PRIORITY

THRUST

STRATEGY

PROGRAM/ INITIATIVE

TARGET

ASPIRASI 1

THRUST 1:

Restructuring the Economy

Increase the contribution of agri

commodity sector to national income

Increase the export of agri commodity sector

Export value of RM180 billion

ASPIRASI 2

THRUST 1:

Restructuring the Economy

Increase the contribution of agri commodity sector to national income

Overcoming the shortage of labour in oil palm plantation sector

Finalize the foreign workers recruitment SOP for plantation sector

ASPIRASI 3

THRUST 3:

Enhancing social wellbeing

Empowering and increasing the competitiveness of smallholders

Targeted agricultural assistance program for smallholders in B40 group

Coordinate the policy of agricultural aid distribution and shape it to a more targeted manner for the benefit of oil palm smallholders with the possession of land below 10 hectares

 

DETAILS:

  1. From the ministry’s point of view, ‘economy’ and ‘smallholders’ are two main elements that have been affected by the spread of COVID-19. Therefore, the ministry’s goal towards 100 days achievement is to restructure the economy and empowering the competitiveness of smallholders.

ASPIRASI 1

  1. From the aspect of economy, ASPIRASI 1 is set to increase the export value of agri commodity sector. The ministry has set a target of RM180 billion this year (compared to RM150.5 billion achieved in 2020). The breakdown of the target by sectors:
  • Oil Palm: RM81.5 billion
  • Rubber: RM55.4 billion
  • Timber: RM34.4 billion
  • Cocoa: RM8.6 billion
  • Pepper: RM0.13 billion
  1. This ambitious goal is due to the increment of export value compared to the previous year. For example the export value for rubber glove as of July is RM40 billion, almost tripling the export value during the same period in 2020.
  1. Similarly, the export value of oil palm and oil palm-based products as of July this year is 40% higher compared to the last year’s performance, not to mention the current high price of crude palm oil which is around RM4,500.
  1. The ministry is on the right track in achieving the export value of RM180 billion from agri commodity sector, so that a greater contribution can be produced to increase the country’s income.

ASPIRASI 2

  1. Almost half of the targeted export value for this year involves the oil palm and and oil palm-based products. Therefore, the production at the upstream level is crucial to sustain the entire system of the value chain.
  1. Hence, ASPIRASI 2 is set to finalize the foreign workers recruitment SOP this year in order to encourage production activities at the upstream level. This is in tandem with the Cabinet’s earlier decision in April 2021 to grant a special approval for bringing in 32,000 foreign workers to ease the situation of workers shortage in the plantation sector. [1]
  1. The SOP is not to exclude locals’ involvement in the plantation sector. Currently, jobs related to the plantation is not favoured by the locals due to various factors. Meanwhile, the harvesting and production at the upstream level must be accelerated since harvesting is the beginning of the entire value chains including the high value-added oil palm downstream industry.
  1. In 2020, the overall contribution of the agri commodity sector to the country’s GDP is RM85.1 billion (6.3%) of which more than half is the contribution from the oil palm sector. If the harvesting work and production at the upstream level halted, it will affect the entire value chain and therefore negatively impact the country’s GDP for the following years.[2]
  1. On the other hand, the ministry also plan to attract locals to replace foreign workers in the plantation sector. These include providing incentives for automation and mechanization in order to encourage local’s participation in the plantation sector.

ASPIRASI 3

  1. On the aspect of empowering the smallholders, the mechanism of aid distribution will be stream lined to ensure the aid and assistance delivered to the right smallholders.
  1. Currently, the general definition of smallholder is individuals with land area of 40 hectares and below. Therefore, ASPIRASI 3 is set to coordinate the policy of agricultural aid distribution and shape it to a more targeted manner for the benefit of palm oil smallholders with the possession of land below 10 hectares, especially the B40 group.
  1. Through the policy coordination, the data of smallholders (especially the B40 group with the possession of land area below 10 hectares) will be collected and the first priority will be given to them in term of receiving agricultural aid and assistance. This is to ensure the value of assistance or incentives given is based on their actual needs, in line with the objectives of the Wawasan Kemakmuran Bersama 2030 to improve the well–being of those economically susceptible or B40 group among smallholders.
  1. In an additional information submitted to the KSN Office, the ministry informed that the policy coordination would involve the listing of 10,000 smallholders with land possession below 10 hectares. With the provided list, the distribution of agricultural aid and assistance will begin before the end of 2021.

 

[1] Sidang Darurat MKN Bil. 13/2021 chaired by YAB Perdana Menteri has also agreed with the decision. As of July 2021, the total employment shortage in the oil palm plantation sector is estimated at least 48,462 which is 12% of the total employment in the sector. The highest shortage is for the work of harvesting and collecting fresh fruit bunches (25,321).

[2] The value of losses due to lack of employment is estimated at RM13 billion per year.