PUTRAJAYA, Nov 20 — Malaysia’s agricultural productivity is 45 per cent of the average among high-income countries, says a World Bank report on Agricultural Transformation and Inclusive Growth: The Malaysian Experience.

This, according to the report launched here today, highlights an urgent need for reforms and expanding the sector’s contribution to the country’s development trajectory.

The report says if agricultural transformation is delayed, the economy will also find it difficult to emerge from upper middle-income status and efforts to enhance shared prosperity between rural and urban communities may be hampered.

“Agriculture in Malaysia is still dominated by smallholders with an ageing farmer population. With palm oil covering 75 per cent of the cultivated land, agriculture diversification should be considered to reduce dependence on single crops to protect the sector from external shock.


“While the country’s success in agriculture can serve as a case study for many emerging economies, further efforts are needed if Malaysia is going to have an agricultural sector reflective of a developed economy,” the report says.

Meanwhile, World Bank Country, Malaysia manager Firas Raad said in an effort to showcase Malaysia’s agricultural transformation, the sector had to continue to modernise and address new challenges.

That, he said included achieving diversification, dealing with population ageing where more than 70 per cent farmers were above 60 years old and boosting productivity.


“It is our hope that the government tackle these new challenges with the same determination and vigour that it deployed in transforming its agricultural sectors in previous decades.

“At the heart of a country’s economic structural transformation, is agriculture. No country has made a transition to high-income status without successful agricultural transformation,” he said at the launch of the report here today.

Meanwhile, Economic Affairs Ministry deputy secretary-general (sectoral) Zunika Mohamed in her speech at the event said the strategy to revive the agriculture sector was ongoing as the government saw its potential beyond the country’s food security.

She said Malaysia had already embarked on the process of moving towards enhancement of a new agriculture era through smart farming, using new technology in line with the Fourth Industrial Revolution such as artificial intelligence, automation, Big Data analytics, drones and robotics.

“Besides, we also looking forward to consolidating small farms to be managed professionally, efficiently and thus promote economies of scale in production to generate higher income for farmers.

“We are also working on diversification agenda, where the farmers do not entirely rely on rubber or palm oil produce alone, but instead will devote a portion of land to the production of agro-food cash crops such as vegetables and fruits that are very much in demand domestically and in the global market,” she said. — Bernama