Vested interest in plantation, O&G sectors holding economy back

 

Export of palm oil and palm-oil based products grew by 55.2% to RM67.48 billion from January to June compared with RM43.47 billion in the same period last year.

PETALING JAYA: Vested interest in the plantation and oil and gas sectors is holding Malaysia’s economy back, claims an economist.

Nungsari Ahmad Radhi said the country must move away from a plantation and resource-based economy in order to flourish.

“Malaysia is still highly dependent on exports of commodities, which are mainly oil and gas.

“We have a long way to go to remove this dependence but the problem is that there is real vested interest against changing this,” he said at a forum titled “Pathway to a Better Future Malaysia”.

Nungsari Ahmad Radhi.

Nungsari said what began as a narrow interest had evolved into a broad interest to prevent change in the national economy.

“The momentum to preserve this is in the national interest. You cannot eliminate or hurt the plantation sector because Permodalan Nasional Bhd and Tabung Haji are major players in it,” he said.

“You cannot do much to oil and gas because Petronas is there and the national Treasury depends on it.”

He said the plantation and resource-based economy had come to define all aspects of the political economy, the socio-economic institutions in the country, how the government was financed as well as governmental influence on the economy.

“Until and unless we move away from this resource-based economy, I don’t think we will get very far in moving towards a better future.”

Nungsari said the local economy needed to move away from big government-led projects and conglomerates to smaller businesses who create their own exportable products and services instead.

The export of Malaysia’s palm oil and palm-oil based products grew by 55.2% from January to June to RM67.48 billion from RM43.47 billion in the same period the year before.

Plantation industries and commodities minister Zuraida Kamaruddin said palm oil had contributed to 66.1% of the total export earnings, amounting to RM44.63 billion this year compared to RM28.8 billion in the same period last year.

Last month, economic affairs minister Mustapa Mohamed said Petronas forecast it would be able to contribute between RM55 billion and RM59 billion to the federal government this year.

He said Petronas projected its total profit after tax for 2022 to be between RM75 billion and RM80 billion. - FMT