Indonesia Tells Furniture Exporters to Look Beyond the US Market

Indonesia's furniture industry should reduce its reliance on the United States - a market that currently absorbs about 60% of the country's furniture exports - and build direct relationships with international buyers, Coordinating Minister for Economic Affairs Airlangga Hartarto said at the International Furniture and Craft Fair Indonesia (IFFINA+) 2026 in Jakarta on Friday, September 25, 2026.

"The implementation of IFFINA+ today is important as a means of mitigating risks by expanding markets, building direct relationships with international buyers and reducing export dependence on certain markets," Airlangga said, as reported by ANTARA News English.

A furniture trade surplus every year since 2021

Despite global trade challenges, the sector has remained a net earner for the national economy. The key figures presented at the fair:

• furniture exports in 2025: US$2.39 billion;
• furniture imports in 2025: US$1.92 billion;
• trade surplus: US$473.31 million - the positive balance has been maintained since 2021;
• global ranking: 25th among furniture exporting countries;
• share of the world market: 0.77%.

Raw materials as a growth lever

Airlangga argued that the country can expand its global market share by capitalising on abundant natural resources. In 2024, Indonesia produced 57.46 million cubic meters of roundwood, and the country supplies more than 80% of the world's rattan. To compete globally, the minister added, local producers must adapt to changing market preferences, which increasingly prioritise functional, customizable and sustainable products.

The SME structure of the industry

The call for diversification also reflects the structure of the sector itself. Small and medium-sized industrial enterprises (IKMs) account for 99.79% of Indonesia's 4.45 million industrial business units and employ 65.52% of the industrial workforce. Many of these businesses continue to face technological constraints and relatively low productivity - factors that complicate the shift toward new export destinations.

How the government supports exporters

To address these challenges, Jakarta is providing fiscal incentives and financing, including:

• government-borne Article 21 income tax (PPh DTP) for eligible workers;
• financing through the Labor Intensive Industrial Credit scheme;
• machinery restructuring programs for manufacturers;
• export promotion support;
• strict enforcement of the Sustainable Wood Legality Verification System (SVLK).

What diversification would change

With around six of every ten export shipments heading to a single market, the industry remains exposed to tariff decisions, freight-rate swings and demand shocks in the US. A broader geography - including direct contracts negotiated at fairs such as IFFINA+ - is meant to make the trade network more resilient. Airlangga expressed optimism that events such as IFFINA+ 2026 would help drive direct trade transactions, expand international partnerships and strengthen the overall competitiveness of Indonesian furniture and craft products in the global market.