Malaysian rubber industry output down 20%, worse to come – urges govt to allow operations in NRP Phase 1

The Covid-19 pandemic has triggered an unprecedented crisis in the rubber sector, and has given “an immediate and immense shock” to the industry since March 2020, according to the Malaysian Rubber Products Manufacturers’ Association (MRPMA), which estimates a 20% decline in the annual output of rubber products, which include automotive parts, tyres and tyre-related products.

The slide could double if recovery is delayed further. “The impact of the crisis is being felt throughout the entire rubber sector ecosystem,” said MRPMA president Yeaw Kok Kwey, who added that at this juncture, the country should look at the worsening “butterfly effects” on rubber industry players.

The association said that the market reopening and rebuilding of the ecosystem will require a joint approach, urging the rubber industry and government to reinforce their coordination mechanisms. Yeaw listed down suggestions for the consideration of both the authorities and members.

Among them are active participation in Vaccination Programme for the Agricommodity Sector (Vacoms) that would target more than 80,000 workers, and strict health protocols for the workplace to restore the public’s confidence on manufacturing sector. The latter includes monitoring the health status of employees and mandatory RTK screening tests for symptomatic workers, as well as the use of authorised self-test kits.

MRPMA also suggested that companies that have completed first dose vaccination of employees be allowed to operate within a “work bubble”, and that emergency case management procedures should be implemented in the event of Covid-19 infection.

The association would also like to see the supply chain supporting essential manufacturing to be allowed to deliver outside EMCO areas. Most importantly, MRPMA wants the government to consider allowing the rubber sector to operate under the National Recovery Plan (NRP) Phase 1, possibly with a reduced workforce of 30%. This would support the supply chain in essential sectors as well as the global supply chain.

Yeaw said that the population in affected states or areas should be given the priority to vaccination, in particular businesses in key economic sectors without any distinction between essential and non-essential sectors. The emphasis should be on strict adherence to SOPs and preventive measures, to minimise the impact on business and the overall economy.

“The measures put in place today will shape the rubber industry of tomorrow. The crisis is an opportunity to rethink and reinvent the way of doing business for the rubber sectors in future,” Yeaw added.

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