KUALA LUMPUR: The government, yesterday, announced RM550 million soft loan at two per cent repayment rate to independent smallholders to replant their unproductive oil palms.
In a statement, Finance Minister Lim Guan Eng said the soft loan is meant to ease the financial burden of smallholders in carrying out their annual replanting of the crop with higher yielding ones.
He explained oil palm smallholders were being given assistance because of the government's concern over the current situation of low oil palm prices.
"The provision of soft loans, especially to smallholders to replant unproductive oil palms, is in line with Pakatan Harapan government’s commitment in ensuring the welfare of oil palm planters.
Lim said the extension of financial help to independent smallholders would ensure all oil palm planters are included in the government's programmes to facilitating economic growth.
The Finance Minister also announced a RM100 million grant to help independent smallholders to secure the Malaysian Sustainable Palm Oil Certification (MSPO).
Under this policy, he said, the government will fully bear the MSPO certification costs from the existing 70 per cent. This incentive is meant for oil palm planters who have landholdings of between 40ha and 1,000ha.
Lim also said the government will increase aid for MSPO auditing costs from the current 30 to 50 per cent. This incentive will be reimbursed to oil palm planters, after they have secured the MSPO certification at their estates.
"This measure to better facilitate MSPO certification among smallholders would help strengthen Malaysia's position as the world's leading sustainable palm producer," he said.