KUALA LUMPUR (July 26): China’s state-owned companies will collaborate with Malaysian firms as well as the Malaysian Palm Oil Board to produce oil palm-based products involving RM6 billion in foreign direct investment (FDI).

Prime Minister Datuk Seri Ismail Sabri Yaakob said the products are hydrotreated vegetable oil (HVO) and sustainable aviation fuels (SAFs).

The companies from China are Shanxi Construction Investment Group Co Ltd and the Institute of Coal Chemistry, Chinese Academy of Sciences, while the Malaysian partners include Benalec Holdings Bhd’s subsidiary Pengerang Maritime Industries Sdn Bhd, and Sabah Oil and Gas Development Corporation.

“The joint venture (JV) is expected to provide 1,000 job opportunities,” he said in his speech at the launch of the Malaysia International Agricommodity Expo and Summit (MIACES) 2022 here on Tuesday (July 26).

He said the development of the maiden HVO and SAF plant in Malaysia is an initiative to drive the palm sector towards high-tech and high-value industries.

Ismail Sabri said the government will continue to encourage FDI to diversify agricommodity products with high added value.

He also expressed hope that the agricommodity sector will help to rejuvenate the country’s economy, and restore the people’s economic stability.

“The government is highly committed to driving the development of the agricommodity sector to be stronger, more competitive and market-oriented to fulfil the nation’s socio-economic agenda,” he added.

Meanwhile, Ismail Sabri said that although palm oil production dropped to a low level due to bad weather last year, the agricommodity sector remained firm.

“Up to February this year, commodity exports rose 5% or RM31.6 billion compared with the same period last year.

“Last year, the sector achieved RM270.2 billion in trade value or an increase of 39.7% from the previous year,” he said. 

Regarding MIACES 2022, the prime minister said the expo can be an excellent platform to promote products and technologies related to the oil palm, rubber, timber, cocoa, pepper and kenaf industries at the international level.

He said the government is targeting MIACES 2022 to generate more than RM300 million in export value, and to be a great platform for local agricommodity industry players to expand their exports to new markets.