Malaysia, RI call for an end to tin quota system
Malaysia, RI call for an end to tin quota system
KUALA LUMPUR (AFP): Malaysia said yesterday it would support
Indonesia's call for an end to the quota system of the
Association of Tin Producing Countries (ATPC) at a ministerial
meeting in Bolivia in September.
Primary Industries Minister Lim Keng Yaik said Malaysia saw no
merit in continuing with the ATPC's supply rationalization scheme
(SRS) when its members and associates have been violating quotas
for the past three-to-four years.
"We can forget about the SRS and let market forces determine
the price of tin through demand and supply," said Lim, reacting
to Indonesia's repeated calls to scrap the export curbs.
"It is no point continuing when most of the members, including
associates, lack the spirit to make it a success," Lim told
reporters.
Indonesia, which is planning to list state tin company Tambang
Timah -- the world's largest tin company -- has argued that a
producer-cartel dictating the market will no longer be acceptable
and was becoming obsolete.
The ATPC groups Australia, Bolivia, China, Indonesia,
Malaysia, Nigeria, Thailand and Zaire, which together account for
nearly 70 percent of world's tin production.
Industry officials said Indonesia has long felt its output
constricted by the quota system and wants it scrapped.
"We will support the call at the ATPC conference of
ministers," said Lim, adding that Malaysia will be represented at
the September meeting in Santa Cruz, Bolivia, by his deputy, Siti
Zainab Abu Bakar.
Lim said Malaysia had fully endorsed the scheme when it was
first implemented in 1987 to bolster tin prices at a time when
global surplus stocks neared 100,000 tons.
The scheme brought the global overhang down to about 30,000
tons, almost near the ATPC's 20,000-ton for the market to achieve
normalcy, Lim said.
"But somehow, the efforts of the past years have been defeated
and prices remain depressed as oversupply by certain members and
associates have again bloated the surplus stocks to about 50,000
tons," he said.
The price of tin, which had peaked at 29.15 ringgit a kilogram
(2.2 pounds) in the mid-1980s before the market crashed in
October 1985, closed 13 sen higher yesterday at 16.20 ringgit per
kilogram on the Kuala Lumpur Tin Market.