BANKS MUST SHED AGE-OLD NEGATIVE PERCEPTION ON AGRI SECTOR, SAYS ECONOMIST

By Mumtaz Aini Alivi
KUALA LUMPUR, Aug 13 (Bernama) -- Banks and financial institutions must be more open and be positive on the prospects of the agriculture sector in disbursing loans as it promises lucrative, says an economist.

Mohamad Salleh Majid, who concurred with Prime Minister Abdullah Ahmad
Badawi, that banks should give serious attention to address the
negative perception, said a change in mindset was crucial to ensure no
agriculture industry failed or could not be developed due to financial
constraints.

"I fully agree with the prime minister's call to banks to shed their low opinion on the potentials of the agriculture sector. The prime minister's concerns are real as it is indeed true that banks are not
agriculture-oriented.

"They have a scant opinion on those applying for loans to invest in
agriculture projects. The agriculture industry is no longer like before. It has
now ventured into modern technology to produce quality yield in large
quantities.

"If banks continue with their lack of confidence in agriculture, the sector
cannot be developed and will not only create problems to farmers but also to the
nation by having to import more food products.

"So long banks and financial institutions don't shed their age-old
perception on agriculture, until then it will be difficult to expand the sector.

"They will always look at collaterals though an agriculture project may
have
the potential to rake in lucrative returns," the former Bursa Saham Kuala Lumpur
president told Bernama Wednesday.
-- BERNAMA