A rubber champion at a multimillion ringgit crossroad scandal

The recent revelation of another questionable land deal has sent the MRB to a different stratosphere


A picture of Queen Elizabeth II tapping a rubber tree during her visit to Malaysia in February 1972 made global headlines. Many still remember her magnanimous act. It was Malaysia then.

A major rubber producer, trail-blazing the sector with new scientific findings. Breeding of new rubber clones that could produce more than 3,500kg per hectare (ha) compared to just 400kg at the turn of the 20th century.

Rubber trees that are disease-resistant and mature in 54 months compared to 96 months. Quality rubber trees helped to boost the country’s furniture sector.

The Malaysian Rubber Board (MRB) was granted over one hundred patents. Technologies, innovations and findings from clones to latex harvesting technologies to soil management and agronomic practices which shape the industry’s growth. MRB has been were spearheading the country’s rubber industry.

But the recent revelation of another questionable land deal has sent the MRB to a different stratosphere.

Kok (left) with Sankara during the press briefing which revealed that MRB had been shortchanged by RM800m from the 2,800-acre land sale to ATNB (Pic by Ismail Che Rus/TMR)

Primary Industries Minister Teresa Kok has revealed that the MRB was shortchanged by RM800 million from the 2,800-acre (1,133ha) land sale to Aset Tanah Nasional Bhd (ATNB).

ATNB, a special-purpose vehicle (SPV) owned by the Ministry of Finance sold the land — known as Lot 481 — in Sungai Buloh to Kwasa Land Sdn Bhd for a price tag of RM2.28 billion.

The deal, sanctioned by the former Barisan Nasional government, saw the SPV pocketing RM800 million in profit from Kwasa Land, a wholly owned subsidiary of state-owned pension fund, the Employees Provident Fund (EPF).

The EPF claimed that the land deal was done at an arm’s length basis for the development of Kwasa Damansara.

From a globally recognised research institute, with a history dating back to the 1920s, to a possible scandal.

“It is heartbreaking to discover such shenanigans in our previous administration,” said MRB chairman Sankara N Nair.

Sankara, who was appointed in August last year as MRB chairman, said he was bewildered about the role of the agency after his first briefing by the management.

“I was quite alarmed, and was even not quite sure if I was the chairman of MRB as the main part of the said briefing was centred entirely on the properties owned by MRB and its proposed, existing and ongoing development projects at various sites at Jalan Ampang in Kuala Lumpur.

“Ironically, there was very little briefing on the research and development (R&D) which was the raison d’etre for its creation, ab initio, in 1925, when the government created the Rubber Research Institute (RRI), to pioneer rubber R&D when rubber was the mainstay of the Malayan economy then,” he said in an email reply to The Malaysian Reserve.

“Worst still again when I attended my first board meeting, most of the incumbent board members eagerly in a sardonic tone, informed me that this was the first meeting which it had on the agenda; matters other than properties.

“I thought it was paradoxical that this was a rubber board as it would have been more appropriate to be called a property or real estate board,” he said.

The RRI is a world renowned institution and it pioneered many top notched inventions, and has registered numerous universal patents.

Sankara said MRB has veered “off course” from its original objectives, and has tragically been on a descendent trajectory.

“The history of its landbank build-up was unintentional. It was due to the old RRI legislation being restrictive in the manner, in which RRI was allowed to invest excess funds and cess.

“Hence, the acquisition of properties for over 70 years. The previous leadership must have seen that there was no, or little money, in R&D compared to dealing with properties,” he said.

But, Sankara has pulled the brakes and imposed a moratorium of all future dealings and development of MRB properties with the endorsement of the minister.

Besides the land deal, MRB claimed it suffered a RM70 million loss, linked to the implementation of five facilities on its remaining 585-acre plot on Lot 481.

A project delivery partner was terminated in February last year.

The whole recent expose has been a stab to the heart.

For Sankara, there is no deliberate “timing” of the release of the exposure.

“Her (Kok) intentions are honourable and is more so in line and consonant with her political beliefs, all along and the new government, in delivering and maintaining a clean, honest and trustworthy government.

“MRB is indeed a big organisation with a long history in various activities, and since I just got my mandate, about six months ago, it remains to be seen as to what more transgressions that I may uncover.

“I hope there are none, and if so, not at such a phenomenal scale,” he said.