An Eel Kingdom in the Jungles of Malaysia

The world's largest eel farm, Song Cheng Enterprises, is located in the state of Pahang, on the east coast of Malaysia. It takes an hour by vehicle to get there from the Kuantan airport. Although the route is long, because the roadside scenery is so enchanting--mostly palm oil trees, one of Malaysia's special products, with a vast, seemingly limitless plain, and clear open skies occasionally broken up by a raised Malay house--and the land so large and the people so few, driving is fast and even soothing. The only thing is that you have to keep an eye open all the time for the periodic slow-moving ox on the edge of the road.

"This stretch of highway is equivalent to our own production path," laughs Lin Tung-kuo, chairman of the Song Cheng. If you drive by at night, someone unfamiliar with the area might ask when seeing the lights of the eel farm, "When did they build that little airport?" And no wonder -- the lights of the eel farm stretch out for 5,000 meters, which is a good bit longer than the average 3,000 meter airport runway!

Lin Tung-kuo, who had originally been a ship wrecker in Taiwan, established Song Cheng industries in 1975. Besides operating 20 chia (1 chia=10,000㎡) of eel farms, even more attention is paid to eel processing. With annual processed exports of about 3000 tons, you could say this was one of the top "bigshots" in the aquaculture industry. Lin, who is simultaneously the chairman of the Taiwan Shrimp Farming Development Foundation, a director of the Eel Export Association, and a director of the Frozen Aquaculture Association, notes that Japan has always been the major market for exports of eel from Taiwan. Because Japanese think it's too hot during the seventh month of the lunar year, they have the custom of eating eel, which in the tradition of Chinese medicine can compensate for losses the body suffers from excessive heat. Japan also has a holiday known commonly as "Eel Day," on which the whole country eats eel to mark the event. So you can see the degree to which Japanese love eel. Because of this, Japanese consume at least 100,000 tons a year.

"The supply of eel for export to Japan can't meet demand, but since Taiwan is too small and labor is expensive, it's very difficult to expand the scope of eel farming. So we have always been alert for investment opportunities abroad," says Lin. At first, the Malaysian government wanted to rent 200 chia of land to him. "In pingtung [in southern Taiwan], to have a five chia eel farm is already miraculous--how could we deal with 200 chia?" Also, friends and relatives worried about anti-Chinese sentiment in Southeast Asia, that Malay sian law stipulates that local people must hold 60% of the ownership of foreign investments, and other problems, so that the investment idea was shelved. "We also looked at Thailand, the Philippines, and mainland China," says director and administrative manager Felix S.S. Luo. In Thailand, they could speak neither English nor Chinese; in the Philippines the political situation is unstable; and the mainland had no basic infrastructure, and you have to go into your own pocket to pay for roads, or put up power lines. None of these places was ideal. In 1988, in order to attract foreign investment, the Malaysian government set a policy of incentives. In any case where more than 80% of the product would be exported, the foreign investor could have complete ownership. Add to this that there are many Malaysians of Chinese descent, who have bilingual education in Chinese and English from childhood, so that communication is easy. Also, the prices for land and labor are inexpensive. So in the end Song Cheng chose Malaysia. But this time the amount of land they rented wasn't 200 chia--it was 2,000.

"Before signing the contract, Malaysian officials first came to Taiwan to inspect," recalls Lin. "They felt that, given the scope of Song Cheng operations, that we could successfully develop in Malaysia, so they decided to rent us 2000 chia."

Two thousand chia of eel ponds would break the world record.

"A lot of People said we were crazy," explains Felix Luo. There had never been an operation of such scope before. And no one had ever been successful doing it in Malaysia before. "This was Mr. Lin's vision, so we had to pull it off for him," recalls Luo, who seems to exude that special acumen and entrepreneurial spirit so typical of Hongkongers. At that time during negotiation of investment conditions between Song Cheng and the Malaysian government, "Song Cheng prepared in great detail, doing comprehensive analyses of the local banking system, labor system, political climate, tax system, and weather reports for the previous ten years. We even dug wells in several prospective sites to check the water resources. In the end we decided to invest in Pahang state, because they have abundant water resources and because the state government was most forthcoming," says Lin Tung-kuo.

The support of the state government was one key factor in Lin's moving forward with the project.

"For most Taiwanese who come here to invest, there are five years tax-free," reveals Lin. But it was ten years for Song Cheng. The Malaysian government does not permit foreigners to buy land, but gave Song Cheng 90-year leasing rights, which is about the same time period that the Ching government gave to England for renting Hongkong after the Opium War! Moreover, the state government spent NT$400 million to link power lines from four kilometers away, and added 60 phone lines. They also specially permitted Song Cheng to dredge up sand from the oceanside to build dikes for the eel ponds. And most importantly, the Bank of Malaysia lent financial support.

"Of course this is related to our fitting in with Malaysian national policy--to develop the east coast and to develop agriculture," says Lin, explaining their "good luck." Although Malaysia is an agricultural country, it only has palm oil and rubber as relatively well developed cash crops. They rely on imports for most other agricultural products like fruit, rice, and vegetables. Production of aquatic products is also low, so that agriculture has always been one of the sectors with investment incentives. In the past few years, foreign investment has risen rapidly in things like electronics; but progress in agriculture has not been great. With the investment by Song Cheng to reach US$74 million (the investment by Chang Rung in its container plant in Malaysia was US$67 million), to be made in the eastern part which greatly needs development, naturally the government of Pahang state waswill ing to go all out to accommodate them.

Lin Tung-kuo opens up a blueprint of an already complete plan. Besides expanding the Kuantan airport and the harbor for the benefit of Song Cheng, the state government has also developed a satellite city with a clinic, police station, school, and marketplace capable of holding a population of 15,000. "How many places have governments with that kind of daring?" he sighs.

To call it daring may not be as accurate as saying that the Pahang state government has seen the future: Having only developed one-sixth of its 2000 hectares, Song Cheng already employs 700 staff. It would take 3-5,000 staff to meet the needs of full development, so naturally it was necessary to construct a small city in the vicinity!

Because eastern Malaysia is still primitive jungle, the first thing to do if you want to raise fish is clear away and burn the forest. Felix Luo, who has been present since the plan's creation, recalls that at the beginning workers lived in old shipping containers. Only later was a raised Malaysian style house constructed. Inside there was just a huge bedding platform, with twenty people sleeping side-by-side. There was only one light bulb, so that you couldn't even read. People went to sleep about 9:00 PM. Sometimes when you'd wake up, there would be a bear sleeping by the jeep who hadn't even woken up yet!

Mr. Tang, whose company was responsible for the clearing operation, added: "The bear would come every night looking for food, and if you didn't give it to him he'd come back in the middle of the night and steal it, or even take the whole pot, scaring the pants off the staff!" Because the jungle had grown untended for hundreds of years, the roots and branches of plants were intertwined, there were countless poisonous insects, monkeys, and snakes, and the rain turned the decaying leaves and grass to muck, making clearing difficult. "We've had several earth-movers sink right in," says Mr. Tang. Further, you had to depend on help from above to burn away deadwood; sometimes the fire would be halfway through when the rains would begin, and it would be necessary to wait for the wood to completely dry out again before you could put it to the torch. And then it would often just rain again. Because of these problems, there was a constant struggle to keep up with the work schedule. Sometimes when Mr. Tang would see Felix Luo, he couldn't help but complain. "Why does Chairman Lin get so angry? What's the difference if it takes a day or two more?" Luo would respond that Lin had already invested NT$1.2 billion, and that every day lost was equivalent to a Proton [note: this car is produced in Malaysia, and costs about NT$300,000]. If it were you, what would you do? "Me? I'd scream even more than he does!" says Tang, who knows what it looks like from the boss's point of view.

During the early period of clearing, technicians from Taiwan were busy doing eel-raising experiments. Felix Luo and other administrators were negotiating with the government and banks, and handling all kinds of documents. Director Lin, who loves being "at the front," drove all over keeping an eye on things and resolving problems. "Once he even fell right into the water while on inspection," Luo says, describing his superior as "like a farmer; he can really take a lot of punishment."

Lin Tung-kuo, who is in fact of slight build, half gray, dark skinned, and usually dressed in a gray shirt and white rubbers, laughs and admits,"My father, who is in his 70's, gets the most enjoyment out of going out with me, because other people think we are brothers!"

So what does Lin put himself through all this for? It's all for a dream of "the biggest."

Lin Tung-kuo feels that to realize this dream, it's not for the fleeting glory, but to test his own knowledge and experience. Currently Song Cheng has already developed 200 ponds, with the largest being 9,000 (1 p'ing = 36ft2), and the smallest 1,000 p'ing, whereas fish ponds in Taiwan usually run from about 1,500 p'ing to about 3,000 p'ing, and the largest in Japan are only about 3,000 p'ing. Professor Iwata of the Department of Aquaculture at Tokyo University says that you could get ten Ph.D. dissertations just on the technical problems arising from "large scale" or on how to resolve the problems of extended periods of temperatures of 29 degrees Celsius. "Everything is novel," says Lin, and they have to grope their way through everything from management to cultivation.

Take for example eel feed. In Taiwan it is customary to use powdered feed, but Song Cheng uses floating feed. The advantage is that you can scoop what's left over from the surface, whereas the powdered feed sinks in and pollutes the water quality. Also, it's easier to determine the precise amounts for feeding the next day.

Systematic management is another starter project. Because Taiwan aquaculture is usually one or two chia, a husband and wife can take care of a unit alone. If the eels have an especially good appetite today, and don't get enough to eat, you just tap another can of feed. But Song Cheng has too many "dependents," and takes over 3,000 cans of feed daily. Felix Luo points out that the cultivation department must tell the feed department how much it will need one day in advance, so that there will be enough time to get everything ready for the second day. How to prepare it, how to deliver it, how to collect it, wash it, and so on are all being worked out from scratch to develop an entirely new management system.

Water quality also needs management. "In fact, the real task of cultivating aquatic products is cultivating water quality," says Luo, originally a student of business administration who is now an aquaculture specialist after two years on the job. He says aquaculture is a manmade environment; if the water quality is poor, then the eels will be ill.

"An aquaculture business had better be able to do water quality analysis," says Lin. But in Taiwan, because most ponds are too small, most operators just rely on their experience to do a "naked eye estimate," so that there are often major problems. Only then will they ask the aquaculture lab to help out with a water quality test. But the Song Cheng is large, and hopes to develop systematic management, so that as soon as it got to Malaysia it began to put this ideal into place. "We've spent roughly NT$10 million on equipment," reveals Lin Tung-kuo.

Currently, there is testing and release of a report every day. "We hope to create optimum conditions for growth, so that in the future all we need to do is duplicate the same type of environment," says Chen Chen-jung, a specialist in water quality analysis. Behind all this is Song Cheng's great operational ambition: to use the least amount of land and feed to raise the greatest amount of fish!

But eels are like infants, and need to be looked after carefully. Lai Chung-yi, a researcher at the Lukang Branch of the Taiwan Fisheries Research Institute, says that many Taiwanese are unsuccessful when they go to the Philippines or Thailand to raise eels, because the local workers are too rough, so that the eels are either squeezed to death or starve.

There is no such problem at Song Cheng, because they use skilled people as much as possible. "We're like a little United Nations here; we've got Taiwanese, Hongkongers, Canadians, Japanese, Koreans, Malays, and Indians," counts off Lin Tung-kuo. These people are all known from his contacts across the world from the eel business, brought together here to take on the world. But the thing that's most important for the eels are the thirty or forty "old hands" brought from Taiwan, who have been temporarily transferred from the Song Cheng main office in Pingtung.

For example there's Wu Tien-hsiang. Every day at dawn he makes the rounds of the ponds, and sees whether or not the fish are "sticking their heads out of the water." If they are, they are either sick or there's not enough oxygen in the water. If it's the latter they have to turn on the water wheel and add oxygen. Later, when the feed truck arrives, Wu shuts down the other water machinery except for one or two near the feeding area. This will attract the fish to swim to the area for chowtime. Wu observes the fish while they eat, "and I have to make a record every day." Fortunately eels eat quickly, with just a flash of their skin as they turn. After just a few minutes, they've picked the place clean, and the pond regains its tranquility. After "waiting on" the fish while they eat, he turns the other water wheels back on, increasing the flow of water. At this time the wheels become exercise machines, forcing the eels through an after-dinner swim. When these tasks are finished, Wu can hop on his motorcycle and go back for his own breakfast.

Besides the old veterans, also cooperates with the aquaculture department at the Malaysian Agricultural University, permitting its students to do work-study or practicals at the farm, with both sides benefiting greatly. The processing plant has hired Malaysian Overseas Chinese who have gone to Taiwan to attend the "Overseas Youth Technical Training Class."

Since the beginning of clearing the jungle in 1989 to today, with production of 20 to 40 tons of eel daily, it is impossible to gainsay the ac complishments of Song Cheng. In particular, few investors in Malaysia are able to achieve this kind of scale and coordination with the needs of Malaysia's national development policy. As a result, last year the Sultan of Pahang state awarded Lin Tung-kuo with a SIMP title. This is an award given to someone who has accomplished much in society. It has five classes, with Lin winning the award First Class. He is the first person from Taiwan to win the award.

Though the award title is now engraved on his name card, Lin still drives around in a jeep through the jungle overseeing Phase Ⅱ of the project. "I have no time to feel tired," says Lin. After two years, he has learned one thing: If there's a problem, just go solve it, and don't be afraid; you can either laugh or cry, so why not just laugh and go solve it? And if you don't demand too much, and just resolve one or two problems a day, then wouldn't you find that 100 problems have been solved before you know it? Besides eel, Lin hints that he might raise other fish products. Already people have been in contact from Africa and Latin America, trying to get him to invest in those places. And when Japanese come, they wonder how their few thousand p'ing can compete with a place like this. These kinds of things help compensate for the two years of hard labor.

In the dense jungles, under the leadership of Lin Tung-kuo, a group of workers labor earnestly, extending Taiwan's vitality under the warm sun of this southern land.

[Picture Caption]

(Right) Every day at six, Wu Tien-hsiang comes to see how his charges like their morning meel.

(Left) This photo shows the one-sixth of the Song Cheng eel farm that has already been developed in Malaysia. (photo courtesy of Lin Tung-kuo)

Each eel large and small has its value, and the bigger they grow the more they're worth. Dipping in your net is like skimming for money.

Each morning the feed department is too busy even to say hello. They deliver 3,000 cans of feed, and not one can be late.

There is a great concentration of skilled people at the farm. Lin Tun g-kuo (second from right) is here seen talking aquaculture with friends from Korea and Japan.

In the early stages of development, everybody lived in this type of house, and the director was no exception.

The eel processing department already has 230 workers. But it's likely that won't be enough, because there are still more than 100 tons of eel in the pond.

Everything must be worked out as they go along. Even though he's had a busy day, Lin Tung-kuo must work overtime, here with his wife viewing videotapes of each area of cultivation looking for ways to improve.

Phase Ⅱ of construction is already picking up steam. Everyone down on the farm can see Lin Tung kuo every day driving around in his jeep.

Lin's investment is of no small importance to local development. He was the first Taiwan businessman to be awarded the title of Datuk by the sultan.

One cannot forget one's customs in a new place. Song Cheng has built a small temple to appeal to the local god of the earth for protection.

（Right） Every day at six, Wu Tien-hsiang comes to see how his charges like their morning meel.

Each eel large and small has its value, and the bigger they grow the more they're worth. Dipping in your net is like skimming for money.

Each morning the feed department is too busy even to say hello. They deliver 3,000 cans of feed, and not one can be late.

There is a great concentration of skilled people at the farm. Lin Tun g-kuo （second from right） is here seen talking aquaculture with friends from Korea and Japan.

In the early stages of development, everybody lived in this type of house, and the director was no exception.

The eel processing department already has 230 workers. But it's likely that won't be enough, because there are still more than 100 tons of eel in the pond.

Everything must be worked out as they go along. Even though he's had a busy day, Lin Tung-kuo must work overtime, here with his wife viewing videotapes of each area of cultivation looking for ways to improve.

Phase Ⅱ of construction is already picking up steam. Everyone down on the farm can see Lin Tung kuo every day driving around in his jeep.

Lin's investment is of no small importance to local development. He was the first Taiwan businessman to be awarded the title of Datuk by the sultan.

One cannot forget one's customs in a new place. Song Cheng has built a small temple to appeal to the local god of the earth for protection.