The external dimension of the EU furniture sector
The European Union furniture industry is a major player on the global market accounting for close to 19% of world exports (2007 figures, in value, and excluding intra-EU trade).
The trade balance for furniture products has traditionally recorded a surplus. However, the balance has deteriorated dramatically from a surplus of almost €3 billion in 2002 to a deficit of €1.2 billion in 2008. This comes from an impressive progression of Chinese performance: in 2000, China's share in EU imports was less than 15%; in 2008 China accounted for 50.7 % of EU imports. Other less important third country suppliers are Vietnam (5.4 %), Turkey (5.3%) and Indonesia (5.1%) and in contrast the main markets for EU exports are the US (16.3 % in 2008) Switzerland (15.1 %) and Russia (14.2%).
Resulting from previous World Trade Organisation (WTO) agreements, EU tariffs are already fixed at zero or close to zero, while some developing countries that are important producers of furniture have kept their tariffs at high levels, e.g. India, Brazil or Indonesia. The trade balance with these countries is increasingly negative.
High tariffs and the continued prevalence of different non-tariff barriers (NTB) in the furniture industry constitute a significant disincentive for SMEs to participate and benefit from international trade. Against this background, increased market access to emerging economies with growing middle classes is of strategic importance, as these represent a quality-conscious market where the EU has the highest competitive advantage.
The main trade priorities for the furniture sector are:
- Improve market access for EU products notably by reducing tariff and non-tariff barriers
In view of the limited growth potential of the EU's internal market, and the fact that steadily growing low-priced imports are gaining an ever-increasing share of that market, open export markets are the main way for increasing EU production, or at least maintaining it at present levels.
The Doha Round of world trade negotiations was launched in Doha (Qatar ) in November 2001 and aims to further deepen the openness of global trade. A successful and balanced outcome of the Doha Development Agenda remains, therefore, important for the sector, as it is a tool for improved market access in currently closed or highly protected markets.
Based on market access analysis carried out by the Commission services, as well as analysis of NTBs notified to the WTO, a number of barriers have been identified which are of relevance for the Multilateral negotiations on non-agricultural market access (NAMA). In particular, the EU has proposed harmonisation and more transparency on barriers such as labelling, conformity procedures, export restrictions and importers' registration.
In addition to the WTO's multilateral negotiations, market access potential can be improved as a result of Free Trade Agreements negotiations with markets with high potential such as Korea, India and Mercosur.
- Respect of WTO rules and disciplines
The European Union monitors compliance with bilateral or multilateral obligations by third countries and attempts to abolish barriers by means of available trade policy instruments (such as WTO litigation procedures resulting from the application of the Trade Barriers Regulation).
- Fight against counterfeiting and piracy
Brand and product piracy is one of the biggest threats to the EU industry. Apart from legislative and political measures and awareness raising, the Commission's Customs Action Plan as well as bilateral Action programmes and Dialogues with non-EU countries help in this matter.
You will find more information on the intellectual property on the Directorate General Trade website.