BESTARI JAYA (Selangor) • Malaysian Prime Minister Najib Razak is dishing out RM510 million (S$164 million) for replanting oil palm trees, a move that will benefit settlers who live and work on smallholdings allocated to them by Felda, the national land development agency.
The fund allocation was announced on Thursday to celebrate 100 years of commercial oil palm planting in Malaysia, the second largest producer of palm oil in the world after Indonesia.
The new funds come on top of an existing RM1.75 billion already budgeted for oil palm replanting between 2010 and 2020 - or an average of RM170.5 million a year.
The government's move will help with cost of living issues faced by about 600,000 settlers and their families, most of whom are loyal supporters of ruling party Umno.
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"I hope that this provision will be able to alleviate the financial burden of smallholders to carry out replanting and new crop planting for oil palm and, at the same time, ensuring the country's palm oil production is able to meet market demand," Datuk Seri Najib said at Sime Darby's Tennamaram Estate in Selangor on Thursday.
Umno holds 86 constituencies in the federal parliament, with 54 of them containing large Felda plantations. The fresh injection of funds come amid speculation that the next general election could be called later this year.
Felda was started in 1956 by Mr Najib's father, former prime minister Abdul Razak, to help poor Malays by resettling them in remote oil palm and rubber plantations.
Today, these rural and semi-rural communities have become bastions of support for Mr Najib's Umno party, with the government providing aid for them to plant, harvest and sell their products.
Second- and third-generation Felda settlers also get government aid in the form of housing and education subsidies.
Mr Najib said the government has allocated more than RM500 million in grants since 2011 to palm oil companies and those that produce palm oil products.
The Malaysian Palm Oil Council said the country has 5 million ha planted with oil palm, and palm oil accounts for almost 6 per cent of Malaysia's economic output.
THE STAR/ASIA NEWS NETWORK