MARKET DEVELOPMENT
Shahrir Recalibrates FELDA To Focus On Settlers' Socio-Economic Status
Shahrir Recalibrates FELDA To Focus On Settlers' Socio-Economic Status
23/01/2017 (Bernama) - For newly-appointed Federal Land Development Authority (FELDA) Chairman, Tan Sri Shahrir Abdul Samad, uplifting the socio-economic status of its 112,635 settlers remains paramount.
That should be the guiding principle in all its operations, corporate deals and future undertakings for the largest palm oil producer in the world.
When FELDA was established about 60 years ago, its aim was to eradicate poverty through the cultivation of oil palm and rubber.
Over the years, it has grown exponentially into a global agri-business corporation and went on to list the world's third largest plantation company by land size, FELDA Global Ventures Holdings Bhd (FGV), in 2012, which signified that the agency has come of age.
But being bigger is, perhaps, not necessarily better for FELDA.
After the listing of FGV, which saw plantations and milling activities coming under the listed entity, FELDA was left with its settlers.
In 2013, it established FELDA Investment Corporation Sdn Bhd (FIC), which focused on strategic businesses via acquisitions or collaborations.
Within three years, FIC came under scrutiny due to failed ventures, poor planning and execution of projects that resulted in it losing millions.
And there have also been investments with no returns.
For starters, Shahrir has asked the FIC board to resign to enable him to reorganise it.
He also announced an aggressive asset disposal exercise to help stem deficit FELDA's cash flow and bring its financial situation into balance.
He acknowledged that weak governance led to "problematic assets" under FIC.
"Some of the ventures that lost millions are units of subsidiaries," he said.
He felt FELDA lost attention along the way.
"So, to overcome its problems it is going back to basics," he told Bernama recently, which means priority must be on settlers and their well-being.
This, he said, is the message he has been sending out ever since he took office on Jan 6, 2017.
Among the problems faced by settlers are late payments from FELDA for their palm oil produce, failure to collect produce, expensive housing, as well as incomplete and late financial statements.
Recognising that FELDA had problems, Prime Minister Datuk Seri Najib Tun Razak expressed concern and announced last September that the problems raised by settlers will be sorted out soon.
"(So, the answer is to) focus back on the settlers. Once the focus is back on settlers and once they have a good flow of income, their economy is good and they are happy, other things will fall into place accordingly," he said.
And the well-being of settlers includes focusing on their plantations and also problems concerning the second generation's needs and welfare that include housing.
Shahrir has vowed to frequently go down to the ground to ensure that the original goal of FELDA when it was set up on July 1, 1956, namely, the socio-economic upliftment of the people, is met.
Besides crops, social and welfare problems, the development of new industries and entrepreneurial activities would be looked into.
Launched in 1957, the social development effort kicked off with 400 settlers and gradually expanded to 112,635 settlers.
FELDA settlers owned one-sixth of the total oil palm plantation land in Malaysia.
Since 1990, FELDA stopped recruiting new settlers.
However, to be able to execute plans to help settlers, FELDA needs a steady flow of income and this is where FIC's role comes into play.
Hence, the move to reorganise FIC and assets and sell off those that are not giving reasonable returns are a much-needed clean-up for FELDA.
It has to streamline its operations and reassess investment portfolio.
A much cleaner and leaner FELDA is what the country wants to see as it is nothing less than a uniquely Malaysia's success story.
No other country in the world has a scheme such as FELDA, the brainchild of Malaysia's second Prime Minister, the late Tun Abdul Razak.
And it is for this very reason FELDA should be brought back to its glory days, by going back to basics, which is to refocus on settlers.
That should be the guiding principle in all its operations, corporate deals and future undertakings for the largest palm oil producer in the world.
When FELDA was established about 60 years ago, its aim was to eradicate poverty through the cultivation of oil palm and rubber.
Over the years, it has grown exponentially into a global agri-business corporation and went on to list the world's third largest plantation company by land size, FELDA Global Ventures Holdings Bhd (FGV), in 2012, which signified that the agency has come of age.
But being bigger is, perhaps, not necessarily better for FELDA.
After the listing of FGV, which saw plantations and milling activities coming under the listed entity, FELDA was left with its settlers.
In 2013, it established FELDA Investment Corporation Sdn Bhd (FIC), which focused on strategic businesses via acquisitions or collaborations.
Within three years, FIC came under scrutiny due to failed ventures, poor planning and execution of projects that resulted in it losing millions.
And there have also been investments with no returns.
For starters, Shahrir has asked the FIC board to resign to enable him to reorganise it.
He also announced an aggressive asset disposal exercise to help stem deficit FELDA's cash flow and bring its financial situation into balance.
He acknowledged that weak governance led to "problematic assets" under FIC.
"Some of the ventures that lost millions are units of subsidiaries," he said.
He felt FELDA lost attention along the way.
"So, to overcome its problems it is going back to basics," he told Bernama recently, which means priority must be on settlers and their well-being.
This, he said, is the message he has been sending out ever since he took office on Jan 6, 2017.
Among the problems faced by settlers are late payments from FELDA for their palm oil produce, failure to collect produce, expensive housing, as well as incomplete and late financial statements.
Recognising that FELDA had problems, Prime Minister Datuk Seri Najib Tun Razak expressed concern and announced last September that the problems raised by settlers will be sorted out soon.
"(So, the answer is to) focus back on the settlers. Once the focus is back on settlers and once they have a good flow of income, their economy is good and they are happy, other things will fall into place accordingly," he said.
And the well-being of settlers includes focusing on their plantations and also problems concerning the second generation's needs and welfare that include housing.
Shahrir has vowed to frequently go down to the ground to ensure that the original goal of FELDA when it was set up on July 1, 1956, namely, the socio-economic upliftment of the people, is met.
Besides crops, social and welfare problems, the development of new industries and entrepreneurial activities would be looked into.
Launched in 1957, the social development effort kicked off with 400 settlers and gradually expanded to 112,635 settlers.
FELDA settlers owned one-sixth of the total oil palm plantation land in Malaysia.
Since 1990, FELDA stopped recruiting new settlers.
However, to be able to execute plans to help settlers, FELDA needs a steady flow of income and this is where FIC's role comes into play.
Hence, the move to reorganise FIC and assets and sell off those that are not giving reasonable returns are a much-needed clean-up for FELDA.
It has to streamline its operations and reassess investment portfolio.
A much cleaner and leaner FELDA is what the country wants to see as it is nothing less than a uniquely Malaysia's success story.
No other country in the world has a scheme such as FELDA, the brainchild of Malaysia's second Prime Minister, the late Tun Abdul Razak.
And it is for this very reason FELDA should be brought back to its glory days, by going back to basics, which is to refocus on settlers.