Jun 4, 2011

Myanmar earned over $569 million from exports of wood (2010-2011 financial year)

Myanmar needs to earn more from the export of its timber products, a Myanmar Forestry Products and Merchants Association official said last week.

U Barber Cho, the association’s co-secretary, said Myanmar’s timber exports were predominantly logs or sawn timber, with little done to add value to them. He added that Myanmar’s regional neighbours – and competitors in the worldwide timber industry – have encouraged exporters to value-add their timber products.

“Malaysia earns big revenues from its wood-based exports because it has focussed on value-adding products, instead of exporting logs,” he said, adding that 30 percent of Malaysia’s earnings from its forestry resources came from furniture sales. U Barber Cho made the comments during the “Emerging Market Requirement, Challenges and Opportunities for Myanmar Timber Industry” seminar at the International Business Centre in Kamaryut township in Yangon on May 10.

“Myanmar’s timber and furniture industries should suggest to the government that it changes the way taxes are levied to make value-adding more profitable,” he said.

U Sein Lwin, chairman of the Myanmar Timber Merchants Association, said the industry planned to lobby the Minister for Commerce, U Win Myint, to change the way taxes are levied on the industry.

“We now seem to be able to openly talk with the new government. We recognise the importance of paying taxes to develop the nation. But we would like to discuss what changes could be made to the taxation system, with a view to lowering taxes on value-added products.”

The Central Statistical Organisation reported that Myanmar had exported more than 864,000 tonnes of teak, hardwood and plywood and veneer, earning about $569 million in the 2010-11 financial year with only the month of March left unreported in the fiscal year.

By comparison, the country earned about US$400 million exporting 890,000 tonnes of timber in the 2009-2010 fiscal year, of which about $100 million came via the private sector, he said. India was the major buyer, purchasing about half of all exports while Japan, Thailand and Malaysia were other big buyers.

Demand from the EU has fallen greatly since the 2007-08 financial year when that bloc voted to impose sanctions on imports from October 18, 2007, U Barber Cho said.

He added that regaining market share in Europe would require the bloc to drop or amend the sanctions on Myanmar, while exporters would have to improve their products.

However, there are signs that exporters might be able to expand their reach in other markets such as Japan.

“Demand from Japan went up by 15pc after the tsunami in comparison with the same period last year,” said U Tint, a furniture producer in Latha township. “I hope the furniture export market will improve in the future, particularly in terms of gaining market share in Japan,” he said.

“But our furniture sales both domestically and for export are up by at least 20pc this year,” he said.

However, the declining value of the US dollar here was pushing furniture makers to focus on the local market, he said.

Source: Myanmar Times