RI's crisis won't hurt rubber deal

RI's crisis won't hurt rubber deal

BANGKOK (Dow Jones): An agreement on rubber reached between
the ministers of Thailand, Indonesia and Malaysia won't collapse
despite the political crisis in Indonesia, Thailand's Deputy
Minister of Agriculture and Cooperatives, Natee Khlibtong told
Dow Jones Newswires in a recent interview.

Natee said the agreement was agreed upon by the three
governments and will be implemented despite domestic crisis which
may occur in any one of the countries.

"I'm confident that the cooperation won't fall through. It
will continue to exist, but how soon it will be implemented
depends on the readiness of the three countries," Natee said.

In a ministerial meeting in Bangkok July 5, ministers from the
three countries agreed to cooperate in several areas in their
efforts to boost world prices of natural rubber. The countries
agreed to cooperate in rubber stock management, managing output
levels and price support schemes.

Thailand is the world's largest rubber producer and exporter,
followed by Indonesia and Malaysia. The three countries account
for around 80 percent-85 percent of the world's rubber
production.

The ministers also agreed at the meeting to set up a
Tripartite Rubber Corporation, or TRC, to manage rubber trading,
stocks withholding and market intervention buying activity. They
also agreed to reduce output by 4 percent in 2002.

Should the political situation in Indonesia lead to a new
minister being placed in charge of issues related to the rubber
industry, Natee said he is still confident that the agreement on
rubber will be carried out by the minister, as the pact was
agreed by the three governments.

Thailand's Natee, Indonesia's Industry and Trade Minister
Luhut Panjaitan and Malaysia's Primary Industries Minister Lim
Keng Yaik are currently in charge of issues related to the rubber
industry for the respective three countries.

A joint task force comprising rubber officials from Thailand,
Indonesia and Malaysia is scheduled to meet in August to decide
how the TRC will function, Natee said.

Recommendations will be submitted during the ministerial
meeting September 7, he said.

"For the time being, the meeting will take place as
scheduled," Natee said.

However, Natee said he is concerned that the political unrest
in Indonesia might hinder the work of the task force as
Indonesian officials might be reluctant to propose their
recommendations to their minister, amid the unstable political
situation in Indonesia.

"If the (Indonesian) officials (working for the joint task
force) worry too much about politics...the work of the task force
might be delayed," Natee said.

Thailand is expected to produce around 2.4 million metric tons
of rubber this year, while Indonesia and Malaysia will produce
1.5 million-1.6 million tons and 600,000 tons, respectively.