RM2.3 billion losses due to switch from rubber: MP
Published on: Tuesday, March 05, 2024
According to Riduan, the mechanism that can be implemented by the government is through the injection of funds or loans from the government to industrial operators and the production of rubber-based products.
Kota Kinabalu: The government needs to transform the rubber industry to ensure that the price of the commodity is more competitive, said Tenom MP Riduan Rubin.
He said the drop in the price of rubber to around RM2.80 resulted in many tappers switching to other crops. As a result, the country suffered a loss of approximately RM2.3 billion because of no rubber output from the 425,000ha plantations.
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According to him, the problem started from rubber prices that are influenced by middlemen as well as world market prices which were difficult for the government to control.
“The government needs to focus on empowering the local rubber manufacturing industry sector, especially in the aspect of producing local brand tyres as the government has done through the implementation of the national automotive policy which produced Proton.
“Efforts need to be made to produce local brand tyres to ensure a ‘game changer’ or transformation of the rubber industry so that it continues to remain competitive at the global level,” he said.
Riduan said this at the Dewan Rakyat, Kuala Lumpur, recently.
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According to Riduan, the mechanism that can be implemented by the government is through the injection of funds or loans from the government to industrial operators and the production of rubber-based products.
He said this matter was implemented by the Thai Government in 2016 through a loan amounting to 15 billion baht (around RM 1.78 billion – based on the rate at the time) to the glove, tire and rubber product manufacturing sector.
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“This loan is given with the condition that the rubber industry operators have to use four tonnes of rubber every year for one million baht (RM 119,000) in easy loans.
“I believe such initiatives can increase the use of domestic rubber and will indirectly increase the price of rubber to a more competitive rate,” he stressed.
According to Riduan, if no immediate action is taken by the government, it will result in the industry being buried one day, as a result of the action of rubber farmers who will switch to more profitable crops.
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