BANGI, Jan 10 (Bernama) -- Sao Tome and Principe is keen to collaboratewith Malaysia to increase its palm oil production and export market, itspresident Fradique De Menezes said here Saturday.

He hopes that the Malaysian government or any corporations could assistthe country in such efforts and form joint-ventures to cultivate thecountry's 300 hectares of oil palm land.

De Menezes and his 16-member delegation arrived here on Friday for athree-day working visit.

"Our visit here is to get an idea on what you do with your palm oil. Weonly produce palm oil for our own food consumption. We want Malaysia tohelp us train our farmers and form joint-ventures in the production (ofpalm oil)," he told reporters after visiting the Malaysian Palm Oil Board(MPOB) here this morning.

De Menezes said that the agriculture-based republic, the smallest countryin Africa, wanted to continue its efforts in sustaining the agriculturesector as its main income earner by utilising its oil revenue.

The 175,883-populated country formed by two islands had recently stumbledover petroleum in its territorial waters in the rich oil-rich waters ofthe Gulf of Guinea.

"We want to use the oil money to concentrate on the agriculture sector aswe are a mono-culture country with our cocoa production," he said.

He said that the oil business was expected to generate US$6 billion toUS$11 billion (US$1 = RM3.8) income with its recent collaboration withNigeria on a joint licence to produce oil.

Earlier, MPOB director-general Datuk Dr Yusof Basiron, in his welcomeremarks, said that oil palm was the most important agriculture crop andthe industry is the pillar of Malaysian agriculture and mainstay of therural economy.

"Today Malaysia is the world's largest producer and exporter of palm oil,"he said.

He said that oil palm covered more than 60 percent of the country'sagriculture land of six million hectares.

The industry was an engine of growth contributing one-third of theagriculture gross domestic product, generating RM20 billion of exportearnings and supporting and employing more than 1.5 million people in allsectors of the industry.

In 2002, palm oil production was 11.9 million tonnes and is expected toreach more than 13 million tonnes in 2003.

"The development and success of the industry is shaped by policies andplanning formulated together by the government and the industry. Theindustry is backed by excellent support services, particularly in researchand development of which MPOB plays a major role," Yusof said.

He said it was envisaged that oil palm would continue to be an importantprimary agriculture crop in Malaysia for many years to come.

Malaysia accounted for 26 percent of the world's oil and fats trade and 58percent of world's palm oil market.

Yusof said that palm oil was forecast to overtake soybean soon, both interms of production and trade.

He also said that MPOB provided technical cooperation under the MalaysianTechnical Cooperation Programme (MTCP) to other oil palm producingcountries to assist in the development of their oil palm sector.

-- BERNAMA