Indonesia denies Malaysia's charges of rubber pact violations

JAKARTA, Indonesia (April 15)—The Indonesian government is denying Malaysia's charges that Indonesia and Thailand aren't honoring the promises they made to cut natural rubber exports and production under the International Rubber Co. Inc. agreement. "It's an agreement and not a contract," Indonesian Trade Minister Rini Suwandi told Dow Jones News Service. "The main thing is the price and the rubber farmers' prosperity." Suwandi spoke in answer to accusations by Lim Keng Yaik, Malaysia's primary industries minister, that Indonesia and Thailand had "forgotten the tripartite agreement" and that their activities were "the surest way of bringing down prices." The cartel agreement, signed in 2002, called on the three countries to cut NR production by 4 percent and exports by 10 percent to bring rubber into the price level of $1 per kilogram. But various factors—including a long dry spell in Southeast Asia and increased buying from China—have kept prices near that level for most of the year to date.