On 17 September 2025, at the opening of the International Furniture and Craft Fair Indonesia+ (IFFINA+) 2025 at ICE BSD, Tangerang, Coordinating Minister for Economic Affairs Airlangga Hartarto stated that Indonesia's furniture industry is based on domestic resources, with the unique feature of tropical timber, placing Indonesia at a competitive advantage over other subtropical countries. In Q2 of 2025, Indonesia's furniture industry demonstrated robust growth, outperforming the national economy. This industry should be a key sector that uses local raw materials and is supported by strong local purchasing power. The sector's abundant supply of local raw materials, including tropical wood, rattan, bamboo, and cork, as well as its high design creativity, positions it as a highly competitive industry with the potential to become one of the main pillars of national exports. Therefore, the Government will continue to support measures to enhance the competitiveness of the national furniture industry, which has significant potential in the international market.
At the end of September, Indonesia will sign a Comprehensive Economic Partnership Agreement (CEPA) with the European Union. The agreement will grant access with a 0% tariff for up to 80% of Indonesian products, including furniture, to the European market. Furthermore, the government has initiated a labour-intensive People's Business Credit (Kredit Usaha Rakyat/KUR) scheme for businesses, particularly small and medium-sized enterprises (SMEs), offering a 5% interest subsidy for investment financing with a duration of up to 7-10 years. The government is also providing income tax incentives under Article 21 (PPh 21) for workers with salaries below IDR 10 million, as well as promoting internship programmes for recent university graduates, with their salaries covered by the government for a period of six months. The government is also focusing on simplifying regulations through a cross-sector deregulation team to eliminate barriers to exports and investment. It is anticipated that these policies will enhance competitiveness, open markets, accelerate industrial growth, and expand employment opportunities.
