Page 17 - Malaysia Food Business Directory 2020/2021
P. 17

 With the country having fallen behind on its Vision 2020 goals, a change was needed to catch up. According to a World Bank report entitled Agricultural Transformation and Inclusive Growth: the Malaysian Experience: “Malaysia’s agricultural productivity is less than half of high-income country averages, highlighting an urgent need for reforms and expanding the sector’s contribution to the country’s development trajectory.” World Bank country manager Firas Raad added: “No country has made a transition to high-income status without successful agricultural transformation. Without such shifts, there will be delays to economic transformation to the detriment of the overall economy, poverty reduction, food security, and the broad welfare of urban and rural people.”
In an effort to revitalise the agriculture sector and reduce the problems caused by dependency on one crop, the government renewed its focus to create a more dynamic, diversified and modern sector. Under Budget 2020, the agriculture sector would receive a marginally higher allocation, going from RM4.4 billion in 2019 to RM4.9 billion, with a focus on improving farmer income.
The amount includes RM150 million to assist palm oil farmers to venture into integrated and diversified farming so that they can cultivate other crops, such as pineapple, chilli, coconut and watermelon, and enjoy alternative sources of income. Paddy yield will also be boosted with an RM855 million allocation.
This refocus on agriculture also aims to incorporate smart farming, a concept that utilises technologies such as GPS, drones, soil scanning, data management and Internet of Things to enhance the quantity and quality of agricultural products. Converting old-style farming to modern, hi-tech ways serves another important purpose – to attract the tech-savvy younger generation with employment opportunities that offer good income. Youths need to know that being a farmer is not the only job in agriculture, nor is it a low-paying one. There are a variety of occupations in the field, such as marketers, engineers, planners, production analysts, financial analysts and agricultural managers.
Aside from the Budget 2020 initiatives, other schemes such as the 12th Malaysia Plan, the Malaysia Agro-food Policy (2021-2030) and the Fourth Industrial Master Plan (2021-2030) are also expected to include specific programmes and incentives that encourage smart farming concepts.
This strategy to diversify the agriculture sector and promote smart farming could not have come at a better time. The COVID-19 pandemic and the ensuing global lockdown severely disrupted international trade, highlighting the problems that come with relying on other countries for staple foods. The movement control also resulted in a shortage of foreign labour in various industries, including palm oil plantations, making it all the more important to encourage locals, in particular the younger generation, to take up jobs in agriculture.
Now that the lockdowns have been eased around the world, palm oil demand is expected to rise, as importing countries such as India and China are restocking. Adding to the increase in demand is the palm oil tax exemption introduced under the Penjana stimulus package. This tax exemption, which is in effect until December 31, 2020, is currently making our palm oil more attractive compared to that of our competition.
Despite this optimistic news of increased demand, it must be regarded as temporary. The lesson we have been learning as a country throughout this pandemic, which is the importance of self-reliance, is the same lesson that other countries have been learning as well. India, in fact, plans to raise its self-sufficiency from 35% to 60% by growing its own edible oil supply by 2025. At that point, palm oil imports from us will reduce.
The threat of a return of COVID-19 is also still very real. If we are to learn just one thing from our experience so far in preparation for a resurgence or the next pandemic, it is that all efforts must be made for our industries – particularly our agriculture industry – to be as self-reliant as possible.

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