“We asked for training and technical assistance from Malaysia,” Lorenzo

By Rexcel Sorza, IOL Correspondent

ILOILO CITY, Philippines, January 23 (IslamOnline.net) – Malaysia would not only help bring about peace but also prosperity among the people of Mindanao as it promised to help develop the island’s palm oil industry.

Filipino Agriculture Secretary Luis Lorenzo Jr. said the Philippines sought Malaysia’s assistance in developing Mindanao’s palm oil industry through Prime Minister Abdullah Ahmad Badawi, who visited Manila January 20 in an official visit.

He said that the Philippines and Malaysia have agreed to join hands in developing Mindanao’s palm oil through technical cooperation.

“We asked for training and technical assistance from Malaysia because they are experts on this. Maybe we would send our technical people to Malaysia to observes and study there while they might send their experts to help us out,” Lorenzo told IslamOnline.net Friday, January 23.

Lorenzo stressed that many impoverished people in Mindanao would benefit once the industry is developed.

Initially, Lorenzo has recommended the possibility of procuring the seedlings through a government-to-government counter-trade arrangement discussed during the bilateral meeting of Badawi and President Arroyo.

Lorenzo noted that over U.S.$550 million worth of crude palm oil was imported by the country last year and domestic consumption is increasing by at least 10 percent annually.

"The Philippines should devote at least 70,000 hectares for palm oil plantations to be able to meet the growing local demand for the next five years," he said.

At present, only 18,000 hectares, mostly in Mindanao, are devoted to palm and more than 50 percent of the trees planted are already old and must be replanted in the next seven years, Lorenzo said.

"Palm oil is a very competitive crop. What is even more encouraging is that most of the marginally developed agricultural areas in Mindanao are suited for palm oil growing," Lorenzo said.

He said that a palm oil plantation would need an investment of about U.S.$900 per hectare with a gestation period of four years. After the first harvest, a hectare planted to palm oil could yield an average of U.S.$100 every year.

The Bukidnon palm oil project aims to establish about 5,000 has of oil palm plantation in northern Mindanao from 2003 to 2006, with an initial 1,000 has set to be established this year during which time an oil mill would have also been put up.

Malaysia currently accounts for 51 percent of world palm oil production and 62 percent of world exports. This also means it has captured 8 percent and 22 percent of the world's total production and exports of oils and fats, respectively.

Palm oil and palm oil products are used in numerous food and non-food applications. They are used as frying media and for making margarines, shortenings, soap, oleo chemicals and other products.

Palm oil, which originated from West Africa, was introduced to Malaysia in 1870 as an ornamental plant. Its use as a crop was not developed until 1917, when it was grown commercially.

The modem expansion of the industry started in 960s when the Malaysian government embarked on a massive program of agricultural diversification.

Today palm oil is the leading agricultural crop in Malaysia, covering about two million hectares or a third of the total cultivated area.

Mindanao, which enjoys a generally fair tropical climate, grows most of the Philippines' major crops such as rubber (100 percent of national production), pineapple (91 percent), and cacao (90 percent) as well as banana, coffee, corn and coconut (over 50 percent). The island also produces exotic fruits like pomelo, mangosteen and durian.

Agriculture is the driving force behind Mindanao's economy. Close to a third of its land area is devoted to agriculture. More than one-third of the island's labor force is employed in the agriculture, fishery and forestry sectors.

Mindanao accounts for over 40 percent of the Philippines' food requirements and contributes more than 30 percent to the national food trade. Mindanao's evenly distributed tropical climate makes it ideal for year-round crop production.

If wisely harnessed, Mindanao's rich agricultural resources can serve as the Philippines' foundation for sustainable growth.

Mindanao's economy grew at an average of 3% in 1995-1997. This dipped to 0.5 % in 1998 due to the Asian financial crisis but improved to nearly 2% in 1999. Its Gross Regional Domestic Product (GRDP) in 2000 grew a noteworthy 4.95%, higher than the national growth rate of 4.01%. This was due to the bullish performance of its agriculture sector (5.84%) and industry sector (5.09%).

During his visit, Badawi reiterated its help to forge a lasting peace accord between the government and the Moro Islamic Liberation Front, which is fighting for an independent Islamic state in Mindanao. Malaysia would also help explore oil deposits in Mindoro Island.