Ministry approves soft loans for forest replanting

obmar · Ministry approves soft loans for forest replanting

http://www.theedgedaily.com/cms/c...88c194-cb73c03a-cef6f100-4d160d4e

Ministry approves soft loans for forest replanting
By Alfean Hardy

The government has approved nine out of 26 shortlisted companies to receive soft loans from the Finance Ministry’s RM200 million fund designed to facilitate forest replanting that will sustain the supply of raw materials to the local furniture industry.

Thirty-six companies have applied for the loans under the fund, which is managed by Forest Plantations Development Sdn Bhd (FPD), a special vehicle under the Malaysian Timber Industry Board, which in turn is an agency under the Plantation Industries and Commodities Ministry.

The minister, Datuk Peter Chin Fah Kui, said: “A lot of them are public-listed companies but I cannot divulge anything until they sign the agreements.”

Speaking to reporters at the first ever biocomposite products conference in Kuala Lumpur on Sept 5, Chin said the RM200 million fund was not under Budget 2006 or 2007 but was an off-budget allocation from the Treasury.

The fund was first mooted in October 2005 by the ministry and was designed to boost forest replanting in Sabah, Sarawak, Johor, Pahang and Terengganu.

On when the first forest replanting programme under the fund would start, he said: “I haven’t finalised the list. We hope to allocate about 48,000ha for this replanting,” he said.

“We hope to plant by the end of this year,” he added.

Meanwhile, Chin encouraged local manufacturers and developers to make use of local biocomposite products worth RM30 billion annually rather than import foreign hard woods and wood products.

Biocomposites and fibres, made from items like oil palm trunks, rubber wood and coconut tree trunks, have uses as varied as decking, automotive components, MDF chipboards and even as feedstock for biomass power plants.

Chin said: “We need to encourage people to change and not import pine from New Zealand or oak from the United States. Why import when we have RM30 billion of biocomposites with most going to waste?”

“In Sabah, the TSH biomass power plant is fully operational and is generating more electricity than is needed and is contributing to the power grid. The other projects around the country using biomass-fuelled power are going well,” he said.