SABAH is willing to make short-term sacrifices for long-term gains in the timber industry and to ensure Sabah follk benefit from growth, said a state minister today.

The state imposed an interim ban on log exports and sacrificed a major source of income to ensure the domestic market enjoyed adequate raw material supply, said Deputy Chief Minister and Industry and Trade Minister Wilfred Madius Tangau.

He said he was given a mandate to ensure that wealth creation is focused on enriching Sabahans.

“We are in the midst of coming out with a cabinet paper on how best to help local industries and create jobs for Sabahans while ensuring logging firms do not incur huge losses because of the ban.

“We are looking at coming up with a win-win situation for all,” said the Tuaran MP.  

Forest-based products account for 7% of the state’s total revenue or RM225 million in 2016, with Sabah recording RM2.04 billion export earnings from the timber industry.

The state’s wood-based industry remains undeveloped and dominated by processing activities, such as sawmills and the plywood sector, according to the Forestry Department.

The number of mills in the state has also dwindled and fell from 390 in 2015 to 189 in 2016 or a 48% drop.

“In view of the log supply constraint, the mills in Sabah are only operating at about half of their installed input capacity,” the department said.

The other timber-linked industry in the state is furniture-making, whereby garden furniture products are exported to the United Kingdom, Italy and Germany.

However, only five out of 18 companies approved by the state government were operational in 2012.

Timber used to contribute more than 50% to the state gross domestic product until the industry’s collapse in the 1990s.

Meanwhile, Sabah Timber Industries Association president James Hwong welcomed the interim ban on round-log exports, saying that mills have had to close shop because of a shortage of raw materials.  

“The downstream timber industry in Sabah has suffered for a long time due to insufficient supply of raw materials. If we continue with the existing log export policy, more mills will close down,” Hwong said. – June 8, 2018.