The agriculture sector played an important role in the early 1920s with the rubber industry which has placed Malaysia as the world’s leading producer of natural rubber until the 1980s. The country’s economy after Independence was monopolized by agriculture and mining activities, contributing 46% to the nation’s Gross Domestic Product (GDP).
Initiatives to establish institutions such as FELDA, FELCRA, RISDA and district development agencies, aimed to develop, combine and recover land, have encouraged the clearing of new lands for the cultivation of industrial crops besides supporting the goal of eradicating poverty as outlined in the New Economic Policy.
Meanwhile, the establishment of specialized agencies such as FAMA (1965), Bank Pertanian Malaysia (BPM) (1969), MARDI (1969), National Paddy and Rice Board (LPN) (1971), Fisheries Development Authorities, Malaysia (LKIM) (1971), Muda Agricultural Development Authority (MADA) (1970), Kemubu Agricultural Development Authority (KADA) (1972), Farmers’ Organization Authority (LPP) (1973) and a few other agencies has contributed in the areas of marketing, research, credit and support services to target groups and bolstered the development of the agriculture sector at the time.
Three policies have been drafted to ensure that the agriculture sector becomes the ‘third engine’ in the nation’s economic growth, next to the service and manufacturing sectors. These policies include the First National Agriculture Policy (1984-1991), which emphasized on the development of the export-oriented agriculture; the Second National Agriculture Policy (1992-1997) which focused on increasing productivity, efficiency and competitiveness; and the Third National Agriculture Policy (1998-2010) aimed to increase competitiveness within the agriculture sector in view of international trade liberalization.
Prime Minister Datuk Seri Abdullah Ahmad Badawi is confident that the agricultural and agro-base industry can not only generate income for farmers in the rural areas, but also contribute towards the nation’s economy. His resolution to advance the agriculture sector is evident with the presentation of the Ninth Malaysia Plan and the 2006 budget which has allocated a significant sum for this sector.
Under the Ninth Malaysia Plan and the 2006 budget, the transformation of the agriculture sector towards becoming a more dynamic and competitive industry is aimed to increase the sector’s economic contribution for the farmers and the nation, as well as to alleviate the nation’s dependence on imported foodstuff in the long run, whereby currently the balance of imported foodstuff still exceeds the potential for export.
As part of a long term plan, the government has tasked and increased the functions of the Ministry of Agriculture and Agro-Base Industry to cover not only farming, but also the area of agro-based industry. The objective of this move is to ensure that all aspects of supply chain management within the agriculture and agro-base industry – from seed production, production, post-harvest handling, storage, logistics, grading, labeling, packaging, transporting, retailing, wholesaling, marketing, branding, processing, up to the point where the goods are sold to consumers (from farm to table) – is evenly developed. In the future, aside from agricultural production, focus will also be given to agro-based industries that can be explored by small and medium sized industries, particularly in new value-added areas.
Aside from this, in order to increase production and production efficiency, the government has mapped out a ‘Cluster’-based development of zones of production not unlike the Fruits Production Zones, the Target Area Concentration, the Aquaculture Zone Industry and a few other applications such as the Modern Agriculture Project and Permanent Food Production Park. In the end, all these projects aims to increase commodity and its by-products based on Industrial Districts where marketing, production, innovation can be planned and completed with its supporting infrastructure.
The government, through the Ministry of Agriculture and Agro-based Industry, has also introduced the ‘Malaysia Best’ brand, which will distinguish national agriculture products from those of other countries, placing high standards on quality and food safety. The Malaysia Best brand emphasizes on the importance of close monitoring and meticulous evaluation of all activities pertaining to food production from farm to table, ensuring that they are in line with international standards. This branding program will benefit not only consumers and producers but also the nation in the long run. Agricultural producers will enjoy an increase in both the domestic as well as international market demands because their products meets consumer expectations and exceeds the quality standard of the market.
The government observes that cutting edge commercial farming methods such as application technology, discovery in research and development, including the use of bio-technology, needs to be applied in order to develop the agricultural sector. To realize this objective, the government has also identified a number of new areas and products with potential for development, to diversify the source of economic growth. Among the new sources which have been identified is the development of the halal food, equine and exotic animals, minimally processed food and bio-technology products such as culture cells, pharmaceutical, nutraceutical, herbal products and cattle food or cattle supplement products.
In addition, production and use of palm oil-based bio-fuel or palm oil bio-fuel is deemed to have potential as a new source of economic growth for the nation. This approach has already been used in several European Union nations as fuel for transportation and industries. In Germany, bio-fuel is used in commercial trains with encouraging results. In addition, palm oil by-products such as stearin, are also used as fuel for the power plant and heating plants.
The market demand for bio-fuel is quite encouraging. In 2004, the world demand for bio-fuel was 2.5 million tonnes, estimated to increase at a rate of 25 percent a year.
However, in spite of the government’s conviction for the potential in the agricultural sector, banks in this country hold a different view. More confidence is given towards the industrial and housing sectors when it comes to financial loan facilities. This situation will create an unfavorable impact especially to farmers hoping to improve their quality of life and elevate themselves from being merely traditional farmers to modern ones. Because of the mentality that the agricultural sector is not profitable, banks have placed constrictive and repressive conditions unto farmers. This step not only poses difficulty, but may also potentially dishearten farmers who plan to transform their status from being traditional to modern farmers.
The Prime Minister has recently made several criticisms and hopes that the banks will reflect more confidence in the agricultural sector by facilitating the lending process involving farmers, in line with the governments focus and policy on the economy’s ‘third engine’, the agricultural sector.
These are not just hollow comments from the Prime Minster. It has been proven by the success of Jasmin Jasin, recipient of the National Male Farmer Award, whose success earns him an annual income of RM2.1 million simply by ‘being kind to the land’. Undoubtedly, farming is not a glamorous career, nevertheless it promises bountiful income to those who are willing to sweat under the sun and brave through all manners of obstacles initially.
The Green Book Campaign which was launched last March, the Malaysian Agriculture, Horticulture and Agro-Tourism Show 2006 that was organized recently, and the Prime Minister’s rallying slogan ‘ability for self-progress’ (capability for self-progress?), encouraging the people’s involvement in producing some of their own food requirements needs to be applied.
Logically, complaints with regard to low prices for fresh produce such as vegetables, meat and so on will grow silent if this challenge is turned into reality. If each citizen is able to produce his own food necessity, part of the nation’s problem will be solved. Not just the individual, but the nation’s economic problem will also be solved. |
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