KOTA KINABALU: A statement issued by the Sabah Rubber Industry Board (LIGS) has failed to address the key problems faced by rubber smallholders in Sabah, said Parti Warisan Sabah.
Warisan vice-president Junz Wong said while LIGS cited several impressive numbers in the statement, it failed to explain how the supposedly servicing agency managed to accumulate more than RM100 million in six years.
“LIGS claimed it has accumulated RM100 million in reserves. My question is, where did this money come from?
“My guess is from smallholders’ shares which should be given back to them,” he told FMT.
Wong also urged LIGS to reveal how it determines the dry rubber content (DRC) of the smallholders’ products, which determines their prices.
He said this is because there are claims that the DRC content of rubber sheets in Sabah are as high as 70-80% but they are usually being paid the price for 50% DRC.
He argued that LIGS, being a government agency, should have some kind of a standard to measure the content or to adhere to international standards, if there was any.
He said smallholders are being kept in the dark on how LIGS measures the content.
“I am not implying that LIGS lied and deceived the smallholders. I am only saying that LIGS needs to be more transparent in its dealings with smallholders,” he said.
More importantly, Wong said smallholders are not benefiting from rubber downstream activities.
The only people making money out of the industry, he said, are the factories, LIGS as well as the exporters.
“LIGS boasted about its export activities while smallholders continue to suffer and have to be content with low rubber prices.
“If LIGS is serious about helping smallholders, like it has claimed, and if it insists that it has given rubber smallholders a fair price, then I challenge LIGS to abolish the 10% export tax and allow smallholders to export their products directly to Sarawak or other places.
“Liberalise the market to allow the smallholders to export their products directly.
Currently, he said since smallholders cannot export their produce themselves, they are forced to sell to LIGS only, leaving them at the mercy of the agency.
By liberalising the market, Wong believed the industry will be more competitive and smallholders will be able to make more profits out of the industry.
“The 10% export tax is the reason for the exploitation of rubber smallholders as this is one of the factors why Sabah rubber prices are lower.
“Sabah is the only state that implements such a tax in Malaysia,” he claimed.
