Economic analysis on oil palm plantation establishment and its impact towards local community: a case study at Kunak, Sabah / Marwan Taupiang

According to Miller (2015), Oil palm is a significant contributor to Malaysia’s economy. At a local level, oil palm development has played a significant role in reducing rural poverty and improving infrastructure. At the same time, oil palm industry will generate the income to the local community , however, there is still lack of information regarding to the oil palm establishment whether it has a positive effect on the economic development of rural people or not. This study is an effort to analyze the relationship between the establishment oil palm plantations with economy of local rural people. Also, this research will assess the most significant variable of oil palm plantation establishment affecting the economy of local community. Location of this study was done in Madai estate, Kunak and for the primary data, it was collected by survey the respondent from Kampung Ulu Madai, Kunak. Sample of respondent for this study was 71 from 86 populations. Methods of data collection used were using interview and secondary data collection from the companies. Data analysis that was used to analyze the data is descriptive analysis and correlation method. Results showed that most of the variables have the positive relationship impact on oil palm establishment towards local community. As a conclusion, the entire variables highlighted are directly and indirectly affect the local community. It was recommended that the government and the stakeholder to maximize the land expansion and sustain the oil palm industry to improve the economy of rural people.