RI and Malaysia ratify rubber pact to end long dispute
RI and Malaysia ratify rubber pact to end long dispute
KUALA LUMPUR (AFP): Indonesia and Malaysia have ratified a new rubber pact to signal the end of a year-long dispute over who should lead an international rubber producer-consumer group, officials said Monday.
Malaysia ratified the third International Natural Rubber Agreement (INRA III) on Dec. 24, followed by Indonesia on Dec. 27, said James Hegarty, the buffer stock manager of the International Natural Rubber Organization (INRO).
"Officially, INRO has been informed by UNCTAD (the United Nations Conference on Trade and Development) today (Monday) that both Malaysia and Indonesia have ratified," Hegarty told AFP.
Malaysia and Indonesia had been vying for INRO's executive- directorship, and Kuala Lumpur had threatened not to ratify the new four-year pact if it failed to win the post, now held by Thailand.
Indonesia had held the post during INRA I.
The Kuala Lumpur-based INRO, which groups six natural rubber producer and 21 consumer countries, including the EU, administers INRA through a buffer-stock mechanism to buy and sell rubber to stabilize prices.
The dispute had held up the ratification process as both Indonesia and Malaysia, being the key rubber producers along with Thailand, hold the bulk of votes which must be gathered from producers for INRA III to replace INRA II.
INRA II expired in December last year.
But Hegarty declined to say whether the ratification meant that the dispute between the two countries over the post had been resolved, and in whose favor.
But Malaysian government sources said Indonesia had agreed that a Malaysian should fill INRO's top post. Ahmad Zubeir Noordin, who is deputy secretary-general of the Malaysian primary industries ministry, is tipped to succeed Thailand's Pong Sono as INRO's new executive director. Zubeir is head of Malaysia's delegation to INRO.
Hegarty said the new executive director will be announced after INRO's semi-annual council meeting scheduled for February 24.
"The February 24 meeting will be the first for the new INRA III council that will see the administrative process of transfer of assets to the new council as well as the appointment of the executive director," Hegarty said.
Industry officials said INRO was now waiting for ratification by China and Italy, without whose votes consumers may not gather enough backing to sign INRA III into agreement.
The United States, the European Union and some individual members of the EU have ratified.
Both consumers and producers must garner at least 75 percent of votes on each side for the new accord to come into force.
Hegarty described 1996 as rubber's "second best year" since INRO's formation 17 years ago despite its benchmark five-day moving average price taking a 22.3 percent dip to end the year at 241.71 Malaysian/Singapore cents a kilo (2.2 pounds).
"Prices were generally pretty stable last year with the five- day moving average chalking up the year's high of 320.86 cents on January 9 and the lowest at 238.69 cents on October 18," Hegarty said.
"The market is now waiting for direction and a clearer trend is expected to emerge only after the first quarter after the festive periods," Hegarty said.