Property News

Anwar: Govt guarantee essential to restructure Felda’s debt, ensure sustainability

KUALA LUMPUR (June 28): Prime Minister and Minister of Finance Datuk Seri Anwar Ibrahim has signed an agreement involving a government guarantee to Federal Land Development (Felda) to restructure the agency’s loans through the issuance of sukuk and revolving credit, in an effort to restore the agency’s finances. 
“This government guarantee is expected to stabilise Felda’s financial position as well as ensure a more sustainable business model so that it continues to be viable for settlers and the new generation of Felda,” said Anwar in a statement issued by the Finance Ministry on Wednesday (June 28).
The statement read that a large part of the Felda loan restructuring will involve a reduction of Felda’s debt principal with financial institutions by RM7.9 billion.
Putrajaya said the move will also reduce Felda’s financial cost against interest rates imposed as well as enable Felda to cancel 80% of the settler’s debt amounting to RM8.3 billion implemented in 2021.
“In addition, the government has improved the governance of channelling funds to Felda as a government statutory agency by appointing AmanahRaya Trustees as trustees of account transactions to ensure Felda’s transformation is on the right track and meets the needs of accountability and integrity,” it added.
The government agreed to provide a guarantee to Felda in 2019 to enable the agency to implement its recovery plan, under its transformation programme which started in 2020 for a period of five years.

Source: EdgeProp.my