PRESS STATEMENT ON CLOSURE OF PLANTATION OPERATIONS IN SABAH DURING MCO

YAB Chief Minister of Sabah yesterday made an announcement on the closure of estate and mill operations to an additional 3 districts bringing the areas affected to about 65% of the total planted hectarage of 1.2 million hectares and 75% of production in Sabah involving about 100,000 workers.

The Industry fully appreciate and understand the State Government concerns on the rising trend of Covid 19 incidents happening in Sabah and measures taken to save lives and we fully support the concerns.

The Industry however is even more concerned on the social impact to the closure decision as well as the resulting consequential damage to the Industry. This closure shall result in:

1. Idle workers being confirmed to their home for long hours without practicing social distancing and living in close proximity that can lead to contact to the virus.

2. Difficulty and impossible to stop them from leaving and the possibility of them wandering around thus posing a security and crime threat as well as defeating the objective of the MCO. Imagine 50,000 workers doing so.

3. Risk of losing our estate and mill workers. They will resort to leaving the estate searching for jobs elsewhere or returning to their home country for good. (Not all Companies can afford to pay without work)

4. Resumption and normalization of operation when allowed shall pose a big challenge to the Industry without the required workers available to do so. Extended harvesting rounds, high FFA and default palm oil contracts are some of the examples on the immediate impact to operations.

The above only highlight the operational nightmare notwithstanding the potential revenue loss of about RM860 million for a month closure in Sabah. The loss in the 7.5% sales tax revenue to the Government amounting to about RM57 million could actually be used to support the fight to contain Covid 19 that benefits the Rakyat.

The Industry has already given its commitment to support the Government in its battle to contain the spread by introducing and adhering to radical and robust guidelines and SOPs at all our estates and mills. Included in our action is what we called “ Voluntary Lockdown “We are even agreeable to a temporary closure to our operating units that have employees affected by the Covid 19 and taking the necessary measures to cleanse and disinfect the affected premises.

Considering all the above factors, we humbly request and appeal to the Sabah State Government to reconsider their decision and allow us to resume operation ONLY for the essential and critical operation example harvesting, crop evacuation as well as milling during the MCO. The Industry strongly feels that we can better contain the spread by continuing operations rather than curbing them.

THANK YOU.