Felda facing critical cash flow; White Paper to be presented

Felda inquiry: Economic Affairs Minister Datuk Seri Mohamed Azmin Ali has announced that the Government will present a white paper on Felda. —Bernama See page 2

KUALA LUMPUR: The Government has decided to present a White Paper in Parliament in the next session to expose the real situation of the Federal Land Development Authority (Felda) and its strategic rehabilitation plan.

Economic Affairs Minister Datuk Seri Mohamed Azmin Ali said Felda was facing a critical cash flow problem, but the Government was committed in revitalising the agency for the well-being of settlers in line with the Land Development Act 1956 goals.

“The immediate focus of Felda’s new board and management is to strengthen the agency’s cash flow through discussions with creditors in order to restructure the agency’s loans which have already reached RM8.025bil.

“The next step taken to strengthen the cash flow is by selling non-strategic assets such as properties abroad and also within the country,” he said when responding to a question from Ma’mun Sulaiman (Warisan-Kalabakan) during the ministers’ question and answer session at the Dewan Rakyat today.

Azmin also pointed out that the focus of the new management was to implement the statutory obligation for Felda settlers, hence, settlers could be rest assured that their advance loans for living costs and advance payments for their harvest would be paid according to schedule.

The Pakatan Government in its 100-day manifesto promised to abolish 50% of the settlers’ debts, which resulted from advance loans for living costs for replanting of crops.

Azmin said Felda’s financial position was a legacy of weak leadership in corporate governance and irresponsible financial management.

However, the Government was confident that the new management of Felda would adhere to the principles of accountability and good governance to ensure the agency’s recovery and sustainable development process.

On whether Tawau Oil Products (TOP), a subsidiary of Felda Vegetable Oil Products Sdn Bhd (FVOP) will be closed, he said FVOP is a subsidiary of FGV Holdings Bhd, hence, it is not under Felda management.

FGV is undergoing a rationalisation process to enhance its value and performance, but has no plan to close the TOP plant, he added.

To Ma’mun’s supplementary question on the status of Felda’s agreement with the Sabah government to allocate 40,000 hectares (ha) to settlers as only 9,000 ha had been distributed so far, Azmin said the deal would be looked into again as the land distribution had been halted.

In 2012 Felda handed over 400,000 ha of land to FGV Holdings for listing purposes, he said, adding that however, FGV was having problems paying dividends and fair profit-sharing to Felda, which was one of the reasons why Felda was facing critical financial management problems. — Bernama