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Furniture industry
blames losses on imports
By Kuo Yan-hui and Stacy Hsu / Staff reporter, with staff writer
The nation¡¦s furniture industry has suffered substantial financial losses after
several international furniture manufacturers entered and started dominating the
market. The signing of the cross-strait service trade agreement would only
compound its suffering by allowing more competitors into the already saturated
sector, industry representatives said yesterday.
New Taipei City Furniture Commerce Association chairman Chien Lung-fu (²¶©´I) said
there used to be up to 700 furniture manufacturers and retailers in the city in
the industry¡¦s heyday, which ended about a decade ago when many Taiwanese
businesspeople started investing in Chinese furniture makers and importing their
low-cost products to Taiwan.
¡§At that time, the majority of consumers had little knowledge of the differences
between furniture manufactured locally and those made in China. All they knew
was that there was no need to spend extra money on a locally produced sofa when
there were cheaper options [from China],¡¨ Chien said.
Chien said the import of furniture made in China dealt the industry a serious
blow and that the adverse effects it brought did not ease up until the public
learned the hard way that home furnishings from China, however inexpensive they
were, were often crudely made.
However, because of the economic downturn in recent years, the number of
furniture sellers in the city has been cut in half, Chien said, adding that
despite the surge in house prices, most homes were bought by property
speculators and were therefore left empty and unfurnished.
Former chairman of the association, Tu Jung-li (¶îºa¥ß), who is also the president
of a 20-year-old Taiwanese furniture brand, said the word ¡§misery¡¨ best
encapsulated the predicaments faced by the industry in recent years.
¡§Due to the difficulties in acquiring land and the rising costs of hiring
domestic workers, many Taiwanese furniture makers have moved their businesses to
China,¡¨ Tu said.
To make matters worse, the government has signed a treaty that will open up the
industry to Chinese investors, Tu said, allowing them to integrate production
and marketing of furniture and squeeze local proprietors¡¦ market shares.
¡§The industry has hit rock bottom and signing the service trade deal is like
adding salt to an already festering wound,¡¨ Tu added.
Tu said local furniture chains and businesses that provided furnishings for
hotels were expected to suffer most from the agreement, as newly built hotels
might shift their furniture orders from Taiwanese manufacturers to Chinese
makers after the latter are permitted to manufacture and sell their products in
Taiwan without having to worry about shipping costs.
¡§Neither small furniture makers nor large furniture chains would be able to
withstand the fierce competition once Chinese investors are allowed to open
furniture retail stores across Taiwan,¡¨ Tu said.
Since the government signed the pact with China on June 21 without any prior
consultations with the sectors potentially affected by the treaty, it should
draw up complementary measures to help local businesses ride out the crisis.
Under the cross-strait agreement, which needs to be ratified by the Legislative
Yuan before it can take effect, 64 Taiwanese sub-sectors would be opened up to
Chinese investment, including transportation, tourism and traditional Chinese
medicine.
Meanwhile, China would open 80 sub-sectors to Taiwan.
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