In a statement today, the finance ministry said the comprehensive plan was formulated to revitalise the agency’s financial standing, and a large chunk of it involves reducing Felda’s debt principal with financial institutions by RM7.9 billion.

The restructuring will also reduce Felda’s financial cost in terms of interest rates and enable it to write off 80% of the RM8.3 billion settlers’ debt implemented in 2021.

The government guarantee was signed by Prime Minister Anwar Ibrahim, who also serves as the finance minister.

“This government guarantee is expected to stabilise Felda’s financial position and ensure a more sustainable business model so that Felda will continue to be able to promote social mobility for settlers and Felda’s new generation,” the ministry said.

As per the statement, the government had agreed to extend a government guarantee to Felda back in 2019.

This guarantee was provided to enable Felda to execute its redevelopment plan as part of its five-year transformation programme initiated in 2020.