentially calls for the flexibility of production, which can be best achieved through networking among firms.

• The world’s wooden furniture manufacturing can demonstrate many types of successful networks and clusters. Most of the eminent exporter countries to the international markets have undergone an evolution of their own in organizing a competitive national furniture-manufacturing base (e.g. Italy, Germany, Denmark, Brazil, Malaysia, etc.).

• Approaches and practical industrial development patterns are varied, and simply mimicking an existing structure in another place is not enough. This is why some industry restructuring and relocation into furniture zones and “imposed clusters” have not borne fruit. Organic growth and subtle political support mechanisms appear to have enabled some of the leading clusters to become sustainable and truly beneficial to the industry as a whole. A dynamic industry is always required to inhabit such clusters.

• Furniture clusters have found widespread acceptance in almost every major furniture exporting country. Nevertheless, there is a lot of differentiation in their basic philosophy to suit local conditions.

• Inevitably, the success of these four cluster models also varies and illustrates their contribution towards the sustainable growth of the furniture industries as a whole.
• It has not become fully clear how the Pakistani firms are networking between them. In other countries like Egypt, the local furniture showroom owners hold a strong negotiating power over the smaller furniture workshops. Showroom owners sub-contract these artisans to manufacture components or un-finished furniture on copied designs, and then cream up the profits by assembling, fabricating, finishing and marketing the ready furniture.

Monday, May 11, 2009

Issues faced by Pakistani Manufacturers/Exporters

Sheesham is not easily available

Sheesham (rosewood) is getting extinct. It is being cut in a large amount, but on the other hand not grown on a large-scale to overcome this scarcity. “The goldmine of Pakistan is being wasted”. Its prices are going high, have become two to four times expensive. There are people who are illegally exporting wood. Illegal wood import has also started since the launch industry has shifted to Dubai. However, there is no big issue regarding its import.

Latest technology is not being used

At least 98% of manufacturers are using traditional methods. The latest technology is not being used at all. One manufacturer demanded that “imported machinery be made available to us at the same rates”. The factory owner should be given the facility to purchase second-hand machinery. The government should come forward, reduce rates and make the imported machinery easily available for them.

No training institutes and centers are set up

All of the manufacturers said that no training centers were available. One or two centers are working, but no effective services are being offered by them. The manufacturers stress the importance of having such institutes in the country. The furniture industry is in dire need of trained and creative individuals.

No financial incentives given by the government

The government is providing no finance facilities. For the few facilities available, the process of documentation is discouragingly cumbersome. The government should also introduce new subsidies as the old rebate and subsidy facility has ended. The MoC freight subsidy is still there, but it is not generalized – it is only for specific destinations. Furniture is a high-value item; therefore freight rates are also high. Thus, for an importer it tends to be expensive. A supportive regulatory subsidy should be introduced. New investors are not coming in because of the high cost of setting up business.

Government takes no steps to promote exports of furniture

No longer-term steps are taken by the Government. TDAP and SMEDA are working on it, but no concrete results have come forward. They gave examples of exhibitions and seminars organized by TDAP, but they are not at all effective.

Sunday, May 10, 2009

Sheesham is not easily available

Sheesham (rosewood) is getting extinct. It is being cut in a large amount, but on the other hand not grown on a large-scale to overcome this scarcity. “The goldmine of Pakistan is being wasted”. Its prices are going high, have become two to four times expensive. There are people who are illegally exporting wood. Illegal wood import has also started since the launch industry has shifted to Dubai. However, there is no big issue regarding its import.

Latest technology is not being used

At least 98% of manufacturers are using traditional methods. The latest technology is not being used at all. One manufacturer demanded that “imported machinery be made available to us at the same rates”. The factory owner should be given the facility to purchase second-hand machinery. The government should come forward, reduce rates and make the imported machinery easily available for them.

No training institutes and centers are set up

All of the manufacturers said that no training centers were available. One or two centers are working, but no effective services are being offered by them. The manufacturers stress the importance of having such institutes in the country. The furniture industry is in dire need of trained and creative individuals.

No financial incentives given by the government

The government is providing no finance facilities. For the few facilities available, the process of documentation is discouragingly cumbersome. The government should also introduce new subsidies as the old rebate and subsidy facility has ended. The MoC freight subsidy is still there, but it is not generalized – it is only for specific destinations. Furniture is a high-value item; therefore freight rates are also high. Thus, for an importer it tends to be expensive. A supportive regulatory subsidy should be introduced. New investors are not coming in because of the high cost of setting up business.
Government takes no steps to promote exports of furniture

No longer-term steps are taken by the Government.

TDAP and SMEDA are working on it, but no concrete results have come forward. They gave examples of exhibitions and seminars organized by TDAP, but they are not at all effective.

Wednesday, May 6, 2009

Chain-of-Custody (COC) Certification

The focus of the timber certification debate has been moving from the forest certification (sustainability) to the chain-of-custody certification. The chain of custody – or wood tracking – is a sequence of ownership or control from one to another along the supply chain. It can also be understood as the identification of material throughout all the processing and transportation stages from the initial raw material source to the final product.

A practical exercise: By filling out this type of diagram with actual firms and traders, the Pakistani industry and value chains could be more easily understood. Things like how many cubic meters are in each flow, how it changes ownership/for what price mark-up, how many kilometers of transportation is typically needed, how long time wood is stored, etc. can be useful questions for a policy-maker.

The chain of custody is required to be certified in connection with the labeling of forest-based products. A label shows that wood raw material – or a known portion of it – comes from sources that are acceptable to a particular labeling system. In addition to forest certification, with which the chain-of-custody certification is usually associated, it could be used for showing that wood comes from legal sources.

Tuesday, May 5, 2009

Certification of Sustainability and Legality

The certification of sustainability and legality of wooden raw material is fast becoming a mainstream requirement for forest products in international trade. Forest certification is based on standards prepared in a country and specific criteria against which a third-party verification is arranged. Chain-of-custody certification (CoC) continues from here onwards by means of establishing the ownership of certified wood throughout the supply.
Yes, Pakistan should not overlook forest certification when it prepares to export more wood products and furniture made thereof. The need to ensure compatibility between export trade expansion and sustainable forest resource utilization gives justification to the certification of forest management, chain-of-custody (CoC) and the related labeling of wood products. And that is no matter if the wood is from domestic or imported natural forests or from planted, man-made forests. The number of international markets where “anything goes” is narrowing quickly. Larger purchasing groups and public procurement offices impose policies that insist on verified legal origin and sustainability of wood-based products. This holds true in the European Union, the United States and more recently in Japan. Even China is gradually tightening its timber procurement rules because they fear for buyers’ boycotts on Chinese furniture made of illegal or unsustainable wood.

Monday, May 4, 2009

Export Quality Requirements and Standards

Institutional buyers (the public building and construction segment demanding furniture for public premises, offices, schools etc.) in the European Union/North America often have procurement policies that include requirements on product quality, which may be specific to the institution in question. In addition to laying out the normative bidding procedures, these policies may include special conditions on the:

· Environmental load (including materials and additives in the product as well as energy used in the production, packaging and transportation)
· Possibility to repair and recycle,
· Volatile compounds (e.g., borax used in rubber wood furniture, formaldehyde emissions from panels, shelving, furniture and other interior products, solvents in glues, paints and varnishes),
· Ergonomics and human safety (flame retardancy testing)
· Durability (structural strength and load bearing, wear and tear, scratching, etc.)
· Adaptability (modular use), and
· Availability of additional components, “spares” and accessories.

Commercial and industrial enterprises (their building and construction projects, hotel, office and shop furniture, etc.) are more likely to put emphasis on the aesthetic appeal, safety, quality, functionality and physical construction of furniture than on environmental or social aspects of furniture making. This is natural, as these organizations are more familiar with such day-to-day business needs as avoiding product liability suits and impressing new clients.
Retailers in the consumer market (mainly selling household furniture, ready-to-assemble furniture, small occasional furniture, garden furniture, etc.), on the other hand, must be more sensitive to the “softer” values. In order to ease their customers’ concerns, many furniture chains have developed environmental management systems and, to a certain extent, monitor the origin of their products. As for raw materials, some may give preference to products made of certified wood.
It is recommended that a potential new furniture exporter from a developing country should discuss with the potential buyers (wholesalers, importers, retailers, etc.) what their requirements are and deal with them. The more alert – or responsible – companies may be the ones to reap the greatest benefits of being “green”, but that is not to say that the indifferent or just plain irresponsible ones will be forced out of business. They will simply seek less demanding buyers.

Sunday, May 3, 2009

Furniture Standards

The objective of standardization is to ensure that all furniture available in the market is safe to use and of solid and strong construction. Therefore, standardization is helpful in facilitating market conformance, including from developing countries. However, there is also a risk that standards may become a constraint for market access or put small producers at a disadvantage when the requirements are particularly difficult to meet. Manufacturers normally use the standards voluntarily in their product development, process control and marketing. Having a common language on test methods, dimensions, safety and strength characteristics is considered a major benefit.
There are over 140 furniture-related standards and labeling requirements in the United States and Canada alone. Most standards are voluntary but some are regulated by the state or federal laws. The European Committee for Standardization (CEN) is responsible for the harmonization of standardization in the European Union. Their EN standards on furniture are not meant to serve for protectionist aims. On the contrary, they are proposed as a basis for wider international work on furniture standards under the ISO/TC 136 “Furniture”. (International Organization for Standardization.)
The national standards institutions in the developing countries are either ISO members, ISO correspondents or ISO subscribers. Their capabilities to implement ISO are often weak. Only few countries have certification bodies, which can issue certificates of compliance with ISO 7173 standards (chair standards for strength and durability), for example. The furniture industry itself should support efforts to establish adequate national standardization institutions and certification bodies.
The Pakistani industry indicated that only the holders of ISO 9001 standard are able to export furniture. ISO 9001 is a broad quality management standard, which is not product-specific. The SESSI Standard from France is said to be followed by some furniture manufacturers. SESSI is not issuing standards, so this is possibly a misinterpretation of the French buyers’ specifications. French industries are quite strict in their requirements as far as standards are concerned. Moreover, they often require the respect of “French Standards” (NF Ameublement), although European standards (EN) at the moment have substituted almost all the national standards.