After the rubber boom: A cautionary tale from Southern Laos and Northeastern Cambodia

Beginning in the mid-2000s, the governments of Laos and Cambodia started issuing land concessions to private companies—both foreign and domestic—to develop large-scale commercial plantations. Since the price of rubber latex was high at the time, most concessions given out in southern Laos and northeastern Cambodia were planted with rubber trees (Hevea brasiliensis). The negative environmental and social impacts of the rapid expansion of these plantations has been well-documented. However, investors have also faced serious challenges due to price declines, conflicts with villagers and activists, management difficulties, technical and environment problems, and the lack of government support. Some plantations have been totally abandoned; others are performing well below expectations. In this chapter, I argue that high latex prices at the time that rubber plantations were first developed, and a frontier mentality, resulted in many ill-informed investments, both in southern Laos and northeastern Cambodia. The point of this story is that the development of large-scale rubber plantations in southern Laos and northeastern Cambodia have not only caused considerable social and environmental impacts but also greatly underperformed from the point of view of investors.

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