Rubber is everywhere. In the shoes on our feet, the tyres of our cars and bikes, conveyer belts in our supermarkets and factories. Not to mention the global condom market, which is projected to be worth $US 6 billion by 2015 – the equivalent of 27 billion condoms a year. With demand set to outstrip supply by around 10 per cent by 2020, the industry is expanding to new territories, most recently Myanmar. Myanmar’s dictatorship may have been ousted, but its corruption remains entrenched and its deals over land are particularly opaque. This is raising concerns that rubber might become Myanmar’s modern resource curse.
Natural rubber comes from the bark of the Pará tree, which is indigenous to South America. Since British colonials smuggled the seeds into Kew Gardens in the 19th century, it has been extensively grown across British colonies in Asia, with Thailand, India and Malaysia currently making up 70 per cent of global rubber production.
Rubber is great for farmers, as it can be easily grown alongside other cash crops such as banana, tea, coffee, cocoa, cassava and pineapple. Not only does this reduce competition for land, it also provides an alternative income for farmers, and the diversity of crops provides a source of food for families. Around 85% of rubber globally is produced by smallholders, with farmers typically owning plots of land ranging anywhere between 5 and 100 acres. This type of agroforestry system, sometimes known as ‘jungle rubber’, can provide resilience to what are often volatile global markets, whilst also helping protect biodiversity and ecosystems.
The main rubber producer countries are short on land, however, and in the face of growing global demand have turned to neighbouring countries to expand their production. The last few years has seen a new wave of rubber investors acquiring large swathes of land in neighbouring ‘frontier’ countries such as Cambodia and Laos, with devastating consequences for both people and forests – a new industry reality that Global Witness exposed in its 2013 report Rubber Barons.
Now the industry has its sight set on Myanmar, often dubbed the ‘final frontier’ for investors in the rush for the world’s remaining natural resources. Decades of military dictatorship and rampant corruption has already seen many of Myanmar’s abundant natural resources exploited for the benefit of a few. A culture of secrecy surrounding land investments has further fuelled concerns that Myanmar’s natural wealth is being looted by members of the military, political and business elite whilst the poor are left empty-handed. The last few years has seen huge rubber plantations expand into Myanmar and with the suspension of sanctions and the country opening up for the first time to global investors, far from bringing progress this agricultural investment model risks both exacerbating poverty levels and increasing deforestation.
It’s not clear why investors are buying up such large tracts of land for rubber when it’s grown so effectively by smallholders – no one in the industry has been able to provide us with an answer to that question. It’s true to say, however, that large-scale land investments tend to go hand-in-hand with both weak rule of law and a lack of recognition of local people’s rights to their land. Access to valuable timber may also be an incentive, with land grabbing and forest destruction two sides of the same coin. Companies grab land to access valuable species such as rosewood, while forests are cleared to make way for agriculture. In both cases local communities and the environment lose out to companies and corrupt politicians.
Land deals don’t need to happen this way – there is masses of evidence to show that investing in and supporting smallholder farmers brings lasting economic, social and environmental benefits. Global Witness’ briefing paper, ‘What Future for the Rubber Industry in Myanmar?’ showcases the benefits of investing in small-scale agriculture and rubber production and advises how the Government of Myanmar can best support and protect its farmers, including the establishment of a strong national land policy.
With the international community poised to invest in Myanmar’s rich natural assets, the government currently stands at a crossroads with regards to how it takes advantage of such foreign investor interest. The future of Myanmar is not yet clear, but the decisions taken now will impact significantly on the country’s people and environment for many years to come.
Ali Hines is a Land campaigner at Global Witness.