06/09/2007 (News Straits Times Online) - The economic success achieved on the back of innovations and research and development of our rubber and oil palm resources underscores the huge potential of harnessing such collaboration effectively, writes AHMAD IBRAHIM.

MALAYSIA celebrated 50 years of independence on Aug 31. For pensionable civil servants, 50 is the age when you can start collecting your first pension instalment. Of course, a country never retires. It has to go on seeking new opportunities for its people so they can continue to survive and live well.

Much of the credit of Malaysia’s success must surely go to effective development strategies for economic progress. There is now serious talk about Malaysia embracing a strong culture of innovation to compete. This is underscored under the Ninth Malaysia Plan where the pursuit of innovation, market-driven research and development (R&D), technology development and commercialisation are strongly emphasised.

But innovation in Malaysia is not new. We have a rich history of achievements in innovation. Maybe there is need for more strengthening to be in line with the new market demands. Looking back, Malaysia should take pride in much of the country’s past R&D investments having reached the marketplace. They have created wealth for the country and helped overcome some socio-economic challenges.

Take the rubber industry. Thanks to investments in R&D, mostly at the Rubber Research Institute of Malaysia (RRIM), natural rubber is now a preferred material in many applications which were before thought impossible or impractical. It may have started just as a material for making a football to be kicked around.

Now natural rubber finds use in thousands of products. Scientists at both the RRIM and its sister institute in London, the Tun Abdul Razak Research Centre, have successfully produced a range of natural rubber materials tailored for end-uses in engineering, medical equipment and the household.

Another interesting innovation that came out of the RRIM is the technology to process natural rubber into crumbs for ease of drying and handling. This Standard Malaysia Rubber (SMR) has since become the benchmark for all the grades of natural rubber sold globally. At one go, SMR overcame all the shortcomings associated with traditional ribbed smoke sheet rubber. It is less labour-intensive, more cost-efficient and consistent in quality and character, making it more attractive in further downstream processing for various product applications.

Talking about converting a low-value material into a highly sought-after product, rubberwood springs to mind. In the early years of the natural rubber industry, the rubberwood left behind during replanting did not fetch much in price. It was used as firewood or fuel for the rubber smokehouses where sheets of rubber were hung to dry.

RRIM scientists in the 1970s found a cost-effective way to treat the wood for furniture. Now, rubberwood furniture is a major export for Malaysia, earning billions of ringgit every year.

If the 1970s belonged to natural rubber, the 1980s signalled the beginning of the golden age for palm oil. Now palm oil is the unrivalled commodity in the global oils and fats trade. Palm oil was nowhere in the book of global traders before Malaysia took over the reins of world production. Now everyone wants to grow oil palm.

Various attempts have been tried to stop the expansion of palm oil, but palm oil survives on sound science. It is R&D and innovation which have changed the fortunes of the oil palm.

The palm oil industry has also enjoyed many innovative products and technologies, thanks to investments in R&D at the Malaysian Palm Oil Board (formerly the Palm Oil Research Institute of Malaysia, or Porim). Modelled after the RRIM, Porim resolved many of the issues of the palm oil industry through innovation.

In the upstream production of palm oil, Porim introduced many agronomic technologies to better manage oil palm growing. Not to mention Porim’s extensive work on breeding to generate new varieties of the oil palm. All such findings have become part and parcel of the industry. (Industry insiders are familiar with a certain weevil brought in to help with the laborious task of hand pollination. Now, that’s innovation!)

Though the upstream aspects of the palm oil industry are critical to the success of the business, it is the downstream side that attracts more attention. Porim’s R&D has revealed palm oil’s unmatched versatility in many food applications.

There was a time when palm oil was thought good only for making soap and lubricants. But when it was shown that palm oil exhibits excellent frying stability and makes superior margarine and shortening, competing oils were shaken.

That started that unfortunate attack on palm oil in the 1980s, now neutralised through sound science.

Since 1979, Porim has introduced countless innovations to add value to the industry. Standouts include the successful development of a cost-effective technology to extract valuable non-oil components such vitamin E and beta carotene. These are now fully commercialised.

Another is the technology to efficiently convert palm oil into biodiesel. The commercialisation of biodiesel is now being attempted by some companies, but the current high price of crude palm oil has made it unattractive for now to invest in biodiesel. It may be necessary for the government to help with some kind of financial support, at least to kickstart the biofuel business. Once the global market is up and running, the support can be slowly phased out, as in the EU and the US.

The history of Malaysian rubber and palm oil shows that innovation can happen if there is close strategising among R&D players, the business community and policymakers. R&D has to be on what the business requires. In many cases, in order to effectively bring the fruits of R&D to market, some form of policy intervention is necessary.

Such a model of industry-research-government collaboration would seem imperative for successful innovation in other sectors of the economy.

Dr Ahmad Ibrahim is a Fellow of Malaysia’s Academy of Sciences.