Rubber Journal Asia Country Focus The AEC has yet to firm up in resolving transborder issues such as forest fires and illegal trade of forest products, according to another conference presenter, Ramos Razal from the University of the Philippines Los Baños (UPLB) and the Manila-based Non-Timber Forest Products Exchange Programme. Meanwhile, this weak component of the AEC to address cross border issues may exacerbate the continuing conversion of forest tracts into rubber plantations. With the AEC, rubber demand could exceed the 12.9 million tonnes global consumption by 2016, reaching up to 16.5 million tonnes in 2023, according to a projection of the Singapore-based International Rubber Study Group (IRSG). To meet the demand, production will have to be increased.
Given that demand for rubber will increase further as a result of the integration, shortage of skilled labour in rubber plantations, as well as the risk of unemployment amongst rubber workers, is listed as a potential glitch. Thailand, the largest rubber producer, is a model case for labour market problems, given its imbalanced market structure. In a 2014 research article authored by Preecha Nobnorb and Wanno Fongsuwan, and published in the Research Journal of Business Management, it was stated that the impact of trade liberalisation “does not cause a positive impact” on rubber industry workers. In fact, the report says that it causes “instability issues in the occupations of unskilled labour”, as well as widens income and the welfare gaps between workers with different skill levels who are coming from different industries. Too, unemployment may increase, especially amongst unskilled workers and those who are over 40 years of age.
Deforestation, a big problem outheast Asia has been inundated with deforestation. And reports also hold expanding rubber plantations culpable for this phenomenon. In a new study published in Global Environmental Change, rubber plantations in the region have increased by over 50% since 2000. Expansion continues at the expense of protected forest areas, specifically in Southeast Asia, says the report. Based on findings, 61% of the rubber plantation expansions were in protected areas and 70% were in key biodiversity areas. In the near term, the estimated coverage of the expansion will run up to 13,310 sq km of forest and 8,952 sq km of key biodiversity areas.
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“..trade liberalisation causes instability issues in the occupations of unskilled labour..” What may put the rest of unskilled rubber plantation workers off the employment circuit is when qualification standards are being instituted. The Thailand Professional Qualification Institute is rounding out occupational standards for workers in the agriculture sector to increase the country’s competitiveness for AEC. The workforce professional qualification system covers 48 sectors and up to 600 occupations. Malaysia is reported to have come up with its own occupational standards. The country has its rubber tappers and smallholders reeling in low output, amid the falling domestic rubber prices. With the country almost frequently facing low output levels, the Malaysian Rubber Board says this is due to the use of unskilled tappers who do not engage in good agricultural practices, as well as the lack of know-how in latex harvesting and technologies. This situation of unskilled domestic labour has opened up employment opportunities for migrant workers in the agricultural sector in Malaysia. With the AEC’s thrust to open the gates of employment opportunities to non-nationals, and the country’s own initiative to scale up the aptitude of its workforce, it may become a double-edged sword for rubber workers.
“..Southeast Asia has been inundated with deforestation..” Meanwhile, an unregulated number of rubber plantations also gives rise to a substandard quality of rubber product, an issue that still plagues the region’s sector. In a rubber products case study from the 2013 report by the Geneva-based World Economic Forum, in collaboration with the World Bank and Bain & Company, the region, a top global rubber producer, was stated as an “unreliable supply chain for finished goods”, attributed to poor quality control along with factors such as substandard infrastructure and long lead times. Influx of unskilled labour he AEC is expected to stimulate mobility of skilled labour to address labour shortages, provide higher work pay, and better job opportunities. However, observers say this could backfire to industries where unskilled labour is rampant.
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