Skip to main content
SpringerLink
Log in

Upgrading Malaysia’s Rubber Manufacturing: Trajectories and Challenges

  • Chapter
  • First Online:
Southeast Asia beyond Crises and Traps

Part of the book series: Studies in Economic Transition ((SET))

Abstract

The rapid economic growth of Malaysia has often been attributed to FDI-led EOI, and the country’s economy shows nearly high income status. It is important to add, however, that natural resource-based industry had also contributed significantly to the growth of Malaysia. This chapter examines the expansion and transformation of the rubber industry in Malaysia, focusing on the rubber glove firms as successful niche-oriented actors. Rubber has played an important role in the global economy and automotive society since the beginning of the twentieth century. Since the late 1980s, Thailand and Indonesia have overtaken Malaysia as the top natural rubber producers. From the late twentieth century, however, the awareness of the risks of HIV/AIDS, SARS, and avian influenza has raised the demand for medical rubber gloves. Taking advantage of the technology developed by government R&D institutions, Malaysia’s local venture rubber glove firms achieved the technological upgrading quickly and seized the opportunities created by escalating global demand. To maintain the sustainable development of natural resource-based industry, it will be crucial to create and improve close public–private relationships.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 119.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 159.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 159.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Notes

  1. 1.

    Production capability is to carry on producing goods and services with technology already in use. Innovation capability is to change and create new forms of production with technology not currently in use.

  2. 2.

    By the 1990s, the RRIM 900 series of seeds had raised the average annual latex yield to 1,500 kg/ha from 1,000–1,200 kg/ha from the RRIM 600 series in the 1960s. Experiments are being conducted to push the yields of the RRIM 2000 series to 2,500–3,000 kg/ha (Ong 2001; MRB 2005).

  3. 3.

    Of the current budget, 70 per cent comes from MRB and 30 per cent from consultation fees in UK and other countries (Interview 8).

  4. 4.

    The current managing director, Lee Kim Meow, also joined Top Glove in 1997.

  5. 5.

    Other issues emerged with Top Glove’s expansion. An important one was the lack of latex for raw material as Malaysia’s production of NR declined due to falling yields and a reduction in rubber acreage. Aging of rubber cultivators was a problem, too, since ageing tended to lead to lower production of latex concentrate and higher production of dry type rubber. As a result, Malaysia has become an importer of latex concentrate (Kawano 2015).

  6. 6.

    Most latecomers in developing countries pursued imitative strategies in their technological development and were largely involved in producing matured consumer products and then becoming ODMs and OBMs (Fu-Lai Tony Yu 2005).

References

  • Abdul Hamid Sawal. 2001. ‘The Malaysian Rubber Industry: Meeting New Challenges and Moving Ahead’. In Malaysia Rubber Products Manufactures’ Association (MRPMA) Industry and Export Directory 2002–2003, 106–14. Subang Jaya, Malaysia: MRPMA.

    Google Scholar 

  • Anuwar, Ali. 1992. Malaysia’s Industrialization: The Quest for Technology. Singapore: Oxford University Press.

    Google Scholar 

  • Bell, M., and Figueiredo, P. N. 2012. ‘Innovation Capability Building and Learning Mechanisms in Contributions and Implications for Research’. Canadian Journal of Development Studies 33(1): 14–40.

    Article  Google Scholar 

  • Bell, M., and Pavitt, K. 1995. ‘The Development of Technological Capabilities’. In Trade, Technology and International Competitiveness, ed. I. U. Haque, 157–211. Washington DC: The World Bank.

    Google Scholar 

  • Cohen, W. M., and Levinthal, D. A. 1990. ‘Absorptive Capacity: A New Perspective on Learning and Innovation’. Administrative Science Quarterly 35(1): 128–52.

    Article  Google Scholar 

  • Doner, R. 2012. ‘Success as Trap? Crises Response and Challenges to Economic Upgrading in Export-Oriented Southeast Asia’. JICA Research Institute Working Paper.

    Google Scholar 

  • Drabble, J. H. 2000. An Economic History of Malaysia, 1800–1990: The Transition to Modern Economic Growth. UK: Macmillan.

    Book  Google Scholar 

  • Felker, Greg with Jomo. K. S. 2007. ‘Technology Policy in Malaysia’. In Malaysian Industrial Policy, ed. K. S. Jomo, 128–56. Singapore: National University of Singapore Press.

    Google Scholar 

  • Fu-Lai Tony Yu. 2005. ‘Technological Strategies and Trajectories of Hong Kong’s Manufacturing Firms’. International Journal of Technology Management 29(1/2): 21–39.

    Article  Google Scholar 

  • Gibbon, Peter. 2001. ‘Upgrading Primary Production: A Global Commodity Chain Approach’. World Development 29(2): 345–63.

    Article  Google Scholar 

  • Giuliani, E., C. Pietrobelli, and R. Rabellotti. 2005. ‘Upgrading in Global Value Chains: Lessons from Latin American Clusters’. World Development 33(4): 549–73.

    Article  Google Scholar 

  • Goldthorpe, C. C. 2015. Rubber Manufacturing in Malaysia: Resource-based Industrialization in Practice. Singapore: National University of Singapore Press.

    Google Scholar 

  • Henderson, J. and P. Philips. 2007. ‘Unintended Consequences: Social Policy, State Institutions and the “Stalling” of the Malaysian Industrialization Project’. Economy and Society 36(1): 78–102.

    Article  Google Scholar 

  • Iwasa, Kazuyuki. 2005. Mareisia ni okeru nogyo kaihatsu to aguribijinesu: yusyutsu sikogata kaihatsu no hikari to kage [Agricultural Development and Agribusiness: Success and Limitation of Export-oriented Development]. Kyoto, Japan: Horithubunka Publisher.

    Google Scholar 

  • Jetley, Neerja. 2015. ‘Lim Kuang Sia Has a Head for Science and Heart in Glovemaking’. Forbes Asia, 25 February.

    Google Scholar 

  • Jomo, K. S. 2014. ‘Malaysia’s Economic Development and Transformation: Looking Back, Looking Forward’. In Malaysia’s Socio-Economic Transformation: Ideas for the Next Decade, eds. Sanchita Basu Das and Lee Poh Onn, 27–56. Singapore: Institute of Southeast Asian Studies.

    Google Scholar 

  • Kalamani, T. N. 2013. ‘Kossan: Top-Notch in Rubber Products and Gloves’. Rubber Asia, September–October, 34–43.

    Google Scholar 

  • Kapinsky, R. 2001. ‘Learning Networks in the South African Auto Components Industry’. Innovation News 5–6, University of Brighton: Centre for Research in Innovation Management.

    Google Scholar 

  • Kawano, Motoko. 2015. ‘Achievements and Limitations in the Transformation of the Rubber Industry of Malaysia’. GRIPS Emerging States International Workshop, GRIPS, Tokyo, 29–30 May.

    Google Scholar 

  • Kossan Rubber Industries. 1999–2014. Annual Report of Kossan. Kuala Lumpur, Malaysia: Kossan.

    Google Scholar 

  • Kossan ‘iNtouch’website. 2016. Accessed March 20, http://intouchcares.com/.

  • Lim, Carol. 2013. ‘Top Glove’s Journey of Going Global’. In Global Malaysian Brands by Carol Lim. 209–95. Kuala Lumpur, Malaysia: Kanyin Publications.

    Google Scholar 

  • Lim Sow Ching. 1985. Industrialization: Role and Prospects of the Malaysian Rubber-based Industry. Malaysian Rubber Research and Development Board (MRRDB) Monograph 11.

    Google Scholar 

  • Lim Wee Chai. 2016. ‘How Top Glove Became and Remains the World’s Largest Rubber Glove Manufacturer’. Presented at the special session, the 8th International Rubber Glove Conference & Exhibition, 6 September, Kuala Lumpur Convention Centre, Malaysia.

    Google Scholar 

  • Malerba, F. 1992. ‘Learning by Firms and Incremental Technical Change’. The Economic Journal 102 (413): 845–59.

    Article  Google Scholar 

  • MARGMA (Malaysia Rubber Globe Manufactures Association). Newsletter, various years. Kuala Lumpur, Malaysia: MARGMA.

    Google Scholar 

  • MRB (Malaysian Rubber Board). 2005. The Evaluation of the Rubber Industry in Malaysia. Kuala Lumpur, Malaysia: MRB

    Google Scholar 

  • MRB (Malaysian Rubber Board). 2007. Tun Abdul Razak Research Centre: TARRC. Kuala Lumpur, Malaysia: MRB.

    Google Scholar 

  • MRB (Malaysian Rubber Board). 2009. R&D Achievements 1980–2005. Kuala Lumpur, Malaysia: MRB.

    Google Scholar 

  • MRB (Malaysian Rubber Board). 2014. Natural Rubber Statistics. Kuala Lumpur, Malaysia: MRB.

    Google Scholar 

  • MREPC (Malaysian Rubber Export Promotion Council). 2013. ‘A Bit of History: Kinta Rubber Works’. STRETCH 7: 6–8.

    Google Scholar 

  • MRPRA (Malaysian Rubber Producers’ Research Association). 1988. Introducing MRPRA: MRPRA 50 years. UK: MRPRA.

    Google Scholar 

  • NEAC. 2010. New Economic Model for Malaysia: Part1. Putrajaya, Malaysia: National Economic Advisory Council.

    Google Scholar 

  • Ong Eng Long. 2001. ‘Mid-term Assessment of the New Industrial Master Plan (IMP2) for the Rubber-based Sector: From a R&D Perspective’. In Malaysia Rubber Products Manufactures’ Association (MRPMA) Industry and Export Directory, 2002–2003, ed. MRPMA, 115–24. Subang Jaya, Malaysia: MRPMA.

    Google Scholar 

  • Ong Eng Long. 2004. ‘Trend of Glove Usage in Occupational Settings’. Paper presented at the 2nd International Rubber Glove Conference & Exhibition, 29 June–1 July, Shangri-la Hotel, Kuala Lumpur, Malaysia.

    Google Scholar 

  • Perez, Carlota. 2007. ‘Re-specialization and the Development of the ICT Paradigm: An Essay on the Present Challenges of Globalization’. In The Future of the information Society in Europe: Contribution to the Debate, eds. C. Compano et al., 27–56. Technical Report Series, Seville: Institute for Prospective Technological Studies.

    Google Scholar 

  • Porter, Michael. 1990. The Competitive Advantage of Nations. London and Basingstoke: MacMillan.

    Book  Google Scholar 

  • Rasiah, Rajah. 1999. ‘Malaysia’s National Innovation System’. In Technology, Competitiveness and the State, eds. K. S. Jomo and G. Felker. 180–98. USA and Canada: Routledge.

    Google Scholar 

  • Pong Kai See. 2016. ‘Role of PRIM in Growth of Malaysia Rubber Products Industry’. PRIM Bulletin 3.

    Google Scholar 

  • Tan Pek Leng. 2008. Land to Till: The Chinese in the Agricultural Economy of Malaysia. Kuala Lumpur: Centre for Malaysian Chinese Studies.

    Google Scholar 

  • Top Glove. 2000–2014. Annual Report of Top Globe, Kuala Lumpur, Malaysia: Top Glove.

    Google Scholar 

  • Top Glove website. 2016. Accessed March 10, http://www.topglove.com.my/.

  • Tun Abdul Razak Research Centre (TARRC). 2013. Celebrating 75 th Anniversary, 1938–2013. Hertford, UK: TAARC.

    Google Scholar 

  • Tun Abdul Razak Research Centre (TARRC). Annual Report 2010–2014. Hertford, UK: TAARC.

    Google Scholar 

List of Interviews

  • 1: Kamarudin Ab-Malek, CEO, TARRC, UK, 26 October 2015

    Google Scholar 

  • 2: Lee Kim Meow, managing director, Top Glove, 26 February 2016

    Google Scholar 

  • 3: Mohamad Asri Ahmad, head of engineering and product design, MRB, 26 February 2016

    Google Scholar 

  • 4: Mustapha Ngah, formerly of Malaysian Rubber Board, 7 September 2016

    Google Scholar 

  • 5: Ong Eng Long, technical advisor to Kossan group and Director of MRPMA; formerly of Malaysia Rubber Board, 17 September, 15 October and 17–18 February 2016

    Google Scholar 

  • 6: Pong Kai See, president, PRIM, 7 September 2016

    Google Scholar 

  • 7: Sekarajasekaran A/L Arasaratnam, former independent non-executive director, Top Glove, 17 and 26 February 2016

    Google Scholar 

  • 8: Stuart Cook, vice-chairman TARRC, UK, 27 October 2015

    Google Scholar 

  • 9: Tan E T, general manager-business development, Kossan, 17 September 2015

    Google Scholar 

  • 10: Top Glove representative, managing team and research division, 18 and 28 September 2015

    Google Scholar 

  • 11: Or Tan Teng, managing director, Doshin, Kossan Group, 18 September 2015

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. National Graduate Institute for Policy Studies, Tokyo, Japan

    Motoko Kawano

Authors
  1. Motoko Kawano
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Motoko Kawano .

Editor information

Editors and Affiliations

  1. National Graduate Institute for Policy Studies, Tokyo, Japan

    Boo Teik Khoo

  2. National Graduate Institute for Policy Studies, Tokyo, Japan

    Keiichi Tsunekawa

  3. National Graduate Institute for Policy Studies, Tokyo, Japan

    Motoko Kawano

Rights and permissions

Reprints and permissions

Copyright information

© 2017 The Author(s)

About this chapter

Cite this chapter

Kawano, M. (2017). Upgrading Malaysia’s Rubber Manufacturing: Trajectories and Challenges. In: Khoo, B., Tsunekawa, K., Kawano, M. (eds) Southeast Asia beyond Crises and Traps. Studies in Economic Transition. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-55038-1_7

Download citation

  • DOI: https://doi.org/10.1007/978-3-319-55038-1_7

  • Published:

  • Publisher Name: Palgrave Macmillan, Cham

  • Print ISBN: 978-3-319-55037-4

  • Online ISBN: 978-3-319-55038-1

  • eBook Packages: Economics and FinanceEconomics and Finance (R0)

Publish with us

Policies and ethics

Search

Navigation