The furniture industry of Ukraine is alive. The furniture industry works, and produces products, satisfying the needs of the domestic market – although due to the war, due to the conditions of martial law and in smaller volumes – it fulfils its obligations to foreign customers. Existing furniture companies are forced to reduce production volumes not only due to a decrease in demand for furniture in the country, part of whose territory is occupied, part of which is being fought but also due to problems with the acquisition of materials and components necessary for their furniture production. A significant part of these problems was created by our government’s decree on the so-called “critical imports”, which prohibits Ukrainian manufacturers from using currency to purchase abroad what is not included in the list of critical import goods.

The first and most critical issue was mentioned in conversations with company executives, in which supply problems began as soon as the government’s list of critical import goods was published on February 26, which, surprisingly, did not include goods of groups 4410 and 4411. These are the basic materials of plates in furniture production: chipboard, chipboard, HDF, and varnished HDF. And this is despite the fact that HDF boards are not produced in Ukraine at all. A significant part of Ukrainian furniture makers works for export, using, in particular, such plates in trendy designs and colors. So, with the beginning of the war, due to the government’s import restrictions, they cannot fulfil their obligations to foreign customers, and therefore pay taxes to the state and pay salaries to employees.

Of course, they are not sitting idly by, “surrendering to the mercy” of the ban, but sounding the alarm that the government’s critical import order is creating a critical situation for their business, limiting the already limited opportunities of the entire furniture industry in the current situation countries. Some companies appeal directly to government institutions on this issue, and many complain to the Ukrainian Association of Furniture Manufacturers, counting on help and support in their import-burning trouble. Of course, UAFM did not stay away from such an acute problem for many of its members. The association, having accumulated all similar appeals of its members, sent to the Cabinet of Ministers and the Ministry of Economy a collective appeal of importers of the Ukrainian Association of Furniture Manufacturers regarding the correction of the situation by including some goods important for the furniture industry in the government’s list of critical imports, in order to promote the development of the furniture business in the conditions of a war economy, because a fourth of the companies that are members of UAFM, cannot continue their work, in particular, due to disrupted supply chains of raw materials, materials and components, a significant part of which is of foreign production. This is not the first appeal to the government with a request to include some extremely important materials for furniture production on the government’s list of critical imports. Some of them were included. “However, – as noted in another letter addressed to the Prime Minister, the Minister of Economy, and the Trade Representative of Ukraine in mid-June, – there is still a whole group of  UCT ZED (Ukrainian classification of foreign economics goods) 44, which is critical for the continued development of the industry and the existence of some Ukrainian enterprises. We had reported that the exclusion of these codes was lobbied by Ukrainian manufacturers of certain goods. And in this, we see the desire for individual companies ” to suppress their own competitors » and besides, it’s a very difficult time for all of them.”

The letter includes a list of companies that suffer the most from import restrictions, and a list of goods that are not produced in Ukraine and are absolutely necessary for domestic furniture production is attached to the letter.

Letter

We asked the representatives of those companies that addressed the government directly, proving that the import restriction of a number of product items is not only unjustified but also erroneous, whether the government offices somehow argue why, for example, the named plate materials are not included in the list of critical goods import Their argument, the authors of the letters told us, is unconvincing: they say, use the significant balances available. And where are they, who has them, those remains?! In addition, if the quality remains, then they cannot satisfy the requests of furniture makers in terms of all the parameters they need: thickness, decors, textures, etc. But UAFM, by the way, informs in a collective appeal that it is ready to convincingly argue the important inclusion of specified goods codes during the meeting offline or online from representatives authorities.

However, as already mentioned, the government has already made certain concessions – therefore, the collective appeals sent by the Association did not turn out to be useless: the list of critical imports has recently included chipboard and MDF boards. We hope that import reductions will soon come for other goods that are important for the furniture industry.