Consulting Study 12: The Felda case study
December 2015 Authors This study was conducted between March to April 2015 by Yuleng Khor of LMC with research associates Dr Johan Saravanamuttu and Deborah Augustin.
LMC International Ltd 4th Floor, Clarendon House 52 Cornmarket Street Oxford OX1 3HJ United Kingdom. Tel: +44 1865 791737 Fax: +44 1865 791739 [email protected] https://www.lmc.co.uk/
© The High Carbon Stock Science Study 2015
This work is licensed under the Creative Commons Attribution 4.0 International License. You are free to reuse, reprint, or republish the work, in whole or in part, without written permission, provided that the source is acknowledged. To view a copy of this license, please visit http://creativecommons.org/licenses/by/4.0/
This report has been independently prepared by the authors for the High Carbon Stock (HCS) Science Study. It is part of a series of consulting studies on high carbon stock, in the areas of biomass estimation, soil carbon dynamics, remote sensing, and socio-economics. Together, these consulting studies provide background information for the HCS Science Study’s synthesis report, but also they constitute stand-alone research that aims to shed light on this critical area of enquiry. Contents
Introduction 06 Background & Methodology Abbreviations 08 Executive Summary 10 • Expectations in the next decade and broad lessons from Felda • Positive & negative socio-economic outcomes for stakeholders 11 • Socio-economic impacts of plantations and future expansion 12 • Institutional features and mechanisms in context of HCS regulations • Smallholder certification, the need for assistance and incentives to participate in sustainability • Felda’s lessons on corporate farm-smallholder ratios and micro-management 13 • Felda’s lessons on the need for rural planning and stakeholder relations 14 Conclusions and questions for further research 15
Part 1: Overview of the Felda Smallholder Project 16 Preamble • Development stage 1 - Financial assistance to state land development boards, and its 19 own new programme for pioneer farm exporters • Development stage 2 - Felda pre-eminence and centralised management 20 • Development stage 3 - Novel systems revert to individual land ownership, a “package deal” of smallholding with house plus social services • Development stage 4 - Last settlers emplaced in 1990, the development of commercial 21 estates and the growth of an agribusiness group • Development stage 5 - Public listing of Felda Global Ventures 22 • Felda case studies - Jengka in Pahang, Johor Tenggara, Sahabat in Sabah 23 Summary 25 Part 2A: The Felda Settler and Settlements 26 Synopsis The Felda settler • Settler origins • Felda settler main income, costs and preferential loans, grants and transfers 27 • Felda settler secondary incomes 31 • Felda settler as economic agents - FFB grading, sustainable certification, replanting 32 • Felda settler land ownership • Felda settler ageing - migrant labour and share cropping 33 • Felda settler - family structure and development 34 • Second generation issues - education, migration, employment, social issues • Felda settler outcome - creation of a modern farmer and a rural middle class? 35 The Felda settlement 36 • Felda settlement - green field and brown field sites • Felda settlement - social services • Felda settlement - local economy linkages 37 • Felda settlement - the local environment Summary 38 Consulting Study 12 The Felda case study
Part 2B: Felda and its Institutional Context 39 Synopsis • Policy, administration and external linkages • Felda, state administration, management and politics 41 • Felda Group - local economic linkages 43 • Felda Group - ancillary, upstream and downstream activities 44 • Felda’s position in the national palm oil sector 47 • Felda’s economic multiplier effect and business linkages • Felda and socio-environmental policy 50 Summary 53 Part 3: Synthesis and Evaluation 54 Evaluation Expectations in next decade from the perspective of Felda 59 Socio-economic outcomes for stakeholders at settler and institutional levels Socio-economic impacts of plantations and future expansion 61 How carbon stock thresholds are affected in expansion 62 Mitigating the impact of industry expansion Institutional features and mechanisms in context of HCS regulations Smallholder certification: the need for assistance and incentives to participate in 65 sustainability Conclusions and questions for further research 67 Appendix 1: References and Bahasa Malaysia Literature Survey 68 References Interviews 70 Appendix 1A: A Selected Listing of Socio-economic Literature on Felda from Key Universiti Malaya 71 Libraries and the Felda Library Appendix 1B: Selected Literature Listing – Universiti Malaya and Felda libraries 75
List of Tables Table ES.1: Estimated monthly income sources for 4 ha oil palm settler (RM) 11 Table ES.2: Felda settler costs, income and resourcing indicators 13 Table 1.1: Felda key development stages 18 Table 1.2: Felda settlers by state of origin, 1967, 1976, 1986 19 Table 1.3: Emplacement of Felda settlers by state, area and crop, 1987 20 Table 1.4: Monthly settler obligations for 4 ha rubber plot and 4 ha oil palm plot, 1986 21 Table 1.5: Sources of Felda funding, 1990-2004 22 Table 2A.1: Felda Settlers by State of Origin, 1967, 1976, 1986 26 Table 2A.2: Emplacement of Felda settlers by state, 1987 27 Table 2A.3: Daily rates for Felda settlers Table 2A.4: Cost of resettling one family, 1976 and 1986 (RM) 28 Table 2A.5: Settlers’ average monthly net income (RM) 1979-2004 29 Table 2A.6: Settlers’ average monthly net income for 4.1 ha of oil palm 30 Table 2A.7: Estimated monthly income sources for 4 ha oil palm settler 31 Table 2A.8: Number of unsettled Felda inheritance applications in selected districts 33
04 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Table 2A.9: Pension rate for Felda settlers, Sungai Koyan, 1991 Table 2A.10: Malaysian citizens and non-citizens in FELDA Peninsular Malaysia, 1989 34 Table 2A.11: Kindergarten facilities in Felda settlements across Malaysia Table 2A.12: Level of education settlers aspire to for children in Felda Semarak Jengka 15, Pahang, 35 2011 Table 2A.13: Land developed by Felda and state development programmes, 1961-1995 36 Table 2B.1: Felda smallholders and plantation area by crop, 2005 40 Table 2B.2: Felda settler costs, income and resourcing indicators Table 2B.3: Felda Group employees, 2005 41 Table 2B.4: Sources of Felda funding, 1990-2004 43 Table 2B.5: Profits of Felda companies, 2002-2004 46 Table 3.1: Felda key data and facts 55 Table 3.2: Felda key outcomes and policy evolution, 1950s to 2010s 56 Table 3.3: Felda smallholder project’s macro lessons for current HCS issues 63 Table 3.4: Indicative costs for smallholder plot and home, Malaysia and Indonesia, 2015 (RM) 66 Table A1: Literature highlights on Felda settler socio-economics 72 Table A2: Selected Literature Listing on Felda and Felda Smallholders 75
List of Diagrams Diagram ES.1: Oil palm and Malaysia total crop hectarage, 1961-1991 10 Diagram ES.2: Felda and Malaysia oil palm hectarage, 1960-2014 Diagram ES.3: National Felda settlers’ average net monthly income, 1979-2004 12 Diagram ES.4: Jengka multi-settlement, an example of the Felda approach 14 Diagram 1.1: Oil palm and Malaysia total crop hectarage, 1961-1991 16 Diagram 1.2: Felda and Malaysia oil palm hectarage, 1960-2014 Diagram 1.3: Felda locations in Malaysia - estates, mills and installations 18 Diagram 2A.1: Layout of typical Felda village 36 Diagram 2A.2: Layout of typical Felda house lot 37 Diagram 2A.3: Jengka multi-settlement Diagram 2B.1: Felda organisation chart, 1991 (a) and 1993 (b) 45 Diagram 2B.2: Felda Global Ventures’ organisation chart 48 Diagram 3.1: National Felda settlers’ average net monthly incomes, 1979-2004 59
High Carbon Stock Science Study 05 Consulting Study 12 The Felda case study
Introduction
Background & Methodology evolution of the internationally highly-regarded Felda programme. The challenge was to tease out from nearly There has been mounting pressure by NGOs on six decades of history, the nuances of Felda’s micro and sustainability and by the health fraternity against the macro-level lessons for present day oil palm expansion use of palm oil. This pressure is increasingly evident under the emerging high carbon stock (HCS) regimes. in the European Union. It has also been a long standing issue in the United States of America with In addition, 10 primary interviews were conducted the opposition to palm oil as part of the broader anti- with Felda and industry sustainability specialists to tropical oils campaign. The purpose of this study is fill in gaps in historical understanding (notably on to provide some clarity on the design, evolution and socio-environmental policies including deforestation outcomes of the Felda scheme for its smallholders and and indigenous peoples), as well as to understand its position within the Malaysian economy and socio- the challenges for Felda settlers (and other Felda mill political sphere. It also seeks to examine the situation suppliers) fitting into the evolving NGO cum processor- of the Felda smallholders and Felda commercial entities trader driven sustainable and traceable supply-chains within the regional, national and global trade and use of for palm oil. edible oils. In this review: NGO pressures on sustainability point to lower future production and consumption growth, but it is likely that • Part 1 provides a history of the Felda project this will not happen in a straightforward manner and indicating how its unique model of the resettlement there will be many unanticipated consequences. The of landless farmers began in 1956 and has over concept of sustainability has been made operational some five decades succeeded in raising smallholder via certification and traceability systems designed household incomes considerably above the national primarily for larger corporate users. There has been poverty line, prompting some observers to consider limited attention on equitable economic and market it as one of the most successful land settlement access. There are widespread worries about inequitable organisations in the world. Felda had developed from distribution of market access, which limits impacts and a state-run statutory authority, where settlers later raises the opportunity costs for smallholders within participated by way of share ownership within an changing global supply-chains. evolving corporate structure, to the establishment of the global conglomerate Felda Global Ventures A case study of the Felda smallholder scheme and its (FGV) in 2012. The Felda scheme for smallholders outcomes can inform the debate, by analysing over- dovetailed neatly into Malaysia’s implementation simplified arguments. Concerns include the funding for of the New Economic Policy (NEP) in 1970, with smallholders; changes in mill zoning by risk, which may its twin objectives of eradicating poverty and harm smallholder market access; and multi-tier pricing raising the economic lot of indigenous communities (discounting) with special concerns for perceived high (Bumiputera). Felda schemes lifted about 122,000 risk regions including peat land zones. families2 (equivalent to one million people), out of poverty and helped a generation of landless Malays This study was conducted between March to April become a rural middle-class, with holdings of 2015 by Yuleng Khor of LMC with research associates typically four hectares of oil palm or rubber crops. Dr Johan Saravanamuttu and Deborah Augustin. Starting with a selected literature review of the Felda in English and Bahasa Malaysia1, the study delved into Felda smallholder livelihoods and prepared an examination of the macro institutional features and
1 There is English language literature on Felda mainly in 1960-1990, but after 1990 the literature is mostly in Bahasa Malaysia, including numerous field studies or theses by Malaysia university students that can be reviewed. Since the official 30 and 50 year anniversary books (published in 1988 and 2006) for Felda, there has been a lack of recent data releases by Felda on smallholder incomes and other socio-economic outcomes. 2 We refer to about 122,000 settler families in this report. The actual settler intake in 1961-1990 was 122,809, yet Felda’s official 50 year book reports 102,621 settlers (Lee and Bahrin 2006, p.25 and pp.236-244). The numbers used in various studies differ; 104,946 families in 1990 were mentioned by Ragayah 2013, and 112,635 Felda settlers were members of KPF (FGV 2012). The reported number of settlements also varies over time. “Up to 2005, Felda would have fully developed a total of 322 schemes. However, since then, 5 schemes have converted their GSA status…. and 42 schemes have merged for administrative purposes. Subsequently, there are 275 existing schemes of which 74 schemes have achieved JKKK status.” (Lee and Bahrin 2006, p.19).
06 High Carbon Stock Science Study Consulting Study 12 The Felda case study
• The second part of the study (2A) examined in detail the settlers and their settlements, the criteria for settler choices and where and how they were emplaced. The majority of settlers saw an increase in income after moving into the schemes and perceived their post-settlement lives as better. However, these socio-economic improvements that included school infrastructure for settler children had an unintended effect of creating a rural to urban migration pattern among the settlers’ children. This worked against the schemes’ objective of containing such migration. This out-migration has continued, with the majority of the Felda second generation uninterested in agricultural work.
• Part 2B examines the institutional context of Felda and its development as a corporate entity and its impact on the smallholders. New dynamics and relationships invariably developed as Felda turned into a massive conglomerate with a portfolio of upstream and downstream activities, executed by a plethora of subsidiaries, joint ventures and associate companies. From its modest beginnings in 1956 with its settler schemes, the Felda Group now sits at the commanding heights of Malaysia’s palm oil industry in a trajectory that has taken it from being a social enterprise with its settler-centric approach to its current profit-oriented stance as a global palm oil conglomerate.
• In Part 3, we evaluate lessons from Felda’s micro- level policies and the macro-institutional aspects of the key questions for the current phase of oil palm expansion under the strictures of certification and new High Carbon Stock regimes seeking to limit deforestation in a period when the competition for land is expected to be heightened along with heightened social issues, compounded by higher aspirations of the industry.
High Carbon Stock Science Study 07 Consulting Study 12 The Felda case study
Abbreviations FFB Fresh fruit bunch of the oil palm tree. CPO is processed from the fleshy fruit and PKO is CPO Crude palm oil. processed from the PK recovered during the milling of FFB. CSPK RSPO’s Certified Sustainable Palm Kernels. RSPO CSPK production can be supported via FGV Felda Global Ventures Holdings Berhad. This the GreenPalm book & claim credits system. is the public-listed company that leases Felda Higher levels of more costly certification commercial estates and owns key processing are RSPO CSPK physically traded via mass facilities of the Felda Group of companies. balance, segregated and identity preserved chains of custody options which are in parallel HCS High carbon stock. Refers to above ground with the CSPO options set at the palm oil mill biomass and also soil carbon. Environmental (see CSPO below). concerns about deforestation drive new policies for the largest oil palm plantations CSPO RSPO’s Certified Sustainable Palm Oil. to adopt policies to conserve forest with a GreenPalm book & claim credits are the minimum threshold of carbon (to minimise basic units that support the production deforestation and to allow for mature of sustainable palm oil, but it is the higher shrubland regrowth) as well as to avoid levels of certification that are demanded development of peat lands (to minimise and coveted. These are the RSPO CSPO greenhouse gas emissions). physically traded via the alternative mass balance, segregated and identity preserved Policies of the TFT (closely associated with chain of custody options, where the palm oil the Greenpeace’s HCS Approach) traceability mill is the basic unit of certification together programmes require that these areas be set with its supply-base of estates, associated aside on a voluntary basis. However, such (scheme managed) smallholders, suppliers and set-asides may not be recognised in national independent smallholders. and local regulations. RSPO announced in May 2015 that it is developing a RSPO+ CSPKO RSPO’s Certified Sustainable Palm Kernel Oil. Voluntary Addendum that is expected The RSPO’s allows a 45% conversion rate upgrade its policies (for an important sub-set from CSPK. Because this is higher than most of its members) in a catch up to at least match actual palm kernel oil yields, most producers those of the newer sustainability / traceability use this rate. RSPO CSPKO production can programmes. The Sustainable Palm Oil be supported via the GreenPalm book & claim Manifesto’s HCS Study is a new programme, credits system. Higher levels of more costly and an important evolution for its member certification are RSPO CSPKO physically companies. traded via the mass balance, segregated and identity preserved chains of custody. CSPKO HCV High conservation value. These include is produced by certified PK crushers who environmental (mostly biodiversity) and need to purchase suitable CSPK. social HCVs (including customary use areas for access to water, food and for cultural FELDA The Federal Land Development Authority of reasons). RSPO sustainability and other Malaysia. Land was alienated to this statutory traceability programmes require that grower body to operate a development programme members do not develop these areas, instead to alleviate rural poverty for about 122,000 setting aside these lands on a voluntary poor families, using modern farming methods basis. However, such set asides may not be to plant mostly 4 hectare oil palm and rubber recognised by and hence contravene national plots. This land development programme and local regulations. resettled families in new communities (with fully integrated social services) hewn out Inti Indonesia plantation estate area operated by of tropical forest zones mostly in the states the land concessionaire. Regulations generally of Pahang, Johor and Negeri Sembilan in oblige the concessionaire to develop 20% of Peninsular Malaysia. This was regarded as the area for the benefit of local smallholders. one of the most successful smallholder Prior to the liberalisation of this policy, development programmes in the world. It the inti:plasma ratio was the reverse, i.e. developed ancillary services and processing 20%:80%. facilities and grew into a full-fledged agribusiness with commercial oil palm estates KPF Koperasi Permodalan Felda or the Felda (largely developed after 1990, the last year in Investment Cooperative. Set up on July 1, which settlers were emplaced). Key commercial 1980 as the cooperative of Felda settlers and assets of the Felda Group of companies were employees. It came to own large key stakes listed via an IPO in 2012 (see FGV). 08 High Carbon Stock Science Study Consulting Study 12 The Felda case study
in Felda Group businesses including palm oil palm oil along the entire supply chain. TFT processing facilities, transport and bulking and is closely associated with Greenpeace (and more. Felda settlers and staff are members other NGOs) and has criticised the RSPO for and given the opportunity to investment on a deficiencies, instead promoting policies for private equity basis in these businesses. “no deforestation, no peat, no exploitation” while creating a new programme that allows They earned 14% per year investment returns the largest processors-traders of palm oil over a 30 year period. In 2012, KPF had to continue to include small suppliers and approximately 220,000 members, of whom smallholders. 112,635 are Felda settlers. The rest are Felda Group employees and the children of settlers. SCCS Supply chain actors (ex-mill facilities such In late 2013, KPF sold off stakes in key Felda as refineries, palm kernel crushers, storage businesses to FGV for cash. It also owns tanks or bulking facilities and others up to and shares in FGV. including end consumer goods manufacturers and others) who own and physically handle NGO Non-governmental organisation. In the RSPO certified products are audited against palm oil sector, these are grassroots and the RSPO Supply Chain Certification campaigning organisations that are focused Standard. The 25 November 2011 version on environmental or social and labour issues. currently in use is in the process of being revised (previous versions include those dated OER Oil extraction rate of CPO from FFB. This August 2008 and July 2009). is an important measure for palm oil mill processing. It is influenced by the quality of UMNO United Malays National Organisation is the fruit (its under- or over-ripeness). The the ethnic Malay political party that heads grading of the oil palm FFB affects the price the Barisan Nasional coalition that has that growers (including smallholders) will formed every government of Malaysia since receive for their fruit. Independence in 1957. In Malaysia’s plural society, political economic concerns and P&C Principles and Criteria are the RSPO standard, ethnic violence in 1969 caused Barisan comprising over 130 indicators covering Nasional to introduce its New Economic environmental, social, good agricultural Policy in 1970. This policy sought to address practice and economics. Palm oil producers ethnic imbalances of income, notably or growers certify their mill (and supply between the (mostly urban) ethnic Chinese base) through verification of the production and the (mostly rural) ethnic Malays. The process by third party auditors. Growers are Felda smallholder programme preceded this assessed for certification once every 5 years initiative, but fits well into the policy. and undergo annual assessment. Smallholders have a simplified RSPO standard, but they represent only 3.6% (114,000 hectares) of the total RSPO certified area (as reported in late 2014, after about 10 years). Larger producers are predominant in the RSPO.
PK Palm kernel.
PKO Palm kernel oil.
RSPO The Roundtable on Sustainable Palm Oil is a multi-stakeholder organisation that has developed a popular voluntary certification scheme for sustainable palm oil, and it is part of the World Wildlife Fund for Nature’s (WWF) stable of commodity roundtables that seeks to transform over 15 commodity supply chains (including timber, agriculture and fisheries). The RSPO has reached its tenth year and achieved a share of 18% of world palm oil output. It faces rising competition from newer (possibly lower compliance cost) programmes such as The Forest Trust (TFT). TFT offers customised traceability systems that track sustainable (certified or otherwise)
High Carbon Stock Science Study 09 Consulting Study 12 The Felda case study
Executive Summary
The Felda scheme for smallholders dovetailed neatly Diagram ES.2: Felda and Malaysia oil palm hectarage, into Malaysia’s implementation of the New Economic 1960-2014 Policy (NEP) in 1970, with its twin objectives of 7 35% eradicating poverty and the uplifting the economic lot of indigenous communities (Bumiputera). The Felda 6 30%
schemes had lifted about 122,000 families (equivalent 5 25% to over one million people), out of poverty and helped a generation of landless Malays become a rural middle- 4 20%
class, with holdings of typically four hectares of oil palm 3 15% crops.
Oil palm planted, million hectares million planted, Oil palm 2 10% Diagram ES.1 shows the impressive growth of oil palm to just over 35 percent of total cash crops areas 1 5%
over the key 30 years (1961-1991) of the core Felda 0 0% settler emplacement period. Diagram ES.2 illustrates 1960 1977 1982 1987 1992 1997 2002 2007 2012 Felda’s position within the national oil palm context. Pensinsula Malaysia - oil palm Sabah - oil palm Sarwak oil -palm Felda - oil palm % (est) It accounted for over 30 percent of total area from Source: MPOB (2015), Bahrin and Lee (1986) and LMC estimates. the late 1970s to the late 1980s. It then dropped in area share as it stopped expanding while others grew Important lessons from the Felda case study are: the rapidly, notably in Sabah and then Sarawak. After Felda importance of an integrated (regional large-scale) slowed its expansion, Malaysia’s national oil palm approach to rural development, the imperative of strong area continued to more than double to over 5 million institutional support by the state, the partnership of hectares. Thus, Felda’s share dropped to about 13 the government with global agencies, the support of percent of the total planted areas by 2014. the local or sub-national governmental authorities and effective cooperation with the private sector.
We provide below a summary of answers to four key Diagram ES.1: Oil palm and Malaysia total crop questions (see Part 3). hectarage, 1961-1991 Expectations in the next decade and broad lessons from 8 40% Felda
7 35% The Felda project which began as a social enterprise in 6 30% 1956 as a resettlement scheme for landless farmers.
5 25% As a social project the Felda project was a high-cost “premium” programme with the resettlement cost per 4 20% family rising to over RM50,000 by the time the schemes 3 15% were stopped in 1990. Many input costs were borne Harvested area, million hectares 2 10% by the state, for example land was given free to the settlers and thus the cost of the land and of subsidies 1 5% to build and provide social amenities for the settlers
0 0% was borne by the government. Felda smallholder 1961 1971 1981 1991 areas did not expand after 1990. The emergence of Oil palm Rubber Grains Cocoa Coconuts Other Oil palm % the new era of corporatisation within Felda itself has Source: FAO (2015). meant that financial resources have been invested in ancillary upstream and downstream operations rather than new settler schemes. In the current phase of ensuring “sustainable” palm production, such as RSPO certification in settler-operated schemes, Felda settlers are aided by Felda Technoplant, which is supported by FGV, to deliver sustainable palm oil from its settler schemes. For FGV’s corporate plantation expansion, the
10 High Carbon Stock Science Study Consulting Study 12 The Felda case study
question remains as to the ratio it will adopt of settler Positive & negative socio-economic outcomes for schemes to plantations. Its public-listed status suggests stakeholders that it will behave like other plantation groups, meeting the regulations plus voluntary commitments. From the settler and institutional perspectives, the primary goal of Felda, which was poverty eradication The Felda project is at a stage where the settlers’ and raising incomes by resettling landless farmers, programme is more than mature, and the impetus of was a major success. Table ES.1 and Diagram ES.3 economic privatisation and globalisation has resulted in demonstrate how Felda oil palm settler incomes have a major policy shift moving another government-linked improved substantially and how primary incomes corporation, FGV, into the international arena. Thus, the fluctuate with CPO prices. For other income, the Felda commercial parts of the Felda Group (pre 2010), though target is for secondary income of 20-30% as are added substantively delinked from the settlers, are likely to incentives including investment returns from private continue supporting them. Felda settlers are still likely equity investment in the KPF (co-owner of Felda to enjoy political patronage, given their importance as a corporations involved in transportation, palm oil milling large rural voting bloc in Peninsula Malaysia. and other downstream activities).
It is unlikely that the Felda settler programme will be replicated in the future in Malaysia and it is questionable that other countries or regions would find the financial wherewithal to create such a high-end model of land resettlement. Specialists reckon that a five-person family now requires an oil palm plot of 10 hectares to fit current needs and aspirations in rural Malaysia.
Table ES.1: Estimated monthly income sources for 4 ha oil palm settler (RM)
1986 1998 2005 2014 Comments FFB output - est. net income 220 2,325 492 1,800 1986-2005, 19 t/ha. FFB; OER 19%; (with labour cost) 33% labour cost, FFB price 21% of CPO price. 2014 from Barlow (2015); 22 t/ha. FFB; FFB price RM500/tonne; operational charges RM200/tonne Est. net income ratio 29% 74% 27% 40% CPO price 579 2,378 1,394 2,384 Target secondary income 154 737 493 951 Step up from 20% to 30% over time (20-30% of primary) KPF investment (1,000-7,500 12 29 58 88 Step up 1,000, 2,500, 5,000 to 7,500 units @14%) units of RM1 Incentives n/a n/a 150 150 Annual incentive RM1,000 in cash, KPF RM500, Hari Raya contribution RM300 Total estimated monthly income - 386 3,092 1,193 2,473 all sources
Note: In 1986 the net monthly income for 4 ha oil palm plot was RM376; gross income was RM750 (net income plus typical monthly obligation amount), for 50% net income margin in year when the CPO price was relatively low. There may have been top-ups and/or loan deferment.
Most settlers joining Felda had monthly incomes below RM200 (1979 data for all settlers). Malaysia’s minimum monthly wage was RM800 in 2014.
Sources: Monthly settler costs in 1986 from Bahrin and Lee (1986), in 1998 from Bukit Wa Ha scheme in Kota Tinggi, Johor (Wong 2000), in 2005 from Lee and Bahrin (2006, p.43), and 2014 costs and returns from Barlow (2015).
High Carbon Stock Science Study 11 Consulting Study 12 The Felda case study
Diagram ES.3: National Felda settlers’ average net Malaysia has more or less run out of acceptable monthly income, 1979-2004 greenfield sites for oil palm development and it has also run out of people keen to work oil palm holdings. 2,500 Moreover, Felda settlers are ageing and entering a more economic satisficing (instead of maximising) stage 2,000 of their economic life-cycle. While the full support of Felda’s commercial arm may no longer be available 1,500 to them, Malaysia federal and state agencies, and politicians of all stripes will still pay close attention to 1,000 their needs, as they are a rural interest group of large electoral significance. 500 Monthly income, CPO (RM) price Institutional features and mechanisms in context of HCS 0 1979 1984 1989 1994 1999 2004 regulations Oil palm, 4.1 ha Oil palm, 4.9 ha Oil palm, 5.7 ha Nominal crude palm oil price (RM, year average) Pre-1979, 85% had income sub RM200 pre-settlement HCS pledges (putting upward pressure on RSPO policy) affect the areas that can be developed, in order to limit Note: 4.1 ha Felda settler earns 9.3x CPO price, 4.9 ha holding the problem of deforestation. There are now at least earns 9.5x and 5.7 ha holding earns 12.4x CPO price. three HCS regimes:
Source: Settler smallholding data from Bahrin and Lee (2006, p.37), • The HCS Approach (April 2015 formalisation) is Malaysia CPO price from MPOB (2015) mostly led by Greenpeace-The Forest Trust--Forest Three key macro themes in Felda settler socio-economic Heroes effortsand supported by the large proces- outcomes are (see Part 3): sor-trader groups, primarily Wilmaralongside Golden Agri Resources and Cargill. This has its origins in • Settler satisficing and economic agency 2011 with work done for Golden Agri Resources by TFT and Greenpeace. • Felda’s benefit to others • RSPO (a certification program) has a de facto HCS • Constrained certification policy via its greenhouse gas emissions mitigation rule in its New Planting Procedure. Socio-economic impacts of plantations and future expansion • That of the Sustainable Palm Oil Manifesto3 is led by a group of key players in the palm oil industry, is due Felda was an integrated rural development to report its finding. programme backed by a strong political will and multi- agency partnerships. Its highly focused policy and • These suggest possible rising competition between administration were supported by strong state and corporate plantations and local peoples as they con- multi-lateral funding to deliver incomes for mostly 4 sider how to develop within a smaller geographical hectare smallholders of rubber and oil palm, whose (lower carbon stock) area. product was destined for export markets. It was a social enterprise that was designed to be settler-centric. We identify three key institutional issues.
Since 1990, Felda has been shifting from a social- Smallholder certification, the need for assistance and enterprise to a corporatised model. The FGV stage of incentives to participate in sustainability development, features the initial public offering or IPO of the commercial estates (on long term land lease) It is a plantation industry consensus that smallholders of Felda and its 49% owned downstream processing and independent producers do not see any direct assets in 2012 to secure RM4.5 billion for FGV’s financial return on RSPO certification. FGV therefore expansion plans (Khor, 2012). It is also apparent from its supports the RSPO certification of settlers. However, plantation acquisitions that FGV operates much like any its sustainability specialists worry that settlers may not other public-listed plantation company, without stated do enough to maintain the certification in the face of goals for achieving higher than regulated smallholder inadequate financial benefits. It is notable that there land development ratios. For it to do otherwise, would is some intention to offer revenues to settlers above (arguably) be surprising given the strictures of market FGV’s income from selling RSPO certificates. In a way, pressure for quarterly reporting and share market this may point to the necessity of integrated plantations performance.
3 It is this organisation which has commissioned this study report.
12 High Carbon Stock Science Study Consulting Study 12 The Felda case study
paying smallholders a premium as a way of righting Table ES.2 summarises the data on the costs and the financially regressive sustainability system that incomes of a typical Felda settler. has evolved. For instance, WWF et al. (2012; WWF is a key mover of RSPO) writes that RSPO regulations Table ES.2: Felda settler costs, income and resourcing are of more direct benefit and lower cost to the indicators largest corporations, while small and medium-sized corporations and smallholders face fewer direct benefits Cost item / and higher costs. indicator Per settler cost RM 50,000 (US$19,230) in 1990; Arshad (2015) refers to NGO costings of RSPO (1990) settler repays ⅔ over 15 years at 6.25% certification and compliance of over RM400,000 per interest, mainly for cost of 4 ha. oil 2,500 hectare site per year and notes that the current palm holding and house. Cost likely to premia imply mere break-even for such a smallholder be double now with 3% per year cost (assuming all certificates are sold under mass balance) inflation. and concludes that there is no incentive to certify Settler net 25 year cumulative net income, 1979- without financial support of a large company. Data from income, 4 ha oil 2004, was RM 276,948 (average Arshad shows that the cost of RSPO compliance for the palm plot RM11,078 per year or RM 923 per largest plantations is around US$5 per tonne of CPO month). 2014 total income estimated at almost RM2,500 (Barlow, 2015b). and that for smallholders works out at about US$12 per tonne. Settler gross In 1986 (a year of low prices) net versus net monthly income for a 4 ha oil palm Felda’s lessons on corporate farm-smallholder ratios and income, 4 ha oil plot was RM376 (US$145). Gross micro-management palm plot income, net income plus typical monthly obligation amount, was RM750 Plantation experts favour managed cooperatives (US$288), for a 50% net income margin. operating under strict rules as the best way to apply Settler cost/ RM 5.0 million (US$1.92 million) per smallholder programmes4. This is seen as necessary settlement and oil palm settlement and RM6.0 billion for financial risk management. So long as the loan for Felda project, (US$2.3 billion) for 120,000 settler comes from a commercial bank and/or is implicitly or based on 1986 families. explicitly underwritten by the plantation company, cost these commercial entities will want to be assured of Cost of land Free; land was alienated from states to quality and consistency in planting new plots, as well as FELDA and not charged to settler. in plantation operations. Cost of basic Roads, water supply, public buildings, infrastructure etc., may cost 10% of combined project Under emerging HCS regimes and rising social and social value or RM 0.67 billion for 120,000 issues, large plantation companies face limitations on amenities settler families expansion of their own land areas. They are mulling how Number of Felda Settlements of 300-500 people enjoyed to develop more smallholder areas within their control. staff the services of 25-35 onsite staff, over a third of whom worked on community Key considerations include: development programmes (Anon. ALR, 2015). The staff-settler household ratio The ratio of inti to plasma. Some talk of 60:40 being was reduced from 8.1 in 1980 to 5.1 in more workable under current social situations (more 1990 (Lee & Bahrin, p. 26 and p. 189). heightened than in the past). Others favour plantations shifting toward a financing and managing agent Note: The total cost of the Johor Tenggara project was RM209.2 approach where the inti:plasma ratio may be 20:80 million (US$89.8 million) with Government expenditures for roads, water supply, and public buildings, such as schools and (which creates the problem of retaining FFB suppliers health centres set at US$10 million (World Bank, 1974); 1986 once the loan has been repaid; Anon. BAH, 2015). In exchange rate US$=RM2.60. the Indonesia context, a 20:80 ratio was one of the key Indonesia regulations before liberalisation for foreign and domestic investors reversed the ratio to 80:20.
Alternatively, smallholders could be grouped together under a cooperative. If so, plantation companies would like to have broad powers over the cooperative, including membership of the cooperative board (Anon. BAH, 2015).
4 In Indonesia, “fully managed plasma” refers to where the plantation company undertakes all development and operations work. There are diluted versions from “partly managed plasma” to independent smallholders.
High Carbon Stock Science Study 13 Consulting Study 12 The Felda case study
The micro management issues are very akin to the Diagram ES.4: Jengka multi-settlement, an example of strict development and operation rules of the Felda the Felda approach smallholders’ programme, where loan repayment was an important issue. However, the natural urge for strict control of plantation developers and financiers may not always suit local settler democratic desires. A significant lesson that plantations developing smallholder schemes could learn from Felda’s experience is the number of staff needed to obtain the high level of smallholder satisfaction that Felda has achieved. Settlement sizes for Felda range from 300 to 500 settler families and on- site staffing was 15-25 staff, over one-third of whom were involved in community development including religious affairs (Anon. ALR, 2015).
Felda’s lessons on the need for rural planning and stakeholder relations
Felda schemes had in the past encroached on forest land, comprising both secondary and primary forests, with some brownfield projects to rehabilitate state- run projects. Contractors, state agencies and the state governments benefited from timber complexes associated with its huge regional schemes on the Peninsula, Jengka Triangle (for which a settlement plan is illustrated in Diagram ES.4) and Johor Tenggara, and also Sahabat in Sabah. Recently, in many countries, the question of who gains from timber rights is pertinent and Felda history may offer an answer to that: state agencies and governments who transparently Source: Bahrin and Lee (1988, p.122). participate in timber complexes, can also gain significant revenues from these (and then be accountable to spend this on development and other such efforts). Another key lesson from Felda’s rural regional land use planning approach is that it can integrate water catchment planning (and riparian reserves), forest reserve (with corridors and fewer small patches), rural towns and settlements and crop area, within its overall spatial plan (now termed as “landscape level” planning). It is a salutary lesson for the current concession-based approach which is inevitably myopic to many of these important concerns.
Felda’s Sahabat conservation efforts give a lesson on the need for government commitment and support for these initiatives and a role for experienced local NGOs. The fast tracking of sustainability efforts, with little real national and state government participation has been a hallmark of international voluntary standards to-date. The gap between voluntary policies and enforceable regulations still needs to be bridged, or else there may be no real improvement: smaller companies and smallholders may just step in to develop areas that large RSPO members have to set aside for HCS and HCV reasons. The corporate-led approach of these voluntary efforts is a mirror image of Felda’s experience with national and state governments leading socio-economic planning, where the corporate sector, especially the processor-trader middle men, were viewed with suspicion in a rather different political economic era.
14 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Conclusions and questions for further research
Two issues clearly emerge from this report Second, what sort of smallholder cum labour that calls for further study and investigation. regime will emerge? In Malaysia’s state-run smallholder schemes with ageing settlers, First, what are the economics of oil palm migrant labour is widely relied on (as it is also cultivation for the corporate / commercial in the commercial plantations). Indonesia farmer and for the smallholder under the new and other countries will also increasingly HCS regimes? face the “second generation” problem as to who will replace the current smallholders. Both groups are set to compete for physical There are the many social problems already and economic space in the new HCS now associated with migrant workers to threshold, smaller (lower carbon) zone. In consider. Further research on smallholders as this context, it should be recalled that, until an integral part of the oil palm industry must 1980, Felda contributed approximately half delve into these issues. of the total new oil palm land development for the whole country (Lee and Bahrin, 2006, Where these two issues possibly overlap, it p.11). Before the current liberalised phase, is intriguing to consider the question posed Indonesia required 80% for smallholders and by a key interview subject (Anon. BAH, offered 20% to corporations (the situation is 2015). Should a poor family be given the now reversed). lease use of the oil palm smallholding for a limited period (reflecting the oil palm planting What ratio should be expected for cycle)? Thereafter, another (poorer) young smallholders within the HCS regimes? family can be offered the use benefit of the smallholding. Turning to more micro questions, within each region, what is a suitable family income target While this idea may face a tough political and hence what is the appropriate area that feasibility test, it hones our focus on the provides a living wage or better to offer to practical question of how to achieve a more the smallest smallholders? Is it, as some now equitable distribution of the socio-economic claim, 10 hectares or more? benefits of oil palm smallholdings, especially in the context of new schemes on greenfield This needs to be balanced against the sites. local population numbers. How many local families can be absorbed into an oil palm This study of the Felda programme points to smallholder project and what is the plan the core issue, namely the distribution of the for possible “surplus” families that cannot economic benefits between the corporate be accommodated with a new home and farmer, the smallholder, the oil palm field smallholding? Are the financial economics and worker, and the poor rural folk who lie agronomics of the smallholding appropriate outside this circle. and suitably benchmarked? What is the development cost, the loan amount (interest rate, tenure, payment terms etc.), and operational cost? Do national and provincial regulations and policies recognise these issues? How can commercial banks and multi- lateral lenders play a role in lifting the socio- economic prospects of a poor rural segment? Given the rising importance of sustainability, how can certification’s financially regressive elements (implying a higher relative cost to small farmers and the risk of reducing their price bargaining power and market access) be reformed to be progressively advantageous for smallholders?
High Carbon Stock Science Study 15 Consulting Study 12 The Felda case study
Part 1: Overview of the Felda Smallholder Project
Preamble Diagram 1.2: Felda and Malaysia oil palm hectarage, 1960-2014
The smallholder scheme in Malaysia initiated and 7 35% developed by the Federal Land Development Authority (Felda) is a unique scheme of land resettlement bringing 6 30%
poor Malay families to modern smallholder farming of 5 25% agro-industrial crops for export, initially focused on rubber but now primarily planted with oil palm. From 4 20% its inception in 1956 till the present time, the scheme 3 15% has succeeded in providing some 122,000 households
of landless farmers, poor fishermen and some retired hectares million planted, Oil palm 2 10% armed forces personnel with land, normally 4.1 hectares per household. 1 5%
0 0% Diagram 1.1 shows the impressive growth of oil palm 1960 1977 1982 1987 1992 1997 2002 2007 2012 to just over 35 percent of total cash crops areas over Pensinsula Malaysia - oil palm Sabah - oil palm Sarwak oil -palm Felda - oil palm % (est) the key 30 years (1961-1991) of the core Felda settler Source: MPOB (2015), Bahrin and Lee (1986) and LMC estimates. emplacement period. Diagram 1.2 illustrates Felda’s very important position within the national oil palm The Felda schemes, with their typically modern context. It accounted for over 30 percent of total area kampung or village homes, have become a key part of from the late 1970s to the late 1980s. It then dropped the rural socio-economic landscape of Malaysia and in area share as it stopped expanding while others are estimated to have a population of possibly up to grew rapidly, notably in Sabah and then Sarawak. After two million people today. Malaysia is the second largest Felda slowed its expansion, Malaysia’s national oil palm producer of palm oil today and the Felda smallholdings area progressed, more than doubling to over 5 million and plantations play no small part in this total. hectares. Thus, Felda’s share dropped to about 13 Supplying their oil palm fruit to Felda Global Ventures percent of the total planted areas by 2014. Holdings Berhad (FGV), FGV is the biggest producer of crude palm oil (CPO) in the world. This study draws Diagram 1.1: Oil palm and Malaysia total crop on the existing literature and on interviews with Felda hectarage, 1961-1991 informants and key individuals to address research 8 40% questions particularly the impact on rural socio-
7 35% economics of the core concerns of new High Carbon Stock (HCS) initiatives. 6 30%
5 25% The oil palm economy has been singled out as one of the causes of large-scale deforestation and is a 4 20% major contributor to greenhouse gas (GHG) emissions. 3 15% According to the World Bank (2011), more than half of
Harvested area, million hectares Indonesia’s oil palm expansion and about half of that 2 10% in Malaysia were at the expense of the depletion of 1 5% forest cover. The World Wide Fund (WWF) initiated
0 0% a Roundtable on Sustainable Palm Oil (RSPO) in 1961 1971 1981 1991 2004 to address these concerns and has succeeded, Oil palm Rubber Grains Cocoa Coconuts Other Oil palm % together with the cooperation of other pioneers such Source: FAO (2015). as Aarhus, Migros, Malaysian Palm Oil Association and Unilever, to introduce RSPO certification; which is primarily designed for large upstream plantation groups. However, as noted by the World Bank:
16 High Carbon Stock Science Study Consulting Study 12 The Felda case study
While independent certification for sustainable The plantations were operated on a commercial basis, management of oil palm plantations can be an effective as a key source of funding for Felda settlements and way to promote sustainable production of palm oil, in business expansion. According to Ragayah (2013, p. practice, the comprehensive requirements in the RSPO 46) the Felda schemes had lifted the equivalent to certification scheme are likely to be beyond the capacity one million people, out of poverty by 1990, the end of of most smallholders, who thus may be significantly the NEP period. Felda, through its scheme, helped a disadvantaged (World Bank, 2013, p. 62).5 generation of landless Malays become a rural middle- class, with their holdings of oil palm or rubber crops. Awareness of sustainability issues, alongside When setting up Felda as a federal-level statutory body, environmental concerns, became more noticeable the government moved enabling legislation in the form in Malaysia in the 1990s as indicated in the Seventh of the Land Development Ordinance (1956) and the Malaysia Plan (1996-2000), which included a section Land Development (Amendment) Ordinance of 1958, to on Sustainable Development. Some earlier NGO sector allow it to alienate land. comments on Malaysian palm oil related issues include, from the 1980s: Part 1 of this study provides a compressed history of the genesis of the Felda schemes, what factors drove • The pollution caused by palm oil mill effluents in the its five stages of development and its key moments Juru river (Sungai Juru) in the late 1970s became a of transition and change. Most significantly, Felda has cause célèbre of the Consumer Association of Penang developed from a centralised federal statutory authority (CAP) and other NGOs such as the Malaysian Nature to one where settlers now participate by way of share Society (MNS) in their campaigns to revive dead ownership within an expanding and evolving corporate rivers. structure, reaching its current stage of the formation of Felda Global Ventures (FGV). This share ownership • Swiss activist Bruno Manser highlighted the plight of by smallholders in a large conglomerate is thought a small group of Penans in eastern Sarawak seeking to be unique to Felda and rarely if at all replicated in to retain their traditional nomadic forest lifestyle other parts of the developing world. An important key amidst pressure by the timber industry and its later moment for the Felda schemes no doubt came with transition to oil palm (Straumann, 2014) the winding down of its settler emplacements in 1990, despite its undisputed success as a land resettlement An important research question of this study is to what plan for landless farmers. This action was in part due extent the early architects of the Felda schemes took to the lack of demand for places (amidst the urban- into consideration concerns about sustainability and the industrial economic boom). Thereafter, Felda’s new environment, including the concern with biodiversity, thrust was the establishment of plantations (on the natural habitat and the displacement of indigenous lands it held but which were not settled) and expanding peoples. its processing facilities, thereby scaling up its presence Over five decades, the Felda scheme has succeeded as the largest state-funded agribusiness entity of the in raising smallholder household incomes considerably country. above the national poverty line, prompting some Part 2A of the study examines in detail the settlers observers to characterise it as “one of the most and their settlements, the criteria for settler choices successful land settlement organisations in the and where and how they were emplaced. One of the world” (Sutton, 1989, p. 339). The Felda scheme interesting features of Felda was the settlement of for smallholders dovetailed neatly into Malaysia’s persons from different regions and states to newly implementation of the New Economic Policy (NEP), alienated land schemes far flung from their places starting in 1970, with its twin objectives of eradicating of origin. This is somewhat like the transmigration poverty and uplifting the economic lot of indigenous programme of Indonesia but, arguably, with better communities (Bumiputera). Largely through state and success in the Felda case, due to its focus on income self-funding (including numerous World Bank loans), outcomes, its “premium” approach to deliver well Felda was able to settle 122,000 families in the period developed lands (prepared by contractors), the from 1959 to 1990, developing about 470,000 calibrated funding of government grants and foreign hectares (ha) of settler smallholdings and 340,142 ha of loans, and the constant attention of Felda officers commercial plantations. It moved poor settler families to maintenance and management of the schemes. to the frontiers of Pahang, Johor, and Negeri Sembilan The income levels of the settlers were also regularly (comprising 80 percent of Felda settler areas) and other monitored via the 15-year loan scheme for ownership Peninsular Malaysia states to work in modern agro- of land titles (with some top ups in lean years and industrial estates carved out of the jungle. money held for replanting). Issues such as secondary incomes and second generation outmigration are
5 See Khor (2013) for a rendering of RSPO and the sustainability discourse, the engagement with companies and governmental responses.
High Carbon Stock Science Study 17 Consulting Study 12 The Felda case study
examined in some detail in this section, drawing on Diagram 1.3: Felda locations in Malaysia - estates, mills the extensively available Bahasa Malaysia literature and installations on the subject. The section also discusses the self- empowerment of settlers and their economic agency in sourcing for themselves better deals (such as for rubber replanting), their political awareness in taking court actions over such matters as FFB grading and their lack of financial interest in sustainability certification. Family size, ageing, second generation social problems and other issues affecting the progress of the settler schemes are also discussed in this section.
In Part 2B, we examine the institutional context of Felda and its development as a corporate entity and how this would have affected the smallholders. New dynamics and relationships invariably developed as the Felda entity morphed into a massive conglomerate with a complement of upstream and downstream Note: “Rancangan” = schemes, including commercial plantations; activities, executed by a plethora of subsidiaries, joint “Kilang” = factory; “Instolasi” = installation; “Pejabat Wilayah” ventures and associate companies. We examine in = head office. some detail the administration, management, funding Source: Felda, 2002 sources, politics and forward and backward economic linkages of Felda settler activities, with an eye to their multiplier effects on the local economy. The section Table 1.1: Felda key development stages reviews how Felda schemes had in the past encroached on forest land, comprising both secondary and primary 1. Financial Felda distributed funding to forests, and how contractors, state agencies and the assistance existing land development schemes state governments, may have benefited from timber to state land administered by state land complexes associated with its huge regional schemes development development boards in Kelantan, in West Malaysia, such as Jengka Triangle and Johor boards (1956- Terengganu, Pahang, Johor, Malacca, Tenggara, and also Sahabat in Sabah. By the time of 1961) Negeri Sembilan, Kedah and Perlis. the establishment of its largest scheme in Sabah, Felda, In addition, Felda established its with World Bank assistance, had embedded a forest own Bilut Valley Land Development Corporation (1958). conservation scheme within the Sahabat project. The web of economic linkages and functions has over time 2. Centralised Felda started managing its own been handled by the parent company, Felda Holdings Management schemes. Lands were developed Berhad (FHB). The settlers held a majority share of (1962-1967) by contractors, with each settler 51 percent (and in theory a controlling hand) in FHB household typically allocated a 4 through their cooperative entity Koperasi Permodalan hectare lot and received the land title under a full loan repayment Felda (KPF) as shareholders. This situation has changed scheme administered by Felda. considerably since 2012, when FGV was listed, as World Bank funding was sourced explained more fully in Part 3. Finally, the implications for a major regional programme in of RSPO certification for smallholders are discussed Pahang (Jengka Triangle). with its target date for their certification lagging 3. Package Deal More novel and cooperative Block somewhat behind that for plantations estates (which is (1967-1990) System (1970) and Shares System set at 2017). Diagram 1.3 indicates the locations of the (1985) were attempted, but Felda Felda schemes, commercial plantations and processing eventually reverted to the more plants. popular system of individual land ownership in 1988. Felda diversified In Part 3, we evaluate lessons from Felda’s micro-level its upstream and downstream policies and its macro-institutional aspects with respect activities. Settlers were given to six key questions (four major) for the current phase of complementary facilities and social oil palm expansion under the strictures of certification services as part of the package deal. and new High Carbon Stock (HCS) regimes. These seek to limit deforestation in a period when the competition for land is expected to be magnified alongside heightened social issues, which are compounded by the higher aspirations of the industry.
18 High Carbon Stock Science Study Consulting Study 12 The Felda case study
4. Agribusiness With growing labour shortages, With the starting capital of RM10 million, Felda (1991-2012) in 1990 Felda had its last settler financed its first scheme in Ayer Lanas, Kelantan, intake. Non-settled lands that it had covering an area of 1,620 ha, and its own Felda- developed were instead managed managed scheme in Lurah Bilut, Pahang in 1958 of by Felda on a commercial basis. 1,708 ha with an initial 418 settlers.6 By the end of Felda therefore changed from its third year, Felda had settled some 3,000 pioneer being mainly an agency with social families in an area of 12,545 ha (Lee and Bahrin, 1988, objectives to add a profit-making p.10). In this initial phase, essentially with only federal palm oil conglomerate. funding, Felda faced difficulties ranging from no- 5. Felda Global Felda’s listed arm FGV is expected cooperation from states (land is a state regulated matter Ventures / to use its cash-generating asset, in Malaysia), shortage of staff, lack of good land surveys FGV (2012 its commercial estates (which also and coordination issues. Tun Abdul Razak, the then onward) need replanting), as its key source minister for rural development, who was acknowledged of funds for overseas investments to be the driving force behind Felda, initiated a Special in oil palm estates and downstream Committee in December 1960 to review and improve businesses, and in the supply-chains of other crops, including sugar. the Felda schemes. In this first phase of the individual ownership system, Felda settlers held land titles under a loan payment scheme and were given ownership of Note: Summarised from Bahrin and Lee (1988) and Lee and Bahrin the land once the loan was fully paid up. Typically each (2005) and the addition of the FGV era from 2012. settler and his family were given a 4-hectare plot of land and a house with garden, situated within a larger Development stage 1 - Financial assistance to state land management complex. This system existed until the development boards, and its own new programme for block system was introduced in 1970 (Lee and Bahrin, pioneer farm exporters 2006, p.13).
Tun Abdul Razak, who was from Pahang, became Prime Minister. It is not surprising that from his position leading the Federal Government and from his relationships in Pahang, Felda moved early in this state with success. His son Najib Abdul Razak (the current Prime Minister) presided over the later evolution of the Felda Group, and the de-linking of the Felda settlers and KPF from FGV.
Table 1.2: Felda settlers by state of origin, 1967, 1976, 1986
1967 mid 1976 1986 STATE Number Percent No Percent No Percent Johor 3,650 32% 9,350 27% 25,270 25% Kedah 1,153 10% 3,138 9% 5,180 5% Kelantan 215 2% 1,792 5% 4,185 4% Malacca 896 8% 2,150 6% 2,694 3% N. Sembilan 1,425 12% 4,035 12% 14,326 14% Pahang 1,013 9% 4,550 13% 24,749 25% Penang 399 3% 898 3% 959 1% Perak 941 8% 3,959 11% 9,051 9% Perlis 54 0% 338 1% 1,241 1% Sabah - - 198 Selangor 695 6% 2,638 8% 5,671 6% Terengganu 1,013 9% 2,183 6% 6,889 7% Not Stated 123 1% - - TOTAL 11,577 100% 35,031 100% 100,413 100%
Source: Lee & Bahrin, 2006, p.26.
6 Lurah Bilut was among the few schemes with mixed ethnic populations. The final number of settlers was 616, comprising 404 Malays, 163 Chinese and 49 Indians. The largest number of settlers came from Pahang (199) but others hailed from Selangor, Perak, Perlis, Penang, Negeri Sembilan, Kedah, Kelantan, Melaka, Terengganu and Johore, i.e., from all the other states of the Peninsula. (Lee and Bahrin, 2006, p. 203-204).
High Carbon Stock Science Study 19 Consulting Study 12 The Felda case study
Table 1.3: Emplacement of Felda settlers by state, area and crop, 1987
No of STATE Oil Palm Rubber Cocoa Sugar Cane Total Percent Schemes Johor 64 18,545 7,066 60 - 26,671 24.1 Kedah 10 - 3,143 - - 3,143 2.95 Kelantan 7 2,573 - - - 2,573 2.42 Malacca 5 - 1.328 - - 1,328 1.25 N. Sembilan 48 2,236 14,298 - - 16,534 15.52 Pahang 109 32,471 9,264 - - 41,735 39.18 Penang ------Perak 16 2,420 2,939 - - 5,359 5.03 Perlis 3 - 444 - 447 891 0.84 Sabah 3 322 - - - 322 0.3 Selangor 4 1,220 940 - - 2,160 2.03 Terengganu 20 5,488 1,306 - - 6,794 6.38 TOTAL 289 65,275 40,728 60 447 106,510 6.38 PERCENT 61.29 38.24 0.06 0.41 100
Source: Lee & Bahrin, 2006, p.26.
Development stage 2 - Felda pre-eminence and centralised Development stage 3 - Novel systems revert to individual management land ownership, a “package deal” of smallholding with house plus social services Tun Razak decided in 1962 to focus on a regional approach to Felda’s development and this gave rise to In this phase, the Block System was introduced, in the Jengka Triangle project in Pahang with World Bank large part because of the shift to oil palm cultivation funding of RM32 million dispensed in three tranches in which required more collective responsibility than 1968, 1970 and 1975 (World Bank, 1987). By the end rubber planting (and less labour). Under this system, of the first Malaysia Plan (1970), Felda had established settlers were organised into groups of about 20 itself as the country’s foremost land developer and its settlers with roughly 80 hectares of oil palm termed success continued to propel targets in the Second and a ‘block’ headed by the block leader. Each settler was Third Malaysia Plans (1971-1980), at the end of which responsible for delivering the FFB to the mill and the 202,347 ha were to be developed. This constituted block sales of FFB would be equally distributed among about 50% of the total land development for the entire the members. Lee and Bahrin (2006) note that this country (Lee and Bahrin, 2006, p.11). system was far from perfect and by 1985, a Share System was introduced whereby each settler owned Organisationally, the second phase saw the expansion 10 units of shares equivalent to 10 acres (about 4.5 of Felda into a centralised system of management. By ha) and were expected to work for fixed wages over a end of the First Malaysia Plan, its staff had increase 20-acre working area. Some 81 schemes with 13,234 from 826 in 1966 to 2,240 in 1970. Most importantly, settlers came under this scheme but after five years in 1967, a major re-organisation took place with the it was also dismantled because of negative feedback introduction of a marketing division, thus providing from the settlers. Ng and Ng (1991, p. 91) contend the basis for its transition into the third phase of that the share system contradicted the very objectives Felda history. With the onset of the massive Jengka of creating a self-reliant rural community, by turning Triangle Project, Felda in 1968 introduced a measure of settlers into “labourers”. Salleh (1991) also argues that decentralisation, setting up the Jengka Division under Felda effectively became a mode of “state capitalism”, an Executive Director as required by the UNDP as one keeping settlers in debt and exploiting them initially of a sort of corvée labour and later as wage labour.7 of its conditions for supporting the initiative.
7 See Salleh (1991, p. 330 and passim). It is difficult to argue that the Felda settlers were unduly exploited since the bad debts written off by Felda were rather substantial; RM156.6m (1975); RM33.5m (1990); RM31.1m (1993) and 90.5m (2000) (Lee and Bahrin, 2006, p.43).
20 High Carbon Stock Science Study Consulting Study 12 The Felda case study
However, as noted by Lee and Bahrin, changes to the Table 1.4: Monthly settler obligations for 4 ha rubber schemes were due in great part to the demands of plot and 4 ha oil palm plot, 1986 the settlers themselves, spurred by their politicisation: “wherever expedient, the settlers could appeal to the 4 hectare RM 4 hectare oil palm plot RM politicians, who are particularly sensitive to grassroots rubber plot support from their Felda constituencies.” (Lee and Fixed loan 217.68 Fixed loan amount 163.67 Bahrin, 2006, p.15). In this third phase, the so-called amount “package deal” approach, settlers were accorded not Consolidated 8.81 Consolidated annual 9.92 just housing but also a plethora of social services. annual charges (land rent, A typical Felda complex or “village” could have the charges premium, etc) following facilities: Felda field office, community (land rent, centre, health clinic, public library, women’s institute, premium, cooperative shop, government services, youth club, etc) young farmers’ club, place of worship (mosque) and Operating 38 Operating costs 110 public playground (Lee and Bahrin, 1988, p. 119). costs In phase 3, Felda expanded to Sabah and Sarawak Agricultural 40 Agricultural Insurance 40 in East Malaysia. Felda tried to take its activities to Insurance Sarawak in 1986, to Sempadi in the Lundu District Replanting reserve 40 with six schemes covering an area of 7,857 ha Reserve for 10 but, owing to the poor response, partly due to the maintenance of lukewarm reception of the Sarawak government and agricultural roads the lack of settlers, the schemes were converted to Total 304.49 Total 373.59 commercial plantations worked by Indonesian labour (Lee and Bahrin, 2006, p.12). The Sahabat and Umas schemes in Sabah, aided by World Bank funding of Development stage 4 - Last settlers emplaced in 1990, the US$71.5 million, were far more successful but they development of commercial estates and the growth of an were mostly commercial estates with the plantation agribusiness group mode of production. The schemes are among the largest plantations created by Felda in the Dent The agribusiness phase of Felda has received Peninsula, in an area twice the size of Singapore. Felda considerable attention from scholars (Sutton and Buang, commercial estates constitute 98% of its projects in 1995; Fold, 2000; Ahmad Fauzi, 2000). Felda saw its Sabah. Eventually, Felda only managed to persuade last intake of settlers in 1990. At this point of Felda’s 874 settlers in Sabah to occupy a mere 5,610 ha expansion in 1990, the statutory body had a total of of land, although the original plan called for 8,600 25,308 employees, which included 15,861 staff in Felda settlers in 13 settlements. A number of reasons, such corporations (Lee and Bahrin, 2006, p,189). as the low awareness of Felda in Sabah and also the perceived unattractive location of the schemes in the In 1991, coinciding with the Sixth Malaysia Plan (1991- Dent Peninsula, led to the low response. Sabah’s labour 1995), an amendment to the shortage situation also led to the Felda plantations Land Development Ordinance (1965) enabled Felda being serviced to the tune of 95% by Indonesian to create its own companies under the Companies Act workers (Lee and Bahrin, 2006, pp. 210-216). 1965. By 1995, Felda rationalised all its businesses under the wing of its parent company, Felda Holdings Sdn Bhd. By 2005, Felda had 26 subsidiaries, 9 joint ventures and 10 associated companies, with total investments of RM868.12 million (Lee and Bahrin, 2006, p. 17). Felda businesses comprised the gamut of milling and processing, bulking, transportation, shipping, engineering, properties, construction, security, animal rearing, resorts and catering.
High Carbon Stock Science Study 21 Consulting Study 12 The Felda case study
This change dovetailed into Malaysia’s privatisation grants. By 1999, Felda had repaid RM3.2 billion of drive in the 1990s under the Mahathir government. principal and RM1.4 billion as loan interest. World Settlers were given 51% of the Felda shares at this Bank loans stood at RM542.8 million at financial year stage, with the parent Felda company owning the ended (FYE) 1999. Other sizeable loans were from the remainder. Settlers held their shares through their own Saudi and Kuwait Funds (RM119.0 and 56.8 million, cooperative, the Koperasi Permodalan Felda (KPF) (Fold respectively), the Overseas Economics Cooperation 2000, p. 480 and Lee and Bahrin, 2006, p.149). In Fund and the Asian Development Bank. Nearly all loans this manner, Felda was able to eschew the sort of full- were through the Federal Government (Felda, Annual blown privatisation undertaken in the cases of Tenaga Report FYE 1999). Nasional Berhad (Malaysia’s primary power supplier) and of Telekom Malaysia (main telecommunications Table 1.5: Sources of Felda funding, 1990-2004 (RM company). The KPF had become highly successful, million) offering dividends averaging 14% each year over 30 years. Dividends and bonuses fluctuated somewhat, for Federal Replanting World Total example dividends were 20% in 2001 and 15% in 2004, government grants Bank, & other Saudi in which year Felda Holdings reported an annual income funds Fund of RM42.1 million, but a pre-tax loss of RM18.9 million. 1990 387.3 11.6 96.3 495.2 Development stage 5 – Public listing of Felda Global 1991 281.6 13.3 62.5 357.4 Ventures 1992 344.0 3.1 16.6 363.7 1993 229.9 20.4 23.0 273.3 The public listing of Felda Global Ventures Holdings (FGV) in 2012 raised Felda’s global profile as the third 1994 233.2 24.8 0.0 258.0 largest producer in the palm oil industry (after Sime 1995 202.2 21.6 0.0 223.8 Darby, which owns operations in Malaysia, Indonesia 1996 169.3 18.9 0.0 188.2 and new areas in Liberia, and Golden-Agri Resources, 1997 171.3 22.3 0.0 193.6 operating in Indonesia and with new areas in Liberia 1998 137.2 11.7 0.0 148.9 too). The listing of FGV with an IPO of 2.19 billion shares was completed on 28 June 2012. Felda settlers 1999 27.0 6.3 0.0 33.3 received an instant cash bonus of RM15,000 each and 2000 1.3 10.8 0.0 12.1 also became minor shareholders in FGV (800 shares 2001 27.4 22.3 0.0 49.7 per settler). FGV is now the largest producer of CPO 2002 54.3 36.1 0.0 90.4 with operations mostly in Malaysia, but also in ten 2003 22.6 134.5 0.0 157.1 countries (for its palm oil supply chain as well as other agro-industrial processing). The globalisation of Felda 2004 30.6 130.2 0.0 160.8 has reduced its original Felda smallholders’ role in the Post 1,931.9 476.3 102.1 2,510.3 newly structured conglomerate.8 In a real sense, the settler, 1991 launching of the FGV marks the end of Felda’s original -2004 mission as a socio-economic project to support landless farmers. The significance of the emergence of FGV and Source: Lee & Bahrin, 2006, p. 196 the impact of sustainability concerns are evaluated in Part 2B of this report. From the 1950s to 1970s, funding came mostly from the Federal Government, the World Bank and There is limited discussion of Felda funding sources Commonwealth Development Corporation. From the and use of funds in academic literature. From primary 1970s until 1987, Felda again received funding from data we note that, by the 1999 financial year (after the the World Bank, with eight loans totalling US$232.1 build-up of settler and commercial estates and before million to finance land development and settler projects. the major replanting phase), Felda had spent RM8.9 From 1990-2004, approximately RM3 billion was spent. billion on land development and settlements, financed The sources of finance were the Federal Government, by RM4.9 billion (54.8%) of loans with the rest (45.2%) the World Bank and Saudi Fund (RM2.5 billion for the post-settler period to 2004).9 As foreign loan
8 FGV has suggested that settlers are still well represented in the global company through Felda Holdings Berhad (FHB) 49 % of which is owned by FGV. Settlers also own 49% of FHB but have no representation on the FGV board. [FAQs on the Listing of Felda Global Ventures Holdings Bhd (FGV, 2012) and Anon. ZAZ, 2015]. 9 According to Ragayah (2013, p. 47), Felda had borrowed a total of RM4.96 billion from the Government, the World Bank, Kuwaiti and Saudi funds, which was fully repaid by 2000, 14 years before the end-date.
22 High Carbon Stock Science Study Consulting Study 12 The Felda case study
disbursement diminished, the Government provided self-management system. Among the lessons drawn 90% of the expenditure in this latter period (Lee & from the Jengka projects were that: a high value crop Bahrin, 2006, p. 196). A breakdown of the sources and a sound technical package were essential to of funding is listed in Table 1.5. This does not include provide sufficient financial returns; settlers’ discipline the use of internal sources of funds (such as from was essential in the early settlement period for profitable Felda commercial businesses or investment eventual project success; combining improved social by categories, including: settlers, commercial estates, infrastructure with some aspects of the traditional ancillary and downstream activities. A detailed review village system was an important factor in attracting is beyond the scope of this project, but could be the and retaining settlers; it was almost impossible to find subject of future study. new job opportunities in a rural context for the second generation, as integrated rural-urban development is Felda case studies – Jengka in Pahang, Johor Tenggara, difficult to achieve and time-consuming; and, settlement Sahabat in Sabah projects have more chance of success if they are executed by strong autonomous agencies with a clearly 10 (i) The Jengka Triangle Projects since 1968 - 1982 identified plan and strategy, with full governmental support. The largest and most ambitious settler schemes of Felda were undoubtedly the Jengka Triangle projects in Although the World Bank evaluation of the Jengka Pahang, initiated in the late 1960s. The three projects, Triangle was largely positive, a critique of the projects with the aid of World Bank funding (including loans was that the Bank itself had no environmental policy at in 1968, 1970 and 1975), involved the clearing of the time of the Jengka projects. Kathirithamby-Wells about 40,000 ha of jungle, the planting of 26,000 ha (2005, p. 272) has suggested that scheme “displayed all of oil palm and 13,800 ha of rubber, the construction the symptoms of environmental degradation that came or expansion of 4 palm oil mills, the construction of to be associated with Malaysia’s rural development, roads, villages and related social infrastructure and the such as flooding, water, soil erosion and the loss of settlement of about 9,200 smallholder families. good arable land.” As noted above, the Bank’s own assessment of the environmental impact at the end of The World Bank’s Impact Evaluation Report (1987) the loan period in 1987 was that it was minimal, but found that planting targets were exceeded and despite its more detailed assessment seems to show areas cost overruns, the economic rates of return were for improvement. In particular, the displacement of satisfactory, mostly because CPO prices were higher indigenous Orang Asli11 and wildlife was significant. than projected. The evaluation found that settlers’ Kathirithamby-Wells’ statement about Malaysian incomes were 300-350% above the rural poverty level agricultural projects such as the Jengka Triangle and significantly higher for oil palm settlers than for schemes was that they lacked a holistic approach rubber settlers. Although women play a major role in and that overall agricultural development aided by agricultural activities, for rubber in particular, overall international agencies has tended in the past to women’s rights were not fully recognised. The negative give scant attention to the conservation of forests: impact on the environment was considered less severe “Effectively, this meant that lowland forests would make than expected; soil erosion due to land clearing was way for development, relegating forestry to the hills” minimal; all palm oil mills were equipped with efficient (Ibid, p. 272). The criticism has to be juxtaposed with treatment plants; there was no indication that climatic the master plans for Jengka where forest reserve areas change has resulted from the development of Jengka. are demarcated (see Diagram 2A.3) and Felda policy not The clearing of forest land, however, had a considerable to encroach on native Orang Asli reserve land. Other effect in terms of reduction of wildlife populations, as criticisms of the Felda schemes were that political protection measures now used in some countries were criteria were used in the selection of settlers, that there not known when the projects were implemented. were undue delays in obtaining land titles and that the “Felda has grown into one of the most successful benefits of poverty eradication were not commensurate land organisations in the world, combining the with its high cost (Ragayah, 2013, p. 45). efficiency of the private sector with the public service of a government agency” (World Bank, 1987, p. viii). However the Bank suggested that the Felda management style needed to evolve into a settler
10 We take 1982 to be the end of the Jengka project as this was the last audit date of the World Bank. 11 Anon. ALR, 2015 states that Orang Asli reserve areas were not developed, but some who lived outside these reserves would have been affected. While Felda offered to develop some Orang Asli reserve land, the agency in charge of Orang Asli affairs had other development project plans for this group.
High Carbon Stock Science Study 23 Consulting Study 12 The Felda case study
(ii) The Johor Tenggara Schemes, 1974-198212 (iii) The Sahabat schemes in Sabah, 1980-199715
Johor was the state with the second largest number of The largest Felda schemes are to be found in the Dent Felda schemes, after Pahang. By the time Felda stopped Peninsula of Sabah. Felda’s long-term plans for Sabah its settler scheme expansion post-1990, Johor had a total included the agricultural development of about 90,000 of 82 schemes occupying 120,716 ha of oil palm, 24,692 ha of primarily oil palm, and settlement of a maximum ha in rubber and 356 ha in other crops, covering a total of 12,700 families in the Sahabat settlement complex of 145,408 ha. The settler estates occupied the bulk of located at the eastern extremity of the peninsula. A Johor schemes leaving 18.1% for plantations. There were World Bank loan of US$71.5 million would fund close 74 settler schemes in all with a total of 28,138 families to 35% of the project. Implementation started in 1980; involved, 22,139 of whom were cultivating palm oil by end-1988, development of about 65% of this area (Sutton and Buang, 1995, p.130-132). was underway. Agricultural production had started, but harvesting and fruit transport from field to processing One of largest regional schemes carried out in Johor facilities was then seriously hampered by an almost with World Bank funding was Felda’s Johor Tenggara total lack of agricultural roads and an incomplete access project, a component of the 1971 Master Plan by road network. Hunting Technical Services for the development of 37, 231 ha of the “rain forest” covering a gross area Unlike the Jengka projects, an Environmental of 303,514 ha in two adjoining territories of the Management Plan (EMP) was introduced in the Dent Johor state, Johor Tengah and Tanjong Penggerang. Peninsula. Adjacent to the Sahabat agricultural area, The Master Plan was a joint development project of are the Tabin (TWR) (120,500ha) and Kulamba (KWR) the state and Federal governments. The two regions (20,700ha) Wildlife Reserves which, together with converge in the small town of Kota Tinggi, 30 miles other neighbouring forest reserves, are the habitat north of Johor Bahru, the state capital (Hunting for breeding populations of endangered Sumatran Technical Services, 1971, p.5 and World Bank, 1974, rhinoceros and Asian elephants, and are the only two Annex 7). Interestingly, the Master Plan called not just areas gazetted as wildlife reserves in Sabah. for the clearing of land for agriculture, setting up a dairy farm and a tourist complex, but was also to establish Agricultural development targets were achieved; “an integrated timber complex” to obtain maximum about 65,000 ha were planted by 1993, compared value from 28,733 ha of lowland forest to be cleared to the target of 61,000 ha at appraisal. However, the for agriculture and 8,498 ha cleared for reservoir project’s social objective of rural poverty alleviation was catchments. The logging programme was to start in poorly implemented; only 925 settlers were emplaced, 1974 and continue till 1989 at an annual rate of 2,428 compared to target of 3,560 expected at appraisal. ha. The was also to be a conservation angle to the plan About 90% of the Sahabat area was managed by Felda in that all land above the 20o gradient was not to be as a commercial plantation, using foreign labour and cleared as well as the catchment area for water and land hired Sabahan workers. “containing biological communities of special interest” (Ibid, p.6).13 The project’s main benefits were increased production and exports of palm oil and kernels and improved Felda’s role in the Master Plan involved the environmental management in Sabah. Total production settlement of 4,400 families, clearing 32,779 ha of of FFB in schemes 1 to 35 in 1994 was estimated at land and planting 26,304 ha of oil palms, along with 884,000 tonnes (yielding 185,650 tonnes of CPO and infrastructure development and the construction of 31,000 tonnes of palm kernels). With the high palm oil housing. The total cost of the project was RM209.2 prices prevailing in 1994, net monthly settler incomes in million (US$89.8 million) with Government expenditures Sahabat schemes averaged RM1,450 (US$580), which for roads, water supply, and public buildings, such as is higher than the appraisal estimate of RM1,320 for schools and health centres, set at US$10 million (World 1994 (RM1,035 in 1988 constant terms). Bank, 1974).14 The economic rate of return (ERR) of the project at completion was estimated at 7%. The ERR was lower than that at appraisal (25%), principally due to a steep decline in forecast palm oil prices since the inception of the project: the Bank’s forecast prices in 2000 and
12 1982 saw the final disbursement of the World Bank Felda loan. The overall goals of Master Plan, including roads, bridges, water resources, posts and telecommunications, were to be achieved in 1971-1990. 13 About two-thirds of the gross area of Johor Tenggara is covered by primary and secondary forests, while one-third has been exploited or logged. Most forest in Tanjong Penggerang and nearly two-thirds in Johor Tengah in 1971 were “undisturbed” and thus “exploitable”, under the plan (Hunting Services, 1971, p.9). 14 We have been unable to find specific evaluative literature on the outcomes of the Johor Tenggara schemes. 15 1997 is the year when planting in the last few Sahabat schemes was completed (Sutton, 2001, p. 101).
24 High Carbon Stock Science Study Consulting Study 12 The Felda case study
2005 (in 1994 real terms) were 27% and 35% lower than the price assumed at appraisal. Other reasons • Some may argue that settler-smallholders, included lower than expected yields of oil palm. If the who were the erstwhile central feature of prices forecast at appraisal had emerged, the ERR at Felda, have become a modest component completion would have been about 21% (World Bank, of the global conglomerate that FGV has 1995, pp. 14-15). become. This said, however, the settlers’ participation in KPF, which still holds shares Overall, the institutional stability of the Sahabat in FGV and other Felda corporates, may Complex has been proven with time (Lee & Bahrin, promise the longevity of a relationship (even 2006, pp. 210-224) but important lessons learnt from if these links have been formally weakened). the project include the following: • How the Felda settler-FGV relationship will a) Employment of local NGOs, with proven track evolve is hard to tell, but it is interesting records and acceptable to government officials, to hear of above market prices being paid is the ideal way to prepare and implement to Felda settlers for their FFB (conjecture) environmental projects; as well as for their RSPO sustainability b) Adequate environmental safeguards should be certificates (as indicated by Norazam, 2015). ensured in land development operations and the While our checks with analysts find that clearing of calcareous forests and swamps in the they are not aware of any guarantee price, in eastern part of Sahabat should have been avoided; 2014 average prices were close to RM2,400 CPO tonne equivalent (which corresponds c) Settler emplacement problems should not have with Malaysia prices reported by MPOB). In been underestimated; and addition, at the time of the FGV IPO, FGV made de facto price guarantees to Felda in d) A well-prepared environmental management plan terms of minimum lease rental payments of with adequate government commitment and RM250 million plus 15 percent of operating technical support can have a significant positive profit of estates (the RM 250 million is a sort impact (World Bank, 1995, pp. v-vi). of guarantee).
• In a real sense, the listing of FGV (and the Summary related corporate actions at the end of 2013 to buy key assets from the KPF) marks the end of Felda’s original mission as a socio- • Felda’s unique smallholder programme had economic project. its beginnings in the resettling of the landless poor. Over time the programme evolved to • Ironically, the original Felda project has become a huge land resettlement project become a victim of its own success. The with major regional land schemes of which attractions of employment away from settler this section has presented three case studies, schemes, globalisation, neo-liberal economics the Jengka Triangle Project, Johor Tenggara and competition, the demands of RSPO and the Sabahat scheme. certification and the internal dynamics of the oil palm industry, all colluded to bring • There is little denying that these schemes about the end of this grand project of settler have been major economic successes for development. the Malaysia developmental state. However, the increasing scarcity of land, and lack of • In Part 2A we will examine key features of potential settlers (the agriculture sector was the (micro) socio-economics of the typical less favoured as the economy boomed) have Felda settler and the associated settlement. meant that the development of plantations rather than settler programmes (as shown in • In Part 2B, we examine the institutional Sahabat) has been the order of the day since context of Felda’s evolution and touch on the the 1990s. implications of the establishment of FGV and the new sustainability-driven era. • Migrant labour rather than local settlers now occupy the Felda plantation estates. Alongside this transition, Felda’s five development stages have brought it to the global level with the establishment of FGV which is now Malaysia’s largest producer of CPO.
High Carbon Stock Science Study 25 Consulting Study 12 The Felda case study
Part 2A: The Felda Settler and Settlements
Synopsis ranging from inheritance matters, family size, ageing, out-migration of the second generation and social ills The settler programme of Felda saw people moved from (e.g. drug addiction and gangsterism). The growing use different regions and states to newly alienated land of Indonesian migrant labour most clearly marks the schemes far flung from their place of origin. Felda was maturing stage of the settler schemes. careful to choose those with an agricultural background. However, Felda also selected candidates with skills such The Felda settler as tailoring and carpentry to cater to the needs of the schemes to create semi-urban towns in the schemes. A Settler origins significant proportion of settlers were ex-servicemen. All states of the Peninsula and Sabah saw schemes, One of the most important selection criteria for settlers with Johor and Pahang attracting the largest numbers. was an agricultural background. Thus, Bahrin and The main task of Felda was to raise settler incomes and Lee (1988, p.77) note that in 1983 18.9% of settlers maintain them well above subsistence levels. had been paddy planters, 13.6% had been rubber smallholders, 2.2% had been coconut smallholders, In this section we demonstrate that, by the mid-1980s, 7.4% had been fishermen, 4.5% had been estate Felda schemes assured settlers of a monthly income workers, 23.2% had been agricultural workers, and well above the policy target of RM300. The average 30.2% worked in other professions (the majority of monthly net income was RM721 from a 4 hectare oil whom were ex-servicemen). It is of some note that palm plot (excluding labour costs), but concomitantly Felda also tried to select a range of settlers from the cost of emplacing an oil palm settler had risen to practically all the states of Peninsular Malaysia, although almost RM50,000. When loan repayments became Pahang and Johor took the lion’s share. unaffordable, bad debts were written off to the tune of RM311 million. Secondary sources of settlers’ income The following two tables summarises data on settler were prevalent and strongly encouraged by Felda, which origins by state from 1967-1986, and the crop they introduced settlers to entrepreneurial projects. The farmed as a settler, and also the state where they were section also discusses the economic agency of settlers emplaced by 1987. in securing sub-contracts such as for rubber replanting. Many issues affecting the settlers are discussed here,
Table 2A.1: Felda Settlers by State of Origin, 1967, 1976, 1986
mid 1967 mid 1976 1986 STATE No Percent No Percent No Percent Johor 3,650 31.5 9,350 26.7 25,270 25.2 Kedah 1,153 10 3,138 9 5,180 5.2 Kelantan 215 1.7 1,792 5.1 4,185 4.2 Malacca 896 7.7 2,150 6.1 2,694 2.7 N. Sembilan 1,425 12.3 4,035 11.5 14,326 14.3 Pahang 1,013 8.8 4,550 13 24,749 24.6 Penang 399 3.5 898 2.6 959 0.9 Perak 941 8.1 3,959 11.3 9,051 9 Perlis 54 0.5 338 1 1,241 1.2 Sabah - - - - 198 0.2 Selangor 695 6 2,638 7.5 5,671 5.6 Terengganu 1,013 8.8 2,183 6.2 6,889 6.9 Not Stated 123 1.1 - - - - TOTAL 11,577 100 35,031 100 100,413 100
Source: Bahrin and Lee (1988, p.82).
26 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Table 2A.2: Emplacement of Felda Settlers by State, 1987
STATE No of Oil Palm Rubber Cocoa Sugar Cane Total Percent Schemes Johor 64 18,545 7,066 60 - 26,671 24.1 Kedah 10 - 3,143 - - 3,143 2.95 Kelantan 7 2,573 - - - 2,573 2.42 Malacca 5 - 1,328 - - 1,328 1.25 N. Sembilan 48 2,236 14,298 - - 16,534 15.52 Pahang 109 32,471 9,264 - - 41,735 39.18 Penang ------Perak 16 2,420 2,939 - - 5,359 5.03 Perlis 3 - 444 - 447 891 0.84 Sabah 3 322 - - - 322 0.3 Selangor 4 1,220 940 - - 2,160 2.03 Terengganu 20 5,488 1,306 - - 6,794 6.38 TOTAL 289 65,275 40,728 60 447 106,510 6.38 PERCENT 61.29 38.24 0.06 0.41 100
Source: Bahrin and Lee (1988, p.82).
Felda settler main income, costs and preferential loans Settlers faced fluctuating incomes even after the (original planting and replanting), grants and transfers crops matured. The type of crop, the year of maturity, and of course commodity prices determined their According to Bahrin and Lee (1988, p. 88), Felda’s goal incomes. Felda tried two different methods to mitigate was to give settlers a monthly income of RM300-500, fluctuating incomes. The first, according to Bahrin and but this could only be achieved once the crops had Lee (1988), was the 1980 Income Stabilisation Scheme matured. Prior to 1962, settlers entering the scheme introduced in the oil palm schemes of Sungai Tengi, Ulu would receive a monthly subsistence allowance of Tebrau, Sungai Kemahal, and Jengka 2 on a trial basis. RM50-70 depending on family size (Ibid, p. 89). This A forecast for the year would be made, and then a was meant to tide the families over while the crops fixed 12-month income would be drawn up. If settlers’ were maturing. However, in October 1962 this was net income exceeded the fixed amount, the excess amended to a daily rate of RM2.90 for an adult male, was saved, to be used in months when net income fell RM2.40 for an adult female, and RM1.80 for children below the fixed amount. However, this was unpopular below 18 years for every day worked in the scheme. with settlers and ended in 1981 (Ibid, pp.91-92). This was to overcome settlers’ perception that they were entitled to their monthly subsistence allowance, Later, a Minimum Income Scheme was introduced in no matter how many (or few) days they worked on the schemes under the Block System where settlers were schemes. However, Felda did provide settlers unable assured of RM150 a month minimum income for the to work due to illness or incessant rain a direct loan of first year of entering the scheme, irrespective of the up to RM50. Under this system, a family where both size of their lots. During the second and subsequent husband and wife worked were able to earn RM90-100 years, the minimum was RM200 for lots of 3.3 to 4.0 per month while they awaited their crop (Ibid, p.89). ha, and RM250 for 5.7 ha. In 1984, this was increased to RM350, but was then decreased to RM300 in 1986. Under this scheme Felda topped up the settlers’ income Daily rates for Felda settlers Table 2A.3: when it was below the minimum, eventually this “top up” would be recovered when the settlers’ incomes Year Daily Rate (RM) Income per month (RM) exceeded the minimum (Ibid, p.92). 1962 3 90-100 When moving into the schemes, the settlers 1973 3.5 84 incurred the cost of building their houses, as well as 1975 4 100 development costs for their individual holdings and 1981 6 125-150 eventual repayment of the subsistence allowance. 1984 8 192-208 According to Bahrin and Lee (2006, p.41), the average cost of resettling a family in an oil palm smallholding in Note: This daily rate refers to the subsistence allowance provided to 1976 was RM26,600. It rose to RM49,760 in 1986 (a settlers between the time of entry and the maturity of crops. breakdown is in the table below). By the time of the last Source: Bahrin and Lee (1988, p. 90). intake of settlers in 1990 the cost was RM 51,241. High Carbon Stock Science Study 27 Consulting Study 12 The Felda case study
Table 2A.4: Cost of resettling one family, 1976 and 1986 (RM)
1976 1976 1986 1986 1986 Oil Palm Rubber Oil Palm Rubber Cocoa Infrastructure development * 5,200 5,500 12,302 12,302 12,302 Management & administration * 3,700 4,200 5,062 6,122 7,196 Agricultural development (4 ha) 15,500 14,800 28,966 27,856 53,633 Settler’s house & house plot 2,200 2,200 3,400 3,400 3,400 TOTAL 26,600 26,400 49,760 48,680 76,531
Source: Bahrin and Lee (1988; p. 93) * Not borne by settlers. Settler loan only included agricultural development of 4 ha smallholding and cost of house and house lot.
By 1986, Felda had 100,413 settlers. If the average The average monthly settler income time-series data cost of resettling one family was RM 50,000; then Felda available in the official literature (the Bahrin and Lee would have spent about RM 5 billion on resettlement in (1988) and Lee and Bahrin (2004) texts) represent 1986 Ringgit cost terms. net income rather than gross income. The only years in which gross income can be estimated are for 1986 Originally, according to Bahrin and Lee (1988, p. (possibly a top up year given the low CPO price), 1998, 92) settler loans were meant to repay the cost of 2005 and 2014. the scheme’s development, development costs of agricultural holdings and infrastructure. The loan The tables below describe the estimated monthly was to be repaid within 15 years at 6.25% (below income (by source) with data net of “typical monthly market) interest. However, in 1960 the Minister of settler obligations” and excluding other, non-agricultural Rural Development appointed a Special Committee incomes. The data in the tables come from Lee and to look into settler loan repayment, as the original Bahrin (2006) as the only truly national Felda data. settler obligation was too high. The Special Committee Wong (2000) and Barlow (2015b) are sources for concluded that settlers should only have to repay the particular settlements (and thus are only indicative). We “subsistence allowance, cost of their houses and the also incorporate estimates of secondary income (where direct cost for developing their individual holdings, some survey data suggests that a good number may and the accrued interest therein” (ibid). Accordingly, achieve the 20-30% of primary income that is targeted the initial loan amount was about two-thirds of the from such earnings; but data on this segment of income development cost. are broadly lacking at the national Felda settler level). We have included, in addition, the dividend income Because of fluctuating commodity prices and the received from investments in the KPF. difficulties settlers faced in repayment, the loan scheme was revised many times and a complex repayment If the monthly net income for 1986 (when CPO price schedule was worked out for rubber and oil palm was particularly low) for an oil palm smallholder in a settlers. Oil palm settlers were less problematic as the Felda scheme with a 4 hectare lot was RM376, then the recovery rate was high; by the 1980s it was almost monthly gross income for that year was RM750. This 100%. Even with this fine tuning, loan repayment was below both the 1985 national mean household depended heavily on settler gross income, which in turn income of RM1,098 and the 1985 mean household depended on commodity prices. If a settler’s income incomes of RM861 in the Malaysian states where Felda dips below the assured monthly net income, then loan settlements existed. The latter figure was calculated by deductions were deferred. There have been several totalling the 1985 mean household income of states years, as in 1986, when low commodity prices caused where Felda schemes existed, excluding Selangor as low loan repayments (Bahrin and Lee (2006, p.42). there were relatively few schemes in this state (based Felda also wrote off bad debts so that settlers can be on data from the Fifth Malaysia Plan, p.38). awarded their land titles. According to Bahrin and Lee (ibid), the total of settler debts written off by Felda was RM 311.7 million. Bahrin and Lee put a favourable gloss on Felda’s control of loans, noting that it was “important and gratifying to the implementing agency that it has successfully completed the whole resettlement process…and equally significant that settlers have fulfilled all their obligations.” By 1987, after 21 years, a total of 15,984 settlers had fully discharged their loan obligations (Bahrin and Lee, 1988, p. 98).
28 High Carbon Stock Science Study Consulting Study 12 The Felda case study
The monthly net income of a Felda oil palm smallholder in 1999 was estimated to be RM1,315, with a gross monthly income of RM2,153. Comparatively, this is slightly below the 1999 mean monthly national gross household income of RM2,472, but higher than the mean monthly rural gross household income of RM1,718 (Eight Malaysia Plan, p.61). In 2014, the national monthly gross household income in Malaysia was RM 5,90016, as compared to RM2,473 average monthly Felda gross incomes.
Table 2A.5: Settlers’ average monthly net income (RM) 1979-2004
Rubber Rubber Rubber Rubber Rubber Oil palm Oil palm Oil palm Felda settler smallholding 2.4 2.8 3.2 4.1 4.9 4.1 4.9 5.7 1979 451 445 561 342 395 805 1,085 1,230 1980 471 457 523 374 606 709 860 864 1981 458 449 527 451 756 632 712 847 1982 333 366 430 412 837 614 758 757 1983 415 443 529 459 1,123 748 868 1,018 1984 460 456 529 493 1,183 1,202 1,401 1,720 1985 366 371 423 429 1,010 885 764 1,203 1986 333 368 415 409 916 376 359 379 1987 377 432 527 575 1311 520 514 580 1988 528 532 706 817 1,297 859 789 1,179 1989 477 384 572 761 761 668 619 874 1990 307 342 455 620 540 437 441 594 1991 348 379 463 553 535 488 502 654 1992 403 403 491 577 608 594 511 721 1993 285 407 385 535 572 729 548 838 1994 465 690 525 863 923 1,126 693 1,407 1995 639 963 692 1,200 1,300 1,426 801 2,201 1996 571 828 551 1,034 1,253 1,064 773 1,416 1997 603 780 586 834 968 1,274 1,215 1,766 1998 547 831 568 824 985 1,848 2,092 1,874 1999 541 685 510 765 817 1,315 1,500 1,421 2000 622 654 554 805 934 765 1,006 784 2001 553 638 561 803 598 735 787 961 2002 829 853 836 1,098 951 999 1,213 1,657 2003 1,263 1,230 1,100 1,929 1,357 919 1,398 2,189 2004 1,371 1,441 1,350 1,915 2,240 1,387 1,807 2,343 Average 1979-2004 519 586 569 736 918 857 890 1,166
Source: Bahrin and Lee (2006, p.37).
16 Figure quoted by Minister in the Prime Minister’s Department Datuk Seri Abdul Wahid Omar. http://www.themalaymailonline.com/malaysia/article/rm5900-mean-not-median-household-income-minister-explains (accessed April 2015).
High Carbon Stock Science Study 29 Consulting Study 12 The Felda case study
The Felda Oil Palm Replanting Fund is another important Felda managed fund. Lee and Bahrin (2006) note that a fee of RM40 per settler per 10 acre lot is collected for the Oil Palm Replanting Fund.
It is estimated that each settler contributes RM9,600 over a 20-year period and is entitled to receive RM17,000 when replanting is carried out. At 2006, the fund stood at RM759 million (Ibid, p. 40). The replanting reserve is crucial as it provides income for settlers during the replanting period, when they cannot harvest oil palm.
Table 2A.6: Settlers’ average monthly net income for 4.1 ha of oil palm
Oil palm, Oil palm, Oil palm, Nominal crude palm oil price 4.1 ha 4.9 ha 5.7 ha (RM, year average) 1979 805 1,085 1,230 1,165 1980 709 860 864 919 1981 632 712 847 964 1982 614 758 757 829 1983 748 868 1,018 991 1984 1,202 1,401 1,720 1,408 1985 885 764 1,203 1,046 1986 376 359 379 579 1987 520 514 580 773 1988 859 789 1,179 1,029 1989 668 619 874 822 1990 437 441 594 701 1991 488 n/a 654 837 1992 594 511 721 917 1993 729 548 838 890 1994 1,126 693 1,407 1,284 1995 1,426 801 2,201 1,473 1996 1,064 773 1,416 1,192 1997 1,274 1,215 1,766 1,358 1998 1,848 2,092 1,874 2,378 1999 1,315 1,500 1,421 1,450 2000 765 1,006 784 997 2001 735 787 961 895 2002 999 1,213 1,657 1,364 2003 919 1,398 2,189 1,544 2004 1,387 1,807 2,343 1,610 Monthly average 1979-2004 889 941 1,211 1,131 Cumulative 1979-2004 277,488 282,168 377,724
Note: 4.1 ha Felda settler earns 9.3x CPO price, 4.9 ha holding earns 9.5x and 5.7 ha holding earns 12.4x CPO price. Source: Settler smallholding data from Bahrin and Lee (2006, p.37), Malaysia CPO price from MPOB (2015).
30 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Table 2A.7: Estimated monthly income sources for 4 ha oil palm settler
1986 1998 2005 2014 Comments FFB output - est. net income (with 220 2,325 492 1,800 1986-2005, 19 t/ha. FFB; OER 19%; 33% labour cost) labour cost, FFB price 21% of CPO price. 2014 from Barlow (2015); 22 t/ha. FFB; FFB price RM500/tonne; operational charges RM200/tonne Est. net income ratio 29% 74% 27% 40% CPO price 579 2,378 1,394 2,384 Target secondary income (20-30% of 154 737 493 951 Step up from 20% to 30% over time primary) KPF investment 12 29 58 88 Step up 1,000, 2,500, 5,000 to 7,500 units 1,000-7,500 units @14%) of RM1 Incentives n/a n/a 150 150 Annual incentive RM1,000 in cash, KPF RM500, Hari Raya contribution RM300 Total estimated monthly income - all 386 3,092 1,193 2,473 sources
Note: In 1986 the net monthly income for 4 ha oil palm plot was RM376; gross income was RM750 (net income plus typical monthly obligation amount), for 50% net income margin in year when the CPO price was relatively low. There may have been top-ups and/or loan deferment. Most settlers joining Felda had monthly incomes below RM200 (1979 data for all settlers). Malaysia minimum monthly wage was RM800 in 2014. Sources: Monthly settler costs in 1986 from Bahrin and Lee (1986), in 1998 from Bukit Wa Ha scheme in Kota Tinggi, Johor (Wong 2000), in 2005 from Lee and Bahrin (2006, p.43), and 2014 costs and returns from Barlow (2015).
Felda settler secondary incomes It is interesting to note that in some instances, secondary incomes, which were a crucial source of Felda actively encouraged settlers to engage in income for settlers before the maturity period, became “subsidiary activities” such as livestock production, the main focus of non-farm activity. Harun’s (1975) vegetable and fruit cultivation, freshwater fish culture, study in Sungai Tiang found that the settlers’ secondary and other cottage industries (Bahrin and Lee, 1988, incomes affected the settlers’ ability to tend to their p.90). Settlers could also contract themselves out for smallholdings (p. 182). A later study by Mohd Radzi jungle clearing, settler house construction, pest control, (1991) on migrant labour in the Sungai Koyan scheme and road maintenance in other schemes once the labour in Pahang found that incomes from subsidiary activities requirements of their own blocks decreased. Bahrin and allowed settlers to hire migrant labour to work the Lee (Ibid, p. 89) say that settlers were estimated to earn schemes. This is in turn allowed them more time to RM10 a month on average from subsidiary incomes. attend to their subsidiary activities (Ibid, p. 328). They do not detail how they arrive at this figure, and there were probably variations in secondary incomes More recently there have been more concentrated from scheme to scheme. However, secondary incomes efforts by Felda to develop entrepreneurial activities were likely to be low. Harun’s (1975) study of the among the settlers. In 2003, the Satu Wilayah Satu Sungai Tiang scheme in Kedah found that settlers who Industri or One Region One Industry (SAWARI) project did engage in a side income usually did not earn more was launched to promote livestock rearing, cropping, than RM50 a month. and aquaculture. The aim of SAWARI is to promote suitable economic activities. At present, ten activities Most of the narrative focuses on male settlers, but the are classified under three industries: textile and wives of settlers also contributed to household income embroidery (Felda Best Collections); food (Felda Best through supplementary incomes. Yahaya (1991, p. Foods), and handicraft (Felda Best Crafts). According 41) found that women were overwhelmingly involved to Bahrin and Lee (2006, p.59 ), activities selected by in animal husbandry and economic activities in three SAWARI generated a turnover of RM4.4 million up to different Felda schemes in Negeri Sembilan. Yahaya’s September 2004, and generated RM2,000 a month study concentrated on animal husbandry, but she in income for entrepreneurs, and RM600-RM800 a found that women in the schemes were also involved month in income for workers. At the end of 2005, Felda in other service oriented economic activities such as exceeded its target of involving 30% of settlers in its sewing, laundry services, small retail businesses, and Entrepreneur Development Programme (EDP) by 2.99% selling handicrafts. This was in addition to helping their with a total of 34,024 settlers participating in its EDP. husbands with agricultural work on the schemes. Historically, Felda has always encouraged settlers to engage in subsidiary activities. Initially, this was to help
High Carbon Stock Science Study 31 Consulting Study 12 The Felda case study
them gain a source of income while they waited for Felda was also accused of deducting their fruit yields crops to reach maturity. However, a secondary income improperly with an average of 200 kg per month for from subsidiary activities must have been important in disqualified fruit bunches, but they did not return the a year when commodity prices were low or during the fruit bunches to the settlers. This led to a claim of replanting cycle. a further loss of RM1,344 per year per settler. This implied that over 17 years, Felda had caused a loss to These non-agricultural activities of late have included the 770 settlers of more than RM422 million. the settlers’ children (Bahrin and Lee, 2006, pg. 61), either as entrepreneurs or mentors in the Graduate Other examples of typical claims against Felda Mentoring Programme that sees settler graduate include random tests by Felda settlers in Jengka with children paired up with entrepreneur settlers. This is a independent laboratories to assess the actual OER, necessary development, as the second generation of which showed a much higher average rate of 27%. the typically large settler families cannot subsist on the Using the figure of 8.5% lost to the settlers, it was yields of the smallholdings. Since Felda land cannot be claimed that Felda had caused a loss of RM257.60 per divided among heirs, the revenue is the only income tonne which worked out to about RM30,912 to each from the smallholding available to the heirs, which settler for 2008 alone.17 can be assumed to be very small once divided among five to six heirs. Furthermore, there are anecdotes of On the question of sustainability certification, plantation one heir administering and earning all income from a specialists report that settlers quickly appreciate that smallholding. This is likely when other siblings have they do not have direct benefit from implementing the migrated out of the scheme. Migration and inheritance requirements that are needed as they do not receive a are discussed further later. premium to do so. FGV’s senior sustainability manager indicated that the benefits of RSPO certification were We can surmise from their efforts in obtaining intangible to settlers and it was difficult to explain these secondary income that settlers were clearly empowering to them. On the matter of settlers being financially themselves and their families to be economic agents to savvy, he remarked that they used to bring ‘parangs’ improve their own situation and were not content to (long working knives) to discussions with Felda staff, just be passive recipients of government aid. This sort but now they also use lawyers and the courts (Interview of economic agency would become more varied and with Norazam Abdul Hameed, 3 March 2015). more inventive with more experience as will be shown in next section of this report. Replanting is another contentious issue on the Felda schemes, especially as it requires 50 % consensus Felda settler as economic agents – FFB grading, sustainable among the settlers for group replanting to take place, certification, replanting and about 80% tend to agree (Khor, 2014, p.95). Problems arise in schemes, such as those in Pahang, The Felda settlers were clearly no pushovers when it where there is less social cohesion than in schemes came to defending their economic rights. 770 Felda in Johor and Perak, where there is more (and higher settlers from eight schemes or ‘rancangan’ (including secondary incomes to offset the drop in income Felda Chini and Chini Timur, Pekan; all in Pahang) took a during replanting). The lack of social cohesion is mainly case of what they considered to be unfair fruit grading because Pahang schemes had the most diversity in to the Kuantan High Court in 2012 and won. settler origins. Once the settlers agree to replanting, they must sign a 15 year contract with Felda. However, The gist of the case was that they had been paid at a Khor notes that Felda managers reported that 30- lower rate for the oil extraction rate (OER) for the last 40% of settlers would try to break that contract once 17 years, averaging at 18.5%, based on the receipt that production starts (Ibid). This is telling of the economic is given for each truck delivery of fruit bunches, when savvy and political clout of the settlers. the recommended rate from the Malaysian Palm Oil Board was at least 22 %. Earlier in January 2010, the Felda settler land ownership Federal Court had ordered Felda to pay RM11 million in damages to settlers in the Kemahang 3 scheme in The main objective of Felda at its inception was to give Kelantan for lowering their OER (but the case was won land to the landless. As noted by Bahrin, Lim and Perera on a legal technicality). In these cases, lawyers claim (1979, p.118), a 1976 Felda Settler Census found that OER for fruit grading that are above those normally the majority of settlers did not own any land, whether achieved on commercial estates (suggesting a possible land suitable to plant paddy or other crops, prior to legal strategy to claim high for later negotiation down). entering the schemes. Only 0.6% of settlers owned land in excess of 2 hectares, 3.9% of settlers owned between 0.4 - 1 hectare of land, while 37% of settlers owned no land at all.
17 The 8.5% loss claim is high and could be a tactic used by the settlers’ lawyers to start negotiations.
32 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Felda land ownership is dictated by the Land Ordinance Felda settler ageing - migrant labour and share cropping Act 1960, which according to Mohamad, Z. (2010, p. 338) was drafted to avoid the problems of traditional The use of migrant labour on Felda schemes became land. This means that although most settlers are Malay inevitable as the original settlers aged, and the second Muslims, Felda land is controlled by secular legislation. generation was largely uninterested in engaging in Therefore, only two people can be registered as co- agricultural work or rural life. According to Mohd. Radzi owners of a Felda holding, namely the settler and the (1991, p. 328) there was also a perception among first wife he entered the scheme with. Bahrin and Lee settlers that migrant labourers were able to work harder (1988) also note that a settler wife divorced by her than their family members. Mohd. Radzi’s study took husband “is entitled to 50% of the value of the property place in Felda Sungai Koyan, Pahang, where there that both of them have accumulated”. was a significant number of settlers who had been ex- servicemen with pensions. This extra income allowed Mohamad, Z. (2010, p. 339) notes that the heirs of a the settlers to hire migrant labourers. Felda holding are only entitled to the revenue derived from a smallholding. A representative from the heirs Table 2A.9: Pension rate for Felda settlers, Sungai is appointed to manage the smallholding, and the Koyan, 1991 remaining heirs receive a share of the revenue. It is illegal for a smallholding to be divided among heirs. Total pension amount Number of Percentage However, Mohamad, Z’s 2010 study (p.341) found received per month (RM) pensioners that there were a high number of unresolved power of 200 - 249 3 14.3 attorney cases among the settlers. In Felda Lurah Bilut 250 - 299 2 9.5 in Pahang where the study was carried out, about 30% of smallholdings, or 4,527 families, faced inheritance 300 - 349 3 14.3 issues. The study also found that a majority of settlers 350 - 399 4 19 did not have a clear understanding of the restrictions on 400 - 449 3 14.3 Felda land in regard to inheritance. 450 - 500 4 19 This issue of inheritance remains as a long-term More than 500 2 9.5 problem of the settler schemes, yet to be fully resolved Total 21 100 by Felda, and is particularly bothersome when it is coupled with the problem of ageing settlers, which will Source: Mohd. R, 1991, p.160. be discussed in the next section. According to the study, settlers were also more likely to Table 2A.8: Number of unsettled Felda inheritance hire migrant labour if they had a secondary income, as applications in selected districts they were busy tending to their secondary businesses, although it also found that a small number of settlers contracted migrant labour due to health problems. The District No. of No. of Total study predicted that job opportunities for migrants unresolved residents would increase as Felda opened up more schemes and inheritance who applications have not failed to attract the second generation to engage in applied for agricultural work (Mohd. Radzi, 1991, pp.328-329). inheritance The current state of Felda smallholdings has not Johor 356 543 899 been studied recently in depth. One of our principal Segamat 318 647 965 investigators, Johan Saravanamuttu, observed that Kuantan 136 249 385 a Johor oil palm scheme was rather quiet during the Temerloh 238 289 527 2011 state level Tenang by-election. This could possibly be because oil palm is relatively less labour intensive, Jengka 233 549 782 and the ageing settlers have moved away. Thus some Negeri Sembilan 268 331 599 schemes are largely managed by Felda. This is a likely Ipoh 148 349 497 state of affairs in the Bilut Valley, where many original settlers have passed on, and the smallholdings should Gua Musang 17 34 51 now be owned and managed by the second generation. Terengganu 114 175 289 Khor (2014, p. 91) on the other hand observed that Sabah 19 10 29 UMNO had promised to build new homes for the Total 1,847 3,176 5,023
Source: Mohamad, Z., 2010, p.14.
High Carbon Stock Science Study 33 Consulting Study 12 The Felda case study
younger residents of Felda settlements as a strategy While schemes setup and managed by Felda from to win votes.18 It was found that there was more than the beginning came with educational facilities such as one family living in each house. These two observations kindergartens, this was not always the case. One case indicate that there is a range of situations, and the study by Khalid (1980, p.223) in Malacca found that the status and reasons for a crowded or empty household Kemendor, Menggong, and Machap schemes, which are not well studied. were originally managed by the state government, did not come with primary school infrastructure. This Table 2A.10: Malaysian citizens and non-citizens in meant that the settlers’ children in those schemes either FELDA Peninsular Malaysia, 1989 had to stop school or be sent to live with relatives to continue their education. State Citizens Non-citizens Total Bahrin and Lee (2006, p. 50) report that the number Kedah/Perlis 912 98 1,010 (7.7%) (2.3%) of kindergartens and kindergarten teachers has been increasing since the Felda schemes opened. Perak/ 884 109 993 Settlers contributed toward the construction costs of Selangor (7.5%) (2.5%) kindergartens, with RM 5,000 grants per scheme from Negeri 748 149 897 Felda. Sembilan (6.4%) (3.5%) Johor/ 3,861 1,546 5,407 Table 2A.11: Kindergarten facilities in Felda settlements Melaka (32.8%) (35.9%) across Malaysia Pahang 4,282 1,607 5,889 (36.3%) (37.3%) Children Year Kindergartens Teachers Attending Terengganu 653 463 1,116 (5.5%) (10.7%) 1976 104 7,938 Kelantan 442 338 780 1987 321 631 19,863 (3.8%) (7.8%) 1990 26,439 Total 11,782 4,310 16,092 (73.2%) (26.8%) (100%) Source: Bahrin and Lee; 2006, p.50.
Source: Mohd. R, 1991, p.135. Primary schools were built with government grants, while secondary schools were built when there were Felda settler - family structure and development enough secondary school age children on the scheme. Otherwise, children attended secondary schools outside Bahrin, Perera and Lim (1979, p. 197) have noted that the schemes. Felda has been increasing educational most settlers had large families; 86.7% had five or opportunities for the settlers’ children over the years. more family members, and 96.5% had four or more family members. Only 3.2% of settlers had only three In 1975, a residential hostel was established in Kuala family members while 2.3% had less than three. At least Lumpur to cater to the top 60 performing students 21.4% of settlers had as many as 10 or more family from Felda schemes. The children in the hostel then members. Settler family size averaged out to be 6.87 attended school in selected secondary schools in KL. people in all schemes. A 2001 study by Ahmad found The number of hostels increased, with one in Kuantan that the average family size in the Felda Lepar Hilir 2 in 1981 (later replaced by one in Trolak), one in Johor settlement in Raub, Pahang was five to six children. This Bahru in 1982, and one in Kelana Jaya in 1988. was despite the availability of family planning services in Collectively, the hostels could accommodate 1,500 the settlement. students. As of 2004, according to Bahrin and Lee (2006, p. 52) 7,847 students had benefited from these Second generation issues – education, migration, hostels. These 7,847 students represent about 1% of employment, social issues the total number of settler children. In general the settlers’ children have seen an improvement in their socio-economic status and enjoyed upward social mobility (although recent policies for 20,000 new homes in Felda areas suggests that some were left in more meagre circumstances).
18 During the May 2015 Rompin parliament by-election (53,596 voters, with 87% comprising Malays living in 14 Felda settlements), news reports revealed that Felda had allocated RM 1.4 billion in 2013 for 20,000 new homes for second generation settlers with the price reduced from RM124,000 to RM90,000 apiece (http://www.themalaysianinsider.com/malaysia/article/felda-has-never-cheated-settlers-says-chairman-bernama#sthash.WH3loMxQ.dpuf, 24 April 2015). 20,000 homes represent 3.5% of the second generation of 4.8 children per settler, suggesting a focus on the second generation residing in Felda areas in overcrowded settler homes. Not surprisingly, all settlers may not be in a happy situation too: Persatuan Anak Anak Felda Kebangsaan information chief Naraza Muda alleged that many first generation settlers were beleaguered with debts, some reaching up to RM150,000” (Source: 26 April 2015; http://www. therakyatpost.com/news/2015/04/26/felda-settlers-facing-housing-financial-woes/).
34 High Carbon Stock Science Study Consulting Study 12 The Felda case study
In 2004, 64% of the 17,876 settlers’ children passed Felda settler outcome– creation of a modern farmer and a their UPSR (primary school leaving) examination, rural middle class? exceeding the national average of 60% (Bahrin and Lee, 2006, pg. 52). Since August 2004, the Ministry of A recurring theme in the literature is an inability/ Education has helped to implement tuition classes in unwillingness of the settlers to manage the schemes the Felda schemes. Felda has also established Institut on their own once they have repaid their debts to Teknologi Utama (ITU) for information technology Felda. Harun (1975, p. 118) confirms this and points and multimedia skills and Kolej Integrasi Ilmu (KINI) to out that the settlers in these schemes had not fully prepare Felda students going on to higher education. adapted to the Felda method of farming and standards Youth who stay on the schemes are encouraged to join of production. Settlers in the Sungai Tiang scheme vocational skills training. It seems that this Felda second studied by Harun had cleared the land and built their generation is what Felda is targeting with its 2013 own homes. This contrasts with the later system where policy for 20,000 new homes. settlers were only introduced to the schemes once the land had been cleared and basic infrastructure laid Studies such as Ghazali’s (1988) show that there has down. This led later settlers to feel less proprietary been a considerable out-migration from the schemes by towards their smallholding. As a result, infractions such the settlers’ children, with few wanting to stay on and as not fertilising according to schedule, not taking manage the schemes. Bahrin and Lee (2006, pg. 54), measures to preserve the rubber tree bark, and not note that there were a total of 13,061 professionals tapping according to their turns occurred and affected among the Felda children up to 2005. These include overall output. They preferred to do as they pleased, plantation managers (241 people), engineers (1,032) listening less to Felda field managers, even feeling and doctors (275). However, according to Ghazali, entitled to sell their rubber illegally (avoiding loan the majority of settlers’ children migrating out of the repayments). schemes went on to work in manufacturing and the service industry (p.33). Lee and Bahrin (2006, p.23) seem to think that the goal of creating a “modern farming community” was While the overall picture points to increasing upward achieved. However, while studies such as Harun’s and social mobility, and improved educational attainment, Mamat (2011) found that overall the settlers did see there have also been cases of social ills. Bahrin and Lee an improvement in economic terms, their conclusions (2006) estimate that there are 1,600 drug addicted about the success of modernising rural folk in Felda youth in the Felda land schemes (p. 53). Wong (2000) schemes differed. Mamat’s study points to a unique notes rampant social ills such as drug use and illegal form of modernisation occurring on Felda schemes; motorcycle racing in his study of the Bukit Tinggi settlers had high expectations for their children’s scheme in Johor. In the national context, drug addiction academic attainment and could accept new ideas, but is widely regarded to be a problem. Recent data still clung to some traditional and religious beliefs. from a statement issued by Deputy Home Minister However, Harun’s study concludes that Felda was not Wan Junaidi Tuanku Jaafar (Bernama, 2015) puts the wholly successful in establishing “a stock of modern and number of drug addicts in Malaysia from 1998 to progressive farmers” thanks to the heavy dependence 2013 as recorded by the National Anti-Drugs Agency of the settlers on Felda. at 365,945 people. Wan Junaidi said that the World Health Organisation states for every addict detected, Table 2A.12: Level of education settlers aspire to for there are four more undetected. children in Felda Semarak Jengka 15, Pahang, 2011
Bahrin and Lee (2006, pg. 53) report that there are Level of Education Percentage 1,700 settler children were recorded as being involved University level 82% in other undesirable activities, such as vandalism and theft. The presence of social ills in Felda schemes was College level 5% also found in Wan Ismail’s (2003) study of the Ulu Finish secondary school 11% Belitong scheme in Johor. Most delinquent youths in Finish primary school 2% the Ulu Belitong scheme were involved in truancy. However, drug abuse and loitering in town (lepak in Source: Mamat, 2011, p.238. Malay) also occurred. Social issues such as lepak and mat rempit (youths involved in illegal motorcycle street racing) gangs are a concern among working class Malay youth in Malaysia, so it is unsurprising that the same issues occur in Felda settlements.
High Carbon Stock Science Study 35 Consulting Study 12 The Felda case study
The Felda settlement
Felda settlement – green field and brown field sites
Table 2A.13: Land developed by Felda and state development programmes, 1961-1995 (hectares)
1961 - 1965 1966 - 1970 1971 -75 1971 - 80 1981 - 1985 1986 - 95 Felda 48,279 72,439 166,882 373,705 161,600 175,745 State 93,806 40,064 143,884 290,133 158,000 160,000 Programmes
Source: Bahrin and Lee, 1988, p.26; figures in Malaysia Plans from the Second Plan to Sixth Malaysia Plan.
The literature, including the books commissioned by Felda settlement - social services Felda such as 3 Decades of Evolution and Felda’s Fifty Years: Land Pioneers to Investors, do not offer details Felda settlements were planned with social services about the types of land that were developed. More and amenities to give the settlements a semi-urban specifically, there is no mention whether the areas that feel. This was in part to reduce the amount of rural- were cleared for the Felda schemes were primary or urban migration. According to Bahrin and Lee (1988) secondary forest, or what kind of timber was found all schemes have reserves for most of the following there. However, we have noted though that it is known amenities: a Felda field office, community centre, post that “tropical forests” and also some “forest reserves” office, police station, market, petrol kiosk, bus station, were developed by Felda according to World Bank fire station, cinema, health clinic, public library, Women’s documents. Institute, co-operative shop, Youth Club, Young Farmers Club, place of worship, government reserves, and a Furthermore, it is known that Felda took over the public playground. Schemes that were developed by management of some state government schemes. Felda from the beginning were also planned with a For example, the Kemendor, Menggong and Machap reserve for a primary school. A secondary school would schemes in Malacca were opened by the state be built for the scheme if there were enough secondary government, but were eventually taken over by Felda school aged children in the area. There was also usually in 1961 (Khalid, 1980, p. 223). Such sites can be planning for a hospital to serve schemes and outlying considered brownfield sites, though the literature areas, a power station, and a graveyard. Bahrin and review has not revealed extensive study of this issue, Lee (1988, p.119) note that the provision of these rather it features only as a side detail. amenities was not always immediately available at the time of settler entry, and the goal of providing a semi- Diagram 2A.1: Layout of Typical Felda Village urban environment was not always met, though Bahrin and Lee (2006) note that this has improved since their earlier publication.
Source: Bahrin and Lee (1988, pg. 117).
36 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Diagram 2A.2: Layout of typical Felda house lot Diagram 2A.3: Jengka multi-settlement
Source: Bahrin and Lee (1988, pg. 118).
Felda settlement – local economy linkages
The literature so far has not covered this topic. The Jengka Triangle is a possible example. It was the “oldest Source: Bahrin and Lee (1988, p.122). large-scale Felda regional land settlement scheme” Felda settlement - the local environment (Bahrin and Lee, 1988, p.121) and was meant to have a population of 85,000 by the end of the 1980s. It was There is notable lack of substantive research on the near the towns of Jerantut, Temerloh and Maran, but local environmental issues within Felda settlements. it was thought that settlers would need frontier towns Environmental impact is also noticeably absent nearer their schemes. However, of the three towns from the Felda commissioned text Felda’s Fifty Years: planned within the Triangle, only Bandar Pusat was built Land Pioneers to Investors. At present our literature and it did not grow as planned, being unable to compete review has only come across a few academic with the established towns (Bahrin and Lee, 1988, exercises (undergraduate coursework) on this topic. p.123). There is more discussion of this in Part 2B. Institutionally, Felda only engaged with environmental conservation issues in the late 1980s when developing the Sahabat schemes in Sabah. This is evidenced by the collaboration between Felda and WWF to deal with environmental issues.
From the available research, air pollution from oil palm refineries close to the settlements seems to be the major concern of settlers. Ali (2009) and Halim (2009) note that air pollution from mills was present in their respective case study sites, with Ali’s study noting a coating of black dust on settler’s home furnishings as a result of smoke coming from the processing unit (p. 104). Ali also notes that the level of concern for environmental issues in the Batang Padang district of Perak depends on individual management. For example, the filter on the refinery’s chimney had not been changed for a long time, but a change in management resulted in the filter being changed, and consequently less air pollution (Ibid, p. 123).
High Carbon Stock Science Study 37 Consulting Study 12 The Felda case study
Water pollution is another concern on Felda Summary settlements. Tarmizi’s study (2000) notes that the permitted level of effluent emissions from mills has changed considerably since 1972 when high emissions were allowed. The permitted levels are smaller now • The original goal of Felda, poverty and anaerobic ponds have to be built to filter industrial eradication and resettling landless farmers, waste, though overspill into nearby rivers still occurs. was largely a success. The majority of As will be shown in Part 2B of this study, environmental settlers saw an increase in income after concerns were not particularly evident in the early moving into the schemes, and perceived Felda schemes and, while the World Bank appeared their post-settlement lives as better (details to have monitored the Jengka schemes in Pahang on are given in Part 3). However, these socio- pollution, no major breaches of policy were found. economic improvements that included However, the Bank did find an incident of raw effluent school infrastructure for settler children, had being discharged from a private mill in 1974 and similar an unintended effect of creating a rural to events were also reported from near Sungai Pahang, but urban migration pattern among the settlers’ apparently none were reported in Jengka itself (World children. This is ironic as the Felda schemes Bank, 1987). This appears to corroborate the study by were supposed to contain rural to urban Ali and Halim cited earlier that non-Felda, private mills migration. were the perpetrators of pollution. • This trend of out-migration has continued, However, at the same time as joining the RSPO in with the majority of the Felda second 2004, there was an institutional shift as revealed by the generation uninterested in agricultural work. 2004 Felda publication, Towards Sustainable Palm Oil Furthermore, there is some conjecture that Production. The booklet details the current production Felda was and is uninterested in training the methods such as soil erosion control, minimising fossil settler children, who for the most part are fuel use, integrated pest management and the future better educated than their parents, to join its challenges and areas in need of improvement. managerial staff or downstream industries. It is thought that Felda wants to keep meddling in the settlers’ lives to a minimum.
• This brings us to the question of how successful Felda was in creating modern farmers. A major criticism of Felda is that the settlers remained over dependent on Felda to solve their problems. The original goal of smallholders who would manage their smallholdings independently after repaying their debts was never met. Felda still manages the majority of smallholdings, and those that have been taken over and run by smallholders themselves (with anecdotes of share cropping arrangement with Indonesian migrants) apparently not meeting the Felda standard of production.
• However, Felda’s role in managing the smallholdings is invaluable as the settlers age, and especially in the current era of sustainability. It is doubtful that the smallholders would comply with sustainability standards if it were not for Felda assistance given the lack of sufficient direct financial incentives offered by RSPO certification (details follow in Part 2B).
38 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Part 2B: Felda and its Institutional Context
Synopsis 2012. The section ends by discussing the implications of Roundtable on Sustainable Palm Oil (RSPO) In this section, we examine the institutional context of certification for smallholders with its target date for Felda, its development as a corporate entity and how certification, alongside that for FGV mills and estates, this has affected settlers. A brainchild of Malaysia’s set at 2017. first rural development minister and second prime minister, Tun Abdul Razak, Felda was initially formulated Policy, administration and external linkages as a land reform programme to resettle landless farmers, raise their level of livelihood and modernise At its independence from the British in 1957, 73.4% their living conditions. It was executed with strong of Peninsular Malaysia’s 6.5 million population lived political will, strong partnership between Federal and in rural areas, with Malays comprising 60.2% of this state authorities, close links and coordination with rural sector (Ngah, 2010, p. 2). The Felda schemes ministries and motivated Felda staff. By most criteria, were undoubtedly one of Malaysia’s primary rural the project was a major success but Felda’s operations development strategies aimed at solving problems of were increasingly adjusted to its corporatisation rural poverty, low income, and the lack of adequate and its emergence as Malaysia’s largest producer of infrastructure and amenities in the rural sector. Felda palm oil. This role changed the dynamics of Felda’s specifically targeted the large-scale resettlement of relationship with its original settler programme. Felda’s landless farmers by opening up virgin land. Other institutional expansion and advancement turned it into central statutory agencies established for rural a conglomerate replete with a plethora of upstream development within the ministry headed by Tun Abdul and downstream activities, executed by a host of Razak were the Rural Industrial Development Authority subsidiaries, joint ventures and associate companies. (RIDA), Federal Land Consolidation and Rehabilitation This meant that the settlers became a peripheral rather Authority (FELCRA), Rubber Smallholders’ Development than a central pillar of its activities. This said, settlers Authority (RISDA), and Federal Agricultural Marketing continued to play an important role via their investment Authority (FAMA). In the period of the New Economic in KPF which owned 51% of key processing assets of Policy (1970-1990), Felda and these Federal agencies the Felda Group until late 2013. and others created by the government dovetailed into the plan for the eradication of poverty and uplifting The section reviews how the forward and backward of the economic lot of the Bumiputera (which by the economic linkages of the Felda settler schemes time of the NEP included the indigenous populations generated their own multiplier effects on the local and of Sabah and Sarawak). The increase and then decline national economy. We show here that Felda settlements of land development in the NEP period by the various became part of a web of semi-urban conurbations agencies, including Felda, is described in Table 2B.1 promoted by various state and Federal agencies in the below. push for economic development and modernisation. Indeed, a few settlements were sold en bloc for Felda remained the primary instrument for land suburban housing projects. development and resettlement of settlers in the NEP period, with 600,000 hectares opened up for The section reveals how Felda schemes had in the agriculture between 1970 and 1990. However, as palm past encroached on forest land, in both secondary and oil and other commodity prices fell in the mid-1980s, primary forests, and how contractors, government- land development slowed and in the 6th Malaysia Plan linked entities and the state governments benefited (1991-1995), no new allocation for land development from timber complexes which were part of two large was given to Felda on the Peninsula, instead schemes regional Felda schemes on the Peninsula, Jengka were developed in Sabah. Ngah (2010, p. 8) suggests Triangle and Johor Tenggara. State-controlled agencies that it was not only the lack of suitable land but rather and Bumiputera trusts, state governments and private the rising cost of resettling families which prompted contractors were the likely beneficiaries of these timber such a change of policy. The average cost of resettling a complexes. At the same time, with the establishment, family under Felda schemes increased from RM49,700 with World Bank assistance, of its largest scheme in 1986 to RM55,000 in 1990, compared to RM26,000 (Sahabat) Felda was able set up a forest conservation in 1976 (Ibid.). project in Sabah. The web of economic linkages has th been handled by Felda Holdings Bhd over time, with The 6 Malaysia Plan demonstrated the success of settlers continuing to have a majority share (but not Felda in over-achieving targets by developing some necessarily a controlling hand). This situation has 175,500 ha of land and resettling 26,100 families which arguably continued into the global phase of Felda, when meant that a total of 715,800 persons came under the Felda Global Ventures Holdings Bhd (FGV) was listed in smallholder schemes by the end of 1990. Ironically, this success set the stage for the halt to the scheme after
High Carbon Stock Science Study 39 Consulting Study 12 The Felda case study
1990 (Sutton and Buang, 1995, p. 127). Dr Mahathir FFB classified as Grade A was a mere 50.1%; so training Mohamad as prime minister emphasised in a speech on crop maintenance, fertiliser use and the like was on the Second Outline Perspective Plan (OPP2), 1991- regularly carried out with the settlers. Of some interest 2000, that Felda land schemes cost more than estates is Felda’s use of high yielding varieties developed by the run by the private sector. In lieu of land resettlement, Felda Agricultural Services Corporation. By 1981, Felda in situ schemes became the order of the day especially smallholdings sourced all their seed requirements from on the Peninsula. Moreover, in this period, a plethora of this corporation. In time its offshoot, Felda Agricultural privatised entities or regional development authorities Services Sdn Bhd (FASSB), was able to produce more (RDAs) were created such as the Pahang Tenggara RDA than 15 million seeds per year. FASSB has also been (DARA) and the Johor Tenggara RDA (KEJORA) aimed responsible for the crucial job of assisting settlers in at uplifting the rural poor through urbanisation. For replanting their crop. Replanting cycles and systems Felda, the change was mainly a switch from its settlers’ were established in three phases; 1983-1992, 1993- programme to an emphasis on the plantation sector. 1997 and 1998 onwards. By 2005, 216,230 hectares The change from smallholdings to estates in terms of involving 56,881 settlers, had been replanted. hectares planted from the 1960s to the early 2000s is demonstrated in the following table. Table 2B.2: Felda settler costs, income and resourcing indicators Table 2B.1: Felda smallholders and plantation area by crop, 2005 Cost item / indicator Ownership Crop Hectares Plantations By Per settler RM 50,000 (US$19,230) in 1990; settler vs settler crop cost (1990) repays ⅔ over 15 years at 6.25% interest, area (%) (%) mainly for cost of 4 ha. oil palm holding and Felda Oil Palm 334,394 96 house. Cost likely to be double now with Plantations 3% per year cost inflation. Rubber 7,579 2 Settler net 25 year cumulative net income, 1979-2004, income, 4 ha was RM 276,948 (average RM11,078 per Others 6,877 2 oil palm plot year or RM 923 per month). 2014 total Total 348,850 43 100 income estimated at almost RM2,500 (Barlow, 2015b). Settler Oil palm 367,787 80 Smallholdings Settler gross In 1986 (a year of low prices) net monthly versus net income for a 4 ha oil palm plot was RM376 Rubber 94,503 20 income, 4 ha (US$145). Gross income, net income plus Total 462,290 57 100 oil palm plot typical monthly obligation amount, was Overall 811,140 100 RM750 (US$288), for a 50% net income total margin. Settler cost/ RM 5.0 million (US$1.92 million) per oil Source: Lee & Bahrin, 2006: p. 98. settlement palm settlement and RM6.0 billion (US$2.3 and for Felda billion) for 120,000 settler families. Along with the shift in policy came the organisational project, restructuring of Felda. By 1992, a plantations division based on (Felda Plantations Sdn Bhd) was established to generate 1986 cost income and reduced government expenditure. The Cost of land Free; land was alienated from states to smallholder schemes were stabilised at 57.0% of the FELDA and not charged to settler. cultivated land of which three quarters were oil palm. For Cost of basic Roads, water supply, public buildings, plantations, 95.8% was under oil palm (Lee and Bahrin, infrastructure etc., may cost 10% of combined project 2006, p. 97). Also, a Manufacturing and Trading division and social value or RM 0.67 billion for 120,000 settler was created, combining the old corporations and joint amenities families venture sections (Sutton and Buang, 1995, p. 129). Number of Settlements of 300-500 people enjoyed Felda staff the services of 25-35 onsite staff, over By 1990s and into the 2000s as Felda’s administrative a third of whom worked on community structure stabilised, its 275 smallholder schemes are development programmes (Anon. ALR, managed by 11 regional offices, each headed by a 2015). The staff-settler household ratio was Regional General Manager who report to the Deputy reduced from 8.1 in 1980 to 5.1 in 1990 Director-General of Operations and Deputy Director- (Lee & Bahrin, p. 26 and p. 189). General of Development located at the Felda head office as shown in the organisational chart below. Note: The total cost of the Johor Tenggara project was RM209.2 million (US$89.8 million. Government spending on roads, water supply, and public buildings, such as schools and The main burden of the smallholdings division was to health centres, was US$10 million (World Bank, 1974); 1986 ensure consistent output and quality, as noted by Lee exchange rate US$=RM2.60. and Bahrin (2006 pp. 99-113). In 1985, the share of
40 High Carbon Stock Science Study Consulting Study 12 The Felda case study
The staffing of Felda Holdings Bhd, the parent orchestrated block system to a system of self- company 51% owned by the KPF (owned by settlers), management through local level Development Councils has kept pace with Felda’s development. Employees (Jawatankuasa Kerja Kemajuan Rancangan, JKKR). As in the corporate sector of Felda far outstrip those in noted by Sutton (1989, p. 345), the JKKRs served as the schemes. In 2004, the number employed in the the vehicle for settler involvement and participation schemes stood at 2,293 compared to 17,780 in the in the highest decision-making body of each settler corporations (Lee & Bahrin, 2006, p. 190). The growth scheme. A leader is elected from among 20 settlers in the number of companies created by and associated to be the representative in the scheme’s JKKR. Other with Felda explains this imbalance. There were also joint representatives include the school head, the midwife, ventures with foreign companies to assist its marketing the imam and representatives of various associations. division and Felda opened refining and bulking Over time, the JKKR and its elected leaders exercised installations in major markets such as Pakistan, China, the functions of former Felda administrators. By the South Africa and Egypt. Lee and Bahrin (2006, p. 152- late 1970s, 2,700 settler leaders were in JKKRs with 169) stated that Felda owned 26 subsidiaries, had nine 306 serving on the state or regional committees and 26 joint ventures and eight associate companies under its in the national committee (Ibid). The JKKRs increased wing by 2004. to about 290 by 1987. Other associations included 102 settler associations, 323 women associations Table 2B.3: Felda Group employees, 2005 and 305 youth associations. In 1991, 232 settler cooperatives joined these entities in the Felda schemes. No. of Employees Representatives of local JKKRs also sit on regional level Senior Management 90 ones and on various Felda boards (Sutton and Buang, 1995, p. 132). Executive 2,152 Non-executive 8,978 The significance of the oil palm industry for Malaysia Daily- paid staff 7,721 and settlers’ unique place in it explains the inevitable politicisation of their role through their own self- Total 17,941 awareness and also the intervention of political actors. Source: Lee & Bahrin, 2006, p.150. Ramli (2003) in a study of a Jengka Triangle scheme found the Malaysian Islamic party, PAS, had been attempting Felda’s major policy shift in 1991 from a scheme which to win voters over to its cause through its missionary was primarily geared to the economic uplifting and or “dakwah” activities and through the use of women resettlement of smallholders could be understood campaigners (perayu undi) in general elections. There have essentially as a shift to the corporate development been several other allusions by academic observers to and financing of the palm oil industry in Malaysia, the importance of the Felda schemes and its settlers as through its upstream and downstream industries, a voting bloc for the UMNO, the dominant party within with the attendant global linkages. The rise of the Malaysia’s National Front government, the ruling coalition palm oil industry, particularly on the downstream side, that has governed the country since 1957. Studies have is described by writers such as Gustafsson (2007), shown that Felda settlers have by and large voted for who notes that there were several factors explaining UMNO in general elections. Khor (2015) notes that expansion of the Malaysian oil palm plantations, notably settlers and those who work in Felda may count for some the long experience in cultivation and marketing of 2 million voters. Felda areas could therefore account for rubber and the ease of diversification to oil palm. Felda 9% of Malaysia’s 13 million registered voters, making the alone accounted for a third of this diversification from political clout of this key rural interest group a substantial 1960 to 1990. The government played a major role factor in electoral politics. This power of the Felda in the palm oil refining industry, as part of Malaysia’s voters is enhanced by the imbalance that exists between export-oriented industrialisation. In 2004 export earnings from refined palm oil exceeded those from small rural and large urban constituencies which gives a crude petroleum and, next to electronics, the palm oil disproportionate number of parliamentary seats to rural industry had become “Malaysia’s premier post–World constituencies. Mohamad (2015) suggests that Felda War II export success story” (Gustafsson 2007, p. 67). settlers constitute a “vote bank” for UMNO with Felda areas largely coinciding with the electoral constituencies Malaysia’s access in the palm oil world market has won by UMNO. Thus, from a government perspective, not been without its obstacles. Folds argues that Felda areas represented a “captured rural-corporatised” Felda’s corporatised structure has been adapted to the Malay vote (Mohamad 2015) and we can extrapolate from World Trade Organisation (WTO)’s new international this that the economic nurturing of the settlers and their regulations on agricultural trade (Folds, 2000, p. 483). schemes was not just important for the economy but also for the government’s own longevity and political survival.
Felda, state administration, management and politics Some studies have referred to protests by Felda settlers vis-à-vis certain government policies and generally As the Felda schemes moved into a more stable, over their own working and living conditions (Mehmet, mature state, the switch was made from the centrally
High Carbon Stock Science Study 41 Consulting Study 12 The Felda case study
1986, p. 69). Most recently, the National Association that, while both were high cost programmes, Felda of Felda Settlers’ Children (Persatuan Anak-Anak Felda fared better on the basis of profit-maximisation criteria - ANAK) has protested over FGV and the floating of but with respect to social policy, particularly poverty its shares on the stock market (Khor, 2014, pp.98- eradication, Mehmet felt that Felcra did the better job.19 99). The ongoing politics in Felda has also revolved around settler lawsuits which the Opposition parties We now turn to the financing of Felda schemes 20 have tried to exploit by throwing their support behind and the returns to its investments. Without doubt the settlers. Khor (2015, pp. 101-102) states that at the bulk of Felda expenditure has come from the Malaysian government, but there has been significant least 23 lawsuits have been filed, of which 18 cases development financial assistance from agencies such as against Felda have been officially reported by the the World Bank and foreign governments such as the Prime Minister’s Department. Up to February 2011, United Kingdom, Japan, Kuwait and Saudi Arabia. the outcomes were as follows: 12 have been decided by the courts with the only loss for Felda being the In the formative years of 1956-1961, apart from state technical loss in the Felda Kemahan 3 cases in Kelantan funding, Felda received loans from where Felda’s counsel failed to show up; six cases were the Commonwealth Development Corporation pending, with total claims of RM90 million (US$30 (CDC), UK. These loans were channelled into the million). Since early 2011, at least five big new cases government’s Malayan Developments Ltd, and by have been filed, including several by Sivarasa of the PKR 1961had exceeded RM6 million. By mid-1962, Felda Opposition party. The claims in the following cases are had received a total of RM32.2 million from three in excess of RM1.2 (US$ 0.4) billion: sources: the Federal Government, CDC, and the Rubber Industry Smallholders’ New Planting Scheme, of which 1. Four settlements in Pahang; Felda Mempaga 1, the government had provided the bulk. A Central Mempaga 2, Mempaga 3 and Bukit Damar. Welfare Fund for settlers was also created and allocated 2. Eight Felda settlements in Pekan, Pahang - Felda RM142,000 by 1964. As Felda grew, its funding needs Chini and Felda Chini Timur. naturally increased but in 1970 the CDC ceased its funding and Felda turned instead to the World Bank for 3. Two in Jengka, Pahang. financial assistance. 4. Bera, Pahang. By 1987, the World Bank had approved eight loans 5. Rancangan Serting and Gugusan Raja Alias in Negeri totalling US$232.1 million. The 7th loan of US$26.1 Sembilan. million financed the construction of eight palm oil 6. Felda Maokil in Labis Johor. mills and a loan of US$50 million the construction of roads, bridges and water supply systems. Other 7. Felda Kemahang 3, Kelantan (a landmark case). sources of Felda funding were the Overseas Economic Cooperation Fund (OECF), with a grant of 2,997 billion Four of the listed ‘settler versus FELDA’ lawsuits are in yen (RM91.4 million) in 1972; US$2.8 million (RM10.3 Pahang, where, as mentioned earlier, settlements suffer million) from the Asian Development Bank in 1969: from relative lack of social cohesion. Settlers in eight RM63 million from the Kuwait Fund for Economic FELDA settlements located near premier Najib Razak’s Development (KFAED) in 1975; and RM100.8 million constituency of Pekan in Pahang have taken a suit in 1975 from the Saudi Fund for Development (SFD). against FELDA. In this case, 770 Felda settlers filed a suit The table below shows the sources of funding of Felda against Felda and Felda Palm Industries Sdn Bhd in April schemes in1990-2004. The funding reached its peak 2012, alleging RM422 (US$141) million of losses over of almost RM500 million in 1990. World Bank and 17 years. Yet, electoral support for the ruling Barisan Saudi funding came to an end in 1993 (Lee and Bahrin, National among settlers is very high. In the 2013 General 2006, p.198). In the ensuing five years, the Malaysian Election, ruling Barisan National candidates won 47 of government contributed 90% of the total funding the 54 parliamentary constituencies located within Felda for the scheme. By 1990, cumulative repayments to schemes (Mohamad 2015). the government topped RM1.5 billion and by 2000, repayments totalled RM6.0 billion, with all outstanding Most studies of Felda have found it to be financially interest paid. Loan repayments were all completed by viable (Lee and Bahrin, 2006; Sutton, 1989). However, the same year, including World Bank loans, years ahead studies taking a more critical stance (Salleh, 1991, of schedule. This said, the budget for Felda rose to a Mehmet, 1982; 1986) have also suggested that “colossal” RM9.5 billion in 2004 (Ibid). Felda settlers have been faced with an undue level of indebtedness or that the schemes are too high cost and could easily be faulted on cost-benefit grounds. In a comparison between Felda and Felcra, Mehmet found
19 Estimating the average cost per Felda settler at RM30,000, Mehmet calculated that it would have cost the government RM23 billion to resettle all poor rural households in Malaysia at that time (Mehmet, 1982, p. 356). Put differently, the Felda schemes only covered a small proportion of the rural poor. 20 Our data are drawn primarily from Lee and Bahrin, 2006, pp. 179-200.
42 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Table 2B.4: Sources of Felda funding, 1990-2004 (RM million)
Federal Via Federal Govt Rubber New Rural Total Govt Replanting Rubber Planning & Planting Misc. Fund World Bank Saudi Fund World Bank Grant Grant 1990 387.3 80.5 5.6 10.2 11.6 - - 495.2 1991 281.6 61.8 0.7 - 13.3 - - 357.4 1992 344.0 16.6 - - 3.1 - - 363.7 1993 229.9 19.0 4.0 - 20.4 - - 273.3 1994 233.2 - - - 24.8 - - 258.0 1995 202.2 - - - 21.6 - - 223.8 1996 169.3 - - - 18.9 - - 188.2 1997 171.3 - - - 22.3 - - 193.6 1998 137.2 - - - 11.7 - - 149.0 1999 27.0 - - - 6.3 - - 33.3 2000 1.3 - - - 10.8 - - 12.1 2001 27.4 - - - 13.0 9.3 - 49.7 2002 54.3 - - - 4.8 31.3 - 90.4 2003 22.6 - - - 10.0 117.5 7.0 157.1 2004 30.6 - - - 11.0 119.2 - 160.8 Total 2319.2 177.9 10.3 10.2 203.6 277.3 7.0 3005.6
Note: The post settler period shows strong funding to Felda from the Federal government. From the early 2000s there is a major pick up in the use of replanting grants, targeted towards Felda settlers. Source: 1962-1970 data from Bahrin and Lee, 1988, p.203 & 205; 1990-2004 data from Lee & Bahrin (2009, p. 196).
The World Bank in its evaluation of the Jengka Triangle facilities; (d) built five palm oil mills; as well as (e) Projects found that the main financial lesson was that roads and the provision of water. 10,200 people were for oil palm, the cost recovery rate was 98%, while for expected to find permanent jobs through the project, rubber it was only 65% (World Bank, 1987, p. 61). In its 4,900 directly on the oil palm schemes, while 5,300 evaluation of the Sahabat Scheme in Sabah, the Bank persons would fill the additional jobs created in villages found that the Economic Rate of Return (ERR) would and nearby urban centres. 30,000 people were to be have been negative if the costs of construction and supported by these jobs. The total cost of the project maintenance of access roads, village roads and water was RM209.2 million (US$89.8 million) with Felda works, i.e. necessary infrastructure, were factored into the expenditure for agricultural development, housing, ERR. The weak CPO price and to a lesser extent low yields processing facilities, and management estimated to be accounted for the low ERR (World Bank, 1995, p. 15). US$61.9 million. Direct Government expenditures for roads, water supply, and public buildings were US$10 Felda Group – local economic linkages million (World Bank, 1974).
Among the more significant local and regional socio- Most importantly, the various regional land schemes of economic impacts of the Felda schemes, including the Felda developed a high level of what one analyst has Felda group of companies, have been its linkages with called the “vertical integration” in Felda’s agribusiness the local economy. The introduction of the large-scale model. Using the Sahabat complex as his case study, regional approach to Felda, such as the Jengka and Sutton (2001, p.102) suggests that this was part Sahabat schemes, had economic multiplier effects on of the larger “empire” of Felda with its complement the regional and local economy. Besides these two of companies located within Bandar Sahabat, such major schemes, there were attempts to dovetail Felda as Plantations Sahabat, Palm Industries Sdn Bhd, with state-driven urbanisation programmes. One of the Agricultural Services Sahabat, Trading Sdn Bhd, Security more significant of such programmes was the Johor Services, Engineering, Transport, Oil Products, Hotel Tenggara project, jointly carried out with the Johor state and Aerospray Sdn Bhd. and partially funded by the World Bank. It (a) cleared 32,780 ha of land; (b) planted 26,304 ha of oil palms; Felda schemes invariably led to the development of (c) built housing for 4,400 settler families and offices semi-urban conurbations and townships and could be and public buildings, such as schools and medical said to have generated a host of economic activities
High Carbon Stock Science Study 43 Consulting Study 12 The Felda case study
in their vicinities. At the end of 1990, some 18 called for the development of 36 townships with a “Adjoining Village Complexes,” comprising 83 schemes total population of 450,000. Lee and Bahrin observed had emerged. An example given of such a village that ultimately 23 townships were created but the complex is that of the Besot Complex 20 km from planned conurbations were a “dismal failure” (p. 85). the town of Trolak in Perak. This complex involved Other commentators (Fu and Salleh, 1978) saw the three schemes: Besot 1 (2,575 ha), Besot 2 (2,713 ha) RDAs as something of an extension of the Felda-Jengka and Besot 3 (2,090 ha), each with 300-350 families concept while Federicks has suggested that, apart from and located within a central village location. The their land settlement objective, RDAs were more of an combined numbers necessitated the establishment instrument for rural-urban migration (Federicks, 2012, of a General Health Centre and some other common p. 56). A recent study by Hussin and Abdullah (2012) facilities. Each settlement typically had its own mosque, examined the role of Felda and KESEDAR in raising the clinic, kindergarten, retail shops, etc. However, such standard of living of settlers in Gua Musang in Kelantan, complexes had their share of management and but apparently found no major difference between the coordination problems for the Federal Government. It schemes.21 was clear “that the demand for services was not high enough to generate the multi-faceted urban services Felda Group – ancillary, upstream and downstream expected principally because of the uneconomical activities duplication of services within a small area” (Lee and Bahrin 2006, p. 81). From its modest beginning in 1956, the Malayan government of that time could hardly have expected The larger “Urban Centre Complexes” enjoyed better Felda become the conglomerate it is today with a host economic scale and had fewer problems; according of vertically integrated upstream and downstream to Lee and Bahrin they were a tool to link industry, companies. We focus on palm oil here, but the Felda business and agriculture and stemmed the outflow of Group over time also developed integrated ancillary the settlers’ income. These complexes were populated companies in rubber, sugar and other vegetable oils. with 10,000-20,000 people and were developed in Initially, Felda’s involvement in the commercial oil palm conjunction with state governments. These urban sector was largely confined to downstream activities complexes were based on its model of “Feldajaya” such as milling and processing but, from the 1980s townships which Felda has established across its onwards, it ventured even into upstream activities such schemes. These townships are aimed in part at retaining as fertiliser supply. Felda’s upstream activities were the second generation of “Felda children” within the clearly part of Malaysia’s import-substitution policy Felda schemes by providing modern housing. The and its downstream expansion part of its resource- townships also include community colleges and a wide based export orientated industrialisation (Lee & Bahrin, array of utilities and facilities catering to the second 2006, p. 144).22 The early investments had limited generation. Felda housing projects include low and objectives, among which was to help settlers to invest medium-cost houses. By 2005, land alienated for indirectly in enterprises related to their work. Felda’s such housing in Pahang, Negeri Sembilan, Kedah and first corporation was the Stores Corporation established Johor accommodated 2,046 medium-cost houses, in 1968, which grew out of its Shops Division. This 801 low-cost houses and 24 shops (Lee and Bahrin, corporation became the Felda Trading Corporation with 2006, p.92). An important development, in tandem 72 outlets and a turnover of RM211 million in 1987. with Felda urban centres, has been the creation of Next came Felda Marketing Corporation (FELMA) in townships by the Regional Development Authorities which Felda settlers held 30% of its shares. By the (RDAs) as early as the 1970s. These townships, 1980s, FELMA was responsible for selling 99% of independent of Felda settler communities, were created Felda’s CPO locally and it set up offices in London by KESEDAR (in Kelantan), KEDA (in Kedah), DARA and San Francisco to sell in those markets. FELMA in (in Pahang), KETENGAH (in Terengganu) and KEJORA 1986 began to sell refined palm oil. Another important (in Johor). Lee and Bahrin (2006, p. 87) suggest the corporation was the Felda Transport Corporation, with RDA townships were less effective economically than a fleet of vehicles to handle palm oil products. By the Felda urban centres in part because there was “stiffer end of 1988, there were 13 corporations in trading, competition from outside businessmen than in the marketing, latex handling, mills, transport, security protected environment” of the Felda conurbations. services, agricultural services and construction leading The Pahang Tenggara project, DARA, was the largest of to diversification into other downstream activities such these attempts to create townships. The Master Plan as vegetable oils, sugar mills and food products.
21 The KESEDAR land scheme covered 779,637 ha of oil palm and rubber, and 3,500 settlers on nine Felda schemes occupied 10,552 ha mostly of oil palm. The authors concluded that income levels had been raised significantly in the two types of schemes. Settlers earned mostly between RM601 and RM1,200, but the authors made no direct comparisons to determine which scheme fared better. About 67% of settlers sought secondary income outside farm work (Hussin and Abdullah, pp. 289- 290). 22 We draw in this section from Lee & Bahrin (2006, chapter 5, pp. 143-176) unless otherwise stated.
44 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Felda’s adoption of enhanced ‘privatisation’ in the devise the shareholding structure where 51% of Felda 1990s saw a change in its corporate form. Corporations Holdings was acquired by Koperasi Permodalan Felda, were converted to “companies” and by the mid-1990s whose membership was restricted to settlers and staff there were 25 companies in the Felda stable. Felda (Ibid, pp. 15-16). Holdings Sdn Bhd was created in 1995 to oversee a wide portfolio of companies which had diversified into Through participation in Felda’s diversified investments, shipping, insurance, information technology, property KPF was able to declare dividends of 20% in 2012 and development and construction. Settlers were involved 15% in 2004, despite weak CPO prices. Information in this transformation through their 51% share of Felda in 2013 revealed that settlers had benefited from an Holdings via KPF (established in 1980), and this is average dividend yield of 14% over a 30-year period, regarded as an important feature in delaying the full-on through their KPF stake. KPF enables its members to privatisation of Felda as already noted in Part 1. Talib pool their savings and invest in equity in companies (2009) states that it was in fact the strategy devised belonging to Felda and its benefits reach all its members by Raja Muhammad Alias (former chairman and civil who comprise settlers and Felda Group employees servant associated with Felda for some three decades and the children of settlers. According to KPF’s annual and its reputed architect). report of 2013, it had 269,250 members (FGV, 2012 and KPF, 2013b). Companies under the Felda Holdings umbrella, which were all profitable, were constantly subject to scrutiny In Malaysia, Felda is now the largest miller and refiner for possible privatisation. Raja Alias’ strong belief was of palm related products, with 72 palm oil mills, 7 that profits from Felda’s activities should stay with refineries and 10 rubber factories. By 2005, the the settlers and staff, and not flow to businessmen Felda Group had 26 subsidiaries, 9 joint ventures and interested in privatisation gains. This led him to 10 associated companies with a total investment of RM868.1 million.
Diagram 2B.1: Felda organisation chart, 1991 (a) and 1993 (b)
(a) GROUP CHAIRMAN
FELDA Corporations Joint Ventures
Director General Production Services FELDA Oil Products Sdn. Bhd.
Deputy Director Deputy Director Assistant Director Agricultural FELDA Johor Mills Zone 1 Zone 2 General Services Bulkers Sdn. Bhd.
Pahang Negeri Sembilan Finance Lands Transport Trading etc. etc. etc. Engineering etc.
Computer Services etc.
etc.
(b) GROUP CHAIRMAN
FELDA Schemes Settllers FELDA Plantations Sdn. Bhd. Manufacturing and Trading
Director General Managing Director Managing/Joint Managing Director
Internal Audit Internal Audit Internal Audit
Operations Services Joint Ventures Corporations
Terengganu North Finance FELDA Oil Products Pt. Ltd Sabah Negeri Sembilan West Planning FPG Oleo Chemicals Pt Ltd Pahang,East Negeri Sembilan East Land Survey FELDA Johor Bulkers Pt. Ltd. Pahang, South Melaka Management Survey Malaysia Cocoa.Mttg Pt. Ltd. Jengka Personnel FELDA Perlis Sugar Mill Pt.Ltd. Kelantan Engineering FPM Pt.Ltd. Pahang, West Pasir Gudang-Green Tea Pt. Ltd
Services Palm oil production
Corporate services Mills Rubber Marketing Trading Palm kernel refinery services Construction Security services Computing services Latex handling
Source: Sutton & Buang (1995, p. 128).
High Carbon Stock Science Study 45 Consulting Study 12 The Felda case study
Table 2B.5: Profits of Felda companies, 2002-2004 (RM million)
2000 2001 2002 2003 2004 Felda Holdings Bhd 74,491 70.928 73,389 77,185 18,892 Subsidiary Companies Felda Plantations 179,247 108,675 129,840 139,000 120,335 Felda Palm Industries 29,181 30,440 47,019 47,426 45,454 Felda Agricultural Services 9,233 16,267 26,359 55,552 70,473 Felda Rubber Industries 23,591 6,679 14,248 276 11,758 Felda Rubber Products 48 3,230 7,123 9,998 14,446 Felda Trading 5,062 3,026 2,367 56,589 29,938 Felda Transport Services 16,526 18,168 10,484 11,794 10,152 Sutrajaya Shipping 10,465 11,609 4,257 4,871 40,064 Felda Engineering Services 10,308 10,522 10,634 12,862 9,497 Felda Prodata Systems 15,722 16,543 14,544 14,765 12,019 Felda Security Services 3,048 2,084 2,133 2,224 2,536 Felda Marketing Services 12,353 12,597 10,709 26,941 24,864 Felda Vegetable Oil Products 15,145 12,304 10,541 10,234 7,504 Felda Kernel Products 9,280 8,360 4,138 24 4,463 Delima Oil Products 6,792 7,006 3,256 1,851 14,150 Malaysia Cocoa Manufacturing 1,615 1,183 6,151 15,511 14,150 Felda Enterprises 22,626 6,343 12,910 19,443 13,617 Felda Construction 656 1,212 1,521 1,983 2,433 Felda Properties 182 4 381 599 1,234 Felda Farm Products 213 341 1,197 1,507 1,461 Plantation Resorts 110 260 166 179 493 Titar Travel 304 306 20 127 163 Pericon.Com 863 356 20 127 163 Felda Bulkers 16,178 16,686 15,061 11,348 11,657 Sub-total 388,748 294,201 335,079 445,231 463,024 Joint Ventures Felda Johore Bulkers 24,235 24,306 28,538 28,382 32,040 Felda Oil Products 5,269 9,849 2,605 1,502 2,100 Felda Bridge Africa 1,333 1,305 671 870 1,302 Pasir Gudang Grains Terminal 1,291 987 1,192 1,444 1,432 Feltex 2,330 2,015 2,086 1,590 6,912 FPM 17,772 3,791 1,284 217 11,702 FPG Oleochemicals 109,125 182,868 127,318 118,288 102,989 Kilang Gula Felda Perlis 2,859 2,875 9,443 4,071 6,770 Felda Ekovest 999 433 318 4,933 1,253 Sub-total 165,213 228,429 173,455 161,297 166,500 Associate Companies Kuala Muda Estates 4,186 407 86 5,910 582 Rex Metal Packaging 2,737 4,382 2,646 3,157 532 Taiko Clay Chemicals 45,076 45,801 38,875 27,123 9,700 Behn Meyer & Co 12,328 7,130 8,492 11,231 17,975 P.K. Education Ladang Tai Tak 0 2,955 3,933 4,144 5,603 Malaysian Pakistan Venture 728 1,090 652 591 1,444
46 High Carbon Stock Science Study Consulting Study 12 The Felda case study
2000 2001 2002 2003 2004 Boustead Oil Bulking 116 429 249 43 69 Voray Holdings Ltd 5,300 2,808 1,839 217 1,457 Royal & Sun Alliance 20,789 29,642 40,190 44,100 42,881 Sub-total 91,260 94,644 96,962 96,516 80,243 Profit before tax before 635,363 598,320 595,938 572,339 536,583 adjustment Minus adjustment for minority 237,333 252,916 240,990 246,662 208,796 interests etc. Profit before tax 398,030 345,404 354,948 325,677 327,787
Felda’s position in the national palm oil sector well-funded programme ensured that a mill was built Based on data from FGV, the group is the world’s third alongside the oil palm settler plots. Large corporate largest oil palm estate operator owning more than planters with the wherewithal would also do likewise. 450,000 hectares across Malaysia and Kalimantan, However, for independent smallholders and small Indonesia. It processes over 15 million tonnes of FFB producers to venture into planting oil palm, they would annually; 5 million tonnes from its own plantations need to know that there is a mill (owned by Felda, a and the balance from Felda settlers and independent corporate plantation or an independent mill owner) to suppliers (about 5 million tonnes, each). Beyond this, it which they could sell their fruit. also produces over 3 million tonnes of crude palm oil As a key developer of rubber and oil palm in Malaysia’s (CPO) annually from 72 palm oil mills. agricultural frontier, Felda has not surprisingly played In the context of Malaysia’s total of 5.4 million a key role in facilitating the expansion of Malaysia’s hectares of planted oil palm at end 2014, FGV and independent smallholder sector. Felda might initially settlers represent 13% of the total, while the other have installed a small oil palm mill of 15 or 30 tonnes state-led schemes accounted for 10% (Felcra, Risda, per day capacity to cater for the crop from its settlers state schemes / government agencies; MPOB, 2015). (and its commercial estates). As with most mills, these Independent smallholders (those with less than 100 would often have been designed to accommodate acres or 40.5 ha) accounted for 15%. Thus, the total expansion of their capacity to 60 tonnes or even more, area outside the private estates sector was 38% of the thereby enabling Felda palm mills to buy FFB from third total, with an area of just over 2 million hectares. party suppliers. Thus, besides its role in developing its own smallholders programme, it has also played a Felda’s economic multiplier effect and business linkages key role in enabling the growth of other independent smallholders and smaller private estates by buying and Currently Felda has 72 mills and sources roughly 1/3 of processing their crop at its mills located throughout FFBs from its own estates, 1/3 from Felda smallholder Malaysia. schemes and 1/3 from external suppliers. It now has 41 mills certified under RSPO; the target is for all FGV Initially, practically all planting materials were sourced estates and Felda land schemes mills to be certified by from outside Felda but by 1981 Felda’s own subsidiary 2017 (Interview with Norazam Abdul Hameed, FGV, 3 (FASSB) supplied all the seeds, producing 15 million March 2015). seeds per year compared to a mere half a million in the early years. Felda’s own nurseries then prepared high- Felda played a key role in the development of plantation yielding seedlings. Fertilisers were the major inputs in agriculture frontiers. For rubber and other traditional the growing stage, costing RM300 million per year and smallholder crops like cocoa, relatively cheap backyard again it was FASSB that developed and supplied the basic processing is possible. For palm oil the processing fertilisers (Lee & Bahrin, 2006, p.106). FASSB owns is more complex, capital intensive and time sensitive. To 2 fertiliser factories, a rodenticide factory, a clone produce CPO of an acceptable quality, FFB has to be breeding laboratory, 2 oil palm seedlings laboratories milled within 24 hours of its harvest. and 2 agricultural analysis laboratories (Ibid, p. 153). Among others, two associate companies of Felda are also As a palm oil mill is a relatively costly facility23, the involved in supplies, namely, Taiko Clay Chemicals Sdn expansion of oil palm smallholders is contingent upon Bhd based in Batu Kawan, Penang, which sells activated there being a mill nearby to which they can sell their bleaching earth and Behn Meyer & Co. (M) Sdn Bhd, FFB output. In the case of Felda, its integrated and which sells fertilisers and agricultural chemicals.
23 Today, a 60 tonnes (FFB) per hour palm oil mill costs RM49.8m or nearly US$14 million (source: “CBIP bags RM49.8m palm oil mill contract” By Sulhi Azman, theedgemarkets.com, 8 April 2015, http://www.theedgemarkets.com/my/article/cbip-bags-rm498m-palm-oil-mill-contract, 8 April 2015).
High Carbon Stock Science Study 47 Consulting Study 12 The Felda case study
The use of migrant labour in Felda schemes, particularly earn only RM800 per month, the local minimum wage, in plantations, has not only increased over the years but compared to the Peninsula where they earn RM900.25 by the 2000s had become a necessity because of the labour shortage that Malaysia faced in the plantations According to Sarawak Oil Palm Plantation Owners’ sector. As pointed out by Kaur (2014), Malaysia’s Association (SOPPOA) chairman Datuk Abdul Hamed plantation system by the 1980s was one based on a Sepawi, the main factors are the increasing competition “guest worker” programme wherein the first major legal from Indonesian plantations coupled with a lack of framework for migrant labour was established between local labour willing to work in estates. He estimates Malaysia and Indonesia in 1984 (Kaur, 2014, pp. 205- that Sarawak is 20-30% short of its needs. Meanwhile, 207). Sabah is increasingly dependent on labour from the Philippines.26 In a study of the labour regime of the oil palm industry in Malaysia, Saravanamuttu (2013) found that the In its downstream palm products, Felda Group’s core number of workers employed in the industry rose to business comprises the production of oleochemicals, 350,000 in 2007 at which time oil palms covered 4.3 biodiesel, oils, fats and fast moving consumer goods. Its million hectares, with an increase to 5.4 million by biodiesel refinery produces certified palm methyl ester 2014. Indonesian workers formed the bulk of foreign for Malaysia as well as EU markets, the US and China. labour in oil palm estates (Saravanamuttu, 2013, p. Other products include cooking oil, margarine, instant 124). Foreign plantation labour totalled 504,159 noodles, mayonnaise, creamer and peanut butter. Felda persons in 2006, with Indonesia providing 64.4% of is also Malaysia’s largest producer of refined sugar.27 all foreign workers in Malaysia that year. Indonesian embassy data show that, of the 550,000 Indonesian Felda Marketing Services Sdn Bhd (which was originally plantation workers currently in Malaysia, 95% are in set up as FELMA or Felda Marketing Corporation the palm sector and about 80% of Malaysia’s palm oil in 1974) was handling the marketing of crude and workforce are Indonesians.24 refined palm oil, palm kernels, latex examination gloves and a host of downstream products. To market its The Incorporated Society of Planters Malaysia estimates downstream products, FMSSB has set up joint venture that the total labour requirement on the country’s palm sales offices in Europe and the US. Of particular interest plantations with good management is 500,000 workers, is the joint venture with the US company, Procter and while 275,000 are needed in the 1.1 million hectares Gamble, which produces esters, fatty alcohols and of rubber plantations. Labour shortage is particularly glycerine in Tanjung Gelang, Kuantan. These products acute in Sabah and Sarawak, where Indonesian workers are exported to many countries.
Diagram 2B.2: Felda Global Ventures’ organisation chart
100%
100% 100% Felda Global Ventures 100% Felda Global Ventures Felda Global Ventures Sugar Sdn Bhd Felda Holdings Bhd Other businesses Plantations Sdn Bhd Downstream Sdn Bhd 40% 50% 11% 100% Felda Global Ventures MSM Malaysia 100% Felda Technoplant Felda IFFCO Sdn Bhd Plantations (Malaysia) Holdings Berhad Sdn Bhd Sdn Bhd
100% 100% Felda Global Ventures 100% Kilang Gula Felda 100% Felda Global Ventures FPM Sdn Bhd Kalimantan Sdn Bhd North America Sdn Bhd Perlis Sdn Bhd
100% Malayan Sugar 100% Manufacturing Malaysia Cocoa 100% 50% 90% 100% Company Bhd Manufacturing Sdn Bhd Twin Rivers Technologies Holdings Trurich Resources Twin Rivers Technologies PT Citra Niaga Perkasa Entreprises de Transformation de 76.9% Sdn Bhd Holdings Inc Graines Oleagineuses du Quebec Inc Felda Agricultural Services Sdn Bhd 100% 100% 100% 100% Twin Rivers Technologies 72.7% Twin Rivers Technologies Holdings MSM Properties Felda -Johore Manufacturing Astakonas Sdn Bhd Entreprises de Transformation de Sdn Bhd Bulkers Sdn Bhd Corporation Graines Oleagineuses du Quebec Inc
72% 100% Felda Palm Delima Oil Products 49% 49% Industries Sdn Bhd Sdn Bhd
Bunge ETGO L.P. Bunge ETGO G.P. Inc 71.4% 83% Felda Rubber Felda Kernel Industries Sdn Bhd Products Sdn Bhd
51% 67% Associated Companies Felda Transport Felda Vegetable Oil Services Sdn Bhd Products Sdn Bhd
51% 51% Jointly-Controlled Felda Engineering Felda Marketing Entity Companies Services Sdn Bhd Services Sdn Bhd
50% FPG Oleochemicals Other businesses Sdn Bhd Source: FGV, 2015. Other businesses
24 http://www.reuters.com/article/2014/04/27/us-palmoil-labour-idUSBREA3Q0P320140427; accessed 8 April 2015. 25 Malaysia introduced a minimum wage policy in January 2013 which required employers to pay monthly wages of RM900 on the Peninsula and RM800 in Sarawak, Sabah and Labuan. http://minimumwages.mohr.gov.my/employers/about-minimum-wages-policy/ (accessed 9 June 2015). However, there are compliants that levies imposed on migrant workers can be deducted from wages. 26 http://www.thestar.com.my/Business/Business-News/2012/07/02/Workers-in-demand/?style=biz; accessed 8 April 2015 27 http://www.feldaglobal.com/business_overview.php; accessed 8 April 2015
48 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Felda is now active in the sugar sector. It is Malaysia’s The literature on Felda’s private contractors is sparse. largest producer of refined sugar. Sugar is refined via However, company reports, reveal some information FGV-owned Malaysia Holdings Berhad (MSM), and its about the interlocking relationship of businessmen two operating subsidiaries, MSM Prai Berhad (formerly who have deep ties with Felda. One of the Malaysian known as Malayan Sugar Manufacturing Company family businesses that participated in works for Felda Limited) and MSM Perlis Sdn Bhd (formerly known as is the Lim family (whose companies include Ekovest, Kilang Gula Felda Perlis Sdn Bhd).28 Iskandar Waterfront and PLS Plantations). The co- founder and Chairman of Ekovest Berhad is Tan Sri Felda relies entirely on private contractors in the first Dato’ Lim Kang Hoo, a businessman with over 36 years phase of each scheme. According to Mehmet (1982, of experience in the construction industry, including as p. 345), land clearing, planting, field maintenance, a contractor to Felda. He has also become one of the construction of housing, and physical infrastructure, earliest investors in the Iskandar Malaysia project. Lim’s are all done by contractors. “The settlers are brought Iskandar Waterfront is the key owner of PLS Plantations into the scheme usually in the third year, well after the Berhad, formerly known as Pembinaan Limbongan Setia planting of the tree, but before they become productive Berhad (a construction company). In an apparently (after four years in the case of oil palm; six years in the enduring relationship, Lim’s company is still a private case of rubber)” (Ibid). These development costs are contractor at Felda Sahabat. Among its published ultimately borne by the settlers and deducted over the completed construction projects are RM113.4 million 15-year period of the repayment of their loans. Salleh for or related to Felda30 (out of 74 completed projects (1991, pp. 331-332) observed that settlers themselves with a value of RM 1.1 billion; PLS Plantations, 2015). became sub-contractors in the schemes. He notes that These include nine projects in the Felda Sahabat area, Felda gave priority to settlers to execute maintenance with two road construction projects with a contract contracts through the disbursements of loans. Malay cost of RM600,000 to RM900,000 per kilometre for a settlers secured 21% of contracts in 1974 and 57.3% main access road to a ring road. In its financial report for in 1983, when these contracts totalled RM18.9 million. FYE 31 March 2014, the company indicated a 24% PBT In addition, specific types of contracts were reserved margin. for Felda settlers, namely: (i) contracts costing below RM2,500 administered by regional controllers as “closed From these two case studies, one of a Felda rubber quotation tenders” and “work orders”; (ii) small contract replanting contractor dispute and the other of Felda work (kerja borong kecil) costing no more than RM2,500. construction contractor, we gain an impression of the Salleh suggests that settlers receiving such contracts nature, number and value of contracts that have been were able to augment their income by an average of generated by the Felda schemes, which have a total of RM990 per month, up to four times the salary of a over 800,000 hectares of plantations and settler plots. manager of a land scheme. As noted earlier, for just the settlers, the development cost was RM6 billion for 120,000 settler families (in Of late, court cases initiated by Felda settlers have 1986 cost terms). revealed some interesting facts about Felda private contractors. In January 2011, 23 Felda settlers from Thus, the economic multipliers related to Felda and the Felda Raja Alias 2 won a case against a Felda sub- businesses that have gained work from it are likely contractor, Huat Hing Rubberwood Sdn Bhd. The to have been highly significant. Malaysia has policies settlers wanted to appoint their own contractor to to promote small Malay businesses and Felda has do the clearing and succeeded in setting aside the encouraged entrepreneurial activities among its settler injunction by Huat Hing to stop them from doing so. members. Huat Hing initially had the contract to cut old rubber trees for lumber but did not get the job directly from the Felda management. Felda had appointed Felda Sungai Dua Multipurpose Cooperative Ltd., which sub- contracted the job to Sheeco Sdn Bhd, which in turn sub-contracted it to Huat Hing. It was going to pay RM28,000 for clearing seven acres, but the settlers said they preferred to deal with another contractor, who had offered them RM35,000 for the same job.29
28 http://www.feldaglobal.com/business_sugar.php, accessed 7 April 2015 29 http://www.freemalaysiatoday.com/category/nation/2011/01/31/felda-facing-deluge-of-suits/, 8 April 2015 30 In this sector, network connections with Felda are common. The company appointed a former Felda staffer. Dato’ Haji Ibrahim bin Haji Keling, to the PLS Board in November 1994 after he retired in 1993 as Director of the Management Services Department, Felda. He also sat on the Board of Felda Construction Bhd.
High Carbon Stock Science Study 49 Consulting Study 12 The Felda case study
Felda and socio-environmental policy of the clearing of about 33,000 acres of tropical forest, the planting of nearly 28,000 acres of oil palms and The funding of the Jengka Triangle project (1968-87) the settlement of about 2,800 rural families over a and the Felda Sahabat project (1980-1995) by the four-year period.” The report noted that there would World Bank brought about a measure of environmental be a forest industry complex to extract, process and and conservation policy and actual implementation of market lumber from the Jengka Triangle and after the conservation objectives in the Sabah scheme. We draw mid-1970s from the adjacent Tekam, Berkelah and Takai on the impact evaluation report of World Bank (1987) forest reserves.”31 to describe the environmental impact of the Jengka schemes (World Bank 1987, pp. 50-53). It was also reported that “Because the forestry potential was not exploited satisfactorily in Jengka I, part of the It is notable that the land that was developed is referred second project was the Jengka Forestry Programme to as “tropical forest” and even “forest reserve” is that would be carried out by Sharikat Jengka Sendirian mentioned. However, details of the nature of these Berhad (SJSB).” This would entail exploitation in 70,000 forests, whether primary or secondary (logged over) or acres of permanent forest in the Triangle itself, 65,000 other types of forest are not indicated in either Felda acres of Tekam, 96,000 acres of Tekai, and 139,000 official histories or in the World Bank loan papers. One acres of Berkelah Reserve forests” (Ibid). of the few details offered is an estimate of 7 million tons of timber to be harvested from the site of the The Department of Orang Asli Affairs stated that Jengka 2 project (details below). about 110 families of tribal peoples, a total of about 330 people, were affected by the Jengka projects, According to the World Bank 1987 report, there was with about 75 Orang Asli actually being displaced no evidence that the Jengka projects contravened from an area now occupied by scheme 6. The Semoq existing Malaysian legislation on conservation and Beri tribe, which constitute the majority of the wildlife protection. However, it nonetheless indicated Orang Asli affected by these Jengka projects, live that the project did have negative impacts. The Bank’s traditionally in individual family houses rather than evaluation found that the clearing of the forested area the long houses like other groups, and so settlement in Jengka had resulted in almost all species of forest in villages is not a considerable change for them. No animals becoming rarer. Large mammals which lost their Orang Asli participated in the Jengka scheme, instead, traditional habitat included about 24 elephants, 40 provision was made for their resettlement nearby and forest ox and 5 Sumatran rhinos, all these species being compensatory land was provided. protected by law. The projects, through deforestation, also had a negative impact on freshwater fish, but Location of mills was not regulated at the time of since no inventory for the area was made against which project implementation but Felda’s mills were sited present conditions can be compared, it was not possible relatively far off their water source. This was beneficial to ascertain the effects of turbidity and increase in in that the raw effluent, by having to travel a similar temperature. distance and often being discharged into a swamp, then had a lower biological oxygen demand (BOD). Since Conversely, wildlife have had a significant impact the introduction of the Environmental Quality Act in on the projects’ development: elephants alone were 1974, Felda has taken steps to ensure that the BOD responsible for the destruction of nearly 79,000 of the effluent from its existing palm oil mills has been young oil palms, equivalent to an area of 530 ha and progressively reduced in keeping with the guidelines. costing over RM300,000 to replant. The 13 elephants Six of the palm oil treatment plants in the Jengka area responsible were pocketed in the eastern forest became fully operational in 1982, two in 1983 and one reserve and, faced with habitat loss, had ventured into each in 1984 and 1985. The settler survey revealed that the newly-planted areas of oil palm. In addition to settlers perceived the rivers in Jengka to be polluted. replanting costs, the game department spent almost RM However after investigation, the mission concluded that 1 million capturing these elephants which were then no evidence was available to support this contention. sent to other reserves. One incident of raw effluent being discharged from a private mill occurred in 1974 and similar events have In the earlier report of 1970 on the second Jengka also been reported from near Sungai Pahang, but none Triangle Project, there was more candid discussion of have been reported in Jengka itself. Nor are there deforestation, which was part of the Forestry Project indications of fertiliser being leached into the rivers: within this scheme. The report noted “The Jengka water quality measurements undertaken in 1977-1979 Triangle Project for which the loan will be made consists revealed that there was little evidence of inorganic
31 http://www.worldbank.org/projects/P004220/jengka-triangle-project?lang=en, accessed March 2015.
50 High Carbon Stock Science Study Consulting Study 12 The Felda case study
nutrients in the water, well within the guidelines for north of Tabin are the Kulamba Wildlife Reserve (KWR) drinking water in developed countries. Pesticides have (20,682 ha), the Kuala Segama and Kuala Maruap Forest been used, but now only in very low quantities with Reserve (24,000 ha), and the nipa swamp state land natural control being the preferred method. set aside for fisheries. Tabin and Kulamba are the only wildlife reserves in the State of Sabah. In Sabah, a conscious implementation of a conservation policy was implemented (World Bank, 1995, pp. iv- In contrast to the rather positive rendering of the vi). The project was launched after an Environmental success of conservation and environmental protection Impact Assessment (EIA) was completed in February in the World Bank assessment, there has been a 1988 which called for the implementation of the Dent suggestion by Sutton (2001, p. 102) that the switch Peninsula Environmental Management Plan (EMP) in from a settler approach to that of establishing tandem with the Felda Sahabat scheme. The World plantations based on Felda’s new agribusiness model Wide Fund for Nature, Malaysia (WWFM) was assigned revived issues raised by its consultants, MINCONSULT to draft the proposal and completed the EMP in May and WWFM: “Steep slopes appear to have been planted of the same year. Sutton (2001, pp. 97 -98) mentions with oil palm and the recommendations by the WWF to that a private consulting company, MINCONSULT, stop clearing forest after Sahabat 31, i.e. after the first had recommended the retention of forest areas. The 53,586 ha, until satisfying the Sabah Government on implementation of the EMP was considered to have had various environmental issues (sic), seem to have been a substantial institutional impact. ignored”. He also mentions that tall Mengaris and Ara trees were not spared and Sahabat 27 and 28 were Key objectives attained included: (a) full-time staff of developed rather than preserved as forest reserves (Ibid). the Sabah Wildlife Department based at Tabin Wildlife Other wildlife reserves in Sabah also exist, but are not Reserve with responsibilities for the Kulamba Wildlife covered in the above review that is focussed on the Reserve. An Ecotourism Plan developed by the WWFM context of Felda’s expansion in the state. for the 7th Malaysia Plan was to be implemented in the Tabin Wildlife Reserve. Licensed logging in Tabin ceased The Felda settler schemes were developed over three in 1992 and illegal logging was reduced to occasional or more decades of low awareness or concerns with incursions. Illegal conservation while the period of the 1990s saw Felda hunting was also much better controlled. Aerial and develop plantations with an eye towards preserving other surveys in 1994 show significant regeneration some level of the environment and human ecology. of logged-over areas and an abundance of wildlife; However, in the post-2000s the cultivation and (b) an amendment to strengthen existing legislation expansion of monocultures such as oil palm came for wildlife sanctuaries was transformed into a more under severe criticism for its negative environmental comprehensive and functional Wildlife Conservation and social impacts. Escalating NGO campaigns, Enactment; and (c) the Sabah Conservation Strategy particularly from Europe, have reined in the prospects has provided guidelines and an operational framework for untrammelled oil palm expansion in Indonesia and for the sustainable management of Sabah’s natural Malaysia, especially by large plantation groups under resources. The Tabin Wildlife Reserve (TWR) (120,000 the public gaze. These large groups also face regulatory ha), the largest forest area in Sabah (and in Borneo), (Indonesia) and land availability ceilings (Malaysia ex- was established specifically for the protection of Sarawak). Large corporate growers have acceded to wild breeding populations of the Asian elephant NGO pressures, as these have resulted in high-key (Elephas maximus), the Asian two-horned rhinoceros boycotts by the likes of Unilever and Nestlé. Many (Dicerorhinus sumatrensis) and the wild cattle (Bos large companies have signed on as members of the javanicus), known locally as banteng or tembadau. Roundtable for Sustainable Palm Oil). Multi-national consumer brands are being persuaded to change their Gazetted in March 1984 under forest legislation, buying policies, with potential global implications. TWR had previously been commercial forest reserve Strategies to ignore or deny problems in oil palm selectively logged for large dipterocarp trees for export. sustainability have not worked well and biodiversity and After gazetting, commercial logging had continued in all a host of “sustainability” issues dominate the discursive parts of the Reserve except in a “Core Area” of 8,616 terrain of the industry today. (Khor, 2013, pp. 102-103). hectares, which had no special legal status but was retained as a sanctuary for rhinos and other mammals The campaigns of the 1980s into the 1990s were displaced by logging in surrounding areas, as well as a focused on health fears purportedly caused by tropical source of plants and animals to regenerate neighbouring oils. This was ultimately disproved. The current forest after logging. Also located in the Dent Peninsula campaign is of a different character altogether. It is
High Carbon Stock Science Study 51 Consulting Study 12 The Felda case study
symbolised by the orang-utan, a highly emotive subject. of a non-certified supply). The non-certified supply This time, industry observers reckon that there will to Kilang Sawit Felda Baiduri Ayu is expected to drop be no return to ‘business as usual’. Indonesia and from 57% in 2012 to 47% in 2014. As a result, it is not Malaysia, as well as other would-be palm oil producers, surprising that FGV has selected an RSPO mass balance must engage with the new global environmental lobby supply chain option for this mill, given its large external as financiers have become persuaded to be wary of FFB supply source. funding oil palm developments. Unlike in the past, the World Bank Group suspended funding for the sector for Given the important role that FGV palm oil mills play in a while, but is resuming support for sustainable palm oil processing private sector and independent smallholder projects (Ibid). crop, it can be anticipated that these mills will have to start with and remain with RSPO mass balance The RSPO is based largely on the Forest Stewardship certification for quite some time. This viewis confirmed Council (FSC), also initiated by the WWF. It is WWF’s by FGV’s head of sustainability and quality management strategy to establish industry roundtable programmes who points to its aggregate level “⅓ : ⅓ : ⅓” sourcing for 15 commodities that pose environmental threats reality of Felda’s own plantation crops, smallholder such as deforestation, soil loss, water use and pesticide crops and external crops (Norazam, 2015). Mass use to key global locations. WWF’s goal is to “reach the balance is deemed a lower effort and therefore lower 100 companies that will control 25% of the trade of value level of eco-certification. In the case of FGV and each. If these companies demand sustainable products, its Felda smallholder clients, their choice of certification they’ll pull 40-50% of production. Companies can push level is less by choice than by necessity. producers faster than consumers can.”32
Felda, as we know, has adjusted to the new socio- political environment and taken on the responsibility of ensuring RSPO certification in stages. As early as 2004, Felda accepted the notion of “sustainable palm oil production” and advertised this in a glossy publication (Felda, 2004). As we noted earlier, the head of the sustainability division of FGV intimated that RSPO certification by 2017 would be targeted for all Felda plantations (Norazam, 2015).
We examined the Felda Sahabat complex as an example of a recent RSPO certification report. This reveals the following facts: Kilang Sawit Felda Baiduri Ayu is a palm oil mill (POM) with capacity of 54 tonnes per hour. “The supply bases are the FFB sources to the POM: 3 estates (FGVPM Sahabat 09/15, FGVPM Sahabat 16 and FGVPM Sahabat 55) owned by Felda and 2 estates (Felda Sahabat 1 and Felda Sahabat 2), which are owned by organised smallholders under the Felda Settlers’ Scheme. There were other plantations/estates which also supplied FFB to the POM, viz., FASSB 6 and FASSB 9 (under the Felda KKS Mercu Puspita grouping which has not yet been certified) and Outside Crop Producers...Area Summary, Jan – Dec 2013, Certified Area: 7,450.49 ha.” 33 Within this part of the vast Sahabat complex, it is notable that there is a small conservation area of 70 ha (comprising buffer zones along small streams, hilly areas, swampy and unplantable areas) and no high conservation (HCV) areas.
In terms of suppliers of FFB, about 75,000 tonnes comes from FGV estates, 1,500 tonnes from settlers’ schemes, 8,400 tonnes from other FGV yet (to-be- certified) estates and about 100,500 tonnes from outside crop producers (which comprise the major part
32 http://www.ted.com/talks/jason_clay_how_big_brands_can_save_biodiversity.html, accessed April 2015 33 Intertek Certification International Sdn Bhd (2013).
52 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Summary
• From its modest beginnings in 1956 with its • FGV is currently the world’s third largest settler schemes, the Felda Group of companies oil palm estate operator, owning more now sit at the commanding heights of than 450,000 hectares across Malaysia Malaysia’s palm oil industry. and Kalimantan, Indonesia, processing over 15 million tonnes of FFB annually from its • Felda’s development as an integrated own plantations and from Felda settlers agribusiness eventually catapulted it onto and independent suppliers. Being a very the global stage. Felda, as an institution, large supplier of CPO and its new global especially in the early years, showed strong outlook, FGV’s moves are eyed for its efforts political will and focused on delivering incomes in sustainable palm oil. Like most large to settlers with some, if not unqualified, companies, FGV is part of the WWF-initiated success. There is some evidence that in the RSPO. In the post-2000 world, “sustainability” employment of private contractors, it would has increasingly dominated the discourse of not bow to Bumiputera procurement policies tropical monocultures, especially palm oil. when their capability in the early days might To its credit, Felda has adjusted to the new have compromised the development of the socio-political environment and taken on the schemes and produce palm oil of export responsibility of ensuring RSPO certification quality. However, Felda did try to maintain in stages with RSPO certification by 2017 some “ethnic balance” in the later years in the targeted for all FGV mills. This will likely procurement of contracts, the government- make it the biggest grower supplier of such linked MARA being one of the beneficiaries. certified products. In its Sustainability Report Felda was clearly an enabler for independent (FGV 2013), it also reports that it is adopting smallholder and small private estates, with its tougher approaches than required under the first-mover advantage, supplying fruit to its RSPO, including a promise not to develop palm oil mill in its processing facility in its area estates on peat land. since it was well funded relative to private sector plantations in the early years. Along with implementing NEP objectives, Felda adopted a state developmentalist approach which generated economic multipliers for private and Felda contractors in infrastructural development necessary for the success of the schemes.
• On the socio-environmental policy front, Felda engaged mostly in green-field frontier developments in tropical forest zones. In the initial years, the current conservation versus development debate was non-existent, but over a period of time concerns with conservation and local indigenous populations became more evident.
High Carbon Stock Science Study 53 Consulting Study 12 The Felda case study
Part 3: Synthesis and Evaluation
In this final section, we provide a synthesis and Evaluation evaluation of the Felda case study. It is particularly important to point out that the Felda enterprise was a In our evaluation, we draw lessons from the literature smallholder-centric land development programme that review of the Felda settler programme in terms of has evolved over nearly 60 years. Its most intensive present expectations of oil palm area expansion under period as a smallholder-oriented scheme was from the sustainability regimes. Some of the specific lessons to late 1950s till 1990. be drawn flow from addressing the following questions:
One of the project’s primary goals was to raise incomes • How did the Felda schemes evolve, and what did and of landless farmers. While very few settlers had no didn’t work well for the settlers? income prior to entering the Felda schemes, 40.1% of the incoming settlers across all Felda schemes had a • What relationships did Felda establish as a social monthly income of RM100 or less, and 85.4% had an enterprise with its major stakeholders, which income of less than RM200. Only 7.8% had an income included the settlers, the state governments and of RM200-RM300 a month, with 0.2% having an international funding agencies? income above RM500. (Bahrin, Perera & Lim, 1979, p. 203). • What mechanisms worked effectively? How effective were individual land plots, the block system and the Felda delivered impressive outcomes on primary share system as management tools? incomes. Designed to secure a RM300 minimum monthly income, the scheme showed average national • How did settlers remain relevant and participate in settler net monthly incomes from oil palm plots in the corporatisation of Felda? 1979-2005 (excluding costs of labour) as follows: We will focus on the answers to the following key 4.1 ha, RM857; 4.9ha, RM905 and 5.7 ha, RM1,166 questions: (Bahrin and Lee, 2006, p.37). In 2014 net incomes were estimated to be RM1,800 from 4 ha oil palm plots • Expectations regarding the future from the entirely outsourced to Felda Technoplant and allowing perspective of stakeholders for labour costs (Barlow, 2015a). • Negative and positive outcomes at the micro- Key outcomes and policy changes since the start of the economic and institutional levels project are summarised in Tables 3.1 and 3.2. • The most relevant socio-economic impacts for stakeholders
• Institutional mechanisms that worked for smallholders
54 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Table 3.1: Felda key data and facts
Felda settler and settlement Felda institutional In 2014, 479,765 hectares of smallholder areas were under From 1959 – 1990, more than 850,000 ha of land granted by Felda. On average, 4 hectare smallholding and 0.1 hectare for state government under Group Settlement Area Act 1960 had house and kitchen garden. About 80% of Felda settler areas been brought under cultivation through Felda operations. By in the Malaysian states of Pahang, Johor and Negeri Sembilan 1990, Felda had 317 settlement schemes and 152 commercial (only very small settler areas in East Malaysia). estates.
About 122,000 rural Malay settler families emplaced (est. 4% By financial year ended 1999, Felda had spent RM8.9 billion on of the 1990 population; Khor, 2012). 85.4% of settlers had an land development and settlements, financed by RM4.9 billion income of less than RM200 when entering the Felda program (or 54.8)% as loans and the rest as grants. By this time, Felda (1979). Project was designed to initially target RM300 minimum had repaid RM3.2 billion principal and RM1.4 billion interest on monthly income. National settler net monthly income from loans (Felda, Annual Report FYE 1999). World Bank loans stood oil palm plot (1979-2005 average): 4.1 ha, RM857; 4.9ha, at RM542.8 million at FYE1999, other sizable loans were from RM905 and 5.7 ha, RM1,166 (excluding labour cost); estimated the Saudi and Kuwait Funds (RM119.0 and RM56.8 million), RM1,800/month from 4ha oil palm in 2014 (including labour the Overseas Economics Cooperation Fund and the Asian cost). Development Bank. Nearly all loans were through the Federal Government. Each settlement has 300-500 settlers (average 350) with 15-25 Felda smallholders and FGV have over 700,000 ha of oil palm staff per settlement (with over one-third of settlement staff for in Malaysia; producing over 3 million tonnes of CPO (17% of community development). Each Felda settlement ranges from Malaysia’s output from 13% of the area in 2014). The next 1,400 to 2,500 hectares. biggest oil palm areas in the country are owned by Sime Darby with 650,000 ha and IOI with 320,000 ha (Anon. ZAZ, 2015). FGV is the third largest oil palm plantation operator in the world and the largest CPO producer in the world.
To join, a Felda settler had to be married and preferably have Felda Group (now FGV) has 355,864 ha of commercial estates children. On average they had 4.8 children. (under 99-year lease to FGV; as of 25 February 2015 oil palm planted area was 289,864 ha), 71 palm oil mills (Malaysian total is 442 mills), 7 refineries, 4 palm kernel crushing plants and 6 bulking installations. FGV’s Malaysia crop area 340,142 ha area (2014) and it has interests in about 80,000 ha in Indonesia.34 FGV’s owners include: Felda Land Development Authority 20%, Felda Asset Holdings 13.7%, PNB 9.06%, Tabung Haji 7.79%, with other Malaysian entities such as KWAP, EPF, Pahang and Sabah state governments also holding shares. National Association of Qatar owns 2.2% and 20% more are held by others (FGV, 27 February 2015). By the final year (1990), cost per settler RM51,241 / US$18,978 (land was granted for free); 25 years later the nominal cost has likely doubled. Loan amount was about 66% of total per settler cost. Interest rate was 6.25% initially, but was lowered later on. Amenities and facilities in settler’s villages (new communities in isolated and new environments), included retail stores, petrol kiosks, police stations, schools, mosques, community halls, shrub-lined roads, cooperatives, markets, bus stations, fire stations, health clinics, women’s associations, public libraries, government reserves, youth clubs and public playgrounds.
Note: Summary information from literature review from Part 2A and Part 2B of this report; with data from FGV (2014) and FGV (2015) unless otherwise stated.
34 Felda Global ventures upstream in Indonesia, 10 July 2013, The Sun Daily, http://www.thesundaily.my/news/765858 (accessed 20 April 2015)
High Carbon Stock Science Study 55 Consulting Study 12 The Felda case study
Table 3.2: Felda key outcomes and policy evolution, 1950s to 2010s
1950s Jungle clearing contracted out but settlers carried out Federal Land Development Authority (Felda) was ground preparation and house construction (1958). established as a statutory body via an act of Parliament in 1956 as a key part of a nation-building, rural development program. It was an attempt to move away from the British colonial plantation model and also sought to break from reliance on middlemen. Key role of Prime Minister Tun Razak in Felda’s development (his son, current premier Najib Razak led the recent restructuring push, FGV IPO and KPF asset sales). Other key Felda managers include Raja Alias and Alladin Hashim. Integrated development to offer full social services, with Goal: Alleviating poverty among the landless and raising key ministries as partners: Infrastructure, roads, water incomes beyond subsistence level, with integrated supply, electricity, health services provided by relevant developments in undeveloped rural areas, largely to help ministries. rural Malays. Key schemes developed: Ayer Lanas (1958). Bilut Valley Method: Establishing 4 ha agro-industrial commodity crop (1959). (rubber, cocoa, sugar; later switching mostly to oil palm) smallholdings and a home with eventual ownership of individual land title; with a 15-year loan. Land as alienated by state-level land development boards (Kelantan, Terengganu, Pahang, Johor, Malacca, Negeri Sembilan, Kedah and Perlis). 1960s Felda contracts all groundwork and house building to Felda started to plant oil palm (1961). third party contractors in all schemes (end of 1960) due to problems arising in earlier schemes e.g. inexperience of settlers in land preparation and home building etc. Felda introduces daily rate instead of monthly subsistence In 1960, Malaysia had 54,634 hectares under oil palm, and allowance (1962). “Block method” of working the schemes in 1965, 96,947 hectares, where Felda’s oil palm area was introduced (1962), instead of working on individual plots. 11,093 ha (11.4%). Minister of Rural Development review of settler loan First formalised selection system of settlers created (1961). repayment results in reduction of settlers’ loan amount; to cover agriculture development of smallholding and cost of house. Infrastructure development and management and administration subsidized / borne by the state (1960). Effectively, this cuts the loan amount from the full per settler development cost (see 1976 for cost example). Integrated approach of Felda organization, with regional development plans with Jengka as first, then Johor Tenggara and Sahabat as multi-settlement regions. Key schemes developed: Jengka Triangle, Pahang, project (1968-1982), 9,200 smallholders and 40,000 hectares; 28,138 families on 112,716 hectares in Johor Tenggara. Sahabat schemes targeted 103, 000 ha for development but only managed to initially settle 925 families on 5,700 hectares. Timber complex established for logging alongside Jengka project (timber concessionaire / beneficiaries include Canadian timber company and MARA). Sourcing funding from international agencies such as the World Bank (including 8 loans amounting to US$231.1 million, disbursed from 1968-1985; including three loans for Jengka - 1968, 1970 and 1973 - amounting to US$52 million).
56 High Carbon Stock Science Study Consulting Study 12 The Felda case study
1970s Block system of management was operating with 20 Developing more frontier lands in Peninsula states, settlers per block (1970). comprising tropical forests and swamps. 1970, Malaysia had 300,607 ha of oil palm and Felda 64,992 ha (21.6%). 1975, Malaysia had 642,000 ha and Felda 181,571 ha (28.3%). Settler wife must be present during interview for selection Johor Tenggara project (1974-1982) initiated with to the schemes (1974). associated timber complex to benefit of Johor state. 28,138 settlers and 145,408 hectares. The cost of resettling one family was RM 26,600 By the 1970s, 2,700 settlers participated in Village (1976). Effectively cuts loan amount from a per settler Development Councils (JKKR) numbering 290 by development cost of RM 26,600 to RM17,700 (67% of 1987. Through their JKKRs, settlers were able to get development cost) ? Interest rate was 6.25%. representation in decision-making on Felda boards. 1980s Share Ownership System attempted in all Felda schemes In 1980, Malaysia’s oil palm area was 1,023,306 ha and (1985) but settlers preferred individual land ownership. Felda had 308,118 ha (30.1%); in 1987, the totals were Income Stabilisation Scheme tried in four different oil palm 1,556,920 ha and 497,084 ha (31.9% of total) respectively. schemes but withdrawn due to unpopularity (1980). The full cost of resettling one family was RM 49,760 Setting up the Felda cooperative-run Koperasi Permodalan (1986), with infrastructure and management costs at RM Felda (KPF) with 51% ownership of key company, Felda 17,094 (vs RM 8,900 in 1976, remaining at about 33% of Holdings Bhd (1980). Regarded as part of “chess game” the total) and settler plot and house lot cost at RM 32,396 that would stave off the rapid privatization of Felda (vs RM17,700 in 1976). commercial companies (Anon. ALR, 2015). Low commodity prices caused one of the lowest loan Developing East Malaysia frontier lands (Sahabat and other repayment collection rates (1986). National average settler schemes on Dent Peninsula) for oil palm plantations in net income was RM 376 per month in 1986. Sabah (mostly commercial plantations, but eventually with 1,659 settlers, with smallholding size around 6 ha). Sahabat development area (1988-1997) was 90,000 hectares. KPF offers organisational participation of settlers in Forest conservation project set up along with Sahabat with the wider Felda Group. Each settler and scheme level input from WWF Malaysia and World Bank assistance. cooperatives join KPF as unit holders with initial units given to them. It is essentially an early-stage or private equity investment opportunity. Felda oil palm areas account for 30% of Malaysia total. 1990s Last intake of settlers (1990). Due to lack of interest in land resettlement (Malaysia was enjoying strong GDP growth with rapid industrialisation and urbanisation), the remaining areas alienated to Felda were developed as Felda commercial estates. Eventual areas developed commercially were over 350,000 ha. From the 1990s (the corporate era) the growth of plantation companies was at the forefront in Malaysia as well as Indonesia (especially from the 2000s with regulations for 20% smallholder development). The average cost of resettling one family was RM 51,241 Agribusiness phase of Felda also saw the growth of (1990). more service and downstream companies, including joint ventures, notably one with Procter & Gamble for oleochemicals in Kuantan. Felda Group grew into a conglomerate with 26 subsidiaries, 9 joint ventures and 10 associated companies. Settlers may earn an estimated RM1,315 net income and RM2,153 gross income per month in Bukit Wa Ha, Johor (1999).
High Carbon Stock Science Study 57 Consulting Study 12 The Felda case study
2000s Satu Wilayah Satu Industri / One Region One Industry Between 1975 – 2000, Felda had written off settler debts (SAWARI) project launched to promote entrepreneurial totalling RM311.7 million. The Felda Oil Palm Replanting activities among settlers (2003). Up to RM4.4 million Fund stood at RM759 million (2006). This is a major period turnover generated from SAWARI activities (September of replanting for smallholder estates. 2004). National average settler net income was RM 1,387 per Felda sustainability policies published in 2004. Felda joins month in 2004. RSPO as a member on 17 October 2004. 2010s Settlers get an RM15,000 one-off payment linked to FGV Felda smallholder and FGV oil palm areas account for IPO and an average 800 shares each in FGV (Khor, 2012). 13% of Malaysia total area of 5.4 million hectares (MPOB, 2015). Major period of replanting for FGV commercial estates. 171,000 ha needs to be rapidly replanted: at 15,000 ha per year indicated, this would take nearly 11.5 years (Khor, 2012). 770 settlers sued Felda for unfair fruit grading in Kuantan The public listing of FGV in 2012 with an IPO listing High Court and won (2012). (second to Facebook in amount raised, year to date that year). Focus on upstream investments outside of Malaysia and consolidating full ownership and control of key Felda Group processing assets. KPF gave settlers and staff dividends averaging 14% pa KPF’s role arguably greatly reduced as it sells key assets to for 30 years to 2013; it had 220,000 members of whom FGV (and loses its 51% ownership control over them) and 112,635 were settlers (FGV, 2012). shifts more to public equities and property investments (KPF, 2013). Controversies have arisen with these moves. Recent investment balances were still only around 7,673 These two major corporate actions, “cut the cord” linking units35 each (KPF, 2013b). Expectations of lower returns Felda settlers with key Felda Group corporations as they around 10% pa now that key assets sold and holding FGV reorient. FGV is a government-linked corporation looking shares and other portfolio investments (Anon. ALR, 2015). outside Malaysia for growth and seeks to enhance its Malaysia earnings by replanting its aged commercial estates and boost mill and processing earnings. Settlers outsourcing work to Felda Technoplant may earn an estimated RM1,800 per month in 2014 (a site in Jengka, Pahang). Technoplant does all harvesting and maintenance, catering for over 80% of settlers who are completely retired; also arranges and supervises replanting by contractors (Barlow, 2015b).
Note: Summary information from literature review from Part 2A and Part 2B of this report.
35 KPF had 269,250 members of whom 88.5% or 238,367 are in the “settler” category. Knowing that around 112,635 are actual settlers and so 125,732 are “other settlers” likely being settlement cooperatives and perhaps settler children too. Given that RM1,829 million or 72.4% of the total shares are held by the “settler” category, the average holding is RM7,673.
58 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Expectations in next decade from the late 1950s but saw no expansion since 1990, was that perspective of Felda (as a stakeholder) settlers’ incomes rose after moving into the settlements, and perceived their post-settlement lives as better. From the viewpoint of its main stakeholders, the Malay- dominated central state, the state governments and the Judged by recent electoral results, the satisfaction level farmers, Felda could be said to have certainly achieved of Felda settlers ranges from 60% to 90%. Many early its original objectives and perhaps became something of Felda settlers arrived with family incomes of under a model rural development programme for the melding RM300 per month. Such was the attraction that some of social objectives and economic goals, along with its settlers even moved elsewhere first to increase their political dividend of delivering support to the ruling chance of entering Felda (migrating to get on a better party. However, the scheme has ultimately suffered state level queue for entry; notably Pahang, as a net- from the problem of ageing settlers and a transition recipient state). to the second generation as shown in Part 2A of this Diagram 3.1 illustrates how oil palm settler incomes report. A prevalent criticism of Felda was also that it fluctuated with CPO prices (and the effect of different created an overly dependent settler. oil palm holding sizes), while Table 3.3 presents data Several important lessons to be drawn from the and information about the key sources of Felda settler Felda case study are: the importance of a holistic earnings (net primary income, secondary income, KPF and integrated approach to rural development, the investment returns and other incentives). The primary imperative of strong institutional support by the state, incomes of Felda settlers from oil palm were highly the partnership of the government with global agencies, dependent on the CPO price and the plot size of their the support of the local governmental authorities and land. The diagram demonstrates these relationships effective cooperation with the private sector. These (drawing upon data presented in Part 2A). lessons will be important for any rural development programme in other parts of the world. Diagram 3.1: National Felda settlers’ average net The Felda project is at a stage where the settlers’ monthly2,500 incomes, 1979-2004 programme is more than mature, and the impetus of privatisation and globalisation has resulted in 2,000 a policy to move another Malaysian government- linked corporation, FGV, onto the international arena. 1,500 Meanwhile, the Felda social institutions are still in place and FGV is linked to Felda Technoplant (a newer unit 1,000 within the Felda statutory board), which can undertake 500 all the maintenance and harvesting of oil palm, Monthly income, CPO (RM) price catering to 80% of settlers who are now fully retired. Technoplant relies on Indonesian migrant labour (paying 0 1979 1984 1989 1994 1999 2004 them RM1,200-1,500 per month with incentives). Its Oil palm, 4.1 ha Oil palm, 4.9 ha Oil palm, 5.7 ha Nominal crude palm oil price (RM, year average) technical and managerial skills have resulted in good Pre-1979, 85% had income sub RM200 pre-settlement yields of 22 tonnes of FFB per hectare (Barlow, 2015b).
Note: 4.1 ha Felda settler earns 9.3x CPO price, 4.9 ha holding From the Felda case study, one can draw conclusions earns 9.5x and 5.7 ha holding earns 12.4x CPO price. about the potential for similar state-driven, socially oriented developmental Source: Settler smallholding data from Bahrin and Lee (2006, p.37), Malaysia CPO price from MPOB (2015). enterprises. We are in an age in which corporations dominate agro-industrial production of oil palm and other crops. It is unlikely that settler-centric schemes Felda sought to bring other income benefits to Felda such as Felda would today achieve the support it settlers. Given the fluctuation of primary incomes, this is enjoyed in the past. not so surprising. Felda’s aim was for settlers to have 20- 30% secondary income from other sources (Anon. ALR, 2015), they also offered investment opportunities in the Socio-economic outcomes for stakeholders at KPF (private equity) for settlers in processing activities, settler and institutional levels and other incentives were also created. This was summarised in the Table 2A.7 as they evolved over time. From the settler and institutional perspectives, the primary goal of Felda, which was poverty eradication and raising incomes by resettling landless peasants, was a major success. The Federal state as stakeholder was the major beneficiary along with landless settlers. Our key finding of the smallholder scheme, which developed intensively over more than three decades from the
High Carbon Stock Science Study 59 Consulting Study 12 The Felda case study
These socio-economic improvements, including school role in developing the Malaysia oil palm sector. Since infrastructure for settler children, had an unintended then, as the private sector has expanded faster, the effect of generating rural to urban migration among Felda Group (settler and FGV) area has dropped to the settlers’ children. This trend of out-migration has 13% of the Malaysian total. With 71 oil palm mills, it is continued, with most of the Felda second generation perhaps no surprise that it sources its FFB in the ratio uninterested in agricultural work. There is some 1:1:1 from settlers: FGV estates: and external suppliers conjecture that Felda displayed little interest in the (independent smallholders and small/mid-sized estates). large scale training of the settler children, who for the most part are better educated than their parents, for Along with implementing Malaysia’s New Economic its managerial staff or downstream industries. This Policy ethnic redistributive objectives, Felda adopted brings us to the question of how successful Felda was a state developmentalist approach which generated in creating modern farmers. A major criticism is that economic multipliers for private and Felda settler the settlers had become over-dependent on Felda contractors in infrastructural development necessary (they are “anak emas” or literally “golden children”, for the success of the schemes. Two notable points are, Anon. ADA, 2015) to resolve their own problems first, its selection of private contractors for effective and therefore lacked the skills necessary for such a implementation and reluctance to bow to Bumiputera transition. Arguably, this is a peculiar problem of oil procurement policies when their capability in the early palm where few are keen to traipse around the field, days might have compromised the development of the hefting 20kg fruits in the humid tropics. Such was the schemes and not produced palm oil of export quality; success of the socio-economic programme of Felda that and second, maintaining some ethnic balance in the a large proportion of the children of settlers became later years in the procurement of contracts, for example, well educated and migrated to urban areas. Indeed, the using the government-linked MARA in an associated thinking of Felda was that its success was in moving timber complex. the children of settlers away from such farming (Anon ALR, 2015, also Anon. ZAZ, 2015), with the settlers On the socio-environmental policy front, Felda was themselves aspiring that their children achieved high historically engaged in green-field frontier developments levels of education (see Part 2A). in tropical forest zones, later expanding its mills to buy more external FFB. Now that it is moving rapidly into We turn to consideration of three key macro themes in RSPO certification, the processing of third party FFB Felda settler socio-economic outcomes. ironically will constrain its ability to secure certification to a higher level. Three points should be noted. As settlers age, their approach may be shifting to a ‘satisficing’ mode, as they are aware of their limitations First, in the initial years, the current conservation and their needs are more modest. They saw the scope vs. development debate did not exist but over time to employ Indonesian migrant labour when the situation concerns over conservation and relations with local demanded it, either by outsourcing plot management indigenous populations became more evident (Anon. to Technoplant or eschewing such Felda support and ARL, 2015). shifting to share cropping with Indonesian workers. In terms of improving the livelihood and economic Second, given its large size, it was inevitable that Felda empowerment and agency of settlers, the Felda project would have been sought as a key early member of created positive outcomes. The economic agency of sustainable palm oil programmes. It has quickly adjusted settlers was evident as shown by the example of taking to the new socio-political environment and taken on the up a legal suit on unfair fruit grading (the transition from responsibility of ensuring RSPO certification in stages “parang to lawsuit” approach as put by an interviewee; with full RSPO certification audits by 2017 for all FGV Norazam, 2015). Using the political opposition mills and Felda settler and FGV estates. for support on FFB grading and rubber replanting Third, because one-third of its FFB comes from external contracting (but still voting strongly for UMNO-Barisan suppliers, many FGV mills are likely to be stuck with the Nasional), settlers displayed their political awareness. lesser RSPO (lower sustainability certificate premium On the broader institutional level, Felda as social earning) mass balance supply chain option. It is ironic enterprise demonstrated strong political will and that the RSPO system favours monolithic structures focused on delivering not just incomes to settlers but over those that are more inclusive of small external also other socio-economic benefits and outcomes. Felda suppliers. Thus, wholly integrated mill and corporate was clearly an enabler for independent smallholder and estates can more easily attain the higher level (higher small private estates, with its first-mover advantage premium) RSPO supply chain Identity Preserved since it was well funded relative to private sector option (Anon. BUG, 2015, Anon. FOL, 2015). In such plantations. Felda was also an enabler for independent circumstances, Felda settlers will find themselves smallholders and small private estates which supplied relatively disadvantaged if they supply FFB to FGV mills FFB to its mills (often the pioneer plant in the region). which also buy large amounts from independent small Felda’s oil palm area was almost one-third of Malaysia’s and mid-sized suppliers. total until the late 1980s. This is testimony to its major
60 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Socio-economic impacts of plantations and By changing this unusual settler-centric economic future expansion approach, do Felda smallholders revert to becoming a corporate appendage? Certainly, the future upstream Felda was an important part of newly independent expansion plans for FGV does not build upon new Malaysia’s poverty alleviation strategy. It was an settler schemes. As for the Felda model, it is apparent integrated rural development programme backed by that FGV, in its plantation acquisitions, now operates strong political will and multi-agency partnerships. Its much like any other public-listed plantation company, highly focused policy and administration was supported without stated goals for achieving higher than regulated by strong state and multi-lateral funding to boost smallholder land development ratios. To do otherwise, outcomes for mostly 4 hectare smallholders of export- would be surprising given the strictures of the free orientated rubber and oil palm. It was a social enterprise market system for profit maximisation and pressure for designed to be settler-centric. quarterly reporting and equity market performance.
Such has been the success of Felda that settler areas Malaysia has run out of greenfield sites for oil palm still voted largely (60-90%) for the UMNO-Barisan development and it has also run out of people keen Nasional ruling coalition at the May 2013 General to work oil palm holdings. Moreover, Felda settlers are Election (Khor, 2015, p.106). ageing and entering a more economic “satisficing” (as opposed to maximising) stage of their economic life- The Felda concept of 1956 to 1990 is widely admired. cycle. While the full support of the Felda commercial “It was as an astute policy to help the large rural Malay arm may no longer be available to them, it is to be population. They were close to or in poverty and not expected that Malaysian federal agencies, state linked to the market economy. Rubber and oil palm agencies, and politicians of all stripes will still pay close were the ideal way to set the Malaysia rural economy attention to their needs, as they are a large rural interest on its feet. This is a very relevant development group of considerable electoral significance (Maznah programme (for many places); parts of Africa suffer 85% 2015 and Khor 2014, 2015). unemployment; and it uses relatively small land areas (to generate income). It creates a very dramatic socio- Many of the settlers now outsource their operations to economic boost for smallholders and workers, although Felda’s Technoplant (a relatively new unit of the Felda perhaps with limited trickle-down to the local economy statutory board, which has contractual arrangements than other alternatives. The settler pays off his loan, with a unit of FGV; where previously replanting and upgrades his house, and gets professional education operations were effected by a unit in Felda’s commercial for his children. It is so profitable that the settler works business). Migrant labour is contracted by Technoplant himself out of a job” (Anon. BAH, 2015). to operate settlers’ holdings in a block system, where each settler earns the same amount per hectare Since 1990, Felda has been shifting from a social- (Barlow, 2015b). enterprise to a corporate model. There have been no more new settlers since that year, and investments in Also notable is the transition of the Felda mills to full commercial estates and more downstream processing FGV ownership. These were critical in creating market assets has been its focus. The most recent stage of opportunities for new oil palm growers in frontier areas the Felda Group’s evolution features heightened of the Peninsula, and this role may now be getting corporatisation, with significant corporate restructurings another new impetus. FGV’s need to lift its profits to build FGV. This has brought mixed reactions. is reportedly driving some expansion of its mills to attract outside FFB; some independent millers have FGV’s development featured an initial public offering become concerned about future problems in sourcing of the commercial estates (on long term land leases) FFB if FGV expands its mills (Anon. TEG, 2015). Such of Felda and its 49% owned downstream processing competition could help support FFB prices to the assets in 2012 to garner a RM4.5 billion cash pile for benefit of independent growers. FGV’s expansion plans (Khor, 2012). This was followed by the late 2013 acquisition of RM2.2 billion worth of It is unlikely that the Felda settler programme will be key processing assets which settlers and employees replicated locally in future and it is questionable that owned via Koperasi Permodalan Felda (KPF, the Felda other countries or regions would find the financial Investment Cooperative). These moves removed Felda wherewithal to create such a high-end model of land settlers from their crucial 51% ownership and control resettlement. Indeed, specialists say that a five person of core processing assets which helped to generate family now needs a palm plot of 10 hectares to fit average dividends of 14% per annum over a 30 year current needs and aspirations (Anon. ALR, 2015). period (FGV, 2012). These high returns are the hallmark of the private equity investment opportunity created by Raja Alias for the settlers in 1980 for the Felda settlers and employees.
High Carbon Stock Science Study 61 Consulting Study 12 The Felda case study
How carbon stock thresholds are affected in (Anon. ZAZ, 2015 and Anon. ALR, 2015). The effective expansion granting of free land by the states, the sourcing of foreign assistance and technical advice from the World The Felda settler programme has not expanded since Bank, WWF and others no doubt, would have mitigated 1990. Most Felda settler schemes were originally some of the potentially negative impacts of the developed on green-field sites in an era when schemes as we have reviewed in Part 2B of this report. sustainability issues were of limited interest anywhere in the world. Historically, its land development was preceded by timber clearance, and accompanied by the Institutional features and mechanisms in establishment of timber complexes in major rural zones context of HCS regulations including Jengka and Johor Tenggara. Further upstream expansion is the goal of FGV, the public-listed arm of Felda settler projects were mostly green-field frontier the Felda Group, but due to Malaysia’s land scarcity developments in tropical forest zones. At the time, the and land cost, new areas will be developed outside the current conservation versus development debate was country. FGV has been reported in news articles to be limited at best. These were the immediate decades exploring expansion in other climatically suitable regions after World War II when the World Wildlife Fund of Southeast Asia, including Indonesia, Papua New for Nature (founded by European-US leaders) was Guinea and Mindanao. As a member of the RSPO, any getting on its feet just as Malaysia and other newly of FGV’s new plantings would come under the RSPO independent countries were trying to do likewise after New Planting Procedure which requires a reduction colonial rule. Now, social cum environmental policies in GHG emissions, a de facto HCS policy. However, are very much at the forefront in the palm oil sector given analyst and investor concerns about its financial with strong NGO campaigns and the largest buyers and outlook, FGV has recently emphasised that its upstream producers acceding. This started in the mid 2000s with growth centres on brownfield sites36. For such sites, environmental issues and the formation of the WWF- the RSPO HCV Compensation Procedure offers strong led Roundtable on Sustainable Palm oil (RSPO). In the financial incentive (a possible multi-US dollar million mid-2010s, social considerations are expanding as some cost barrier) for the purchase of “correctly planted” sites efforts to implement stronger environmental policies are if non-RSPO member owned estates are bought. running into social issues.
High carbon stock pledges (putting upward pressure on Mitigating the impact of industry expansion RSPO policy) affect the areas that can be developed, to limit deforestation. There are now at least three HCS The most important lessons drawn from Felda schemes regimes: the HCS Approach (April 2015 formalisation) was its socially oriented character, which differed pioneered by Greenpeace-The Forest Trust-Golden from a purely commercial strategy. This approach was Agri Resources and supported by the large processor- backed by a strong federal institution and the political trader groups including Wilmar and Cargill; RSPO (a will to carry through the project despite its high cost. certification program) has a de facto HCS policy via Moreover, a partnership with local-level states and the its greenhouse gas emissions mitigation rule in its private sector with state oversight meant that overly New Planting Procedure; and the Sustainable Palm Oil deleterious effects of land development could be Manifesto37, led by a group of large integrated palm checked. One should also not ignore the importance plantation groups. These point towards potentially rising of a strong and principled leadership behind the Felda competition between plantations and local peoples institution. as future development gets restricted within a smaller geographical (lower carbon stock) area. For a long period of Felda’s development, a no- nonsense chairperson and hands-on director ensured In interviews with former senior administrators of Felda that commercial excesses were controlled and and specialists familiar with Felda over the decades, deviations from the social programme were checked. we gained valuable insights about the early thinking, The Sahabat area was then an unstable frontier zone cohesive partnerships and socio-environmental with the presence of pirates. Felda schemes through approaches of Felda. Key person interviews include: its social programme and infrastructural development, Barlow (10 April 2015), Anon. ALR (16 April 2015) and e.g. the supply of electricity to all the rural dwellers, Anon. ZAZ (19 April 2015). We set these observations contributed to stabilising the socio-political environment. Near Sahabat, Felda pioneered a project about macro-institutional issues alongside the current for an indigenous group, the Murut, who remained socially charged outlook, with competition for rural land, in situ with their lifestyle, while an oil palm area was inevitably linked to the new HCS regimes. developed by Felda for their benefit via a trust agency
36 Felda Global Ventures eyes brownfield plantations to maintain cash, 1 May 2015, http://www.themalaymailonline.com/money/article/fhv-eyes-brownfield-plantations-to-maintain-cash#sthash.SrP74BMS.dpuf. 37 This organisation commissioned the present study.
62 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Table 3.3: Felda smallholder project’s macro lessons for current HCS issues
Felda lessons Current issues
On the economic model - corporate and processor- On the economic model – settler-centric trader centric We inherited the British colonial plantation system. Now, Felda was a social enterprise that was settler-centric. In “(companies) must learn to share” (Anon. ALR, 2015). contrast, the present day focus on corporate-led plantation development will always set smallholder development as less than primary. What do you mean by “milling margin”? We were there to cut Processor-traders are central to the setting socio-environmental out the middleman. We wanted to bring low cost processing rules that form de facto market-access policies. These are (benchmarked against private sector cost) to give the settler anticipated to have impact on pricing bargaining power relative a better price for his crop (Anon ALR, 2015). Barlow (2015b) to producers (especially those with difficulty or slow to join reiterates this point, “(post-Independence) we were very sustainability programs i.e. smallholders inclusive). suspicious of middlemen in many crop sectors.” Felda staff were a cohesive force to deliver outcomes for Clearly, corporate led new smallholder programs will seek settlers. It was only when staff shifted from civil servants pay to deliver a cost-effective and well executed project but will scales to commercial salary and incentives that the “tensions” not seek to expand smallholder interest beyond the farm started (Anon ALR, 2015). gate (unlike the early Felda social enterprise approach). In the present day free market capitalist milieu, expansive smallholder centric commodity supply-chain efforts are not a major policy platform in corporatist polities.
On close government-community-corporate relations and On close corporate-NGO but distant government limited stakeholder conflicts relations and heightened stakeholder conflicts
The evolution of Felda put government- community relations The sustainability - HCS regimes for palm oil has placed the as the lead, and relations with the corporate sector were corporate sector at the forefront (led by NGO advocacy) and established later. government-community relations are following these. In the newly independent Malaysia, Felda set out to work with Inevitably, corporates will contest policy with consideration of state governments to create a different approach. The program their interests at the forefront. There is also a growing sector was well supported at the federal, state and community of NGOs which have relationships with corporates, as technical level. State governments welcomed the creation of jobs and service providers. There are also newer NGOs entering the livelihoods; and were happy to see federal funds being invested palm oil sector fray as issues and policies evolve and expand. in their state. Felda worked closely with state governments to alienate this land for its rural poverty alleviation effort, and such was the rapport and trust that we would sometimes move ahead regulatory and legal sign-offs (Anon ALR, 2015). “There was very little conflict…. everyone was poor at that time The HCS regimes do not appear to have worked closely - it is easier to work together when you are all poor” (Anon ALR, with national-state agencies. Indeed, it is the hallmark of 2015). sustainability that they are voluntary efforts which are supra- national and exceed national and state government policies. As Felda developed its downstream sectors, it started to Different stakeholders have their interests and asymmetrical establish joint-ventures with key processors and buyers negotiating powers will impact outcomes. Who is representing including US company Procter & Gamble, which set up its base and negotiating for the interests of the smallholders? in Kuantan, moving its major operations there. (Details in Part 2B, Anon. ZAZ, 2015). Civil servants have rising concerns about the potential negatives of rapidly advancing corporate sector pledges on the market access for smallholders. Indonesia’s Farmer Empowerment and Protection Act 2013 is an example of a mitigating policy to empower governments to check any untoward repression of farmer economic interests by dominant companies in the supply-chain.
High Carbon Stock Science Study 63 Consulting Study 12 The Felda case study
Felda lessons Current issues
On environmental policy - biodiversity and deforestation On environmental policy - smallholder needs first, set asides reduces plantable area, biodiversity and deforestation came at a later stage for the company and/or smallholders? “We were thinking about orang kampong (villagers), not Sustainability specialists report that they are finding 30-35% orang hutan (forest people) or orang-utan.” Felda settler sites net plantable area for the inti in secondary forest areas which were selected for their suitability for planting the crops. The have 30% human use areas (say 10% crop and 20% forest environmental issues came later (Anon ALR, 2015). usage); this suggests 50% HCV and HCS set-asides, 30% inti and 20% plasma (Anon. BUG, 2015). This implies de facto new inti:plasma ratios of 60:40. A similar ratio was reported by a sugar cane developer as a more workable inti:plasma ratio in Sumatra, under higher rural social expectations (Anon. LIS, 2015)38. Felda benefited only indirectly from the timber, as the land was It is also necessary to have supportive national and regional cleared, ready for planting. There was primary forest as well as policies and regulations. A retrospective counterfactual logged over forests (Anon ALR, 2015). review of Felda’s development might be well informed by the approach taken by Brazil where regulated set-asides have been established for corporate planters (stricter), as well smallholders (more lenient) to allow for socio-economic development. Several timber complexes are associated with the Felda programs, notably for Jengka in Pahang (concessionaires and beneficiaries included a Canadian timber company and MARA), Johor Tenggara (beneficiaries included the state government) and Sahabat (see Part 2B). On indigenous / local peoples - community project for On indigenous / local peoples - the need for state reserve land development held in trust subsidies and multi-lateral funding? The policy for indigenous peoples was not to disturb their For strictly smallholder and indigenous centric projects, it reserve land areas. Some were likely moved if their shifting appears that experience has demonstrated the expected - few cultivation practise took them outside of their reserve areas and large corporations can subsume social enterprises within the in Felda development zones, “but there was no conflict with ambit of their commercial status. indigenous peoples… (indeed), there was very little conflict…. everyone was poor at that time - it is easier to work together when you are all poor” (RA, 2015). The Felda program did not encompass indigenous peoples The success of the Felda settler program points to the need as their development was led by a different agency with its for national and/or state subsidies as well as multi-lateral own policy approaches. Later however, Felda did finally get funding. Impartial support of cost-efficient social enterprise is to develop a site for the Murut people in Sabah, where their likely needed to negotiate a good commercial deal and access native reserve land was developed on their behalf, with the oil for smallholders who would otherwise disadvantageously face palm proceeds going to the Murut cooperative. The indigenous asymmetrical knowledge, bargaining and power relations. peoples remained in situ and they benefited as oil palm Corporates and individuals tend to seek direct financial returns cooperative shareholders. This was a community project funded but public sector funding can take the wider view and benefit by Felda in the Kalabakan area. This was one-off. More could from positive externalities. have been done along these lines (RA, 2015). However, there is need to balance the relatively high cost approach of the Felda settler program; this affects the number of people it can emplace. Depending on the socio-economic situation of the newly developing region, the smallholder family income target can be set and the land area needed can be determined (in the case of Malaysia, Felda specialists think that 10 hectares is needed for a family of 5 (Anon ALR, 2015). Felda mills an enabler for independent smallholders and FGV mills faces RSPO certification problems because of its small private estates high level of sourcing from smaller producers Felda was also an enabler for independent smallholders and Now, FGV has 71 mills and their FFB sourcing is Felda settler: small private estates who supplied fruits to its palm oil mill FGV estates: independent suppliers (smallholders and small and (often the pioneer processing facility in its area). mid-sized private estates) in the ratio of about 33:33:33. FGV needs to effect and perhaps help fund the certification of its Felda settler suppliers (see Focus topic immediately below).
38 For the largest plantation, at the forefront of determining new planting areas are high conservation value / HCV and high carbon stock / HCS standards. It appears that the corporate farm (inti) area is then set out and there is uncertainty and contestation over whether the plasma area (Indonesia regulation sets a minimum 20%) is taken off the wider concession area or the net plantable area (with the unplantable area returned by the plantation to the state; likely to be reallocated to another concessionaire, and possibly nullifying the intended positive environmental impact of the corporate pledge standards; Anon. FOL, 2015; Anon. BUG, 2015). In this regard, it is worth reiterating this point: We inherited the British colonial plantation system. Now, “(companies) must learn to share” (Anon ALR, 2015). 64 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Smallholder certification: the need for purposes. So long as the loan comes from a commercial assistance and incentives to participate in bank (interest rates in Indonesia for smallholders sustainability are in the low teens) and/or is implicitly or explicitly underwritten by the plantation company, these It is the overwhelming consensus that smallholders commercial entities will want to be assured of quality and independent producers do not see any direct and consistency in the management of plantings, as well financial return on RSPO certification (Anon. BUG, as in operations. 2015; Anon. FOL, 2015 and Haris, 2015). FGV is With emerging HCS regimes and rising social issues, therefore supporting the process of RSPO certification large plantation companies face limitations on the for settlers. However, FGV sustainability specialists expansion of their own planted areas. They are mulling worry that settlers may not take measures to maintain over how best to develop more smallholder areas within certification in the face of insufficient direct financial their control (for reasons stated above). benefits from this certification. There is reportedly some intention to offer higher revenues to settlers Key considerations include: even if that exceeds what FGV might earn from selling the RSPO certificates (Norazam, 2015). In a way, this • Ratio of inti to plasma. While some talk of 60:40 may point to the need for third party FFB to be paid being more workable under current social situations a premium by integrated plantations to offset the (which are more heightened than in the past), financially regressive sustainability system that has others speculate about plantations shifting toward evolved. For instance, WWF et al. (2012) write that a financing and managing agent approach, whereby RSPO regulations offer more direct benefit and lower the inti:plasma ratio may be 20:80 (which faces the cost to the largest corporations; while small to medium- problem for the plantation company of retaining sized corporations and smallholders have fewer direct control over the supply of FFB from the plasma share benefits and higher costs. of the project once the loan has been repaid; Anon. BAH, 2015). In the Indonesia context, the 20:80 ratio Arshad (2015) refers to NGO costings for RSPO was one of the key Indonesia regulations before the certification and compliance at just over RM400,000 adoption of liberalisation for foreign and domestic per 2,500 hectare site per year (for 50 smallholders with investors which reversed the ratio to 80:20. 50 hectares each, substantially more than the Felda 4 ha smallholding). He notes that current premia imply • One possible approach is to group smallholders only break-even for such a smallholder (if all certificates together within a cooperative. The plantation are sold under mass balance) and concludes that companies would like to have broad powers over there is no incentive to certify unless there is financial such a cooperative, and for their powers to extend support from a large company. Further, he states that to determining who is a member of the cooperative “companies with processing assets can garner more board (Anon. BAH, 2015). from RSPO certification... the premia gains are out of reach of smallholders.” • The planning cycle could be 25 years or even shorter where oil palm replanting is needed. The cycle length It is not surprising that the lack of incentive for would be likely to be determined by the cost of land smallholders ties in with the rising effort of large and its development (see Table 3.5 for indicative cost companies such as FGV and others to create special considerations), the level of the interest rate, the support programmes to induce them to certify. Data outlook for palm oil prices, as well as the reputation from Arshad indicates that the cost of RSPO compliance of the plantation company backing it as an effective for the largest plantations may be US$5 per tonne partner or managing agent. of CPO and that for smallholders (using the costing summarised above) works out at US$12 per tonne. • An important question underlying the viability of new schemes is the determination of the appropriate Senior plantation experts point to a strong need for size of an oil palm holding per smallholder family; managed cooperatives operating under strict rules to and this will depend on aspirations, number of implement smallholder programmes effectively39. This potential smallholders and land availability. Table 3.4 is regarded as necessary for financial risk management indicates the overall investment costs in Malaysia and Indonesia.
39 In Indonesia, “fully managed plasma” refers to where the plantation company undertakes the development and operations work in their entirety. There are also diluted versions of this, from “partly managed plasma” all the way to fully independent smallholders.
High Carbon Stock Science Study 65 Consulting Study 12 The Felda case study
Table 3.4: Indicative costs for smallholder plot and home, Malaysia and Indonesia, 2015 (RM)
Malaysia indicative costs RM/ha 4ha 6ha 8ha 10ha 2/3 * 1990 Felda cost inflated 3% pa 20,847 RM 83,387 125,080 166,773 208,467 US$ 22,972 34,457 45,943 57,429 Indonesia indicative costs RM/ha 2ha 4ha Greenfield land cost 5,798 11,595 23,190 New planting cost 13,750 27,500 55,000 Cost of house and garden site 8,000 10,000 RM total 47,095 88,190 RM total, excl. land 35,500 65,000 US$ total, excl. land 17,906
Note: By the final year (1990), cost per settler was RM 51,241/US$18,978 (with land granted for free). The loan amount was approximately two thirds of the total cost per settler. Source: Land cost from “Plantation Sector: Where are land prices now?” 16 April 2015. CIMB Research; new planting cost from “Genting Plantations: Indonesia to drive volume growth.” 12 January 2015, AmBank Research.
The micro management issues are very akin to the strict development and operation rules of the Felda smallholders’ programme, where loan repayment was an important issue.
However, the natural urge for strict control of plantation developers and financiers may not always suit local settlers’ equally prevalent democratic urges. Thus, a significant lesson that the plantations developing smallholder programmes could learn from the Felda experience is the scale of the staff resources that need to be put in place in order to achieve the level of smallholder satisfaction that Felda has achieved.
The settlement sizes for Felda’s schemes have been in the range from 300 to 500 settler families, alongside whom were the on-site staffing was between 15 and 25 people, over one-third of which were involved with community development including religious affairs (Anon. ALR, 2015).
66 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Conclusions and questions for further research
Two issues clearly emerge from this report Secondly, what type of smallholder cum that call for further study and investigation. labour regime will emerge? In Malaysia’s state-run smallholder schemes with ageing First, what are the economics of oil palm settlers, migrant labour is widely relied on cultivation for the corporate / commercial (as it is also in the commercial plantations). farmer and for the smallholder under the Indonesia and other countries will also new HCS regimes? increasingly face the “second generation” problem as to who will replace the current Both groups are set to compete for physical smallholders. There are the many social and economic space in the new HCS problems already now associated with threshold, smaller (lower carbon) zone. In migrant workers to consider. Further this context, it should be recalled that, until research on smallholders as an integral part 1980, Felda contributed approximately half of the oil palm industry must delve into of the total new oil palm land development these issues. for the whole country. Before the current liberalised phase, Indonesia required Where these two issues possibly overlap, it 80% for smallholders and offered 20% to is intriguing to consider the idea posed by corporations (the situation is now reversed). a key interview subject (Anon. BAH, 2015). Should a poor family be given the lease use What ratio should then be expected or of the oil palm smallholding for a limited justifiable for smallholders within the HCS period (reflecting the oil palm planting regimes? At the micro level, within each cycle)? Thereafter, another (poorer) young region, what is a suitable family income family can be offered the use benefit of the target and hence what is the appropriate smallholding. area that could provide a living wage or better to the smallest smallholders? Is it, as While this idea may face a tough political some now claim, 10 hectares or more? feasibility test, it sharpens our focus on the practical question of how to achieve a more This needs to be balanced against the equitable distribution of the socio-economic local population numbers. How many local benefits of oil palm smallholdings, especially families can be absorbed into an oil palm in the context of new schemes on greenfield smallholder project and what is the plan sites. for possible “surplus” families that cannot be accommodated with a new home and This study of the Felda programme points to smallholding? Are the financial economics the core issue affecting the palm oil industry, and agronomics of the smallholding namely the distribution of the economic appropriate and suitably benchmarked? benefits between the corporate farmer, the What are the development costs, the loan smallholder, the oil palm field worker, and amount (interest rate, tenure, payment terms the poor rural folk who lie outside this circle. etc.), and operational costs? Do national and provincial regulations and policies recognise these issues? How can commercial banks and multi-lateral lenders play a role in lifting the socio-economic prospects of a poor rural segment? Given the rising importance of sustainability, how can financially regressive elements of certification (implying a higher relative cost to small farmers and the risk of reducing their price bargaining power and market access) be reformulated to be progressively advantageous for smallholders?
High Carbon Stock Science Study 67 Consulting Study 12 The Felda case study
Appendix 1: References and Bahasa Malaysia Literature Survey
References Fu, C.L. and Salih, K. (eds) (1978). Growth Pole Strategy and Regional Development Policy: Asian Experiences and Arshad, Haris (2015). “Outlook for certified palm oil trade Alternative Approaches. Oxford: Pergamon Press for - are premiums realistically traded?” Sime Darby Plantation United Nations Centre for Regional Development. Sdn Bhd, MPOC Reach & Remind Friends of the Industry Seminar 2015 & Dialogue, 12 February 2015, Putrajaya, Ghazali, S. (1988). Rural development: study of Malaysia. migration, aspiration and perception of second generation of Felda settlers. 1988. Masters. Bahrin, Shamsul and Lee, Boon Thong (1988). FELDA, 3 decades of evolution. Kuala Lumpur: FELDA. Gustafsson, Fredrik (2007). The visible palm: market failure, industrial policy and the Malaysian palm oil Barlow, Colin (2015b), Seminar at IKMAS (Institute of industry. Stockholm: Almqvist & Wiksell International. Malaysian and International Studies), UKM (National University of Malaysia). “Malaysian Agriculture In Harun, Y. (1975). Community development in a Felda Transition: Felda Settler Schemes and Felda Global scheme: a case study in the Sungai Tiang scheme, Ventures: An Outside Appraisal.” 16 April, 2015. Kedah. Masters. University Malaya.
Ekovest (2014). Corporate website, http://www.ekovest. Hussin, Fauzi and Hussin Abdullah (2012). The Role of com.my/home.html. FELDA and KESEDAR in the development of land in the district of Gua Musang: A comparison FAO (2015). Food and Agriculture Organisation of the the socio-economic level of the settlers. Sustainable United Nations website, http://data.fao.org/, accessed 6 Agriculture Research 1(2) pp. 284-291. May 2015. Intertek Certification International Sdn Bhd (2013). Felda (2002). Felda website – map. “Felda Global Ventures Plantations Malaysia Sdn Bhd, RSPO Membership No: 1-0013-04-000-00, Plantation Felda (2004). Good agricultural practices in Felda’s group Management Unit, KKS Baiduri Ayu Grouping, Lahad of estates: towards sustainable palm oil production. Kuala Datu, Sabah, Malaysia, Public Summary Report (Abridged Lumpur: Felda Agricultural Services Sdn Bhd. Version).” Assessment Dates: 21-25 October 2013.
FGV (2012). FAQs on the listing of Felda Global Jahara Yahaya., (1991). Women’s participation in Ventures Holdings Bhd, http://www.feldaglobal.com/ small ruminant enterprise. Kuala Lumpur: Institute for site-content/FAQs_leaflet_General_Public_new204.pdf, Advanced Studies, University of Malaya. Accessed, 22 April 2015. Kathirithamby-Wells, Jeyamalar (2005). Nature and FGV (2013). Sustainability Report 2013: Enriching Values Nation: Forests and Development in Peninsular Malaysia. A Continuous Journey. Honolulu: University of Hawaii Press.
FGV (2014). FGV Corporate Profile, May 2014. Kaur, Amarjit (2014). Plantation Systems, Labour Regimes and the State in Malaysia, 1900–2012. Journal FGV (2015). FGV Corporate Website, accessed 22 April of Agrarian Change 14(2) pp. 190-213. 2015. Khalid, H. (1980). The socio economic position of settler Folds, Neil (2000). Oiling the Palms: Restructuring children in the state of Malacca. Masters. University of Settlement Schemes in Malaysia and the New Malaya. International Trade Regulations. World Development 28 (3). pp. 473-486. Khor, Yu Leng (2011). The oil palm industry bows to NGO campaigns. Lipid Technology 23(5). pp. 102–114. Fredericks, L.J. (2012). Exploring the Spatial Dimensions of Rural Development Models in Malaysia Khor, Yu Leng (2012). Khor Reports: Felda Settlers and the 1957-2007. Institutions and Economies. 4 (1). pp. 47-62. Felda Global IPO - a socio‐political perspective, 22 May 2012.
68 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Khor, Yu Leng (2013). Struggle for sustainability in Ng Gan Chee and Ng Ban Lian (1991). FELDA land palm oil industry shows results, http://www.iseas.edu. development strategy in Malaysia. In Muhammad Ikmal sg/documents/publication/ISEAS%20Perspective%20 Said and Johan Saravanamuttu (eds). Images of Malaysia. 2013_18.pdf Kuala Lumpur: PSSM (Malaysian Social Science Association). Khor, Yu Leng (2014). The political tussle over Felda land schemes – UMNO strengthens its Malay rural PLS Plantations (2014), Annual Report 2014. fortress in 13th General Election. Kajian Malaysia 32(2). pp. 89–121. PLS Plantations (2015), Company website, http://www. limbongan.com/index.htm, accessed 7 April 2015. Khor, Yu Leng (2015). The political economy of FELDA seats: UMNO’s Malay rural fortress in GE13. In Johan Ragayah, Haji Mat Zin (2013). The New Economic Saravanamuttu, Lee Hock Guan and Mohamed Nawab Policy and Poverty Eradication. In Terence Gomez and Mohamed Osman (eds). Coalitions in Collision: Malaysia’s Johan Saravanamuttu (eds). The New Economic Policy in 13th General Elections. Kuala Lumpur and Singapore: Malaysia: Affirmative Action, Ethnic Inequalities and Social SIRD and Institute of Southeast Asian Studies. Justice. Singapore, NUS Press.
KPF (2013a), Koperasi Permodalan Felda Malaysia Ramli, Rashila (2003). The multiple roles of rural Berhad, Annual Report 2013. Malay women during the 1999 Election: The case of the FELDA J8. In Francis Loh Kok Wah and Johan KPF (2013b), Berita Prestasi KPF 2013 (News of KPF Saravanamuttu (eds). New Politics in Malaysia. Singapore: performance in 2013), http://kpf.felda.net.my/Lists/ Institute of Southeast Asian Studies. Buletin/ Salleh, Halim (1991). State capitalism in Malaysian Lee, Boon Thong and Shamsul Bahrin (2006). Felda’s agriculture. Journal of Contemporary Asia 21(3). pp. 327- fifty years: land pioneers to investors. Kuala Lumpur: 343. FELDA. Saravanamuttu, Johan (2013). The Political economy of Mamat, M. (2011). The Influence of science, technology, migration and flexible labour regimes: and a management system on the modernisation on The case of the oil palm industry in Malaysia. In Pye, Malay rural society: A case study of in Semarak Jengka Oliver and Jayati Bhattacharya (eds). The palm oil 15 Felda scheme, Pahang. Phd. University Malaya. controversy in Southeast Asia: A transnational perspective. Singapore: Institute of Southeast Asian Studies. Mehmet, Ozay (1982). Evaluating alternative land schemes in Malaysia: FELDA and FELCRA. Straumann, Lukas (2014). Money Logging: On the Trail Contemporary Southeast Asia 3 (4). pp. 340-360. of the Asian Timber Mafia. Basel: Bergli Books.
Mohamad, Maznah (2015). Fragmented but captured: Sutton, Keith (1989). Malaysia’s FELDA land settlement Malay voters and the FELDA factor in GE13. In Johan model in time and space. Geoforum 20 (3). pp.339-354 Saravanamuttu, Lee Hock Guan and Mohamed Nawab Mohamed Osman (eds). Coalitions in Collision: Malaysia’s Sutton, Keith (2001). Agribusiness on a grand scale – 13th General Elections. Kuala Lumpur and Singapore: Felda’s Sahabat Complex in East Malaysia. Journal of SIRD and Institute of Southeast Asian Studies. Tropical Geography 22(1). pp. 90-105.
MPOB (2015). Economics and Statistics, http://bepi. Sutton, Keith and Amriah Buang (1995). A new role mpob.gov.my/. Accessed, 22 April 2015. for Malaysia’s Felda: From land settlement agency to plantation company. Geography 80 (2). pp. 125-137. Ngah, Ibrahim (2010). Rural Development in Malaysia. Monograph No. 4. Centre for Innovative Planning and Talib, Rokiah (2009). Raja Muhammad Alias: The architect Development, Faculty of Built Environment, Universiti of Felda. Bangi: Penerbit UKM. Teknologi Malaysia. Talib, R. (1984). Associations and institutions in Felda Mohamad, Z. (2010). Inheritance issue solution in Felda society: a survey of form and function. Kuala Lumpur: schemes: case study in Lurah Bilut Bentong Felda, University Malaya. Pahang. Phd. University Malaya. Wan Ismail, W. (2003). Characteristics of Teenagers in Mohd Radzi, M. (1991). Indonesian migrants in the Ulu Belitong Felda, Kluang, Johor: a study of problems. Sungai Koyan Felda scheme, Raub, Pahang: process Masters. University Malaya. of entry and socio-economic implications. Masters. University of Malaya.
High Carbon Stock Science Study 69 Consulting Study 12 The Felda case study
Wong, Siew Tow (2000). Felda and Settler Interviews Development: A Socioeconomic Study of Felda Bukit Wa Ha, Kota Tinggi, Johor. Academic exercise. Universiti Anon. ADA (2015), senior planter cum lawyer from Malaya. Sabah, active in palm oil associations, 23 April 2015, Kuala Lumpur. World Bank (1974). Appraisal of the Johore Land Settlement Project. Report No.2652-MA. Asia Projects Anon. ALR (2015), long time Felda senior manager, Department. 15 April 2015, Kuala Lumpur.
World Bank (2013). Malaysia Economic Monitor June Anon. BUG (2015), sustainability specialist, plantation 2013: Harnessing natural resources. World Bank Office, development, personal communication, 2 April 2015, Bangkok. Kuala Lumpur.
World Bank (1987). The Jengka Triangle projects Anon. BAH (2015), member of senior management of a in Malaysia: impact evaluation report. Operations large plantation company, personal communication, Evaluation Department, World Bank, Washington, D.C. 15 April 2015, Kuala Lumpur.
World Bank (1995). Project Completion Report: Sabah Anon. FOL (2015), member of senior management of a land settlement and environmental management large plantation company, personal communication, project. Report No.15189. East Asia and Pacific 17 April 2015, Kuala Lumpur. Regional Office. Anon. LIS (2015), member of senior management WWF et al. (2012). Profitability and Sustainability in of cane sugar plantation company, personal Palm Oil Production - Analysis of Incremental Financial communication, 9 April 2015, Kuala Lumpur. Costs and Benefits of RSPO Compliance, March 2012, A report by WWF, FMO and CDC, http://wwf.panda.org/ Anon. ZAZ (2015), long time Felda senior manager, wwf_news/?204114/Sustainable-palm-oil-is-good-for- 19 April 2015, Kuala Lumpur. business--WWF-study. Accessed April 2015 Anon. TEG (2015), member of senior management of palm oil mill company, personal communications, 14 April 2015, Kuala Lumpur.
Barlow, Colin (2015a); Felda and Southeast Asia smallholder development expert, 10 April 2015, Kuala Lumpur.
Norazam Abdul Hameed (2015), Head of Plantation Sustainability and Quality Management, Feld a Global Ventures Berhad, personal communication, 3 March 2015, Kuala Lumpur.
70 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Appendix 1A: A Selected Listing of Socio- Economic Literature on Felda from Key Universiti Malaya Libraries and the Felda Library
Universiti Malaya is Malaysia’s pre-eminent university. The following selected literature listing for the key As part of the literature review work of this project, socio-economic topics of interest focuses more on a selective review of the native language / Bahasa works published after 1985, especially in the key Malaysia literature available on the socio-economics geographies of Jengka in Pahang, Johor Tenggara and of the Felda project was reviewed over a period of 10 Sahabat in Sabah: days. • Settler origins Other key libraries that may be reviewed by student’s seeking material on Felda include the libraries of • Primary and secondary income Universiti Putra Malaysia (the former agricultural university) and Universiti Kebangsaan Malaysia. In • Labour and land addition to Universiti Malaya, the collection at the Felda • Family and social services Library was also reviewed (and shown in a separate table listing below). • The settlement - development and operations
• The Felda Group
• State administration and funding
• Economic multipliers and business linkages
• Environmental policies
The Bahasa Malaysia literature comprises mostly Phd theses, masters papers, academic exercises with some project paper, lectures and Felda corporate publications. These have been seldom referred to recent international reviews of the Felda smallholder program.
High Carbon Stock Science Study 71 Consulting Study 12 The Felda case study
Table A1: Literature highlights on Felda settler socio-economics
Topic Title Abstract/Conclusion Key data points Settler origins Note: Settler origins is often a detail in various studies. Most include some data on state of origin and previous profession. Primary and secondary income Pengaruh sains, teknologi dan The FELDA schemes have brought development from social, physical, and economic aspects to Participation in organisations/committees sistem pengurusan ke atas the settlers. The process of modernisation of the rural population through FELDA can be seen Savings Among Settlers pemodenan masyarakat Melayu through the introduction of a work schedule that was organised and followed a set production Level of Education Settlers Aspire to for Children luar bandar : satu kajian di Felda procedure (Mamat, 291). The characteristics of modernisation can also be seen through the Knowledge Prioritised by Settlers for Children Semarak Jengka 15, Pahang by existence of the FELDA management and administrative bureaucracy, and also the settler Settlers Perception of Women’s Rights Mohd Zufri Mamat, 2011 associations and committees. Overall, the process of bringing rural folk to the settler schemes Perception of How Life Has Changed Post-Felda can be seen as a reorganisation of rural society from a traditional kampung economy to a modern one in the schemes (Mamat, 292). The study is aimed at finding out if modernisation in the Settler schemes fit Weber’s model of modernisation. Ultimately, Mamat concludes that a unique process of modernisation took place on the settler schemes. While the settlers saw improvements in socio-economic terms, and were open to new ideas, they still clung to some religious and traditional beliefs. Primary and secondary income Pembangunan Komuniti di This study focuses on how far the development objectives of FELDA have been achieved. The In 1971, the average wage of the settlers was $150 a month, more than when Rancangan FELDA: Satu Kajian study looks at community development, the background and setup of the scheme, and the entering the schemes (185). Kes di Rancangan FELDA Sungai standard of living of the settlers. The study also examines the social objectives of FELDA, namely FELDA estimated that a settler with an 8 acre lot (including 2 for dusun) would be Tiang, Kedah by Yaacob Harun, to create “a stock of modern and progressive farmers”. This study confirms the recurring theme able to earn a net income of $97 a month after 5 years, and $112 a month after 1975 in the literature of an overdependence of the settlers on Felda. Furthermore, the settlers had not 15 years. However, the Sungai Tiang settlers were able to earn about $48.17 more fully adapted to the Felda method of farming such as clearing the smallholdings to the schedule than this target after five years (189). or standards set by Felda, the fixed schedule, or taking their turns to tap the rubber. The study FELDA estimated that settlers on a rubber smallholdings with a lot of 10 acres, also finds that there was low participation in official settler organisation, another recurring finding including 2 for dusun would be able to earn $344 net income after paying back in the literature. In sum, Felda failed in its mission to produce a “stock of modern and progressive all loans and debts. This was estimated to take 22 years. However, the settlers in farmers” despite the socio economic progress. Sungai Tiang would have to wait longer as their rubber lots were smaller, around 8 acres including 2 acre for a dusun (189). After five years, Sungai Tiang settlers were earning about $145.71 a month (189). The minority of settlers who engaged in side businesses or a second income, usually did not earn more than $50 a month (189). 60% of settlers’ income was used on basic necessities (190). 50% did not put aside any money away for savings (190). Less than 35% of settlers were registered with the official associations on the scheme (JKKR, GPW) (192). Felda and Settler Development: This study examines the social and economic development achevievements of Felda among the Type of facilities on scheme; Computer literacy; Place to learn computer skills; A Socioeconomic Study of Felda settlers of Bukit Wa Ha. The focus is economic activity patterns, specifically incomes, subsdiary Town library fees; Staff who work at the Bukit Wa Ha Felda Clinic; Duties of Bukit Wa Ha, Kota Tinggi, Johor incomes, savings, and spending. Aspects of settlers’ social life is also a focus, with a look at social Clinic Staff During the Week; Number of patients in a day; Level of education by Wong Siew Tow (2000) organisations, social ties amongst settlers and Felda management, and social ills amongst settler of respondents; Literacy levels of respondents; Level of education among children. Conclusion: The settlers have seen an increase in income, but monthly expenditure respondents’ wives; Vocational Skills; Number of children; Level of education varies depending on family size. Though overall it can be said they are receiving a profitable among settlers’ children; Summary of 1998 UPSR Results; 1998 UPSR Results income. They have various electronic appliances, and at the very least own a motorcycle to travel Analysis According to Subject; Complete Summary of 1998 UPSR Performance; to work. About 82% have renovated or rebuilt their houses, and all respondents save money. 1998 PMR Performance According to Subjects; Summary of 1998 SPM Results; Hoever, the settlers experience economic instability due to changing commodity prices, and the Summary of 1998 SPM Results According to Subject; Deduction on basic rate of quality of the oil palm harvested. A small number of settlers are involved in subsidiary activities oil extraction according to percentage of fresh fruit bunch; Subsidiary Activities; due to increase in age. Several people are invovled in cattle rearing, and this is popular in this Monthly Income; Respondent A’s Income; Respondent B’s Income; Monthly scheme. There is an overdependence on Felda to solve social and economic problems. The settler Spending; Family Size; Condition of House; Number of children in school; Yearly organisations (JKKR, GPW, Belia) don’t have very good leadership from the settlers, and their Schooling Expenses for Children; Luxury Items Owned by Respondents; Vehicles activities are poorly received by the settlers. Rampant drug use, illegal racing, and theft occurs Owned by Respondents; Respondent A’s Monthly Expenses with a Family of Five; among settler children. Respondent B’s Monthly Expenses with a Family of Seven; Saving Habits Among Respondents;
72 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Topic Title Abstract/Conclusion Key data points The Socioeconomic Difference This study examines the socioeconomic differences in a settler settlement where rubber tress Number of settlers according to type of crop and managements of replanting; in a Settler Community Before were replaced with oil palm after replanting. 91.4% of the respondents agreed to the replanting, Number of entrepreneurs and business; Age of respondents; Level of education of and After Replanting. Case while 8.6% agreed to continue managing their smallholdings independently with rubber. Most respondents; Number of children of respondents; Number of children still in school; Study in Felda Jengka 21, settlers (38%) did not engage in any subsidiary activities during replanting. While incomes dipped Car ownership amongst respondents; Motorcycle ownership amongst respondents; Pahang by Abdul Rashid bin during replanting, all settlers saw an increase in income after replanting. Computer ownership amongst respondents; Mobile phone ownership amongst Jaafar (2011) respondents; Type of crops; Management of Replanting; Subsidiary activity during replanting; Income before replanting; Income during replanting; Income After Replanting; Perception of Socio-economic Difference After Replanting; Reason for Respondents’ Perception; T-test free sample difference of opinion on replanting based on gender; T-test free sample of difference of opinion based on type of crop; T-test free sample of difference of opinion based on management; Women’s Participation in Small This study examines the role of women in small ruminant enterprise in three different FELDA Main Purpose of Rearing Goat and Sheep; Main Uses of Cash Income from Goat Ruminant Enterprise by Jahara schemes in Negri Sembilan. Conclusion: Animal husbandry is a significant supplementary income and Sheep Rearing; General household expenses; Net Income from Goat Sheep Yahaya, 1991 for the smallholders who do engage in it. However, there are constraints that do not allow the Enterprise (M$) women to participate in animal husbandry at a commercialized level. This is in part because the settler families lack the financial resources to purchase a flock that would be large enough to be considered commercial. The study also reveals that the women on the schemes are engaged in other commercial activities to earn supplementary incomes. Primary and secondary income The Current Working Status of The original objective of Felda was to raise the socio-economic status of landless Malaysians who 80% of labour is provided by foreign migrants (134). the First Generation of in Felda were living below the poverty level through re-settlement. However, a number of first generation Sungai Tekam Utara, Jerantut, settlers no longer work the land they were given. Instead they receive a monthly income. Some of Pahang (2013) the first generation are also involved in subsidiary incomes and receive two incomes. Conclusion: Those who manage their smallholdings by themselves do so because they can received a higher income (128). However, others feel a duty to preserve the smallholdings that were given to them and so continue to manage their lots (129). There have been some smallholders who initially gave their land over to Felda to manage, but have since broken their agreement and taken the land back. This has resulted in bad relations between Felda management and the settlers. However, Felda has not taken action as it is a political issue (130). Labour and land Pendatang Indonesia di The subject of the study was illegal migrant Indonesian labour working in Felda schemes, with Number of Malaysian citizens and non-citizens in Felda Peninsular Malaysia, 1989; rancangan Felda Gugusan the Sungai Koyan scheme in Pahang as the case study. The author examines the factors driving Number of citizens and non-citizens within Felda Pahang, 1987; Pension Rate for Sungai Koyan, Raub, Pahang : Indonesia migration, how the migrants have adapted, and their relations with the locals and to Settlers in Sungai Koyan proses kemasukan dan implikasi Malaysia and their country of origin. Conclusion: The main factor driving Indonesian migration sosio-ekonomi by Marsitah bte. is economic. A combination of a lack of job opportunities or well paying jobs in Indonesia, and Mohd. Radzi. 1991 a demand for migrant labour with better wages in Malaysia means that migration is increasing. Social division/separation between the migrants and locals exists, unless the migrants have come with their families (330). Migrants maintain a strong connection with Indonesia through remittances, visits home, and letters (331). It is doubtful that Indonesian migration can be stopped or reduced, as the second generation of Felda settlers is uninterested in managing the schemes. The author concludes that Indonesian migrantion would also increase as more Felda schemes are opened up. Family and social services Penyelesaian isu harta pusaka The study explores inheritance issues associated with Felda land, which is controlled under the Number of Unsettled Inheritance Applications in Selected Districts; Method of tanah rancangan Felda : kajian Land Act 1960. The Land Act 1960 restricts the number of people who can be registered as Obtaining Land; Attitudes of Settlers Towards the Division of Felda Land by Order kes Felda Lurah Bilut Bentong, the owners of Felda land to two people. As Felda approaches its 52nd year, issues regarding of Mean Score; Perception of Settlers Towards Felda Land Ownership Restrictions; Pahang Darul Makmur by inheritance have cropped up as the original settlers are in their old age, or have already passed Zulkifli bin Mohamad away. The study examines the administrative and legal issues faced by heirs. Conclusion: The Land Act 1960, which imposes a number of restrictions on Felda land inheritance, is a secular law. It was drafted to avoid the problems inherent in traditional land. Nevertheless, inheritance issues with Felda land affects a large number of settlers’ heirs. A combination of lack of knowledge, not naming a representative, and bureaucratic delays at various state land offices has resulted in delays of transferring land titles. However, there is an awareness of the consequences of not administering the land. Perhaps with better awareness of the restrictions on Felda land the delays can be reduced.
High Carbon Stock Science Study 73 Consulting Study 12 The Felda case study
Topic Title Abstract/Conclusion Key data points Family and social services Pembangunan luar bandar : The majority of settlers migrated to the schemes for a better quality of life. The children of the Number of Settler Children in all Schemes According to Schooling Level up to kajian ke atas migrasi, aspirasi settlers, the second generation, migrated out of the schemes. Conclusion: The majority of FELDA September 1987; Number of Unemployed Settler Children Up to September 1987; dan persepsi generasi kedua children were satisfied with the FELDA schemes, but were not interested in settler work and Characteristics of Potential Out-Migrants from Johor Barat; Education Level of peneroka FELDA by Suriati binti aspired to migrate out of the scheme. The distance of the scheme from the main growth centre Settlers; Monthly Savings of Settlers in Study Area; Rate of Migration for Settler Ghazali (Kuala Lumpur), did not affect aspiration to migrate out of the scheme (330-31). The objective of Children According to Age and Scheme Area; Migration Destination of Settler FELDA to reduce rural to urban migration has failed to work with the second generation, who are Children by Urban/Non-Urban Classification; Level of Academic Achievement not interested in agricultural work or the opportunities to further develop the FELDA schemes among Migrants and Non-Migrant Aged 20 and Above; Year of Leaving School (333). Migration out of the schemes has to exist as the schemes are only able to maintain a Among Migrant Settler Children According to Region; Occupations of Migrated certain number of families. The objective of FELDA is not to take care of the settlers, but rather to Settler Children According to Gender and Destination; give them the ability to compete with residents outside the schemes (334). Family and social services Kedudukan sosio-ekonomi The FELDA schemes have raised the standard of living among settlers, and their children. This 33.3% of settlers, excluding Bukit Senggeh, have $450 a month (220); 41.3% of anak-anak peneroka Felda di study examines the socio economic position of the settlers’ children; especially in regards to their three old settlements have income of $300-499 a month (221); 25.4% of settlers negeri Melaka, 1980 educational attainments and career choices. from the above three settlements make <$300 by Hassan Naziri bin Khalid Conclusion: In general the socio economic position of the settlers’ children has improved, especially in terms of education. A high percentage of settlers’ children attain primary school education, while about 36.9% attend lower secondary, and 46% complete secondary school. Though some children do go on to higher education. However, a higher failure rate in SRP/ LCE than schools near the schemes suggests that the overall academic achievement of FELDA children is behind their non-FELDA peers. The research also uncovered a high unemployment rate among the second generation. They lacked the entrepreneurial skills to open small businesses such as workshops, carpentry shops and so on despite the fact that these businesses were needed on the schemes. The settlement - development Kesatuan dan Institusi dalam Felda, in an effort to reorganise rural life, has created three official organisations in all Felda Types of Facilites on the Settlement; Type of Associations and Activities; Opinion of and operations masyarakat FELDA : satu schemes. Namely the Jawatankuasa Kemajuan dan Keselamatan Kampung Rancangan (Resettled Settler/Wife on the Requirements of Good Leader; Most Beneficial Official Gorups; tinjauan mengenai bentuk dan Village Development and Safety Committee) (JKKR), Gerakan Persatuan Wanita (Women’s Most Beneficial Unofficial Groups; fungsi by Rokiah Talib, 1984 Movement Association) (GPW), and the Persatuan Belia (Youth Association) (PB). However, the due to the top down nature of these organisations, the activities of these organisations do not always receive good participation from the settlers. There is a block-centric sentiment among the settlers. There is more sense of community amongst the blocks rather than the scheme as a whole; this is due to gotong-royong activities, and marriage ties that exist in the blocks. As a result activities sponsored for the entire scheme does not receive as much participation as activities organised in individual blocks. Life in the FELDA schemes is more organised than traditional kampung life (Talib, 32). Besides the urbanisation process that has occurred, the settlers’ participation in these official organisations has changed their behaviour patterns from those characteristic of traditional society as inherited from the kampungs (Talib, 32). The settlement - development Impak Sektor Perkilangan Sawit A study of the effects of an oil palm processing plant on both the environment and humans. There was moderate air pollution, with fine black dust in the air from the factory and operations Kepada Alam Sekitar Fizikal dan Study conducted with a sample of 100 respondents and secondary data. Negative environmental chimney that was too short (104). There was also an anecdote of a leak in the Manusia: Kajian Kes di Felda impacts were discovered. chimney, and a filter that was not replaced by one of the workers, which led to Padang Piol, Jerantut, Pahang more air pollution (104). There was also water pollution with factory waste flowing by Nor Azura binti Ali, 2009 into a nearby river (106). 55% felt air pollution affected them, 13% felt there was earth pollution, 7% felt there was water pollution, and 25% that there was sound pollution from lorries going to and fro.
74 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Appendix 1B: Selected Literature Listing - Universiti Malaya and Felda Libraries
Table A2: Selected Literature Listing on Felda and Felda Smallholders
Title Title - translation to English Author Year published Library Publication type University Library reference Peranan FELDA dalam membantu kaum bumiputera dalam ekonomi dan FELDA’s role in helping indigenous people in the economy and the Noor Latifah Hanim 2014 UM Islamic Studies Academic Exercise UM BP43 M4 2014 prestasi FGVH di bursa Malaysia performance of FGV in the Malaysian exchange binti Mohd Said. NOOLHMS Pengaruh sains, teknologi dan sistem pengurusan ke atas pemodenan The influence of science, technology and management systems for the Mohd Zufri Mamat tiang UM Main Library Phd UM Q175 UMP 2011 masyarakat Melayu luar bandar : satu kajian di Felda Semarak Jengka 15, modernization of the rural community: a study in Felda Semarak Jengka Mohzm Pahang 15, Pahang Penyelesaian isu harta pusaka tanah rancangan Felda : kajian kes Felda Solution to estate issues in Felda: A case study in Felda Lurah Bilut, Zulkifli bin 2010 UM Main Library Phd UM BP42 A1 UMP 2010 Lurah Bilut Bentong, Pahang Darul Makmur Bentong, Pahang Darul Mohamad Zulm Raja Muhammad Alias : the architect of FELDA Raja Muhammad Alias : the architect of FELDA Rokiah Talib. 2009 UM Main Library Book JQ1062 A69Rokt Akhlak remaja di Felda Ulu Belitong, Kluang, Juvenile behaviour in Felda Ulu Belitong, Kluang, Johor: a study of Wan Norasiah Wan 2003 UM Main Library Masters UM BP42 A2 UM 2003 Johor : kajian tentang masalah problems Ismail. Wannwi FELDA dan pembangunan peneroka : satu kajian sosio ekonomi di FELDA FELDA and settlers’ development: a socio-economic study in Felda Bukit Wong Siew Tow. 2000 UM Zaa’ba Academic Exercise UM PL5065 2000 Won Bukit Wa Ha, Kota Tinggi, Johor Wa Ha, Kota Tinggi, Johor FELDA Gunung Besout, Sungkai Perak : tinjauan dari aspek ekonomi FELDA Gunung Besout, Sungkai Perak: a review of the economic aspects Rusilawati Said 1999 UM Malay Studies Project Paper UM PL5065 1999 Russ Pendatang Indonesia di Felda Bukit Cherakah Selangor : kajian latar FELDA schemes of Papan Timur: a case study on the socio-economic Ahmad Adli bin 1997 UM Zaa’ba Academic Exercise UM PL5065 1997 Ahmay belakang penempatan, ekonomi dan sosial aspects Yusof. Rancangan FELDA Papan Timur : satu kajian kes mengenai aspek sosio- FELDA schemes East board: a case study on the socio-economic aspects Salawati Saringat 1997 UM Islamic Studies Academic Exercise UM BP43.1 M41997 SALS ekonomi peneroka of settlers Peranan wanita dalam pembangunan ekonomi keluarga di kawasan The role of women in family economic development in the area of the Masliza bt. 1996 UM Islamic Studies Academic Exercise UM BP43 M41996 Mass Lembaga Kemajuan Tanah Persekutuan (FELDA) : satu kajian di FELDA Federal Land Development Authority (FELDA): a study in FELDA Keratong Shahadan Keratong Dua, Pahang Darulmakmur Two, Pahang Darulmakmur Pembangunan tanah : usaha dan pencapaiannya Land development: efforts and achievements FELDA 1995 UM Main Library HD890.6 Z63Pem Pendatang Indonesia di rancangan Felda Gugusan Sungai Koyan, Raub, Indonesian immigrants in Felda Sungai Koyan cluster, Raub, Pahang: Marsitah bte. 1991 UM Main Library Masters UM DS595.2 I5Marmr Pahang : proses kemasukan dan implikasi sosio-ekonomi admission process and socio-economic implications Mohd. Radzi. Women’s participation in small ruminant enterprise : a case study of three Women’s participation in small ruminant enterprise : a case study of three Jahara Yahaya 1991 UM Main Library Book HD6073 A292M4Jah Felda schemes Felda schemes in Negeri Sembilan in Negeri Sembilan Peningkatan taraf hidup peneroka Felda : satu kajian di Felda Kesidang, Improvement of living standards of Felda settlers: a study in Felda Zainudin bin 1991 UM Islamic Studies Academic Exercise UM BP43 M41991 Zaib Pahang Kesidang, Pahang Bahdon Participation of adult learners in the program decision-making process : a Participation of adult learners in the program decision-making process: a Aminah binti 1989 UM Main Library Phd U of Wisconsin HD890.6 Z63Amia study of FELDA schemes in Malaysia study of FELDA schemes in Malaysia Ahmad Madison Strategi pembangunan Felda / oleh, Datuk Felda’s development strategies / by Datuk Alladin Hashim Datuk Alladin 1988 UM Main Library Book LG173.1 U83.8 I6 Alladin Hashim Hashim Pembangunan luar bandar : kajian ke atas migrasi, aspirasi dan persepsi Rural development: studies on migration, aspirations and perceptions of Suriati binti Ghazali 1988 UM Main Library Masters UM HD890.6 Z63Surg generasi kedua peneroka FELDA second-generation Felda settlers Sejauh manakah rancangan FELDA dapat meningkatkan taraf hidup The extent that Felda schemes can improve the lives of the settlers: a case Zamnah binti Haji 1988 UM Zaa’ba Academic Exercise HB31 1987/88 peneroka : satu kajian kes di rancangan FELDA Bukit Senggeh, Jasin, study of Felda Bukit Senggeh, Jasin, Melaka Hashim Zamhh Melaka Kesatuan dan institusi dalam masyarakat FELDA : satu tinjauan mengenai Associations and institutions in FELDA society: an overview of the form Rokiah Talib 1984 UM Main Library Book HD890.6 Z8J7Rokt bentuk dan fungsi and function Clients’ commitment to a project in a group farming organization : a study Clients’ commitment to a project in a group farming organization : a study Rahim Md. Sail 1983 UM Main Library Phd U of Wisconsin HD890.6 Z7Rahms of Felda schemes of Felda schemes in Malaysia / Madison in Malaysia /
High Carbon Stock Science Study 75 Consulting Study 12 The Felda case study
Title Title - translation to English Author Year published Library Publication type University Library reference Local participation in rural development planning : a case study of Local participation in rural development planning : a case study of Tilakasena 1983 UM Main Library Book HN700.6 Z9C6Abe settlements established by Felda settlements established by Felda in West Malaysia Abeyrama and Karl in West Malaysia E. Weber Kedudukan sosio-ekonomi anak-anak peneroka Felda di negeri Melaka Socio-economic status of children of Felda settlers in Melaka Hassan Naziri bin 1980 UM Main Library Masters UM HD890.6 Z8M4Hasnk Khalid Ke arah masyarakat petani moden kelas menengah Towards a modern middle class farming society Harris Mohd. 1980 UM Main Library Speech .. HC497 M22S2Harms Salleh, Datuk. Technical and allocative efficiency on independent and Felda rubber Technical and allocative efficiency on independent and Felda rubber Abdullah bin 1979 UM Main Library Book HD9161 M22Abds smallholdings : a summary smallholdings : a summary Sepien. Pembangunan komuniti di rancangan Felda : satu kajian kes di rancangan Community development in Felda schemes: a case study in Felda Sungai Yaacob Harun 1975 UM Main Library Masters HN700.6 K28Yaah Felda Sungai Tiang, Kedah Tiang, Kedah Peningkatan taraf hidup peneroka Felda : satu kajian di Felda Kesidang, Improvement of living standards of Felda settlers: a study in Felda Zainudin bin 1991 UM Islamic Studies Academic Exercise UM BP43 M41991 Zaib Pahang Kesidang, Pahang Bahdon Participation of adult learners in the program decision-making process : a Participation of adult learners in the program decision-making process: a Aminah binti 1989 UM Main Library Phd U of Wisconsin HD890.6 Z63Amia study of FELDA schemes in Malaysia study of FELDA schemes in Malaysia Ahmad Madison Strategi pembangunan Felda / oleh, Datuk Alladin Hashim Felda’s development strategies / by Datuk Alladin Hashim Datuk Alladin 1988 UM Main Library Book LG173.1 U83.8 I6 Hashim Pembangunan luar bandar : kajian ke atas Rural development: studies on migration, aspirations and perceptions of Suriati binti Ghazali 1988 UM Main Library Masters UM HD890.6 Z63Surg migrasi, aspirasi dan persepsi generasi kedua peneroka FELDA second-generation Felda settlers Sejauh manakah rancangan FELDA dapat meningkatkan taraf hidup The extent that Felda schemes can improve the lives of the settlers: a case Zamnah binti Haji 1988 UM Zaa’ba Academic Exercise HB31 1987/88 peneroka : satu kajian kes di rancangan FELDA Bukit Senggeh, Jasin, study of Felda Bukit Senggeh, Jasin, Melaka Hashim Zamhh Melaka Kesatuan dan institusi dalam masyarakat FELDA : satu tinjauan mengenai Associations and institutions in FELDA society: an overview of the form Rokiah Talib 1984 UM Main Library Book HD890.6 Z8J7Rokt bentuk dan fungsi and function Clients’ commitment to a project in a group farming organization : a study Clients’ commitment to a project in a group farming organization : a study Rahim Md. Sail 1983 UM Main Library Phd U of Wisconsin HD890.6 Z7Rahms of Felda schemes in Malaysia / of Felda schemes in Malaysia / Madison Local participation in rural development planning : a case study of Local participation in rural development planning : a case study of Tilakasena 1983 UM Main Library Book HN700.6 Z9C6Abe settlements established by Felda in West Malaysia settlements established by Felda in West Malaysia Abeyrama and Karl E. Weber Kedudukan sosio-ekonomi anak-anak peneroka Felda di negeri Melaka Socio-economic status of children of Felda settlers in Melaka Hassan Naziri bin 1980 UM Main Library Masters UM HD890.6 Z8M4Hasnk Khalid Ke arah masyarakat petani moden kelas menengah Towards a modern middle class farming society Harris Mohd. 1980 UM Main Library Speech .. HC497 M22S2Harms Salleh, Datuk. Technical and allocative efficiency on independent and Felda rubber Technical and allocative efficiency on independent and Felda rubber Abdullah bin 1979 UM Main Library Book HD9161 M22Abds smallholdings : a summary smallholdings : a summary Sepien. Pembangunan komuniti di rancangan Felda : satu kajian kes di rancangan Community development in Felda schemes: a case study in Felda Sungai Yaacob Harun 1975 UM Main Library Masters HN700.6 K28Yaah Felda Sungai Tiang, Kedah Tiang, Kedah Syarahan FELDA : satu pengenalan rengkas terhadap masyarakat desa dari FELDA lectures: A brief introduction to the rural community in terms of Sharifah Zaleha 1975 UM Main Library Lecture Series UKM HD890.6 Z63Sya segi struktur, organisasi dan masaalah / disunting oleh, Sharifah Zaleha structure, organization and problems / edited by Sharifah zaleha Hassan Hassan dan Mohd Hassan dan Mohd Dahlan Hj. Aman and Hj Mohd Dahlan. safe Dahlan Hj. Aman. Tekanan Kerja Dalam Kalangan Peneroka Felda Working Pressure Among Settlers Farah Hafsah binti 2014 UM Zaa’ba HN 700.6 Mohd Noor A82013/2014 Farhmn Status Pekerjaan Generasi Pertama Masa Kini di Felda Sungai Tekam Utara, Present Employment Status of First Generation Settlers in Felda Sungai Khairulnisa binti 2013 UM Zaa’ba DS 521 2012/2013 Jerantut, Pahang Utara Tekam, Jerantut, Pahang Jamaludin Khaj Pengambilan Daun Ketum dalam Masyarakat Felda Kajian Kes: Felda Batu Case Study of Daun Ketum (Mitragyna speciosa) consumption in Felda Mod Yuszairi Hafis 2013 UM Zaa’ba HN 700.6A82012/13 Papan, Gua Musang Community: Felda Batu Papan, Gua Musang bin Ismail Mohyhi Tanaman di Sekitar Rumah Felda Chiku Dua, Gua Musang Kelantan Plants in Gardens Around Felda Chiku Dua, Gua Musang Kelantan Norazila binti Jusoff 2011 UM Zaa’ba G77 M42011 Norj Kesan Penempatan semula Penduduk Felda Terhadap Perubahan Effect of Resettlement and Socioeconomic Changes towards Felda settlers Nor Hidayah binti 2011 UM Zaa’ba G 77M42011 Norhi Sosioekonomi Peneroka di Felda Gunung Bongsu Karangan Kedah in Felda Gunung Bongsu, Karangan, Kedah Ismail Perbezaan Sosioekonomi Masyarakat Peneroka Sebelum dan Selepas Socioeconomic differences Settler Society Before and After Replanting. Abdul Rashid bin 2011 UM Zaa’ba G77 M42011 abdrj Penanaman Semula. Kajian Kes di Felda Jengka 21, Pahang Case Studies in Felda 21, Pahang Jaafar Pembangunan Felda, impak ke atas alam sekitar dan manusia : kajian di Felda development, the impact on the Environment and Humans:A case Siti Salwahunah 2011 UM Zaa’ba G77 M42011 Sitsak Felda Jengka 21, Bandar Jengka, Pahang study in Felda Jengka 21, Bandar Jengka, Pahang binti Abdul Kadir
76 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Title Title - translation to English Author Year published Library Publication type University Library reference Pembangunan & Perubahan Sosioekonomi Masyarakat Felda, Kajian Kes: Community Development & Socioeconomic Change in Felda Society, Nurul Aida binti 2010 UM Zaa’ba G77 M42010 Nuraz Felda Kemahang 3, Tanah Merah, Kelantan Case Study: Felda Kemahang 3, Tanah Merah, Kelantan Azakaria Pencapaian Tahap sosioekonomi Peserta Felda. Kajian Kes: Di Felda Bukit Participants Felda socioeconomic level of achievement. Case Study: In Mohd Azuan bin 2010 UM Zaa’ba G 77M42010 Mohab Rokan, Gemencheh, Negeri Sembilan Felda Bukit Rau, Seremban, Negeri Sembilan Budin Impak Sektor Perkilangan Sawit Kepada Alam Sekitar Manusia Palm Manufacturing Sector Impacts on the Environment Nor Azura binti Ali 2009 UM Zaa’ba G77 M42009 Noraa Projek Penanaman Semula Kelapa Sawit: Kajian Kes di Felda Ulu Penggeli, Oil Palm Replanting Project: A Case Study in Felda Ulu Penggeli, Kluang D. Nurul A’in binti 2009 UM Zaa’ba G77 M42009 Dhamt Kluang Johor Johor Mohd Tahir Hubungan Etnik (Melayu dan Cina) di Pahang: Kajian Kes di Felda Melati Ethnic Relations (Malay and Chinese) in Pahang: A Case Study in Felda Noor-Aida binti 2009 UM Zaa’ba PL 50652009 Nooai Jengka 11, Bandar Jengka Melati Jengka 11, Bandar Jengka Ishak Pembangunan Serta Sosioekonomi di Tanah Rancangan Felda & Kesannya Development and Socio-Economic Plan in a Felda Scheme & Mohd Asrul Mizat B 2009 UM Zaa’ba G77 M42009 Kepada alam sekitar: Kajian Kes di Felda Besout, Perak Consequences to the Environment: Case Study in Felda Besout, Perak Halim Mohamh Perubahan Corak Gunatanah Getah ke Kalapa Sawit.Kajian Kes: Felda Land Use Pattern Changes from Rubber to Palm Oil Case Study: Felda Khairol Anuar B 2008 UM Zaa’ba G77 M42008 Khaal Palong 3, Gemas, Negeri Sembilan Palong 3, Gemas, Negeri Sembilan Latip Pembangunan Perladangan Tebu. Satu Kajian Mengenai Pembangunan, Isu Sugarcane Plantation Development. A Study of the Development, Issues Dasyirul B Darahoh 2008 UM Zaa’ba G77 M42008 Dasd dan Cabaran di Felda Chuping, Perlis and Challenges in Felda Chuping, Perlis Penglibatan Masyarakat Peneroka Felda di Dalam Industri Kecil & Community Involvement of Felda Settlers in the Small & Medium Yuslia Murni bt 2007 UM Zaa’ba G77 M42007 Yusmn Sederhana (IKS) Kajian Kes: Wilayah Jengka Enterprises (SMEs) Case Studies: Jengka Region Ngadenin@M. Yusman Pendidikan Anak-anak Felda: Kajian Kes di Felda Chiku Dua, Gua Musang, Education of Felda Children : A Case Study in Felda Chiku Dua, Gua Mohd Yusri bin 2006 UM Zaa’ba PL 50652006 Mohyj Kelantan Musang, Kelantan Jusoff Usaha Untuk Meningkatkan Pendapatan Efforts To Increase Revenue of Felda Settlers: A Case Study in Felda Aminah binti Abdul 2005 UM Zaa’ba G77 M42005 Amiaa Peneroka Felda: Kajian Kes di Felda Lembah Klau, Raub, Pahang Lembah Klau, Raub, Pahang Aziz Perkembangan Felda dengan Rujukan Khas Segitiga Jengka (1971 - 1990) Felda development with Special Reference to the Jengka Triangle (1971 - Norumiza binti 2005 UM Zaa’ba DS 5962005 Norm 1990) Mohammad Felda dan Pembangunan Peneroka: Satu Kajian Kes di Felda Lembah Klau Felda and Settlers Development: A Case Study in Felda Lembah Klau Raub, Mastura bunti Abd 2004 UM Zaa’ba PL 50652004 Masam Raub, Pahang Pahang Manaf Pembangunan dan Perubahan Sosio ekonomi Masyarakat Felda: Satu Socio-economic development and change in Felda Community: A Case Norhaziana binti 2004 UM Zaa’ba HN 700.6 A82003/04 Kajian Kes di Felda Lembah Klau, Raub Pahang Study in Felda Lembah Klau, Raub, Pahang Zulkeply Norz Perancangan Keluarga di Kalangan Wanita Family Planning Among Rural Malays Women: A Case Study in Felda Lepar Rosilawati bt 2002 UM Zaa’ba HN 700.6 A82001/02 Melayu Luar Bandar:Kajian Kes di Felda Lepar Hilir 2, Kuantan, Pahang Mahamad Jusob Rosmj Hilir 2, Kuantan, Pahang Migrasi Keluar di Kalangan generasi Kedua Peneroka India: Suatu Kajian Out migration among Second Generation Indian Settlers: A Case Study in Navarathina a/p 2002 UM Zaa’ba HN 700.6 A82001/02 Kes di Rancangan Felda Palong Dua Felda Palong Two Ramalingam Nav Penduduk Felda di ambang 2004: Kajian Kes di Felda Besout 2, Sungai Felda population on the verge of 2004: Case Study in Felda Besout 2, Yuslatifah binti 2002 UM Zaa’ba G77 M42002 Yusmy Perak Sungai Perak Yusoff Kesihatan Wanita: Satu Kajian Kes di Felda Lepar Hilir 2, Kuantan Pahang Women’s Health: A Case Study in Felda Lepar Hilir 2, Kuantan Pahang Sharedawati Ahmad 2001 UM Zaa’ba HN 700.6 A82001/02 Shaa Pembangunan dan Perubahan Sosial Masyarakat Peneroka Felda: Kajian Community Development and Social Changes among Felda Settlers: A Khuzaima bt Ismail 2001 UM Zaa’ba HN 700.6 A82000/01 Kes di Gugusan Felda Chiku, Gua Musang, Kelantan Case Study in Felda Chiku, Gua Musang, Kelantan Khui Belia dan Pekerjaan: Satu Kajian Kes Generasi Kedua Felda Lepar Hilir 3, Youth and Employment: A Case Study of Second Generation Felda settlers Maliana binti 2001 UM Zaa’ba HN 700.6 A82000/01 Gambang Pahang in Felda Lepar Hilir 3, Gambang, Pahang Remeli Malr Pengurusan Alam sekitar: Satu Kajian di Kawasan Pertanian (FELDA) Environmental Management: A Study of an Agricultural Area (FELDA) in Nor Azean binti 2000 UM Zaa’ba G77 M42000 Norat Daerah Batang Padang Perak Batang Padang District, Perak Tarmizi Penglibatan buruh-buruh Indonesia di sektor perladangan kelapa sawit : Involvement of Indonesia labourers in the oil palm sector: a case study in Roazmizah binti 1999 UM Zaa’ba DS521 1999 Roama satu kajian kes di FELDA Pasoh Tiga, Batu Kikir, Negeri Sembilan FELDA Pasoh Tiga, Batu Kikir, Negeri Sembilan Azmi. Peranan dan fungsi pertubuhan peneroka dalam masyarakat di Tanah The role and function of settler organizations in the Land Scheme in Mohd Nasran Abd 1998 UM Zaa’ba BA UM HN 700.6 A81997/98 Rancangan: kajian kes di FELDA Jengka Tiga, Pahang societies: a case study in FELDA Jengka Tiga, Pahang Halim Mohnah Peranan keluarga dalam membendung masalah sosial di dalam komuniti The role of the family in preventing social problems in the FELDA Junainah binti 1998 UM Zaa’ba HN700.6 FELDA : kajian kes di FELDA Chemplak Barat Labis Segamat Johor community: a case study in FELDA Chemplak Barat Labis, Johor Jamal. A81997/98Junj Penanaman semula kelapa sawit di tanah rancangan: satu kajian kes di Oil palm replanting on resettled land: a case study in Felda Sungai Moh Zawawi bin 1997 UM Zaa’ba HN700.6 FELDA Sungai Panching Selatan Panching Selatan Mat Tahar A81996/97Mohzmt Penanaman semula kelapa sawit FELDA : satu kajian kes di FELDA Bukit FELDA oil palm replanting: a case study in Felda Bukit Goh, Kuantan, Anita Binti Abd. 1997 UM Zaa’ba HB31 1996/97 Aniaj Goh, Kuantan, Pahang Pahang Jabar.
High Carbon Stock Science Study 77 Consulting Study 12 The Felda case study
Title Title - translation to English Author Year published Library Publication type University Library reference FELDA dan pembangunan peneroka : satu kajian sosio-ekonomi di FELDA FELDA and settler development: a socio-economic study in Felda Sahabat Sannang bin 1997 UM Zaa’ba HN700.6 A81996/97 Sahabat Pasalon. Sanp Buruh-buruh Indonesia dalam sektor perladangan kelapa sawit : kajian kes Indonesian workers in the oil palm sector: a case study in FELDA Sening, Hasnor Faiz 1997 UM Zaa’ba DS521 1997 Hasfms di FELDA Sening, Kota Tinggi, Johor / Kota Tinggi, Johor / Mohammad Salleh. FELDA Sebagai Agensi Pemodenan Orang FELDA As Modernisation Agency Orang Melayu; A study in Felda Keratong Norhazida bt Hasan 1996 UM Zaa’ba BA UM HN700.6A81995/96 Melayu; Satu Kajian di Felda Keratong 1 Pahang Darul Makmur 1 Pahang Darul Makmur Kehidupan politik di kalangan komuniti luar bandar : kajian kes di FELDA Political life in rural communities: a case study in Felda Cini 3, Pekan, Maizatul binti Abdul 1996 UM Zaa’ba BA UM HN700.6 A81995/96 Cini 3, Pekan, Pahang Darul Makmur Pahang Darul Makmur Majid. Maiam Budaya pengguna di kalangan penduduk luar bandar : satu kajian di FELDA Consumer culture among the rural population: a study in FELDA Ulu Ahmad Farid Abd. 1996 UM Zaa’ba HN700.6 A81995/96 Ulu Belitong, Belitong, Kluang, Johor Jalal. Ahmfaj Kluang, Johor Kajian kes migrasi tenaga buruh dari sektor perladangan ke sektor Case study of labor migration from the plantation sector to the industrial Noor Khairi bin 1995 UM Zaa’ba G77 M41995 Nookp perindustrian : merujuk kawasan Felda Air Tawar 3, Kota Tinggi, Johor sector: referring to Felda Air Tawar 3, Kota Tinggi, Johor Darul Ta’azim Pungut Darul Ta’azim Pengetahuan, sikap dan amalan terhadap perancang keluarga : satu kajian Knowledge, attitude and practice of family planning: a case study on the Rusidah bte Mohd. 1994 UM Zaa’ba G77 M41994 Rusma ke atas population FELDA Sg. Mas, Kota Tinggi, Johor / Akil. penduduk FELDA Sg. Mas, Kota Tinggi, Johor / Pembangunan institusi peneroka FELDA Bukit Puchong dalam menangani Development of Bukit Puchong Settler Institutions in addressing the Rosni bin Kuris 1994 UM Zaa’ba G77 M41994 Rosk masalah kemiskinan / problem of poverty / Propensiti migrasi di kalangan generasi kedua : sebuah kajian kes di Felda Propensity of migration among the second generation: a case study in M. Azahari bin Edin. 1994 UM Zaa’ba G77 M41994 Maze Bukit Aping Timur, Kota Tinggi, Johor Felda Bukit Aping Timur, Kota Tinggi, Johor Organisasi tenaga kerja di Felda Kemendor Labor organization in Felda Kemendor Norma Mohd Saleh 1992 UM Zaa’ba BA UM PL5065 1992 Norms Rancangan tanah Felda Sungai Behrang, Slim River, Perak : tinjauan aspek Felda Sungai Behrang, Slim River, Perak: a review of socio-economic Rosilawati binti Md. 1992 UM Zaa’ba PL5065 1992 Rosmd sosio-ekonomi peneroka)/ aspects of settlers Daud. Kehidupan sosial pendatang tanpa izin Indonesia : kajian kes di Felda Social life of illegal immigrants Indonesia: a case study in Felda Bukit New Nazarudin Abu 1992 UM Zaa’ba PL5065 1992 Nazab Kampung New Zealand, Maran, Pahang Darul Makmur Zealand, Maran, Pahang Darul Makmur Bakar Integrasi dan konflik dikalangan peneroka FELDA : satu kajian case di Integration and conflict among FELDA settlers: a case study in FELDA Zainal bin Mat Saat 1985 UM Zaa’ba HD890.6 Z8P1Zaims FELDA Lurah Bilut Lurah Bilut Penglibatan Generasi Pertama Masyarakat Felda Bukit Aping Timur di Involvement of the First Generation of Felda Bukit Aping East Community Ishak Radzi 1984 UM Zaa’ba HN700.6 A81983/84 Dalam Kumpulan Sosial dan Keugamaan in the Social and Religious Groups Ishr Kumpulan sosial di rancangan felda bukit Serampang / Social groups in the design felda hill Serampang / Kalsom Semon. 1983 UM Zaa’ba HN700.6 A81982/83 Kalse Keberkesanan perancangan Felda ke atas generasi kedua : satu kajian kes Felda scheme effectiveness on the second generation: a case study in Rosiah Hamid. UM Zaa’ba HB31 1994/95 Rosh di Felda Bukit Wa Ha, Kota Tinggi, Johor Felda Bukit Wa Ha, Kota Tinggi, Johor Sejauh manakah rancangan FELDA dapat meningkatkan taraf hidup The extent of the schemes can improve the lives of the settlers : a case Zamnah binti Haji 1988 UM Zaa’ba HB31 1987/88 peneroka : satu kajian kes di rancangan FELDA Bukit Senggeh, Jasin, study on the schemes Bukit Senggeh, Jasin, Melaka Hashim ZAMHH Melaka Pelaksanaan dan keberkesanan kaedah pengajian al-Qur’an dalam kalangan Implementation and effectiveness of Qur’an study methods in the Felda Haizuran bin Mohd 2013 UM Islamic Studies Masters BP42 A2 UM 2013 masyarakat Felda : kajian di Felda Bukit Goh Kuantan, Pahang community : a study in Felda Bukit Goh Kuantan , Pahang Jani. Haimj Isu-isu tuntutan harta sepencarian di tanah Felda Semenchu, Kota Tinggi, Issues of matrimonial property claims in Felda land Semenchu , Kota Tinggi Khairul Firdaus 2007 UM Islamic Studies Academic Exercise BP43 Johor / Khairul Firdaus Mohamad , Johor / Khairul Mohamad Firdaus Mohamad M42007KHAFM Program dakwah : kajian mengenai sambutan Missionary program : a study on the response and the problems in Felda Yusmaliza Yusof. 2003 UM Islamic Studies Academic Exercise BP43.1 M42003 dan permasalahannya di Felda Trolak Selatan Perak / Yusmaliza Yusof. Trolak Selatan, Perak YUSY Gejala sosial di kalangan remaja masa kini di Social problems among youth in Felda Keratong 2, Pahang Darul Makmur Samsiah Sharif. 2003 UM Islamic Studies Academic Exercise BP43.1 M42003 Felda Keratong 2, Pahang Darul Makmur SAMS Kajian mengenai sambutan masyarakat Felda Mayam Triang, Pahang Study on community response in Felda Mayam Triang, Pahang to Norjannatun 2003 UM Islamic Studies Academic Exercise BP43.1 M42003 terhadap aktiviti dakwah missionary activity Shamsir Alam. NORSA Kajian sosio-ekonomi masyarakat peneroka di Felda Kemahang 2 Tanah Study on socio -economic development of Felda settlers in Felda Mohd Suhazizi 2003 UM Islamic Studies Academic Exercise BP43 M42003 Merah Kelantan Kemahang 2, Tanah Merah, Kelantan Sulaiman. MOHSS Masalah moral di kalangan orang dewasa : suatu kajian di-Felda Trolak Moral problems among adults : a study in Felda Trolak Timur, Perak Mohd Nazri Umar 2002 UM Islamic Studies BP43.1 M42002 Timur Perak SITFMI Konsep persaudaraan Islam : satu kajian kes di Felda Kemahang 2, Tanah The concept of Islamic brotherhood : a case study in Felda Kemahang 2, Rosidah Yusof 2002 UM Islamic Studies Academic Exercise BP43.1 M42002 Merah, Kelantan Tanah Merah, Kelantan ROSY
78 High Carbon Stock Science Study Consulting Study 12 The Felda case study
Title Title - translation to English Author Year published Library Publication type University Library reference Adat amalan dan kepercayaan khurafat dalam perkahwinan masyarakat Customary practices and superstitious beliefs in weddings among Abu Bakar Jaafar 2001 UM Islamic Studies BP43.2 M4 2001 Melayu : suatu kajian di Felda Keratong 4, Pahang Darul Makmur traditional Malay society: a study in Felda Keratong 4 , Pahang Darul ABUBJ Makmur Amalan menjual buah-buahan yang masih di atas pokok : satu kajian di The practice of selling fruit still on the trees : a study in Felda Tementi, Asmuriza 2000 UM Islamic Studies Academic Exercise BP43 M42000 ASMM Felda Tementi, Triang, Pahang Triang, Pahang Mohamad. Konsep dan perlaksanaan aqiqah di kalangan masyarakat Islam : kajian Concept and implementation of ‘aqiqah’ (sacrific of an animal on the Hairayu Haron. 2000 UM Islamic Studies Academic Exercise BP43 M42000 HAIH khusus di Felda Simpang Wa Ha, Kota Tinggi, Johor Darul Takzim / occassion of a child’s birth) among the Muslim community : specific study in Felda Simpang Wa Ha , Kota Tinggi , Johor / Hairayu Haron Gejala sosial remaja : satu kajian di FELDA Kumai, Triang, Pahang Social ills among adolescents: a study in FELDA Kumai, Triang, Pahang Noor Aida Binti 1998 UM Islamic Studies Academic Exercise BP43.1 M41998 Hushin NOOAH Penyusuan ibu : satu kajian di kalangan wanita bekerja di Ibu Pejabat Breastfeeding : a study of working women in the FELDA Headquarters , Azilawati binti Amat 1998 UM Islamic Studies BP43 M41998 Aziay FELDA, Kuala Lumpur Kuala Lumpur Yasin Rancangan FELDA Papan Timur : satu kajian kes mengenai aspek sosio- FELDA Papan Timur : a case study on the socio- economic aspects of Salawati Saringat. 1997 UM Islamic Studies Academic Exercise BP43.1 M41997 SALS ekonomi peneroka settlers Aktiviti-aktiviti Dakwah di kalangan masyarakat FELDA : satu kajian khusus Missionary activities among FELDA communities: a special study tdi Maryana binti Alias. 1997 UM Islamic Studies Academic Exercise BP43.1 M41997 tdi FELDA Jengka 4, Maran, Pahang FELDA Jengka 4, Maran, Pahang MARA Sistem pemberian hakmilik tanah Felda Kemahang mengikut pandangan Felda land alienation system in Kemahang according to the Islamic view Ahmad Raddi 1997 UM Islamic Studies Academic Exercise P43 M41997 AHMRA Islam Abdullah Pemberimilikan dan pembangunan tanah pertanian sebagai satu cara Alienation and the development of agricultural land as a way of addressing Hishammuddin 1997 UM Islamic Studies Academic Exercise BP43 M41997 HISAA menangani masalah kemiskinan : kejayaan yang dicapai oleh agensi Felda the problem of poverty : the success achieved by the Felda agency Abd. Aziz. Peranan Gabungan Persatuan Wanita (GPW) dalam meningkatkan taraf Role of Women’s Associations ( GPW ) in improving the social status of Haslinda Mat Tozi 1997 UM Islamic Studies Academic Exercise BP43 M41997 sosial wanita : satu kajian di Felda Sungai Koyan 1, Raub, Pahang Darul women : a study in Felda Sungai Koyan 1, Raub, Pahang Darul Makmur HASMT Makmur Peranan FELDA di dalam memperseimbangkan kefahaman Islam dan FELDA ‘s role in promoting a better understanding of Islam and economic Nazlina Sadali 1995 UM Islamic Studies Academic Exercise BP43.1 M41995 pembangunan ekonomi : satu kajian di FELDA Bukit Mendi, Triang, Pahang development : a study in Felda Bukit Mendi, Triang , Pahang Darul Makmur NAZS Darul Makmur / Nazlina binti Sadali. Sekolah rendah agama di Felda : peranan dan sumbangannya di dalam Islamic primary schools in Felda : its role and contribution in Islamic Noraini binti Ismail. 1993 UM Islamic Studies Academic Exercise BP43.1 M41993 pendidikan Islam education of the settlers’ children: a specific study in Felda Bukit Goh, NORI kepada anak-anak peneroka ; suatu kajian khusus di Felda Bukit Goh, Kuantan, Pahang Kuantan, Pahang Sebab-sebab berlakunya kemiskinan menurut Causes of poverty according to the Qur’an and as- Sunnah : a special study Ahmad Faisol 1993 UM Islamic Studies Academic Exercise BP43.1 M41993 al-Quran dan as-Sunnah : satu kajian khusus terhadap sebab berlakunya of the causes of poverty among the Felda Sg. Tengi, Hulu Selangor b . Bakri @ Hj . AHMFB kemiskinan di kalangan masyarakat Felda Sg. Tengi, Hulu Selangor Baharudin Peranan masjid dalam pembangunan pendidikan agama di FELDA : kajian The role of the mosque in the development of religious education in Nora binti Ngarif. 1993 UM Islamic Studies Academic Exercise BP43 M41993 NORN di Jengka 16 FELDA : studies in Jengka 16 Penerokaan tanah di Malaysia : cara dan perlaksanaan menurut perspektif Land resettlement in Malaysia : how and implementation according to the Fatimah binti Ngah. 1992 UM Islamic Studies Academic Exercise BP43 M41992 Fatn Islam, kajian di Felda Keratong 5, Pahang Darul Makmur Islamic perspective , studies in Felda Keratong 5 , Pahang Darul Makmur Semangat kejiranan menurut perspektif Islam : kajian khusus di Felda Neighborliness according to Islamic perspective : specific studies in Felda Kamaliah Kassan. 1992 UM Islamic Studies Academic Exercise BP43.1 M41992 Soeharto, Hulu Selangor, Selangor Soeharto , Hulu Selangor , Selangor Kamk Peningkatan taraf hidup peneroka Felda : satu kajian di Felda Kesidang, Improvement of living standards among Felda settlers : a study in Felda Zainudin bin 1991 UM Islamic Studies Academic Exercise BP43 M41991 Zaib Pahang Kesidang, Pahang Bahdon Perancang keluarga menurut perspektif Islam Family planning from the perspective of Islam and the reality of today’s Hanifah bt Abd. 1990 UM Islamic Studies Academic Exercise BP43 M41990 dan realiti masyarakat kini : satu kajian di FELDA Soeharto, Hulu Selangor society : a study in FELDA Soeharto , Hulu Selangor Aziz HANAA Aktiviti keIslaman dan penerimaannya di kalangan masyarakat peneroka : Islamic activities and acceptance among the settlers : specific review in Maznah Abd 1990 UM Islamic Studies Academic Exercise BP43.1 M41990 tinjauan khusus di Felda Tenang Besut, Jerteh, Terengganu Felda Tenang Besut, Jerteh, Terengganu Rahman MAZAR Perancang keluarga menurut perspektif Islam Family planning from the perspective of Islam Hanifah bt Abd. 1990 UM Islamic Studies Academic Exercise BP43 M41990 dan realiti masyarakat kini : satu kajian di FELDA Soeharto, Hulu Selangor and the reality of today’s society : a study in FELDA Soeharto , Hulu Aziz HANAA Selangor Aktiviti keIslaman dan penerimaannya di kalangan masyarakat peneroka : Islamic activities and acceptance among the settlers : specific review in Maznah Abd 1990 UM Islamic Studies Academic Exercise BP43.1 M41990 tinjauan khusus di Felda Tenang Besut, Jerteh, Terengganu Felda Tenang Besut, Jerteh, Terengganu Rahman MAZAR Peranan Sekolah Ugama Rakyat Felda Bukit Banding dalam pendidikan Role of Community Religious School in Felda Bukit Banding in Islamic Latifah Mohd 1989 UM Islamic Studies Academic Exercise BP43.1 M4 1989 Islam education Tamamuddin LATMT Biro Agama Felda : satu tinjauan berkenaan pembentukan sosial Felda Religious Bureau : one review in respect Zahanuddin 1987 UM Islamic Studies Academic Exercise BP43.1 M41987 masyarakat peneroka of the formation of the settlers social society in the Jengka District Hashim. ZAHH Wilayah Jengka
High Carbon Stock Science Study 79 Consulting Study 12 The Felda case study
Title Title - translation to English Author Year published Library Publication type University Library reference Penghayatan Islam di kalangan masyarakat Felda Sg Retang, Retang, Appreciation of Islam amongst the Felda Sungai Retang, Retang, Jerantut, Fatimah Talib 1987 UM Islamic Studies Academic Exercise BP43.2 M41987 FATT Jerantut, Pahang Pahang society Pentadbiran Felda dan hukum Islam : satu Felda administration and Islamic law : a survey Felda 1987 UM Islamic Studies Academic Exercise BP43 M41987 tinjauan khusus bagi Felda Sungai Pancing Selatan, Kuantan, Pahang Darul of Felda Sungai Pancing Selatan, Kuantan, Pahang Darul Makmur administration MOHIMA Makmur and Islamic law: a survey of Felda Sungai South Hook, Kuantan, Pahang Darul Makmur Peneroka Magazine 2014 “Generasi Baharu Memacu Transformasi” Settlers Magazine 2014 “New Generation Driving Transformation” FELDA 2014 FELDA Library Adendum Program Kerja 2014 “Bersama Merealisasi Transformasi” Addendum for Work Programme 2014 “Joint Realisation of FELDA 2013 FELDA Library Transformation” Program Kerja 2013 “Merealisasikan Transformasi” Work Programme 2013 “Realization of Transformation” FELDA 2013 FELDA Library Laporan Tahunan 2013 “Teruskan Kegemilangan” Annual Report 2013 “Maintaining Glory” FELDA 2013 FELDA Library Laporan Tahunan 2012 Koperasi Permodalan Felda Malaysia Bhd 2012 Koperasi Permodalan Felda Malaysia Bhd Annual Report FELDA 2012 FELDA Library Laporan Tahunan Kumpulan Felda 2011 Felda Group Annual Report 2011 FELDA 2011 FELDA Library Soal Jawab Mengenai Felda Questions and Answers About Felda FELDA 2011 FELDA Library Program Kerja 2012 “Merealisasi Transformasi” Work Programme 2012 “Realising Transformation” FELDA 2011 FELDA Library Jengka 1966 Jengka 1966 Nordin Hussin 2011 FELDA Library Good Agricultural Practices in FELDA’s Group of Estates “Towards Good Agricultural Practices in FELDA’s Group of Estates “Towards Felda Agricultural 2005 FELDA Library Sustainable Palm Oil Production” Sustainable Palm Oil Production” Services Sasaran Kerja Felda 2005 “Ke Arah Pengurusan Lebih Berkualiti” Felda Work Target 2005 “Towards a Better Quality of Management” FELDA 2004 FELDA Library Kit Maklumat Felda Felda Information Kit FELDA 2004 FELDA Library Urusan Tanam Semula Managing Replanting 2000 FELDA Library Rancangan Kerja 2000 “Felda 2000: Penguasaan Teknologi” Work Plan 2000 “Felda 2000: Mastering Technology” FELDA 1999 FELDA Library Bantuan Tanam Semula Rancangan Getah Rubber Scheme Replanting Aid 1999 FELDA Library Tanam Semula Rancangan Sawit Palm Replanting Plan 1997 FELDA Library Tanam Semula Rancangan Sawit Palm Replanting Plan 1993 FELDA Library Menguruskan Kebun Sawit Peneroka yang telah Selesai Bayaran Kembali Manage Palm Oil Smallholdings Where Settlers Have Completed Loan 1992 FELDA Library Repayment Kertas Penerangan Mengenai Tanam Semula Kawasan Sawit Information Paper About Replanting Palm Oil Areas 1991 FELDA Library Laporan Aktiviti dan Pencapaian Kumpulan Felda Report on Felda Group Activities and Achievements FELDA 1990 FELDA Library Kawasan Pilihanraya bagi Rancangan-Rancangan Felda Electoral Area Plans for Felda 1990 FELDA Library Laporan Aktiviti dan Pencapaian Kumpulan Felda Report on Felda Group Activities and Achievements FELDA 1989 FELDA Library Lapuran Aktiviti dan Pencapaian Kumpulan Felda Report on Felda Group Activities and Achievements FELDA 1989 FELDA Library Sabah Land Settlement and Environmental Sabah Land Settlement and Environmental Project )Loan 3039 M A) 1989 FELDA Library Project )Loan 3039 M A) Sahabat 1 to 35 Sahabat 1 to 35 Settlement Schemes Setlement Schemes Perancangan dan Perlaksanaan Pusat-Pusat Perkhidmatan / Bandar Annual Report of Activities 1981 Stlers Consultative Committee FELDA 1986 FELDA Library Kawasan Felda Felda and Its Activities Felda and Its Activities 1982 FELDA Library Laporan Tahunan Kegiatan Jawatankuasa Perunding Peneroka 1981 Annual Report of Settlers’ Consultative FELDA 1981 FELDA Library Committee Activities 1981
80 High Carbon Stock Science Study www.carbonstockstudy.com