UMNO veteran Tan Sri Shahrir Abdul Samad has been appointed the new chairman of the Federal Land Development Authority (FELDA), Prime Minister Datuk Seri Najib Razak announced last Friday. Shahrir is a former minister of domestic trade and consumer affairs and the present chairman of the Barisan Nasional Backbenchers Club.

He will take over from Tan Sri Mohd Isa Abdul Samad, who will remain chairman of Felda Global Ventures Holdings Bhd (FGV), in which FELDA has a 20% stake. Isa is also chairman of FGV’s 51%-owned MSM Malaysia Holdings Bhd and wholly owned Felda Holdings Bhd and Pontian United Plantations Bhd. He also chairs Encorp Bhd, in which FELDA has a 72.27% stake.

Najib said in a statement that under the restructuring, there is a division of responsibilities towards settlers’ welfare and socio-economic status and business.

While it is not clear what this means, political watchers say Shahrir and Isa have their strengths, and both could play an important role.

A source familiar with FELDA says Isa’s key performance indicator was the acquisition of PT Eagle High Plantations Tbk. Despite facing some difficulties, after a long 18 months, FELDA’s wholly owned FIC Properties Sdn Bhd has emerged as the possible buyer of a 37% stake in the Indonesian plantation firm for US$505.4 million.

The deal has received much flak, but there seems to be a push to make it happen. While the acquisition of the Eagle High stake may have been beyond the capability of publicly traded FGV, it appears that FELDA, a government agency, is more confident of pushing it through.

Shahrir’s Johor roots a factor

Shahrir was the political secretary to former prime minister Tun Abdul Razak, the father of Najib, for about a year, until 1976.

In May 2006, he resigned as BN Backbenchers Club chairman after he supported a motion by the opposition to refer integrity issues involving an Umno or BN member of Parliament to the Rights and Privileges Committee. Almost all government MPs opposed the motion.

Shahrir was re-elected chairman of the BN Backbenchers Club for the 13th Parliament in June 2013.

Shahrir’s younger brother, Khalid Abdul Samad, the MP for Shah Alam, is an influential member of the opposition, first with Pas, then Parti Amanah Negara.

According to another source, Shahrir’s roots in Muar, Johor, where his parents are from, was also a factor for his new appointment.

“Shahrir as FELDA chairman would help check Muhyiddin’s [former deputy premier Muhyiddin Yassin] strength in Johor as well … Appointing a Johorean will appease some of the Johor settlers,” the source says.

While Shahrir may have had some experience in the plantation sector — he was once the chairman of the Malaysia Palm Oil Board — how well he interacts with the settlers, many of whom are grassroots Umno members — remains to be seen.

FELDA settlers, who are spread out over 54 constituencies, have always been seen as a vote bank for the BN.

Coincidentally, a group of settlers and opposition politicians gathered at Menara FELDA last Friday to protest against the Eagle High deal and submit a memorandum to FELDA.

Isa respected for his loyalty

Isa’s appointment as FELDA chairman in January 2011 was not liked by many. Many sought his resignation at FELDA and FGV, and blamed him for the dismal financial performances at the two entities.

For its financial year 2014, FELDA suffered a net loss of RM1.04 billion. Its FY2015 financials have yet to be filed. For its nine months ended September 2016, FGV suffered a net loss of RM98.20 million on revenue of RM12.09 billion.

As Isa is the non-independent non-executive chairman of FGV, it is unlikely that he is involved in the actual operations of the plantation company.

Among the reasons he is viewed unfavourably is that in the 2004 Umno elections, he obtained the most votes among the candidates for the three Umno vice-president posts in 2004, but was found guilty of money politics by the disciplinary committee and suspended for three years.

However, he does have his strengths, including an understanding of the Malay heartland and familiarity with grassroots voters, which will come in handy in an election year.

He is respected for his loyalty, and did not leave Umno even when he was suspended, says a political observer.

Save by subscribing to us for your print and/or digital copy.

P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.