Rubber City and the hope of Thai rubber industry amid challenges

FLASH
16 March 2016

Author: Teerayut Thaiturapaisan

 

ThinkstockPhotos-12640998v2.jpg



Event.png

Event.gif

  • Industrial Estate Authority of Thailand (IEAT) invited both foreign and Thai investors to participate in the Rubber City project during the Global Rubber & Latex Expo 2016 (GRTE2016) on 10 March 2016. Moreover, Thailand’s Rubber City is now on an urgent implementation in accordance with the government’s super cluster policy, which is expected to be completed in 2018. Its primary objectives are to boost domestic consumption of rubber and consequentially expand mid- and down-stream of rubber industry in Thailand.
Analysis.png Analysis.gif
  • Kedah’s Rubber City is being implemented in Malaysia as well. According to Kedah State Government, Ku Abdul Rahman, the project is expected to complete the acquisitions and land clearing by the third quarter this year. This project is located just 80 kilometers away from Thailand’s Rubber City. Malaysia aims to expand Kedah’s Rubber City to over 6 million square meters by 2025, while Thailand’s Rubber City currently has over 2 million square meters (excluding the southern industrial estate of 3.8 million square meters). Moreover, Indonesia is taking interest in investing in the Rubber City project as well.


  • If Thailand collaborates with Malaysia and Indonesia on developing the overall value-chain of the whole rubber industry, EIC assesses that rubber industry in Thailand will grow well in the near future. In early this year, Thailand, Malaysia, and Indonesia, (accounting for 60% of total world production), joined hands to reduce exports quantities under the tri-party agreement to boost the domestic consumption of each country. Such cooperation to reduce export quantities was seen as the right solution, because it could help to reduce global rubber supply sustainably. In addition, the tri-party alliance of the three countries has shown cooperation for embracing strengths and takling weaknesses, which will in turn help the whole rubber industry to grow in the long run.

 

Implication.png

Implication.gif

  • EIC suggests investors carefully study Rubber City plans of Thailand and Malaysia before making investment decisions. While similar projects are currently being implemented, the two countries may differ in their incentive schemes for investors. It would be best to select an appropriate scheme for investors’ own businesses.


  • Moreover Thai rubber entrepreneurs should find ways to become a part of the global value chain through international cooperation. If the tri-party cooperation becomes stronger and tightly knitted, the value chain of the rubber industry will transform itself into a super cluster internationally in the future. This opens up more opportunities that Thai rubber entrepreneaurs should not over look.

 

Share
Register for free account to continue enjoying content
Email notifications of breaking news and more Access to all past publications Other privileges
Log in
For new registration, if you didn't get the activation email within 10 minutes, please try check it in your junk folder or request the activation email
Request the activation email
Don't have an account?
Register
Email notifications of breaking news and more
Access to all past publications
Other privileges
Forgot your password?
Enter your email address below and we'll send you a link to reset your password.
change
If you are experiencing problems resetting your password contact us or send us an email
Don't have an account?
Register
Email notifications of breaking news and more
Access to all past publications
Other privileges
Unlock account
Enter your email to unlock your account. You will receive an email with instructions on how to reset your account.
change
If you are experiencing problems resetting your password contact us or send us an email
Don't have an account?
Register
Email notifications of breaking news and more
Access to all past publications
Other privileges
Request the activation email
Enter your email to receive a verification link again.
change
If you are experiencing problems resetting your password contact us or send us an email
Don't have an account?
Register
Email notifications of breaking news and more
Access to all past publications
Other privileges