American Rubber Concessions Abroad

August 23, 1928

Report Outline
Rubber Production in the Philippines
Firestone Concession in Liberia
Ford Rubber Concession in Brazil

Recent attacks at Geneva upon the labor policies of the Firestone Plantations Company in Liberia, and present preparations for the opening up of Henry Ford's 3,700,000-acre concession in the Amazon Valley, have drawn public attention in the United States to the operations in foreign countries of American companies requiring large supplies of crude rubber. The Ford and Firestone concessions are the two largest enterprises undertaken to date to provide American consumers with rubber grown on American plantations abroad. These concessions, in contrast with other American rubber-growing projects, include grants of power by the contracting governments which go far beyond the growing of rubber itself. Questions arising in connection with the exercise of these powers and the exploitation of other American rubber holdings abroad seem likely in the future to receive a steadily increasing amount of attention from students of international problems.

Proposals for the establishment of American-owned rubber plantations in tropical countries first attracted wide public attention in 1923, following the inauguration of the Stevenson plan for restriction of British rubber production. British planters in Malaya and other Asiatic colonies, producing well over half the world's supply of crude rubber, were confronted after the war with a severe depression in rubber prices. Failing in an attempt to come to an agreement with planters in the Dutch East Indies, who produce most of the non-British supply, the British producers decided in 1922 to go ahead alone with their plans for restriction of output.

Restriction of British Rubber Production

Malaya, Ceylon and other principal British rubber-growing colonies, with the approval of the British Colonial Office, gave legal sanction to the Stevenson plan for restricting the British rubber supply late in 1922. The Stevenson plan set up a sliding scale of export duties on rubber.1 Planters were assigned quotas based upon their production in 1920, and each planter was permitted to export a fixed percentage of his quota under the minimum duty. Exports exceeding the quota were not prohibited but were discouraged by being taxed at higher rates of duty. The plan provided for increases or decreases in the percentage, to correspond with changes in the market price, so that planters would receive a fairly uniform return.

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