THE NEW CONCEPT
THE CONCEPT
The New Concept of NCR land development is being
formulated on the premise that the vast tract of such land can be turned
into "LAND BANK" with new forms of land ownership to enable it to be
developed on a large scale commercial basis. Such a development is the
only best way of transforming the rural sector from that of a traditional
and subsistence economy into a strong, sustainable, and modern economy.
The basic assumptions in this Concept are:
(a) Native Customary Rights (NCR) Land which are now unorganised and
fragmented could be turned into an economic asset through the creation of
NCR Land Bank;
(b) NCR Land Bank once created would pool together and
mobilise the resources of the natives with NCR land for large scale
development from which optimum returns could be realised;
(c) Plantation Development is the most natural and
practical way of developing NCR land on a large scale basis that could
provide optimum returns on investment on sustainable basis;
(d) NCR Land Bank with areas of 5,000 hectares and
above are attractive and viable for investment by the private investors
and as such, will not require Government fund to develop them.
Using the framework of the above assumptions, the development of NCR land
in Sarawak is conceptualised into one Commercial Development Model by: -
the bringing together of the native landowners with
their land and the private sector with its capital and expertise to
develop the NCR land for commercial estate on a joint- venture basis. In
order to facilitate the formation of such joint-ventures and to safeguard
the interests of both the landowners and the investor, the State
Government will appoint its agency such as LCDA as Trustee to manage the
interests of the landowners.
A standard land development model has been formulated
and approved by the State Government which can be summarised as follows: -
JOINT VENTURE MODEL
In this model, the government agency will hold in trust the interests of
the NCR landowners. The trustee will form a Joint Venture Company (JVC)
with a well established private sector company approved by the Government.
Land title will be issued to the JVC for a period of sixty (60) years (2
plantation cycles) for an agreed value. The monetary value generated by
the use of the land will be used for two types of investments:
(a) as 30 % equity in the JVC ( long term investment), and
(b) as cash for investment in Unit Trusts (investment
with fast return).
Progress of Existing NCR Land Development
Projects
As at 31 December 2008, 128,390 hectares of NCR Land have been planted with
oil palm. Out of this 44,907 hectares were planted under the New Concept
of Development on NCR Land. Out of the areas developed under the New
Concept, 62.08% or 27,877.59 hectares were in production.
Upcoming Projects
The Ministry is fully committed in achieving the target set by the State
government of having 400,000 ha of NCR land fully developed into oil palm
plantations by the year 2010. In this respect another 22
new NCR land areas throughout the State have been processed. By 31 March 2009 another 22 areas had been approved for development under the New Concept, bring the cumulative total to fifty-eight (58).
PRIVATE SECTOR PARTICIPATION IN NATIVE
CUSTOMARY RIGHTS (NCR) LAND DEVELOPMENT
The State Government of Sarawak has long encouraged the private sector to
take the lead in large scale land development for plantations. The New
Concept of Land Development on NCR Land was formulated to further enable
the private sector to be actively involved in the commercial development
of the vast, but underutilized, NCR land found throughout the state.
Private sector companies interested to invest in NCR
land development has to apply to either the Ministry of Land Development
or the Land Custody and Development Authority to register their interest.
The following information/documents should be submitted together with
their applications:
| 1. |
Up-to-date Corporate Profile for the Company, and if
applicable, for the Group also. |
| 2. |
Memorandum and Articles of Association |
| 3. |
Form 24 |
| 4. |
Form 9 & 13 (if applicable) |
| 5. |
Form 49 |
| 6. |
Annual Reports for the last 5 years incorporating the
audited Financial Statements. |
| 7. |
List of persons holdings shares in the Company and an
account of the shares held extracted from the Companys latest Annual
Return. |
| 8. |
Supporting evidence of relevant technical and management
capability if core business has been outside the oil palm plantation
industry. |
| 9. |
A Detailed Project Proposal (if applicant has details of
the area applied for or has undertaken field reconnaissance survey of
the area) or a Preliminary Project Proposal if details of the area
applied for are not available.
In either case, the Project Proposal must include the following:
(i) An implementation/development plan
(ii) A financing plan which should also state clearly the source and cost
of fund
(iii) An analysis of financial viability in terms of IRR, NPV,
Break-even
measures such as the Payback Period and/or the accounting
break-even point, and
(iv) Sensitivity analysis.
All
assumptions used must be clearly stated.
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