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Thursday, June 29, 2023

Felda's financial restructuring a great relief, say settlers


The government’s move to restructure Felda’s loans will be able to improve the agency’s cash flow, thereby greatly benefiting the welfare and wellbeing of the settlers, said a settlers’ group.

Sulong Jamil Mohamed Shariff, the head of Peneroka Kebangsaan, said efforts made through the agreement involving the government’s guarantee, which involved the reduction in the principal of Felda’s debt by RM7.9 billion, also injected enthusiasm into the new generation of Felda settlers.

This is because, he said, income earned is no longer just channelled to pay off debt but also becomes profit.

“With the cancellation of 80 percent of the debt, settlers get more monthly income with their welfare restored and Felda can also breathe,” he told Bernama today.

Felda currently has over 120,000 settlers involved in 317 plots of land nationwide.

Meanwhile, Persatuan Kami Anak Felda president Fakhurrazi Mohd Habib said that with the restructuring of the loan, Felda is now able to rebuild its cash reserve that can be used to cover the upfront cost of farm management to settlers, if results are not encouraging.

He said settlers now had to pay the advance deduction in full, even though results were poor due to Felda not having sufficient reserves to postpone the deduction, as previously practised.

“Now Felda is cutting operating costs directly in advance, unlike before. With strong finances, Felda will be able to postpone the deduction,” he said.

According to him, Prime Minister Anwar Ibrahim’s signing of the government guarantee also shows the administration’s concern for the settlers and help Felda return to the original ambitions of its foundation.

General Linjal, head of Peneroka Felda Wilayah Sahabat Sabah, said the government guarantee helps settlers to improve their economic status as well as restore Felda’s financial position.

“This (guarantee) is a good step if implemented… the positive benefit is that the 80 percent reduction in debt means more than 1,000 settlers in Sabah have no more excuses to leave,” he said.

Yesterday, Anwar signed an agreement involving a government guarantee for Felda to restructure the agency’s loans through the issuance of sukuk and revolving credit to restore its financial position.

The restructuring will also reduce Felda’s financial costs against the interest rate charged and enable Felda to cancel 80 percent of the settlers’ debt amounting to RM8.3 billion, which was implemented in 2021.


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