$2.4 Million Investment in Myanmar for Sustainable Rubber Production


$2.4 Million Investment in Myanmar for Sustainable Rubber Production

Myanmar Business Today, 04 Dec 2018

The DaNa Facility, a UK Government Department for International Development (DFID) funded programme, and the World Wide Fund for Nature (WWF), have announced a joint investment of over $2.4 million in an innovative project aimed to change global rubber production.

The project, focused on supporting environmentally, socially, and commercially sustainable rubber production in Tanintharyi, Myanmar, has a long-term goal that the region will become a replicable business model in sustainable and traceable rubber.

Speaking at the launch Tom Coward, Team Leader of the Inclusive Growth and Livelihoods Unit for DFID in Myanmar, said: “It is exciting to be launching this project with WWF and to see the significant transformative potential of producing rubber sustainably in Myanmar. With Myanmar the seventh largest rubber producer in the world, this project has huge potential to improve the livelihoods of poor farmers, while also promoting the feasibility and profitability of ‘zero deforestation’ sustainable rubber.”

The project will be implemented in partnership with Dawei Golden Land Co Ltd (DGL), established in 2017 by the Tanintharyi Rubber Planters and Producers Association (TRPPA), a proactive actor in the sector determined to break the cycle of low quality and low priced rubber. TRPPA have invested over $1 million in building a new rubber factory that enables high quality rubber to be produced at a scale attractive to premium buyers.

Myanmar is the world’s seventh largest producer of rubber and rubber is one of the country’s biggest exports. Yet, the sector is stuck in a cycle of low yields, poor processing, low quality products, and low pricing, making Myanmar dependent on the cut-price market.

The project has three main components. To support DGL in working with their suppliers by setting up collection centres in nine villages and training smallholders in sustainable rubber agroforestry systems, including the requirements of zero deforestation, and purchasing latex from the farmers to ensure a fully traceable and transparent processes.

The project will then support DGL in developing their rubber processing factory to meet the sustainability compliance requirements of international premium buyers, ISO quality standards and to produce the large volume of consistent, high quality rubber, needed for the business to attract the sustainable buyers necessary to become commercially viable.

The project will also support DGL in marketing their products internationally to attract premium, sustainable buyers. The project has already secured expressions of interest from a Singapore-based buyer and is conducting discussions with premium international tire producers.

The project will work with 250 smallholder producers to increase their income by up to 30% through training in sustainable rubber agroforestry practices. By selling latex directly to the factory for processing, the project hopes to help an additional 2,500 smallholder producers save around 50% of their labour-production time with no loss of income. The new sustainable rubber factory is estimated to create another 250 new full-time jobs, 60% of which will be for women.