A Major Investment Crumbles: Firestone Liberia Closes Rubberwood Production, Cites Lack of Market
MONROVIA – When Firestone Liberia commissioned its rubberwood processing facility in 2015, Madam Ellen Johnson Sirleaf, who was President at the time, described the US$15 million investment as a “wonderful thing” when she visited the facility in June 2015.
Report by Lennart Dodoo, [email protected]
“We want to encourage Firestone to expand the facility. And we also want to encourage our local carpenters who are engaged in wood processing to use these products and make things that we can sell on our local markets so we can stop importing furniture, plywood. By doing so we expand our economy.”
Sirleaf’s aspiration was that Firestone’s rubberwood production would have revolutionized the carpentry industry in Liberia and create a local market for the wood. This would have reduced the importation of furniture and plywood into Liberia.
The rubber wood processing facility, named Hevea Wood, made use of Firestone’s expired rubber trees by treating the wood and making it useful for furniture.
Before the production of the rubberwood, the wood was most of the time left to rot or be used for making charcoal.
The End of a Good Dream
Despite all the potentials envisaged by Firestone leading to the multi-million-dollar investment, the company has confirmed to FrontPageAfrica it is shutting down its rubberwood business due to continued and unsustainable losses and the inability to compete with low cost producers in the global Rubberwood market.
“This decision resulted in 165 redundancies, which form part of the previously announced plan to implement a 13% headcount reduction in our workforce made earlier this year,” the informed FrontPageAfrica.
Over recent years, Firestone Liberia has experienced significant losses due to low natural rubber production resulting from the country’s prolonged civil wars and ongoing low global natural rubber prices, the company said.
In 2018, the company reduced production at its rubber wood factory in Liberia and laid off 75 staff.
Global rubber prices have fallen over 40 percent since January 2017 and are now only slightly above historic lows.
The slowdown in rubberwood output marks another blow for Liberia that relies on rubber exports and whose two civil wars that ended in 2003 left the economy in ruins.
Firestone, a subsidiary of tire producer Bridgestone Americas, signed a 99-year contract with the Liberian government in 1926. Its plantation covers almost 200 square miles in a forested area east of the capital Monrovia and has provided much-needed schooling and medical care to employees.