The Malaysian Insight

TALK of an Indonesian company taking over as the new shareholder of Felda Global Ventures Holdings Bhd (FGV), the plantation arm of Felda, is causing anxiety among Felda settlers.

Fears that their rights will be at stake if the shares and management of FGV are taken over by a foreign company was a common concern expressed by all those interviewed recently by The Malaysian Insight.

Abdul Rahman Ramli, 57, from Felda Raja Alias in Jempol, Negeri Sembilan, said that a foreign company in charge of FGV would most definitely have a negative effect on settlers, especially in terms of profits.

“The fruits of our plantations, or good fruit bunches, are sent to the Felda factory. The factory has now changed ownership from Felda to become a palm oil processing factory owned by FGV.

“If this happens, they (Indonesian businessmen) will take control of the sales, the setting of prices and everything else according to their needs and their profit margins,” he said.

Felda is said to be seeking the return of the land that is currently leased out to and managed by FGV because it feels that it can extract higher returns.

FGV is also likely to see a new shareholder, rumoured to be Indonesian businessman Martua Sitorus, the co-founder of Wilmar International Ltd.

Felda’s interest in FGV is about 34%, and the public-listed company manages about 335,000 hectares of Felda’s 850,000ha of land.

“Why do they want to sell FGV’s shares to an Indonesian businessman? Why do they want to share Felda with Indonesia now?” questioned Abdul Karim Masri, 48, who has been a settler at Felda Sungai Tengi in Hulu Selangor for 45 years.

“This will definitely become a problem for Felda settlers. We settlers already have to live with so many debts. All this while, Felda has been treating us well, but since the emergence of Felda Technoplant and FGV, the lives of the Felda people have become terrible.”

Felda Technoplant Sdn Bhd was formed by Felda in 2005 to manage plantations which had yielded fruits and were to be replanted.

Settlers bearing the burden

Samsudin Ishak, 49, from Felda Sungai Tengi said that if there were any mistakes made by foreigners, it would be the settlers that ultimately bore the repercussions.

“It feels like Felda is trying to ‘cover’ back money that has gone missing,” he said.

“Right now, the settlers are in great debt. In this bad economy and with the introduction of the goods and services tax (GST), the bitterness of life is greatly felt by the people of Felda.”

Bernama recently reported that Felda needed to pay a minimum of RM3 billion to FGV and serve an 11-month notice if it intended to end its lease.

President and executive officer of the FGV group, Zakaria Arshad, said that because the root problem behind the ending of the lease was due to Felda’s cash flow, both parties needed to hold further talks to deal with the issue.

Mazlan Aliman, chairman of Persatuan Anak Felda Kebangsaan (Anak), said that as soon as FGV was listed on Bursa Malaysia on June 28, 2012, concerns had already surfaced surrounding Felda’s position.

“Before this, there were rumours that parties from China and Europe wanted to buy a stake in FGV. The latest is the Indonesian company.

“If this is true, I think the foreign companies will buy a large number of shares. My concern is if they buy a majority stake in FGV, they would control FGV, ending Felda’s ownership,” he told The Malaysian Insight.

“What would be left of Felda? Before all this, Felda held 34% of FGV shares.

“Maybe Felda will reduce its stake in the company, down to around only 10 to 15%. Because they’ll be wondering why bother investing in FGV if it’s not profitable?”  

Shutting down FGV

For Shamsuddin Salleh, Felda should return to the original method of managing its plantations and land, and cease being involved in businesses that are not profitable.

“Just shut FGV down. Why the need to protect it?” questioned the 46-year old who has lived almost all his life at Felda Sungai Tengi.

“In the past, before we had FGV, Felda was making billions of ringgit every year. The best way is to return Felda to what it was,” he said.

There are 54 parliamentary seats in Felda areas, and opposition parties are trying hard to make inroads into those areas in their quest to defeat BN in the next elections. 

Deputy Prime Minister Ahmad Zahid Hamidi has also been actively urging Felda settlers to continue supporting BN and to return to the ruling coalition six Parliamentary seats that were lost to the opposition in the last elections.

The six seats are Raub, Kuala Nerus, Temerloh, Dungun, Kulai, Sungai Siput. – May 8, 2017.