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Structural changes and the prospect for FELDA

Structural Changes and the Prospect for FELDA

There is no doubt that the Federal Land Development Authority (FELDA) worked in its initial decades in providing a way for poor Bumiputera to get a head start in palm oil. However, this Monitor will argue that there are structural changes which influence the sustainability of the current FELDA model.

These changes include global decline in palm oil prices due to the end of the commodity super cycle and shifts in global demand for palm oil. In addition, previous efforts to diversify FELDA’s income through commercialisation, especially the establishment of FGV, has led to massive losses and shifts in the demography of settlers further necessitates review of the functions of FELDA.

This GLC Monitor calls for fundamental reforms to FELDA to address structural issues including those highlighted in the Monitor.