MONROVIA – Sime Darby Plantation, a major concession company in Western Liberia, would pull out of the country by the end of this year, the company has disclosed.
Report by Lennart Dodoo, [email protected]
The company made the disclosure in Kuala Lumpur, Malaysia, over the weekend, stating that it will sell its land in Liberia by end of the year under the group’s asset monetization strategy under which sale proceeds will be used to cut borrowings.
The decision, FrontPageAfrica gathered is going to be a hard hit on the Liberian economy, especially so when the new company taking over is not prepared financially to pump in not less than US$1.2 million monthly as Sime Darby has been doing.
A senior staff at the plantation company who asked for anonymity said, “Sime Darby contributes US$1.2 million every month, whether it is by taxes, income taxes, through purchasing, etc. So, you can see that a lot is going to change after they shall left in December.”
The company has employed over 1,700 workers in the region. Western Liberia is said to be one of the most impoverished regions in Liberia.
Sime Darby began scaling down its operation in Liberia since July this year. 350 persons were laid off in July and up to 750 in total have been redundant since July this year.
The oil palm grower had signed a 63-year concession agreement with the Liberian government to develop 220,000ha in Grand Cape Mount, Bomi, Gbarpolu and Bong Counties into oil palm and rubber plantations. To date, 10,508ha have been planted in five estates, namely, Matambo, Grand Cape Mount, Zodua, Bomi and Lofa. Out of the total planted area of 10,508ha, 10,401ha are planted with oil palm and 107ha with rubber.
Group managing director Mohamad Helmy Othman Basha said the group’s Liberian unit, which has a land bank of more than 10,000ha there, has been continuously loss-making over the years.
He said Sime Darby Plantation is in talks with three parties on the planned sale.
“Liberia asset remains loss-making but we are quite confident that in the next few months we will exit in an appropriate manner. We have been present there for more than 10 years, so when we leave, we want to do so in the best way possible.
“We have informed the Liberian government of our intention to exit,” Mohamad Helmy said at the group’s first half results press conference here today.