Another waste of tax payers monies.
In the 1st instance, who gave them the idea to form this subsidiary thinking they can manage their own properties and plantations?
The subsidiary was officially incorporated, formally approved in Dec 2001 by the then Minister of Primary Industries (the predecessor to today's Ministry of Plantation and Commodities) and officially began its operations on July 1, 2002.
The primary intent then was to commercialise and generate alternative revenue for the board by professionally managing its vast landbanks, real estate, and plantation assets, rather than keeping public properties idle.
Was that a bold and visionary intent or a foolish belief that a statutory body can and knows how to generate alternative revenue in the commercial world?
The governance model where a statutory body operates a dedicated corporate subsidiary to manage commercial real estate is definitely not a financially viable option.
Furthermore, direct asset holding can expose public statutory bodies to political interference or unfavorable land deals.
Expecting a statutory body to thrive in the commercial real estate and plantation markets is inherently flawed.
LGM’s legal mandate is research, development, and regulation of the rubber industry.
Its institutional DNA is composed of scientists, researchers, and bureaucrats—not property developers, asset managers, or commercial traders.
Public sector entities operate under strict bureaucratic compliance, procurement rules, and civil service mindsets.
Commercial real estate requires agility, rapid risk-taking, and aggressive market-driven decision-making.
Merging these two worlds as shown in LGM results in the worst of both: slow public-sector speed combined with private-sector commercial risk.
The fact that LGM Properties Corporation (LGMPC) eventually ballooned its operating costs to RM30–40 million annually—forcing the government to step in, execute a mutual separation scheme for staff, and hand property management back to the private sector, as announced by the Plantation and Commodities Minister in Parliament recently where she said LGMPC will be rendered dormant and hand properties over to independent commercial managers, is clear proof that the original belief was foolish.
While the intent to unlock value from idle public assets was visionary, the execution mechanism was clearly flawed.
The mistake wasn't trying to monetize the assets; the mistake was believing a government-owned subsidiary could do it better than the open market.
The current policy shift—where LGM retains asset ownership but delegates day-to-day operations to external, private-sector experts—is an admission that statutory bodies should stick to regulation and governance, leaving commercial execution to the professionals.
What happened at LGM and the fate of its subsidiary, LGM Properties Corporation (LGMPC), serve as a stark warning to dozens of other federal and state statutory bodies i.e
Badan Berkanun operating under the same modus operandi e.g agencies like FELDA, MARA, RISDA, FELCRA, and various State Economic Development Corporations (SEDCs) which historically have created extensive networks of commercial subsidiaries to manage land, property, and agricultural investments.
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