By Diogo Esperante:
The tyre industry that consumes almost 70% of the Natural Rubber produced in the world, is now keen to ensure that the natural rubber which it purchases originates exclusively from plantations which respect the principle of zero deforestation. In Latin America, there is great potential for such sustainable expansion.
Long-term increasing pressure on environmental common-pool resources, such as energy and water, hae made Environmental Planning imperative to the future success of practically all productive chains. Civil Society pressure to improve sustainable development has also contributed to making Responsible Development a goal for all major corporations.
With 70% of all the Natural Rubber (NR) produced in the world being consumed by the Tire Industry (ANRPC 2016), it is presumable that the Sustainable Development of environmental practices towards Rubber production is not only strategically important to this Industry’s reputation, and brand image, but paramount to its reproduction. (WARREN-THOMAS 2015)
Historically, the Tire industry environmental sustainability focus has been on Energy Consumption and CO2 emissions. That means, the majority of Sustainable Development projects of Tire Manufacturers have been, until now, based on answering the question: “How to make a Tire more fuel-efficient by reducing its rolling resistance?” (Tire Sustainability Report 2016).
Nonetheless, the Tire Industry being a segment that relies heavily on raw materials sourced from tropical regions, recently a string of important International Agreements1 made its drivers for Sustainable Development pay considerable attention to other aspects.
Among this new drivers stands out the increasing concern over how raw materials are sourced and processed in addition to the increasing diligence over all the documentation surrounding that supply chain. (Tire Sustainability Report, 2006). For what is worth, global demand for natural rubber has increased rapidly in the past decade, motivated specially by China’s economic emergence (FAO 2013).
That made rubber the most rapidly expanding tree crop within mainland Southeast Asia, where main producing countries are located. (FOX 2012). Noteworthy, the main regions where rubber plantations have expanded in the world concurs with Biodiversity-red-alert Areas such as: Sunderland , Indo-Burma and Wallacea (MYERS 2000).
These areas are home to a great number of endemic and highly threatened international fauna and flora (SODHI 2004).
In this context it is clear there is an emergency for the World NR Industry agents to increasingly challenge the promotion of initiatives regarding Private Environmental Governance (VANDENBERGH 2014).
The awareness of such emergency is clear when revising the Green Source Programs created by major Tire Manufacturers and their latest developments.
Pirelli’s Green Source Guide Lines has already “Strongly Advised” its raw material suppliers to adopt ISO 14040 Life Cycle Assessment by 2014, and stated clear intentions of making it mandatory in the near future. (PIRELLI 2014)
Michelin also states in its PURCHASING PRINCIPLES document that in the process to be approved, a supplier of raw material is requested to comply with Certification of ISO 14001 and TS16949 standards. In addition, the company declares in its Natural Rubber Procurement Policy:
“Combat deforestation: Attaching importance to the protection of primary forests and of zones of high environmental value likely to be endangered by the expansion of rubber plantations, the Michelin Group actively supports a policy of responsible land management. Within its means and the possibilities available through the organization of the natural rubber industry, the Michelin Group does all it can to ensure that the natural rubber which it produces or purchases originates exclusively from plantations which respect the principle of ‘zero deforestation’.”(MICHELLIN 2016)
II. LATIN AMERICA AND THE SUSTAINABLE EXPANSION OF NATURAL RUBBER
In Latin America, there is great potential for such sustainable expansion.
The region’s main producer, Brazil, was once the only rubber producer in the world, way back when Natural Rubber was produced only as an Extractivism product out of the Amazon jungle.
The cultivation of rubber as an agricultural crop was later developed and its production grew largely in Southeast Asia. Experiences of cultivation on the northern part of Brazil were not successful because of plague and other diseases.
Later on, not only disease-resistant clones were developed but also discovered that southern parts of Brazil contained large portion of land that were suitable for the cultivation of rubber trees and were free of plagues and diseases.
One of these main areas is the State of São Paulo (SP). Since the 1980’s, SP has been the continent’s main NR producer and today accounts for 58% of the whole Brazilian yield (about 30% of the American continent).
On the other hand, Brazil is considered one of the Top 10 NR consumers in the world with nearly 400 thousand tons of rubber consumed every year. Since only 40% of that is produced locally, the country is import-dependent.
Most of Brazil’s NR imports come from 2 countries – Thailand and Indonesia. The thing is both these countries are more and more promoting their industrial activities. That leads us to presume these nations in future will export less natural resources and more industrialized goods; less natural rubber and more tires. So diversifying the sources of import and helping to create an integrated regional market might be strategical to the Latin America region.
To that extent, Latin America Rubber Producing Countries like Brazil, Guatemala, Colombia and Mexico not only have a good reason to expand their natural rubber output, but also to do it with a good environmental sustainability score.
III. CHALLENGES TO THE SUSTAINABLE EXPANSION OF NATURAL RUBBER
Taking those facts into consideration, it’s clear that the sustainable expansion of Natural Rubber is being perceived by some of the biggest Tire Manufactures as a matter of importance and also as an opportunity for industries in the pursuit of adding value to its output.
The strategies of such companies and governments are involving not only Best Practices in land usage (avoiding deforestation) but also including other rigorous responsible practices regarding all aspects of its production in the pursuit of full traceability and certified sustainability.
In this comtext sustainability and the challenges imposed to its pursuit, may be better understood if characterized as a global “public good”, as has been debated by Elinor Ostrom:
“Millions of actors affect the global atmosphere. All benefit from reduced greenhouse gas emissions, but the problem is they benefit whether or not they pay any of the costs. In other words, beneficiaries cannot be excluded from the benefit of cleaner air. Trying to solve the problem of providing a public good is a classic collective action dilemma—and potentially the largest dilemma the world has ever knowingly faced. The classic theory of collective action predicts that no one will change behavior and reduce their energy use unless an external authority imposes enforceable rules that change the incentives faced by those involved”. (OSTRON 2009)
To that extent, the challenges to such enterprise are no different from most commonly difficulties found when debating over the concept of common-pool resources (CPRs):
“Forests, irrigation systems, fisheries, groundwater basins, grazing lands, and the air we breathe are all examples of (CPRs). Because no one has property rights or control over such a resource, users of CPRs are frequently assumed to be caught in an inescapable dilemma—overexploitation of the resource, or what is commonly known as “the tragedy of the commons.” (OSTROM 1994).
Ostrom shows that often, users of CPRs have defeated incentives to “destroy the resources” creating long-enduring institutions and policies that enabled them to consume such resources adequately.
In corroboration, it’s interesting to point that, Mancur Olson, in his Collective Action Theory already stated that: groups may produce public goods provision at an optimal level only if making such provision complementary to some private good which the group can exercise an effective monopoly over. (OLSON 1965).
Thus, the issue of creating voluntary activities for the sustainable expansion of natural rubber might benefit from, and be beneficial to, the debate over Collective Action Theory and the Common-pool Resources issue.
As to a possible approach, using such theoretical reference, the Polycentric framework seems to hold good potential to such study, for as Ostron argues:
“Given the complexity and changing nature of the problems involved in coping with climate change, there are no “optimal” solutions that can be used to make substantial reductions in the level of greenhouse gases emitted into the atmosphere. A major reduction in emissions is, however, needed. The advantage of a polycentric approach is that it encourages experimental efforts at multiple levels, as well as the development of methods for assessing the benefits and costs of particular strategies adopted in one type of ecosystem and comparing these with results obtained in other ecosystems.”
IV. POLYCENTRIC STUDY OF SUSTAINABLE NATURAL RUBBER PROJECTS
To undertake the exercise, this article proposes a multi-case study of the Sustainability Plans of different Latin American rubber producers:
a) Hevea Forte Cooperative in São Paulo State Brazil
b) Goias Látex Group in Goiás State Brazil
c) Mavalle SA in Colombia
d) Occidente Econegocios in Guatemala
In this regard, this article intends to answer the question:
a) Taking the Polycentric Governance framework analysis of Elinor Ostrom for CPR management, how does the particular framework of such initiatives are performing to the success (or failure) of guaranteeing Sustainable Practices in Latin Americas NR production?
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