ASEAN: The Association of South East Asian Nations was formed in 1967. Its objective in the initial stage was to strengthen regional politics. In 2003, ASEAN leaders signed in Bali Summit to embark on a program of economic cooperation. In 2007, the ASEAN members signed the ASEAN Charter, a constitution governing relations among the ASEAN members and establishing ASEAN Economic Community in 2015. At present, ASEAN comprises of 10 member countries, viz. Brunei, Singapore, Indonesia, Malaysia, the Philippines, Cambodia, Laos, Burma, Vietnam and Thailand.

ASEAN aims at establishing the economic community in 2015 into a single market, enabling the free flow of goods, services, capital and people across the regional bloc. Benefits of AEC are 1) expansion of regional trade and investment; 2) reducing dependency on external market; 3) negotiation power in the world market; 4) better standard of living of consumer; enhancing competitivity of ASEAN; 6) efficient utilization of resources.

Natural rubber is rushed to serve as an initialized product in AEC. Malaysia is assigned to prepare Road Map of rubber product. ASEAN countries cover the largest area of rubber cultivation, production and export. Thailand, Indonesia and Malaysia together possess 60% of the world’s natural rubber cultivation area. The three countries produce 7.27 million tonnes of natural rubber, accounting for 66% of the world production (10.95 million tonnes). Additionally, Vietnam is a highly potential rubber producer with the production of 873,000 tonnes. Including Vietnam, the four rubber cartels produce over 74% of the world natural rubber.

These are advantages of AEC to Thai rubber industry: 1) geographically, Thailand is located in the very center of ASEAN, hence favourable for logistics; 2) Thailand is the world’s largest rubber producer; the most important source of rubber raw material; 3) there are many academic institutes for rubber studies and labour development in Thailand. However, there are certain disadvantages: 1) government intervention in rubber market is prevalent; 2) rules and regulation concerned obstruct rubber trade liberalization 3) cost of production on logistics in Thailand is still high. For suggestions, all rubber producing countries in ASEAN shall take part in the preparation of Road Map of rubber product for the benefit of all ASEAN countries; 2) strengthen the corporation in ASEAN countries in order to have negotiation power with consuming countries, focusing on green products as a sale point; 3) non ITRC countries in ASEAN are to be invited to join ITRC (International Tripartite Rubber Council).

From the above data, we see the importance of AEC and mutual benefit for business expansion and investment among member countries, to enhance the competitivity in the world market. The Thai Rubber Association expects that AEC will bring about strategic benefit to Thailand in general and natural rubber in particular.