An analysis of the Standard Malaysian Rubber scheme (SMR) and its implications for the performance of the rubber industry in Malaysia

Abstract

The Malaysian natural rubber (NR) industry has had over 100 years of existence. It has grown to become an important industry in Malaysia, especially in terms of employment opportunities for rural smallholders' families, foreign exchange earnings and downstream activities. However, over the last few years the NR industry has faced a multitude of problems in the fields of economics, production and related aspects. The purpose of this study is to investigate the performance of rubber industry in Malaysia, mainly the SMR Scheme within the time frame of 1985-1995. The Malaysian NR industry is determined to overcome it's problems by implementing the (Standard Malaysian Rubber) SMR Scheme. The SMR Scheme has a crucial role to play in the process of securing the status quo which natural rubber had been enjoying before the establishment of the synthetic industry. This study also attempts to examine the performance of the SMR Scheme in the international market. It was revealed that SMR has the ability to compete against other grades in the international market, as it has emerged to become stronger, more efficient, dynamic and competitive in the international scene. In order to conduct this study, the researcher used descriptive analysis and also monitored the changes in terms of percentage (%). The secondary data was directly obtained from the Rubber Statistics Handbook, Malaysia 1996. The findings revealed that although the rubber production decreased over the past 10 years the SMR Scheme has played a crucial role by increasing the production of rubber in both estates and smallholdings in Malaysia. This paper also shows that SMR leads the field among other types of rubber in the international market as is in heavy demand and is exported to almost 34 countries.