Production and Input-use Efficiency in the Sawmilling Industry of Peninsular Malaysia

Production functions for the sawmilling industry in three states of Peninsular Malaysia are estimated. Sawntimber output is regressed with gross capital and labour as independent variables. The returns to scale underlying the sawmilling industry are estimated. The findings of this study do provide useful indications on efficiency of input utilisation, subject to potential sources of bias noted in the paper

Legal implications of compulsory rainwater harvesting in Malaysia

Rainwater harvesting refers to a process that capture rainfall and use it for non-portable use like flushing and general washing. Although it has been promoted in Malaysia since 1999, the implementation of rainwater harvesting as an alternative supply of water is still very limited due to the current low rate of water supply. In 2006, the government proposed that rainwater harvesting wii be made compulsory to new large buildings as a measure to cope with drought and other impact of climate change. When the new law is passed, it may have some implications on the existing legal provisions. Compulsory rainwater harvesting requires amendment of certain laws since it attracts some planning, environmental and health issues. For instance, as design and requirement of a building are legislated under the Uniform Building By-laws 1984, it will be the most affected legislation and has to be amended accordingly. This paper shall analyse any affected legal provisions once rainwater harvesting is made compulsory. The content analysis method is used in analysing those provisions. The findings will be useful to support the new law on rainwater harvesting in Malaysia

Economic impact of oil trade in a developing country: an empirical investigation of consequences of recent Gulf crisis in Malaysia

Petroleum-based industry has become significant to the Malaysian economy since the early seventies. It is now one of the key industries in the economy. The economy's export ratio of oil quadrupled to 16 percent in 1988 from 4 percent in 1974. The country is now a net exporter of oil and gas but a net importer of petroleum products. This paper attempts to present the results of our empirical inquiry into the impact of an increase in oil price to the economy. Using the interindustry input-output model, the paper found that the net effect of an increase in oil surplus and a deficit in petroleum products trade provides strong potential for expanding output and employment

A Market Model of Peninsular Malaysian Sawntimber Industry

A market model of sawn timber consisting of supply, export demand and domestic demano equations, and excess supply and price as identities was developed. The model can be used to analyse the effect of changes in exogenous variables such as export duty, substitute product prices, forest opening and economic growth on the supply, demand and price of sawn timber

Determinants of deforestation in Peninsular Malaysia: an ARDL approach

The forested land in Malaysia is slowly giving way to agriculture especially oil palm and other forms of land use, creating a conflict between agriculture production and forest management. Land use for agriculture has changed over the years. While the land use for oil palm has been increasing steadily since the late 1980s, the relatively more drastic increment has been observed in the late 1990s. On the other hand, land use for other crops such as rubber and cocoa has been declining. This paper highlights the empirical evidence on tropical deforestation in Peninsular Malaysia. The economic factors and short-run and long-run effects of its determinants were examined in an Autoregressive Distributed Lag (ADRL) approach. The results suggest that in the long run, there are no determinants that have significant impact on deforestation. Instead, the price of oil palm is significant at 10 percent level and has positive impact on forest area. In the short run, the results show that the weighted price of logs and the price of oil palm are negative and statistically significant at 10 and 1 percent level respectively. These results indicate that the determinants of deforestation in the short run do exist. They lead to the decline of forest area which increases the rate of deforestation in the Peninsular Malaysia

A market share model of the Malaysian sawntimber and plywood exports

The objective of this paper is to estimate market share functions for Malaysian exports of sawntimber and plywood and to obtain estimates of their relative price elasticity of market share. The empirical evidence indicates that the estimates of relative price elasticity of Malaysian market share exceeded zero and are statistically significant, implying that avenues exist for Malaysian producers to increase their shares of the world market through price competition

Financial and economic analyses of conventional and new technology harvesting systems

This paper examine the various committed new technology and improve logging activities ascribed in the 'Logfisher' Practice (LP) rather than Conventional Practice (CP). The result of cost analysis shows that the cost constitutes under LP is higher than under CP. Incremental average per ha total cost rose by 46.86% to RM13,576/ha. While the incremental average per m3 total cost increased by 57.41% to RM267.80/m3. Hence, CP was slightly more profitable and exceeds the Net Present Value (NPV) of LP. Similarly, the Benefit-Cost Ration (BCR) for CP is better than LP. On the other hand, the result of the economic analysis of 40-year period showed that the LP system (NPV = RM9302/ha) provided a higher level of overalls benefits and welfare to the society as a whole as opposed to CP (NPV = RM8497/ha)

Sustainable forest management and West Malaysian sawntimber supply analysis

This paper examines the dynamic effects of sustainable forest management (SFM) on the West Malaysian sawntimber supply. Both short-run and long-run effects on sawntimber supply are studied using a multivariate cointegration analysis. The proxy of SFM variable is permanent forest reserve. It is expected as an exogenous negative shock in the sawntimber supply. In general, given the fact that West Malaysian sawntimber supply is decreasing since 1990s, the results show that sawntimber supply is statistically influenced by SFM practices. Furthermore, reducing of harvested area of forest has significant effect on sawntimber supply decreases. While in the short-run, the results suggest that there are negative impacts of SFM practices on sawntimber supply at 10 percent significant level, in the long-run, the result is significant at 1 percent level. This may to some extent pull down the West Malaysian sawntimber supply together by bringing the forest harvests to sustainable level

A comparison analysis of logging cost between conventional and reduce impact logging practices

The operational application of the ‘Logfisher’ technology and system were undertaken at Sungai Betis, Gua Musang Forest Reserve in 2007 as an alternative to existing logging technologies. It has since been widely accepted and acknowledged as an efficient and cost effective alternative to existing low and reduced impact logging technologies such as skyline, Mobile Tower Yarder and Helicopter. This paper examined the various committed new and improved logging activities ascribed in the Reduce-Impact Logging (RIL) particularly using ‘Logfisher’ rather than Conventional Logging (CL). The cost function of present value is developed to analyse the logging cost between these two types of harvesting systems. The result of this study shows that the cost constitutes under RIL is higher than under CL. Incremental average per ha total cost rose by 46.86% to RM13,576/ha. While the incremental average per m3 total cost increased by 57.41% to RM267.80/m3. With increasing fuel prices and other cost related to labour, the logging cost is expected to increase in the near future. This situation will have adverse affect on the profitability of the practice of Sustainable Forest Management (SFM)