As with the other member ASEAN states, Malaysia expects its economy to rebound in 2022 along with the recovery of the world economy.
Economic and fiscal stimulus to support Malaysia’s economic expansion is among the country’s recovery strategies. Malaysia’s GDP is expected to grow by 5.7% in 2022, according to the International Monetary Fund (IMF). The government has budgeted more than US$80 billion for 2022 to help the economy recover from the effects of the Covid-19 pandemic.
Malaysia’s rubber sector, which is ranked seventh in the world for natural rubber production, continues to be a key driver of growth. Rubber demand is being boosted by increased demand for gloves as a result of coronavirus outbreaks and the emergence of omicron variants.
The Malaysian Rubber Glove Manufacturers Association (MARGMA) predicts that demand will be 10-15% higher than pre-pandemic levels in 2022 and 2023. Market will be fuelled by other rubber products such as medical devices, rubber components for automotive, consumer products, and industrial applications.; and rubberwood for biomass purposes is also expected to grow in popularity.
In the meantime, the sector is also making headway into new markets. The Malaysian Rubber Council (MRC) is said to be focusing on new markets this year, including the Middle East and Africa, to promote high-quality local rubber products. Rubber exports are expected to reach RM100 billion, according to MRC CEO Nor Hizwan Ahmad.
Rubber trade has been stabilized as a result of efforts to increase demand for the commodity. According to MRC data, global rubber production increased by 8.9% in the first nine months of 2021, from 19.8 million tonnes to 21.6 million tonnes, compared to the same period in 2020. World rubber consumption increased 14.4% to 22.2 million tonnes in that year, up from 19.4 million tonnes in 2020, over the same 9-month period.
Meanwhile, Malaysia’s rubber output in the first nine months of 2021 declined by 1.1%, to 519.3 thousand tonnes, from 524.9 thousand tonnes in the same period of 2020. In 2021, the country’s rubber consumption grew by 9.6% to 937.5 thousand tonnes, up from 855.0 thousand tonnes in 2020.
Rubber imports crossed 21% to 1.4 million tonnes in the first nine months of 2021, up from 1.2 million tonnes the previous year, and while rubber exports increased by 1.2% to 893.9 thousand tonnes, up from 883.6 thousand tonnes the previous year.