Photo credit: DiasporaEngager (www.DiasporaEngager.com).
By Othello B. Garblah
The Firestone Natural Rubber Company is arguably the single largest employer in Liberia, with 4000 employees referred to as teammates and 2000 contractors, contributing over 100 million every year to the Liberian economy through taxes, payroll, payment to smallholder farmers, and social security to the Government.
Harbel, Firestone, July 22, 2024—Established in 1926 as a subsidiary of Bridgestone America, Inc., the Firestone Natural Rubber Company in Liberia has evolved, this paper learned during a joint investigative tour on Tuesday, July 16.
Once regarded as the largest contiguous rubber farm in the world, Firestone has witnessed many ownership transitions in recent years but has maintained its standard despite challenges.
The company’s current Concession Area is 118,990 acres, which management says has remained unchanged for over 50 years. This is not 1 million acres, as has been misquoted over the years in reference to an original 1920s survey of the area.
The plantation is divided into 44 Divisions, each around 2,500 acres. The Divisions are under a replanting cycle that includes 7 years of growth after planting, followed by 24 to 27 years of tapping.
“Annually, Firestone processes and exports over 100 million pounds of Technically Specified Rubber (TSR) to the Bridgestone Group, which amounts to less than 5 percent of its global demand,” Mr. Seamus Gunton, General Manager of Firestone Liberia, said in response to emailed questions sent to him by the joint investigative team on Friday.
A contractor weighing station at Division 27
“Generally, we plant one division per year to ensure that our annual latex volumes remain stable in the long term. In total, around 75 percent of the plantable land is production.
The remaining land is either planted with young trees or is waiting to be felled and replanted,” Mr. Gunton wrote in his response.
Under the terms of the Concession Agreement, Firestone spends over $8 million each year on social costs across the farm. It manages 22 schools and educates over 7,000 students on its farm, Mr. Gunton explained.
The OPD block of the Firestone Clinic on Division 27
He added that the company’s medical services through Duside Hospital and the 3 additional clinics administer to 50,000 outpatient and 5,000 inpatient cases each year.
He said Firestone maintains and repairs over 6,000 housing units and thousands of miles of roads in its concession area.
Outsourcing tapping to contractors
In 2019, Firestone made what has now become a controversial decision to outsource some of its tapping to contractors, many of whom are retired company employees.
The company made the decision at a time when the price of rubber on the global market was significantly low. Rubber theft within the concession area was uncontrollably high. The company was operating at a net loss and continuing to rehabilitate the farm with steep overhead and operational obligations under the Concession Agreement.
“The outsourcing of tapping to contractors in 2019 was a difficult but necessary decision.” Said Mr. Gunton.
He narrated that Firestone’s goal in 2019 was to continue operations while mitigating the risk of closure by working with the Liberian Government, teammates, and stakeholders to find creative solutions to remain a viable entity.
(l-r) Joseph Kaiheya, CEO of J&K Square Inc. and Chair of contractors with another contract at Division 19
“Thus, the Government of Liberia and Firestone Liberia formed a high-level Working Group to discuss and find meaningful and practical solutions to address the severe economic condition impacting the operation. The decision to restructure and outsource tapping was then agreed upon.
The introduction of Contract Tapping within the Concession is pursuant to Section 7.1 of the Concession Agreement, which permits Firestone Liberia to: “Engage in the production and operate its business in the manner that, in its sole discretion, it deems best suitable.” It also states that Firestone Liberia shall “produce Rubber Products in such quantities as in [its] sole discretion deems appropriate taking into account world market condition of rubber products, economic conditions in Liberia and abroad…”
Further, it states: “Firestone Liberia shall provide timely information to the Government regarding any business decision that [it] reasonably determines may have a substantial social or economic impact in Liberia, so as to permit appropriate planning and response by Government.” To be continued.
The post Firestone: The Untold Story (pt-1) appeared first on Liberia news The New Dawn Liberia, premier resource for latest news.
Source of original article: Liberia news The New Dawn Liberia, premier resource for latest news (thenewdawnliberia.com).
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