MARAN (July 8, 2026): Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi has proposed that a portion of the plantation land currently managed by FGV Holdings Berhad (FGV) be returned to the Federal Land Development Authority (Felda) as part of efforts to strengthen Felda's long-term financial position and improve returns for settlers.
Zahid, who is also the Minister of Rural and Regional Development, said restructuring the management of Felda plantations could accelerate debt repayment while enhancing the agency's financial sustainability.
Plantation restructuring to improve returns
According to Zahid, allowing Felda to directly manage more of its plantation assets could generate stronger financial performance and improve benefits for settlers.
He believes the move would enable Felda to accelerate the settlement of its financial obligations while providing better long-term returns to the Felda community.
The proposal forms part of broader initiatives aimed at restoring Felda's financial health and ensuring the sustainability of its operations.
Government continues financial support
Zahid revealed that the Federal Government currently allocates nearly RM1 billion annually to support Felda.
The financial assistance covers various areas, including:
Welfare programmes for settlers.
Operational support.
Financial restructuring initiatives.
According to the Prime Minister, it is expected to take approximately nine years for Felda to fully restore its financial position despite ongoing government assistance.
The government has emphasised that the welfare of first, second and third-generation Felda settlers remains a national priority.
KPF asset restructuring underway
Zahid also provided an update on Koperasi Permodalan Felda (KPF), saying the government is assisting the cooperative in restructuring several of its assets.
The objective is to enable KPF to repay members who wish to redeem their shares.
He explained that weaker stock market and property market performance has resulted in lower dividend payouts, prompting many members to request redemption of their investments.
Approximately RM350 million is required to meet the current redemption obligations.
The restructuring programme is expected to be completed before the end of 2026.
Supporting cooperative members
Zahid noted that some KPF members had previously taken bank loans or sold personal assets to purchase cooperative shares.
The restructuring exercise aims to improve liquidity and ensure eligible members are able to receive their share redemption payments within the planned timeline.
Key Takeaways
The government is considering returning part of the plantation land managed by FGV Holdings to Felda to strengthen the agency's financial position and improve returns for settlers.
Direct management of plantation assets by Felda is expected to accelerate debt repayment while enhancing long-term financial sustainability.
The Federal Government currently provides approximately RM1 billion annually in financial assistance to support Felda's operations and settlers' welfare.
Based on current projections, Felda may require around nine years to fully restore its financial position.
The government is also assisting Koperasi Permodalan Felda (KPF) in restructuring its assets to facilitate approximately RM350 million in share redemption payments to members.
Lower dividends caused by softer stock and property market performance have increased redemption requests from KPF members.
From a property and plantation perspective, the proposed restructuring signals a potential shift in the management of Felda's land assets, with greater emphasis on improving operational efficiency, financial sustainability and long-term value creation for settlers.
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Posted by Yao Mu Realty Sdn Bhd on 8 Jul 26
Malaysia