The Implementation of Contract Farming of Fresh Fruits and Vegetables (FFV) for Smallholders in Malaysia: Government Roles and Initiatives

Abstract

Contract Farming (CF) in Malaysia has been identified as a system capable of stimulating agricultural production and was given a central role in the latest strategy by the government to encourage the production of vegetables and fruits. It is also seen as a means of fostering smallholder participation in new high-value product markets and improving quality standards, thus the application of CF is increasing the smallholder incomes. This paper is a review study that contributes to defining the role of the government in fostering the CF in Fresh Fruits and Vegetables (FFV) for smallholders in Malaysia. The purpose is to understand the relation between CF and the country’s economic growth as well as farmers’ standards of living. The findings of this paper indicated that the government plays an important role in fostering the CF of Fresh Fruits and Vegetables (FFV) of smallholders in Malaysia. Indeed, the development of programs (Contract Farming Programme), effective management method, and strong commitment from the players, and strong support from the government are considered as the strongest tools for facilitating economic growth and improving farmers’ standards of living in Malaysia.