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https://theedgemalaysia.com/node/620715

Building desirable homes

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KUALA LUMPUR (May 22): SkyWorld Development Group Sdn Bhd aims to continue improving on building and designing quality properties for homebuyers. CEO Lee Chee Seng notes that the developer is focused on creating value for buyers, and that he hopes buyers will be able to enjoy comfortable and quality living conditions when they purchase properties from SkyWorld.   SkyWorld’s projects also take into account environmental, social and governance (ESG) factors, he added, such as preserving the surrounding environment, as well as keeping the construction site clean by having a proper drainage system to prevent excess water from accumulating either on the ground or underground. SkyWorld has four projects in the pipeline, namely Curvo Residences in SkyArena in Setapak; SkyRia by the Hills in Desa Melawati; SkyAmanyi in Cheras; and The Vesta Residences in SkySierra in Setiawangsa — all of which are slated to be launched in the second half of this year (2H2022).  Read more about it in the latest issue of City & Country, which comes out with The Edge Malaysia weekly's May 23, 2022 edition.

https://theedgemalaysia.com/node/650750

Japan's Nov real wages fall most in eight years, defying BOJ objective

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TOKYO (Jan 6): Japan reported on Friday (Jan 6) its worst real-wage decline in more than eight years, with November data highlighting the elusiveness of the central bank's objective of reinforcing inflation and the economy with sustained rises in workers' pay. The 3.8% annual fall in inflation-adjusted wages heightens the urgency of Prime Minister Fumio Kishida's push for upcoming talks between labour and management to deliver wage hikes that outpace rises in living costs. Japan wants inflation that is led by demand and higher pay, rather than the current cost-push inflation driven by high commodity prices and a weak yen. Bank of Japan Governor Haruhiko Kuroda has also repeatedly stressed the need for price rises to be accompanied by wage growth. While looking for that, the central bank is keeping its policy ultra-loose. "Regardless of who replaces Kuroda when his term ends in April, wage growth will hold the key to the outlook for monetary policy," said Takeshi Minami, chief economist at Norinchukin Research Institute. Adding to the challenge, Friday's data showed that annual growth in wages before adjusting for inflation had slowed markedly in November, reflecting slow recovery from Covid-induced doldrums. Kishida this week urged firms to implement wage hikes that exceed the rate of inflation to prevent stagflation. With record profits, Japanese firms have piled up internal cash and other reserves that by September were worth ¥500 trillion (US$3.7 trillion). In the wage talks, due to end in March, the companies are expected to offer pay rises of around 2.7%, versus the previous year's 2.07%. Still, that would fall far short of the 5% demanded by the Japanese Trade Union Confederation, known as Rengo, and would not match core consumer inflation, which is at a more than four-decade high. Sluggish wage recovery remains a pressing issue for Japan as surging living costs hurt households and weigh on consumer spending in the economy, the world's third largest. November was the eighth straight month to show an annual fall in real wages, which were undercut by inflation. The month's 3.8% fall was the greatest since a 4.1% drop seen in May 2014, when real wages had been affected by rises in sales tax, the labour ministry said. The consumer price index that the ministry uses to calculate real wages, one that includes fresh food but not the rent value of owner-occupied homes, was 4.5% higher in November than a year earlier, the quickest pace of increase since June 1981. Nominal total cash earnings were up an annual 0.5% in November, but the pace of growth slowed from a revised 1.4% gain seen in October, led by falls in special payments such as bonuses.

https://theedgemalaysia.com/node/677832

Wanda executive taken away by China’s police — local media

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(Aug 8): A senior executive of Dalian Wanda Group Co was taken away by police in China, according to a local media report, spurring fresh concerns over the conglomerate.  Liu Haibo, a senior vice-president of Wanda Group, was taken away by the police, state-owned The Paper reported, citing unidentified people. The report didn’t offer further details. A representative of Wanda didn’t comment when reached by Bloomberg News. Liu has been at Wanda for more than a decade, working as the vice-president of its former commercial properties unit, and later as a senior vice-president at the headquarters, according to various statements on the company's website. He was still at the firm as of July 25, when he accompanied chairman Wang Jianlin on a business trip to meet city officials in the central Henan province, according to a company statement.  Wanda has experienced unprecedented volatility in credit markets recently. The conglomerate is one of the few Chinese junk-rated developers to have avoided defaulting on public dollar-debt. Some offshore bonds issued by Wanda units fell after the news, according to prices compiled by Bloomberg. A note due January 2024 had declined 0.8 cent to 49.6 cents as of noon. 

https://theedgemalaysia.com/node/673532

Musk, Zuckerberg lead a US$852b surge among world’s richest people

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(July 4): The world’s 500 richest people added US$852 billion (RM3.96 trillion) to their fortunes in the first half of 2023. Each member of the Bloomberg Billionaires Index made an average of US$14 million per day over the past six months, according to data compiled by Bloomberg. It was the best half-year for billionaires since the back half of 2020, when the economy rebounded from a Covid-induced slump. The gains coincided with a broad stock market rally, as investors brushed off the effects of central bank interest rate hikes, the ongoing war in Ukraine and a crisis in regional banks. The S&P 500 rose 16% and the Nasdaq 100 surged 39% for its best-ever first half as investor mania over artificial intelligence boosted tech stocks. While Elon Musk and Mark Zuckerberg flirt with scheduling a cage match, Tesla Inc’s chief executive officer came out on top in dollar terms. Musk, the world’s richest person, added US$96.6 billion to his net worth this year through June 30, while Meta Platforms Inc CEO Zuckerberg gained US$58.9 billion. Gautam Adani’s net worth sank the most in the six-month period, losing US$60.2 billion. Adani, chairman of Adani Group, also posted the biggest one-day loss of any billionaire, shedding about US$20.8 billion on Jan 27, after short seller Hindenburg Research accused his conglomerate of accounting fraud and stock manipulation — a claim Adani denies. Hindenburg, founded by Nate Anderson, also knocked down the net worth of another billionaire: Carl Icahn. His Icahn Enterprises LP had its steepest one-day drop after Hindenburg disclosed it was shorting the shares, saying the stock was significantly overvalued relative to its holdings. Icahn’s net worth fell US$13.4 billion, or 57% — the largest percentage drop of any member of the Bloomberg Billionaires Index in the period. For Musk, the wealth gains spilled over into July as Tesla shares climbed 6.9% on Monday (July 3) in New York, tacking on an additional US$13 billion to his fortune.

https://theedgemalaysia.com/node/678207

Home Ministry enforces ban on publications related to LGBTQ+ on Swatch watches, collections

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PUTRAJAYA (Aug 10): The Home Ministry has gazetted an order prohibiting publications related to lesbian, gay, bisexual, transgender, queer and plus (LGBTQ+) on Swatch brand watches, including any collections of boxes, wrappers and accessories of the watches. The ministry in a statement on Thursday (Aug 10) said that the prohibition order through Government Gazette P.U.(A) 236 came into force on the same day. The statement said that the prohibition order is in line with the provisions under Section 7(1) of the Printing Presses and Publications Act 1984 (Amended 2012). The provision stipulates that printing, importing, reproducing, publishing, selling, producing, circulating, distributing or possessing such a publication is strictly prohibited in Malaysia. "The result of the publication is subject to a prohibition order, because it is the result of a publication that harms or may harm morality, public interest, and national interest by promoting, supporting, and normalising the LGBTQ+ movement, which is not accepted by the general public in this country," said the ministry. Based on the provisions under Section 8(2) of the Printing Presses and Publications Act 1984 (Amendment) 2012, any individual who prints, imports, produces, reproduces, publishes, sells, issues, circulates, offers to sell, distributes, or has in his possession for any such purpose as a result of the publication of a prohibition, commits an offence, and if convicted he may be imprisoned for a period not exceeding three years or fined not exceeding RM20,000, or both, it said. The ministry said it is committed to maintaining public safety and order through the supervision and control of publications in order to combat the spread of elements, beliefs, and movements that conflict with local socio-culture from time to time continuously, in line with the provisions under the Printing Presses and Publications Act 1984 (Amendment ) 2012. "The Malaysian government is committed to preventing the spread of elements that are harmful or may be harmful to morality, public interest, and the country among the community," said the ministry. In May, the ministry reportedly raided 11 Swatch brand watch boutiques in several states, and seized rainbow-themed collections often associated with the LGBT community. Read also: Aug 23 leave hearing for Swatch's bid to challenge 'rainbow' watches seizure Swatch Malaysia takes Putrajaya to court over ‘rainbow’ watches Frankly Speaking: Seizure of Swatch’s rainbow watches is ridiculous Malaysian authorities raid Swatch stores over rainbow Pride Collection

https://theedgemalaysia.com/node/630426

Metronic, Classic Scenic, Fibon, Jentayu Sustainables, PCCS, Rohas, Teladan, PGF, Sedania

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KUALA LUMPUR (Aug 1): theedgemarkets.com highlighted nine stocks with momentum at Bursa Malaysia’s afternoon close on Monday (Aug 1). Seven stocks showed negative momentum, while two stocks had positive momentum. The stocks with negative momentum were: Metronic Global Bhd — unchanged at 14 sen Classic Scenic Bhd — up 2.5 sen at 79 sen Fibon Bhd — up three sen at 39 sen Jentayu Sustainables Bhd — up two sen at 51 sen PCCS Group Bhd — up two sen at 57.5 sen Rohas Tecnic Bhd — up 1.5 sen at 30 sen Teladan Setia Group Bhd — up nine sen at 83 sen The stocks with positive momentum were: PGF Capital Bhd — up three sen at RM1.18 Sedania Innovator Bhd — down one sen at 42.5 sen The list of stocks with momentum is generated using a proprietary mathematical algorithm highlighting stocks with a build-up in trading volume and price. The algorithm differentiates between stocks that exhibit positive (+ve) momentum and negative (-ve) momentum. This list is not a buy or sell recommendation. It merely tells you which stocks are seeing higher-than-normal volume and price movements. The share price may move up or down from this point. But the “+ve” (suggesting a rising price trend on volume) and “-ve” (suggesting a falling price trend on volume) indicators should give readers a better idea of what the market is buying and when to sell. Note also that momentum generally only persists for a short period of time. However, each stock has an accompanying fundamental score and valuation score to help readers evaluate the attractiveness of the stocks if they want to ride the momentum. For more detailed financial information and reports on the above-mentioned stocks, please subscribe to AbsolutelyStocks at www.absolutelystocks.com

https://theedgemalaysia.com/node/644881

Alternative Views: The crown will sit heavily on whoever takes Putrajaya after GE15

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This article first appeared in Forum, The Edge Malaysia Weekly on November 21, 2022 - November 27, 2022 In an unprecedented move, the government is guaranteeing a RM6 billion loan taken by Tenaga Nasional Bhd to ease its cash flow because the utility company is not allowed to pass on the higher cost of generating and supplying electricity to households. The guarantee came about as Tenaga’s finances deteriorated owing to the freezing of the Cost Pass Through (CPT) mechanism since the pandemic broke out in March 2020. Under the mechanism, Tenaga could pass through the additional cost incurred in generating electricity to end-users. However, to ease the public’s burden, the government stopped the utility giant from increasing tariffs. In return, the government will compensate Tenaga to the tune of RM5.9 billion. In lieu of the compensation, it has given the utility a guarantee for the purpose of raising RM6 billion in funding. The economy started to open up in March this year and by May, life was back to normal in most economic sectors. But Tenaga was forced to continue to supply relatively cheaper electricity owing to the populist policies adopted by successive governments since March 2020. Malaysia has had two governments since February 2020 and both had razor-thin majorities. The Perikatan Nasional and Barisan Nasional governments continued adopting populist policies to please the people. Tenaga’s receivables increased by almost 100% to RM19.2 billion as at June this year from RM10.5 billion last December. Net cash flow from operations fell to RM1.9 billion as at end-June compared with RM9 billion in the corresponding period last year. Tenaga’s deteriorating financial situation has impacted its valuations. Before the pandemic, in December 2019, its market capitalisation was RM12 billion. Today, it is RM8.5 billion. Energy prices worldwide have gone up significantly. But in Malaysia, it has been kept artificially low — thanks to the huge subsidy borne by the government. It is not just the price of electricity that has been kept artificially low. Prices of petrol, gas for households and some essential food items have also been kept low by the government. All these goodies will be removed in the months after the general election on Nov 19, irrespective of who rules in Putrajaya. The subsidies and social assistance are over and above the direct financial assistance that the government provides to households and individuals under Bantuan Keluarga Malaysia (BKM). The allocation for BKM was RM8.4 billion this year and it will not be reduced in the next few years. In the last two years, the government subsidy and social assistance bill surged significantly due to the higher prices of food and petrol. While Malaysia benefits from the higher crude oil and crude palm oil prices, the amount it pays out in the form of subsidies to the people is far greater. This year, the subsidy bill is expected to be RM80 billion, way higher than the RM31 billion initially estimated. For next year, the government has almost halved the allocation to RM43 billion. This means the supply of relatively cheaper electricity will have to stop. Prices of petrol at the pump will have to start going up to reflect the global trend. The policy today is a blanket subsidy that benefits all segments of the population. It breeds inefficiency and inequality. The rich get to enjoy the cheaper food and fuel just like the poor. The previous government was looking at implementing targeted subsidies from next year, which is obviously the way forward. But can it be done without drawing protests from the people? Another unpopular measure that the next government will have to take is increase the tax base. Malaysia’s tax revenue as a percentage of gross domestic product is estimated at 12%, lower than the global benchmark of 15%. All political parties agree that a tax based on consumption is fairer and more efficient than the current structure. In 2015, the government introduced the goods and services tax (GST), which was hugely unpopular because of weak implementation. The GST was dropped in 2018 and replaced with the sales and service tax. It resulted in the federal government’s coffers seeing a net reduction in income for that year alone by about RM13 billion. The spending spree will end this year. The Fiscal Responsibility Act (FRA) will be introduced and the cabinet has approved the tabling of the bill in parliament when it resumes after the general election. The FRA’s purpose is essentially to discipline government spending and to curb the exposure on the “off-balance sheet guarantees” it gives to government-endorsed projects or entities such as 1Malaysia Development Bhd (1MDB). At the moment, financial institutions consider government guarantees to be as good as sovereign guarantees. It has led to a major hole in government expenditure. From the controversial Port Klang Free Zone project and Felda’s acquisition of Eagle High Plantations in Indonesia to the 1MDB scandal, all of it involved government guarantees that are finally borne by taxpayers. After Nov 19, the celebrations for the party that wins in Putrajaya will be short-lived. One of the first things that will need to be approved is Budget 2023. It is highly unlikely that a single coalition will be able to command an absolute majority by winning 112 seats in parliament. Horse trading will take place and a government consisting of unlikely partners may be in power. The new government will need to stop dishing out goodies such as cheap electricity. Interest rates will have to go up as it has in the US and other developing countries despite resistance from politicians. A higher interest rate regime leads to slower investments and job losses. It is already happening in the US. A new marriage of different parties will likely control Putrajaya, but the honeymoon period will be short. M Shanmugam is a contributing editor at The Edge Malaysia Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/652451

France hit by disruptions as unions start pension strikes

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PARIS (Jan 19): Strikes coordinated by French unions brought significant disruption to the country on Thursday, as they protest against government plans to revamp the pension system and test President Emmanuel Macron’s ability to resist street pressure. Workers in sectors including railways, schools and energy are taking part in the 24-hour strike against Macron’s plan to raise France’s minimum retirement age to 64 from 62. Unions are leading marches across France’s largest cities with the backing of left-wing political parties. In a rare show of unity, France’s eight largest labour unions have coordinated efforts and the disruptions have prompted the government to urge people to work from home. Still, the success of the strikes is set to be at least partly measured by the scope of the street demonstrations. Both the CGT union and the head of the Communist party have set a goal of having at least one million people protest across France for what is likely to be just one of a series of actions. “Come demonstrate your disapproval of this pension reform,” CFDT union leader Laurent Berger said on Thursday on BFM TV. “It’s massively rejected by public opinion; we need to show it.” Macron’s decision to forge ahead with his reform comes at a difficult juncture for the French economy as it wrestles with power prices that soared last year and as inflation weighs on households and businesses. In an effort to build consensus, Macron has set the proposed minimum retirement age at 64, down from an initial plan to put it at 65, and government ministers have said that they are open to tweaks to the plan during parliamentary debates. Some of Thursday’s largest disruptions were in transportation. Most high speed trains were canceled and an even smaller fraction of regional trains were in service. In Paris, most metro lines were only operating during rush hour and even then at less than half of regular levels. Airlines were ordered by the government body in charge of civil aviation to cut 20% of flights at Orly airport. A walkout by staff at Electricite de France SA lowered the country’s nuclear output by 12% on Thursday, according to grid operator RTE, just as a cold snap is boosting electricity demand. Strikes are disrupting the delivery of fuels from three oil refineries operated by TotalEnergies SE, though the company said it would continue to supply its clients and filling stations. They are also hampering fuel loading at Exxon Mobil Corp’s Fos refinery. Some 42% of primary school teachers were on strike on Thursday, the education ministry said, along with nearly 35% of secondary school teachers. The combined disruptions confirmed Transport Minister Clement Beaune’s warning of “a painful Thursday”.   Macron’s government will submit it’s plan to parliament in early February. Debate there is set to last into March. Although Macron lost his outright majority in June’s parliamentary election, the conservative Republicains party has said it could back the pension bill under certain conditions, giving him a large enough majority in the lower house. Failing that, Macron could still use an article in the constitution that allows bills to pass without a vote.   Making the French work longer is essential to boost relatively low employment rates among seniors and avoid persistent deficits in a system funded by worker contributions, the government has said.  But labor organisations argue that changing the minimum retirement age will unfairly hit the low-skilled and the least wealthy who began working earlier in life. Unions say there are better ways to boost employment among older workers and re-balance the system, including tax increases — which Macron has ruled out.  Public support for the government plan has dropped since it was presented on Jan 10, according to an Ifop poll for Sud Radio released on Thursday. Of those surveyed, just 28% said they supported the reforms, down from 32% last week. Some 58% also expressed at least some support for protests. Macron withdrew a different proposal for pension reform in 2020, following lengthy strikes mainly in transport. At the time, he cited the Covid pandemic as the reason. 

https://theedgemalaysia.com/node/675233

Kuala Terengganu by-election to be held simultaneously with six state polls on Aug 12

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KUALA LUMPUR (July 18): The Election Commission (EC) has set the polling day for the Kuala Terengganu parliamentary by-election to be held simultaneously with the six state polls on Aug 12. EC chairman Tan Sri Abdul Ghani Salleh said the nomination and early voting for the by-election will also be held simultaneously with that of the state polls in Kedah, Kelantan, Terengganu, Penang, Selangor and Negeri Sembilan, namely on July 29 and Aug 8, respectively. He said this at a press conference after chairing the EC special meeting in Putrajaya on Tuesday (July 18). The meeting was held following the decision of the Terengganu Election Court on June 27 to nullify the victory of Datuk Ahmad Amzad Hashim of PAS in Kuala Terengganu during the 15th general election on Nov 19 last year, after finding that the petitioner, Datuk Mohd Zubir Embong of Barisan Nasional, had succeeded in proving that corruption had taken place with the aim of influencing voters in the election for the seat. On July 8, PAS decided that it will not appeal against the court’s decision. Read also: EC meets to set important dates for Kuala Terengganu by-election  EC: Kuala Terengganu by-election requires additional allocation of RM465,000

https://theedgemalaysia.com/node/624705

BFood: Klang Valley's first Paris Baguette outlet to be opened by end-2022

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KUALA LUMPUR (June 20): Berjaya Food Bhd (BFood) said on Monday that its 50:50 joint venture (JV) with Paris Baguette Singapore plans to open the first Paris Baguette outlet in the Klang Valley by the end of 2022. According to BFood chief executive officer (CEO) Datuk Sydney Lawrance Quays, the JV — that was announced on Monday — targets to open five Paris Baguette outlets in Malaysia in a year. Under the JV agreement, BFood — that has a 50% ownership in the venture — will be the principal operator of Paris Baguette outlets in Malaysia, according to Quays. "It (the first store) will be in Kuala Lumpur. We are not at liberty to say where it is because we are still in talks. But generally, we will be looking at bigger and more established malls," Quay said. He was speaking at a press conference at the Berjaya Times Square Hotel on Monday in conjunction with the JV signing ceremony. According to a separate statement, Paris Baguette is a French-inspired bakery brand operated by South Korea-based SPC Group and is the number one bakery chain in South Korea. It noted that the brand owns over 4,000 units globally including 3,400 stores in South Korea and more than 440 locations across the US, China, France, Vietnam, Indonesia, Cambodia and Singapore. It added that Malaysia is its eighth international market in the world. According to the statement, SPC Group has begun the initial stages of building its regional manufacturing and distribution centre named SPC Centre in Johor in its target to obtain halal certification for this centre to cater its business to the Southeast Asia (SEA) and the Middle East markets. "As we look at setting out the facility in SEA, it is clear to us that our market is the Muslim market… of course we want to get the best halal certification. And we recognise that the Malaysian JAKIM halal certification is one of the renowned and best within the region. "We want to make sure the certification is recognised within the Middle East and SEA. We also want to make sure the facility is quite near to Singapore so that it is convenient for us," said Paris Baguette SEA chief executive officer Hana Lee. As for BFood, it said the strategic partnership is part of BFood's broader retail push to be a more inclusive food and beverage group on the Main Market of Bursa. When asked about the pricing strategy of the products, Quay responded that the retail price will be managed to make it affordable for every consumer. At noon break, BFood's share price traded five sen or 1.21% higher at RM4.18, bringing the group a market capitalisation of RM1.63 billion.

https://theedgemalaysia.com/node/651684

Bursa ends at intraday high on improved sentiment

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KUALA LUMPUR (Jan 13): Bursa Malaysia ended the week in positive territory at its intraday high on Friday (Jan 13), taking the cue from the improved performance of regional markets and optimism surrounding China’s reopening as well as the weakening of the US dollar, a dealer said. At 5pm, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) advanced by 6.37 points or 0.43% to reach its intraday high of 1,495.03 from Thursday's closing of 1,488.66. The market bellwether opened 0.61 of-a-point weaker at 1,488.05. Market breadth was positive with gainers surpassing decliners 517 to 382, while 408 counters were unchanged, 895 untraded and 20 others suspended. Turnover decreased to 3.40 billion units worth RM2.02 billion against Thursday's 3.57 billion units worth RM2.75 billion. Rakuten Trade Sdn Bhd vice-president of equity research Thong Pak Leng noted that key regional indices ended mostly higher following the positive cue from Wall Street overnight as easing inflationary pressure in the US may cause central banks to slow down the pace of interest rate hikes. Region-wise, Hong Kong's Hang Seng Index inched up 1.04% to 21,738.66, China’s SSE Composite Index added 1.01% to 3,195.31, South Korea’s Kospi gained 0.89% to 2,386.09, and Singapore's Straits Times Index improved by 0.7% to 3,290.56 However, Japan’s Nikkei 225 slid 1.25% to 26,119.52. “As for the local bourse, we expect the buying momentum to continue given the strong support from the local institutions," he told Bernama. Among heavyweights, IHH Healthcare Bhd added one sen to RM5.99, Press Metal Aluminium Holdings Bhd gained nine sen to RM5.08, Malayan Banking Bhd (Maybank) rose six sen to RM8.86, Petronas Chemicals Group Bhd improved by five sen to RM8.40, and IOI Corp Bhd increased five sen to RM3.99. As for the actives, Serba Dinamik Holdings Bhd added one sen to two sen, NationGate Holdings Bhd increased six sen to RM1.06, Zen Tech International Bhd firmed 1.5 sen to four sen, Velesto Energy Bhd gained 1.5 sen to 17.5 sen, while Dagang NeXchange Bhd (DNeX) declined 1.5 sen to 56.6 sen. On the index board, the FBM Emas Index increased 43.04 points to 10,785.8, the FBMT 100 Index inched up 41.49 points to 10,482.57, and the FBM Emas Shariah Index was 31.87 points firmer at 10,976.72. The FBM 70 Index was 39.2 points better at 13,380.67, and the FBM ACE Index garnered 26.85 points to 5,455.48. Sector-wise, the Energy Index climbed 6.67 points to 822.94, the Technology Index inched 0.67 of-a-point up to 66.96, the Industrial Products and Services Index ticked up 1.48 points to 185.29, while the Financial Services Index rose 83.46 points to 16,621.15, and the Plantation Index gained 0.29 of-a-point to 6,922.91. The Main Market volume was higher at 2.09 billion shares worth RM1.53 billion compared with Thursday’s 1.80 billion shares worth RM1.76 billion. Warrants turnover eased to 317.53 million units worth RM65.01 million from 334.13 million units worth RM81.89 million on Thursday. The ACE Market volume decreased to 987.01 million shares worth RM415.28 million from 1.43 billion shares worth RM907.77 million previously. Consumer products and services counters accounted for 216.43 million shares traded on the Main Market, industrial products and services (582.48 million), construction (56.07 million), technology (288.83 million), SPAC (nil), financial services (56.64 million), property (101.2 million), plantation (27.51 million), REITs (8.12 million), closed/fund (nil), energy (634 million), healthcare (59.96 million), telecommunications and media (25.17 million), transportation and logistics (32.41 million), and utilities (9.67 million).

https://theedgemalaysia.com/node/603869

友尼森PDT和IDSS暂停

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（吉隆坡14日讯）大马交易所暂停友尼森（Unisem Bhd）日内的自营交易商（PDT）和即日卖空（IDSS）活动。 马交所在文告中表示，这是由于股价下跌超过15%。 “将于下个交易日，即周一，1月17日，上午8时30分恢复PDT和IDSS活动。” 休市时，友尼森大跌51仙或14.25%，报3.07令吉，市值达49亿5000万令吉。 半天成交量约有894万股，超过200天平均的124万股。   （编译：陈慧珊）   English version：PDT and IDSS for Unisem's stock suspended

https://theedgemalaysia.com/node/609179

Frontken achieves record annual, quarterly profit amid strong demand from customers; declares 2.5 sen dividend

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KUALA LUMPUR (Feb 25): Frontken Corp Bhd's net profit for its fourth quarter ended Dec 31, 2021 (4QFY21) rose 26.9% to a record high of RM29.55 million from RM23.29 million in the corresponding quarter a year earlier, mainly attributable to improved revenue, strict cost management and continual process enhancements that led to better production efficiency. Earnings per share (EPS) for the quarter rose to 1.88 sen from 1.48 sen previously, its filing showed. Revenue expanded by 20.2% to RM121.49 million — the highest quarterly top line seen — from RM101.04 million, thanks to better contributions from nearly all its subsidiaries, in particular its Taiwan semiconductor business which continued to show significant growth due to increased production from its customers to meet the high demand for the advanced node chips, and the improved capital expenditure allocation from oil and gas (O&G) customers amid strong Brent crude oil price. Frontken declared a second interim dividend of 2.5 sen per share, with the entitlement and payment dates to be announced later. This raised its total dividend declared for FY21 to four sen per share, unchanged from FY20. The stronger 4QFY21 earnings also lifted the group's annual net profit for FY21 to a record high of RM104.5 million — up 27.5% from RM81.97 million in FY21 — following a 22.23% improvement in annual revenue to RM450.22 million from RM368.32 million. Annual EPS rose to 6.65 sen from 5.21 sen. Frontken said it saw better revenue contributions throughout FY21 from its subsidiaries in Taiwan, Malaysia and Singapore, and that its net profit was a result of higher revenue and strict cost management. It added that if the job support subsidy received in FY20 was excluded, together with withholding tax and foreign currency impact, for a like-for-like comparison, then its net profit for FY21 would have been 34.1% higher at RM31 million instead. On prospects, Frontken's management is cautiously optimistic about its FY22 performance, but expressed excitement over what lies ahead for the company amid promising business developments. For its semiconductor segment, Frontken said the on-schedule progress of commissioning its new facility in Kaohsiung, Taiwan will enable it to meet its key customers' projected increases in demand for its services. Meanwhile, it said its O&G segment has seen a pickup of new orders from various contracts for the provision of manpower supply and also mechanical rotating equipment services and parts that it has with Petroliam Nasional Bhd and its subsidiaries, amid the timely completion of its new facility in Pengerang to meet the projected additional services demand from its customers. At Friday's market close, Frontken's shares gained 15 sen or 5.17% to close at RM3.05, giving the group a market capitalisation of RM4.8 billion. The stock is now trading at 45.73 times historic earnings, according to Bloomberg data.

https://theedgemalaysia.com/node/620231

XOX subsidiary buying Perak football club for RM1

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KUALA LUMPUR (May 18): XOX Bhd said on Wednesday (May 18) its wholly-owned subsidiary XOX Pro Sport Sdn Bhd on Tuesday (May 17) entered into a share sale agreement with Impact Media & Communication Sdn Bhd for XOX Pro's proposed acquisition of the 100% equity interest in football club owner Perak FC Sdn Bhd for RM1. "XOX views the proposed acquisition as an opportunity to expand its reach further by enlarging its ecosystem to incorporate football," mobile virtual network operator XOX said in a Bursa Malaysia filing. According to XOX, the RM1 purchase price for Perak FC was arrived on a willing-buyer, willing-seller basis after taking into consideration Perak FC's loss after taxation, outstanding liabilities and operational difficulties of the football club. XOX said Perak FC recorded a loss after taxation of RM2.32 million as at June 30, 2021 while net liabilities stood at RM3.5 million. As of December 31, 2021, Perak FC’s outstanding liabilities stood at approximately RM7.1 million, according to XOX. "The XOX Group will [however] not be assuming any liabilities, including contingent liabilities and guarantees arising from the proposed acquisition," XOX said. According to XOX, the proposed acquisition of Perak FC is conditional upon the fulfilment of several conditions within 24 months from the date of the share sale agreement. The conditions include the completion of the financial and legal due diligence on Perak FC by XOX Pro and that Impact Media having repaid Perak FC’s debt in full. XOX said the proposed acquisition of Perak FC is expected to be completed by the third quarter of 2024. Impact Media is an advertising agency. According to XOX, the issued share capital of Impact Media is RM2,500 comprising 2,500 shares which are equally owned by Rehana Mohd Abbass and Mohamad Aimran Razif Roslan. Rehana and Mohamad Aimran are also directors of Impact Media, which is the registered owner of 2,500 shares representing a 100% equity interest in Perak FC, XOX said.  At Bursa's 5pm market close on Wednesday (May 18), XOX's share price settled unchanged at 1.5 sen, valuing the company at about RM75.75 million. XOX's latest-reported number of outstanding shares stood at 5.05 billion, according to the company's Bursa filing on Tuesday (May 17).

https://theedgemalaysia.com/node/670770

PNB’s Prolintas listing back on track

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This article first appeared in The Edge Malaysia Weekly on June 12, 2023 - June 18, 2023 PERMODALAN Nasional Bhd (PNB) has put in place plans to list its highway concessionaire Projek Lintasan Kota Holdings Sdn Bhd (Prolintas) in what could be one of the biggest listings in two years. Sources say the exercise is still being worked out and bankers have been appointed to look into the possible flotation exercise of the company that has six city highways under its belt.  “Prolintas is estimated to raise between US$300 million and US$400 million (RM1.38 billion and RM1.84 billion). The initial public offering (IPO) is expected to be in the fourth quarter of this year, depending on the market condition,” a source says. Another source says, “PNB and Prolintas are in the midst of getting the relevant approvals from the government for the flotation exercise and it is unlikely to face any resistance.” PNB declined to comment when contacted. The country’s largest fund management company stated that “with reference to the enquiries regarding Prolintas, as a matter of policy PNB does not comment on speculation”. PNB and Prolintas are said to be mulling an infrastructure trust model. “It’s similar to the real estate investment trust model,” says a source. Should the deal go through, the Prolintas IPO would be bigger than the listing of Farm Fresh Bhd in 2021 and would be the first infrastructure trust on Bursa Malaysia. According to Prolintas’ latest financial results, the company had total assets of RM17.33 billion as at end-December 2022 — 13.3% higher than RM15.29 billion in 2021. Its total liabilities stood at RM14.32 billion at end-2022, an increase from RM12.51 billion the year before. Prolintas suffered after-tax losses of RM172.68 million for the financial year ended December 2022 (FY2022) compared to a profit after tax of RM142.61 million a year earlier. The company may have slipped into the red as it had just completed the construction of the Damansara-Shah Alam Elevated Expressway (DASH) last October, a 20.1km highway with 13 interchanges. The highway links Puncak Perdana in Shah Alam with Penchala in Damansara. Revenue, however, surged 15.5% to RM369.99 million in 2022 from RM342.67 million in 2021. Last October, the government gave the green light to a proposal by Prolintas to restructure four highway concessionaires. The restructuring was aimed at reducing the toll rates at its highways, namely the Ampang-Kuala Lumpur Elevated Highway (Akleh), Guthrie Corridor Expressway (GCE), Kemuning-Shah Alam Highway and Kajang Dispersal Link Expressway (also known as Kajang Silk). It is learnt that Prolintas has the approval in principle for an extension of the concession periods for the four highways in return for upgrading them and not increasing the toll rates. The extension periods for some of the concessions are much more than 10 years.   “The extension of the concession [periods] makes a listing feasible,” says a source. Sources say the extensions were much longer than what was given to Amanat Lebuhraya Rakyat Bhd (ALR), the vehicle that has taken over four highways from Gamuda Bhd and two other companies. ALR was given an extension of between six and 10 years in return for not increasing the toll rates. However, the highways under ALR are mature with no room for expansion. In contrast, sources say some of the highways under Prolintas have room for expansion to cater for growing traffic, hence the longer extension in the concession periods. For instance, the government gave Anih Bhd, the concessionaire for the East Coast Expressway, a 37-year extension in return for expanding, upgrading as well as flood mitigation works on the highway costing some RM2.5 billion. According to Prolintas’ website, the company — through its subsidiaries — designs, constructs, operates and maintains Akleh, GCE, Kemuning-Shah Alam Highway and Kajang SILK. Prolintas is in the process of completing the Sungai Besi-Ulu Kelang Elevated Expressway (SUKE), the construction of which started in 2016. SUKE has 14 interchanges along its 24.4km main line length and connects Sri Petaling with Bukit Antarabangsa. The stretch that is now open is from Cheras-Kajang to Bukit Antarabangsa. A source says the Prolintas infrastructure trust IPO is unlikely to include the newly completed DASH and SUKE as the traffic on the highways is still low and will drag down the valuation. “However, the highway trust will be the vehicle to house all highways under PNB such as DASH and SUKE when they become viable,” says a source. Thus, the initial indication is that the planned IPO is likely to have four highways — Akleh, GCE, Kemuning-Shah Alam Highway and Kajang SILK. Among the four, Akleh and Kajang SILK are experiencing heavy traffic and require upgrade and expansion works. News of the listing of Prolintas has been making the rounds since 2017. It was first mooted by former PNB chairman Tan Sri Wahid Omar and he had targeted to list the company between 2018 and 2019. In 2017, PNB bought Kajang SILK for RM380 million. This followed failed attempts to buy Kajang SILK by IJM Corp Bhd’s unit Road Builder (M) Holdings Bhd (RM398 million cash offer in 2014) and Citaglobal Bhd (then known as WZ Satu Bhd), which offered RM368 million last year, to be satisfied with RM239.25 million cash and WZ Satu shares. At the time, the acquisition of the highway had been touted as a means to expedite the listing of Prolintas, but the idea was later shelved after a change in management at PNB as well as the Covid-19 pandemic that brought many major economic activities to a standstill. Prolintas’ IPO should attract much interest as there are fewer listed highway operators now, following the acquisition of four concessionaires — Shah Alam Expressway (Kesas), Western Kuala Lumpur Traffic Dispersal Scheme (SPRINT Highway), Lebuhraya Damansara-Puchong (LDP) and Stormwater Management and Road Tunnel (SMART) — by not-for-profit entity ALR from Gamuda, Lingkaran Trans Kota Holdings Bhd and Kumpulan Perangsang Selangor Bhd. The remaining listed concessionaires on Bursa Malaysia include IJM Corp, which owns the Sungai Besi Expressway (Besraya), New Pantai Expressway (NPE) and Kajang-Seremban Expressway (Lekas); Ekovest Bhd that operates the Duta-Ulu Kelang Expressway (DUKE); WCE Holdings Bhd, the concession owner of the 233km interstate West Coast Expressway, which is now under construction; and Ahmad Zaki Resources Bhd that owns the East Klang Valley Expressway (EKVE), which is also currently under construction. It is worth noting that IJM Corp has a 26% stake in WCE Holdings, which has yet to complete the highway that runs along the coastline of Selangor and to Taiping in Perak. “There are no pure highway concessionaires that are listed to cater for investors seeking steady dividend returns,” says an investment banker. Last Friday, IJM Corp closed at RM1.83 per share, giving the company a market capitalisation of RM5.66 billion. WCE Holdings ended trading at 50 sen for a market capitalisation of RM1.49 billion; Ekovest traded last at 37 sen, valuing the company at RM997.5 million; while Ahmad Zaki closed at 19.5 sen for a market value of RM116.3 million.    Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/608021

ELK-Desa Resources 3Q net profit up 15.9% y-o-y to RM10.52 million

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KUALA LUMPUR (Feb 18): ELK-Desa Resources Bhd's net profit for the third quarter ended Dec 31, 2021 rose 15.9% to RM10.52 million from RM9.08 million a year earlier, due to higher contribution from both hire purchase and furniture segments. In a bourse filing Friday (Feb 18), the company said revenue for the quarter was up by 3% to RM38.19 million from RM37.2 million in the year-ago period. Earnings per share rose to 3.53 sen from 3.06 sen previously. The company did not declare any dividend for the quarter. For the cumulative nine months, ELK-Desa’s net profit dipped 4% year-on-year to RM20.24 million from RM21.12 million, as revenue slipped to RM92.93 million from RM105 million previously. The company said the decrease in revenue and earnings for the cumulative period was mainly due to lower contribution from the furniture segment for the financial period ended Dec 31, 2021. Reviewing its performance, ELK-Desa said the Covid-19 outbreak had resulted in disruptions to the group’s business and operations. On its prospects, ELK-Desa said due to the disruptions from the full lockdown from June to September 2021 that affected both its hire-purchase and furniture businesses, the company expects its performance for the financial year ending March 31, 2022 (FY22) to be lower than the previous financial year. It said the operating landscape in the remaining part of FY22 is expected to have fewer uncertainties compared to the prior year. However, it said the board remains committed to delivering its dividend policy of distributing not less than 60% of the group's annual net profit after tax to shareholders. “This stems from the ongoing roll-out of the national vaccination programme, positive outcome of the government’s economic stimulus packages and the gradual recovery of global trade and economy. “However, the recent unexpected and unprecedented floods in Kuala Lumpur and Selangor may have an impact to our hirers, albeit not substantial, in terms of potential damage to their vehicles and their loan repayment ability,” it said. The company said in spite of the increased demand for affordable quality furniture products, raw material supply locally and globally have been hampered by logistic problems due to the pandemic while travel restrictions as well as foreign labour policies have caused labour shortages. ELK-Desa said it aims to focus on overcoming these supply chain issues by working closely with suppliers. In a separate statement, ELK-Desa executive director and chief financial officer Teoh Seng Hee said the group’s improved performance in the third quarter is in tandem with the normalisation of business operations following the movement control order. “We remain positive on our prospects in the medium to long term as hire purchase solutions in the used car niche market are still robust, more so as macro-economic indicators like job security, consumer and business confidence as well as the overall economy are trending towards the path of recovery,” he said. At midday break Friday, ELK-Desa added one sen to RM1.32, valuing it at RM392.83 million.

https://theedgemalaysia.com/node/624771

MAA: Total vehicle sales declined for second consecutive month in May

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KUALA LUMPUR (June 20): Vehicle sales in May declined for the second consecutive month, as carmakers continued to be affected by the shortages of chips and components, bringing total sales for the month down 12% to 49,603, from 56,213 in April. In a statement, the Malaysian Automotive Association (MAA) attributed the fall to shortages of chips and components, as well as logistics disruptions. It was also a short working month due to the Hari Raya festive holidays, MAA added. On a year-on-year (y-o-y) basis, sales of passenger vehicles increased 3% to 43,710 units from 42,515, while sales of commercial vehicles increased 2.6% to 5,893 from 4,692. Year-to-date (YTD), sales of passenger vehicles stood at 234,115 units, up 5% from 221, 964 units a year earlier, while sales of commercial vehicles rose 25% to 31,541 from 25,286. Overall, total YTD sales increased 7% y-o-y to 265,656 units. The nation saw a 16% increase in total vehicle production for the month to 49,154 units from 42,536 a year earlier, while YTD total vehicle production increased 7% to 258,048 from 241,012. Looking ahead, MAA expects better sales in June 2022 than in May 2022, supported by the sales tax exemption incentive for consumers to buy passenger vehicles, which will expire by end-June, and aggressive sales push by car companies. However, the shortages of chips and components and the supply chain disruptions will continue to affect some makes, it said.

https://theedgemalaysia.com/node/637589

Dash for gas — why fracking is back on Britain's agenda

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LONDON (Sept 23): Britain has formally lifted a moratorium on fracking for shale gas in England that has been in place since 2019, saying strengthening the country's energy supply was an "absolute priority". Below outlines why the government is seeking to build a gas fracking industry and the questions that remain. What is fracking? Fracking, or hydraulic fracturing, involves drilling into the earth and injecting water and chemicals at high pressure to break rocks and release the gas trapped inside. Why does the government want to do it? Following Russia's invasion of Ukraine European gas prices have surged to record highs and Britain is subsidising bills for households and businesses at a predicted cost of more than 100 billion pounds (US$110.4 billion). Britain is heavily reliant on natural gas, which will take years to reduce. Gas heats around 80% of the country’s homes and on some days it can be used to generate almost 50% of the country’s electricity. The government is seeking to increase domestic gas production, which has been in decline, to reduce its reliance on imports. The industry body Offshore Energies UK says that without new investment, Britain will have to import around 80% of its gas by 2030, up from around 60% now. How much gas could be produced? Scientists say this is still unclear. Since only few test wells have been drilled, there are no estimates of proven reserves to confidently predict how much shale gas would be technically and economically viable to extract by fracking. The government has said that the only way to assess this is to allow drilling to start. “Lifting the pause will enable drilling to gather this further data, building an understanding of UK shale gas resources and how we can safely carry out shale gas extraction in the UK,” a statement from the Department for Business, Energy and Industrial Strategy (BEIS) said on Thursday. Why is it controversial? Injecting fluids at high pressure can cause earth tremors, while people in the communities affected are also concerned about the impact on the landscape, tourism and agriculture. Shale gas is also a fossil fuel and campaigners say that extracting more fossil fuels goes against the country’s target to reach net zero emissions by 2050. It also uses a large amount of water and environmental groups have raised fears over possible groundwater contamination. A BEIS public attitude tracker, which uses random sampling, in Autumn 2021 showed opposition to fracking far outweighs support, with just 4% supporting the practice and 45% opposing it. Which companies are involved? More than 100 exploration and drilling licences have been awarded to several companies including Cuadrilla, Third Energy, IGas, Aurora Energy Resources and Ineos. Cuadrilla, 96% owned by Australia's AJ Lucas, was the only one of these firms to receive consent to begin fracking. It found a natural gas resource at its site in northwest England in 2019, but the rules around earth tremors meant its operations had to keep stopping, meaning that neither of its two wells could be fully flow-tested. Which other countries have done it? Onshore gas fracking is commonplace in the United States, where it has helped to drive down the cost of gas, but the practice remains banned in many European countries, such as Germany and France, while few European countries are believed to have suitable shale gas geology for the technology. Will it cut energy bills? Not in the short term and questions remain over how much gas can actually be extracted. Even if large amounts are recovered the price of this gas would still be subject to global prices. British Chancellor Kwasi Kwarteng said in March when he was Business and Energy secretary gas fracking would not lead to lower British gas prices. "With the best will in the world, private companies are not going to sell the shale gas they produce to UK consumers below the market price,” he tweeted.

https://theedgemalaysia.com/node/670405

Anwar hails 'extraordinary' ties with Indonesia after inking of six bilateral instruments

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PUTRAJAYA (June 8): Bilateral ties between Malaysia and Indonesia are now at a stage that both countries can be proud of, according to Prime Minister Datuk Seri Anwar Ibrahim. He said this was a result of the close and family-like relationship between him and Indonesian President Joko Widodo, as well as among government officials, which had seen several long-standing issues successfully resolved, including the maritime border disputes between the two countries in the Sulawesi Sea. “The enhanced understanding and cooperation forged within a short time with Indonesia is extraordinary and will certainly bring about many positive impacts and benefits for the people and the country. “The close relationship has made it easier for us in many areas...the President and I are very proud that because of it (the close relationship), we were able to solve that one issue which we have been negotiating for years,” he said at a joint press conference after holding a four-eyed meeting with Joko Widodo at the Seri Perdana Complex here on Thursday (June 8). Anwar said the six bilateral instruments related to economy, trade, borders and maritime that were signed on Thursday also proved that matters that were difficult to resolve before can be made easy through the family-like relationship between the two countries. The six instruments are the Agreement on Border Crossing (BCA), Agreement on Border Trade (BTA), Memorandum of Understanding on Cooperation in Investment Promotion, Memorandum of Cooperation (MOC) on Mutual Recognition of Halal Certification for Domestic Products, Treaty Relating to the Delimitation of the Territorial Seas of the Two Countries in the Southernmost Part of the Straits of Melaka (SOM Treaty), and Treaty Relating to the Delimitation of the Territorial Seas of the Two Countries in the Sulawesi Sea (Sulawesi Sea Treaty). Apart from that, Anwar also gave assurance of continuous cooperation in dealing with cross-border haze, as well as in the fields of culture, education, dakwah activities and understanding of Islam. Meanwhile, Joko Widodo described his official visit as a success and welcomed the solution reached by the two countries regarding maritime border disputes in the Sulawesi Sea after 18 years of negotiations. The Indonesian president said negotiations on land and maritime border issues, as well as Indonesian migrant workers in Malaysia, can also be resolved through family-like relationships and cooperation of the prime minister and related ministers. “Alhamdulillah, we are able to resolve the issue which had been negotiated over the past 18 years, today. I do hope that other issues can also be resolved immediately while [the] Malaysian prime minister is still Anwar and [the] Indonesian president is still Jokowi,” he added. Read also: Anwar: Malaysia and Indonesia agree to defend oil palm interest  Malaysia and Indonesia heighten trade, investment and halal ties Agong grants audience to Jokowi

https://theedgemalaysia.com/node/634439

交投谨慎 马股微跌

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（吉隆坡30日讯）隔夜美国股市收低，马股在谨慎和窄幅波动中微幅下跌。 休市时，富时隆综指微跌1.92点，至1499.65点。 综指今早以1500.78点报开，较昨日闭市的1501.57点，下滑0.79点。盘中于1496.89点和1503.04点之间波动。 下跌股405只、上升股334只，另有371只无起落、1222只无交易，以及53只暂停交易。 成交量15亿2000万股，值8亿744万令吉。 一名交易商表示，综指开盘微滑，且大部分时间处于下跌格局，因部分重量级股遭套利，与大多亚洲股市背道而驰。 ActivTrades交易员Anderson Alves指出，在美国联储局（FED）主席Jerome Powell和其他欧洲央行行长在Jackson Hole发表强硬言论后，亚股处于防御模式。 “在本月的货币政策决定出台前，交易员已开始计入美国和欧洲利率市场加息75个基点的可能性高于80%。” 他表示，对新冠疫情的担忧也继续打压亚股，因为疫情仍未结束，而且由于中国封控和清零政策，该国经济压力正在增加，投资者可能降低在亚太地区的风险敞口。 日本日经指数扬1.16%、新加坡海峡时报指数增0.52%、韩国首尔综合指数升0.91%，而香港恒生指数跌0.9%。 重量级股中，马银行（Malayan Banking Bhd）和联昌国际集团（CIMB Group Holdings Bhd）各起1仙，分别报8.95令吉和5.41令吉、大众银行（Public Bank Bhd）扬3仙，挂4.66，而国油化学（Petronas Chemicals Group Bhd）下滑1仙，至8.89令吉，以及IHH医疗集团（IHH Healthcare Bhd）挫17仙，报6.17令吉。 至于热门股，Vortex集团（Vortex Consolidated Bhd）和迪耐（Dagang NeXchange Bhd）皆升0.5仙、分别挂18.5仙和85.5仙、MyEG服务（My E.G. Services Bhd）扬6仙，至77.5仙、UMediC Group Bhd涨7仙，报63仙，美全（Metronic Global Bhd）则跌0.5仙，至7仙。   （编译：陈慧珊）   English version：Bursa ends morning session lower

https://theedgemalaysia.com/node/605031

Astaka Padu and DMR Holdings sign MoU to develop 42 acres of land with RM1b GDV in Johor

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PETALING JAYA (Jan 25): Astaka Holdings Ltd, through its subsidiary Astaka Padu Sdn Bhd, has entered into a non-binding memorandum of understanding (MoU) with DMR Holdings Sdn Bhd for a potential collaboration to jointly develop 42 acres (about 17 hectares) of land in Johor with an estimated gross development value (GDV) of RM1 billion across various key cities in Johor, including Iskandar Puteri, Tampoi and Pengerang. Astaka Holdings executive director and chief executive officer Khong Chung Lun in a statement on Monday (Jan 24) said that having closely monitored the Malaysian economy for the past few months, now is the appropriate time to execute its expansion plans. “While the [Covid-19] pandemic has disrupted the global economies, we have continued to identify suitable opportunities to grow the group in a well calibrated manner. These joint development projects, if undertaken, will allow both parties to synergise resources, networks and expertise to help the group establish itself as a prominent integrated property developer in Johor,” he added.  The development sites are also within close vicinity to prominent establishments, with the proposed site in Iskandar Puteri located near LEGOLAND Malaysia and the Kota Iskandar development, the administrative centre of the Johor government. Meanwhile, the joint development projects are expected to be completed over the span of five years, comprising mixed commercial developments and a light industrial park development. The light industrial park project also marks Astaka Holdings’ first venture into the industrial sector. 

https://theedgemalaysia.com/node/610118

China Automobile Parts gets another Bursa reprieve from delisting

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KUALA LUMPUR (March 3): Automobile parts manufacturer China Automobile Parts Holdings Ltd (CAP) has received yet another reprieve by Bursa Securities from being delisted on the Main Market of Bursa Malaysia, after it managed to issue its annual report for the financial year ended June 30, 2021 (FY21) for public release. As a result, trading in the company's shares will resume on Friday (March 4). Trading of CAP shares has been suspended since June 8, 2017, after it first failed to submit its quarterly report for the financial period ended March 31, 2017 (FPE17) within the stipulated time frame. Since then, it has received several reprieves from being delisted. In the latest round, CAP had until Dec 22, 2021 to submit an appeal to Bursa Securities before its securities were to be delisted five market days later. In a bourse filing on Thursday (March 3), CAP said Bursa Securities has decided to allow its appeal and not to de-list the company, after it had on Feb 25 submitted its outstanding annual report for FY21 that included the audited financial statements for FPE17 to FY21 to the regulator for public release. It will also hold its annual general meeting virtually on March 31. Still, the road ahead is not all clear yet. CAP was classified as a Practice Note 17 (PN17) in January 2018, after its external auditor Messrs PFK had expressed an audit disclaimer of opinion in the company’s accounts for the financial year ended Dec 31, 2015 on undisclosed material liabilities. CAP has sought from Bursa Securities a further extension of time of up to Sept 10 to submit its regularisation plan and is awaiting the regulator's decision. On Jan 28, the company announced that it had entered into a memorandum of understanding with Tan Sri Datuk Seri Panglima Joseph Lo @ Lo Tain Foh and Datuk Jonathan Lo Chaw Loong to negotiate the acquisition by CAP of the entire equity interest of Azam Jaya Properties Sdn Bhd, Pembinaan Azam Jaya Sdn Bhd and Kolopsi Jaya Sdn Bhd, as part of its proposed regularisation plan. The target companies are principally engaged in construction work, civil engineering, road maintenance, construction of highways, flyovers and bridges in Sabah. In FY21, CAP posted a smaller net loss of RMB348,000, compared with RMB1.09 million in FY20.

https://theedgemalaysia.com/node/652039

Cabotage policy to be reviewed

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This article first appeared in The Edge Malaysia Weekly on January 16, 2023 - January 22, 2023 THE federal government is reviewing its cabotage policy restrictions for submarine cable repair vessels, a move that could potentially lead to the opening up of Malaysian waters to foreign-flagged ships providing such services. Newly minted Transport Minister Anthony Loke Siew Fook, in a reply to a question from The Edge on whether the government was reviewing the cabotage policy with regard to submarine cable repair vessels, replied, “Yes [the government is looking to review the existing cabotage policy],” without elaborating further. In a nutshell, cabotage laws prevent foreign-registered ships — or in shipping parlance, foreign-flagged vessels — from operating in a particular market. The law is there to protect local companies. Issues with the Malaysian cabotage policy pertaining to submarine cable repairs came about in mid-November 2020 after previous transport minister Datuk Seri Wee Ka Siong exercised his powers under Section 65U of the Merchant Shipping Ordinance 1952 to revoke an exemption for vessels involved in submarine cable repairs. His predecessor, Loke, had approved submarine cable repair vessels from being exempted from the cabotage laws in March 2019. This came about after complaints of delays for the repair of undersea cables by tech giants such as Facebook, Google, Amazon and Microsoft, and the national internet exchange body, Malaysian Internet Exchange. Facebook, Google, Microsoft and Amazon had lobbied very hard, even writing to previous prime ministers Tan Sri Muhyiddin Yassin in November 2020 and Datuk Seri Ismail Sabri Yaakob in September 2021, for the exemption. There were also appeals made to the then science, technology and innovation minister, Khairy Jamaluddin, in mid-January 2021, to help resolve their problems, but nothing came of it. There were also threats made by some of the tech giants that they would review their investments in Malaysia should it withdraw the exemption. Facebook, Google, Microsoft and Amazon had complained that sans the exemption, submarine cable repairs were taking too long. According to them, the requisite domestic shipping licensing exemption (DSLE), which allows a ship to undertake submarine cable repairs, can take up to 27 days to obtain in Malaysia. This is in contrast to 20 days in the Philippines, 19 days in Singapore and 12 days in Vietnam. There were also other issues. The foreign-flagged vessels selected to undertake submarine cable repairs had to be endorsed by the Malaysian Ship Owners Association or Masa, which would have to confirm that there was no locally registered vessel capable of handling the required function. The tech giants had claimed that Masa was looking to protect its members and blocking foreign-flagged shipping companies from operating in Malaysian waters, which led to delays in getting approval for vessels to operate in Malaysian waters. The tech giants also highlighted that the implementation of the cabotage policy by Wee flies in the face of the Malaysia Digital Economy Blueprint, which spearheads Malaysia’s progress as a technologically advanced economy. They contended that the technology pathway is predicated upon having fast and reliable internet connectivity, which in turn requires a supportive regulatory environment that encourages investment in digital connectivity. Wee, in reply to a question by The Edge on the delays of getting the DSLE then, had said that after he had taken over as transport minister, the approvals by Masa for a submarine cable repair vessel was only about two to three days, and not 27 days as claimed. In a phone conversation with The Edge in early September 2021, Wee said: “I really don’t understand why these tech giants don’t support the Malaysian government’s effort in developing the local industry and enhancing technical know-how among Malaysians. This effort will certainly help to support their investment here.” In a WhatsApp message, Wee said, “The Malaysian government promotes the cabotage policy mainly to develop local know-how and expertise to support our country’s digital economy. Malaysia needs local expertise to ensure our national undersea cables are well maintained and not be fully reliant on foreign companies. “This is the first time I have heard that investors do not want availability of local expertise to provide support and services for their investment … If an undersea cable is cut and requires immediate attention, don’t you think a local presence is better than relying on foreign vessels as a first choice?” Wee had brushed aside fears of investments into Malaysia being slashed as a result of the cabotage policy, saying that other countries in the region had more stringent regulations, and that it was a question of national security. He added that national security was at risk with foreign undersea repair ships operating freely in Malaysian waters. Much of the undersea cable repairs have been undertaken by Asean Cable Ship Pte Ltd (ACPL), which operates three vessels — Asean Explorer and Asean Protector, which are both flagged in Indonesia, and Asean Restorer, which is registered in Singapore. ACPL was set up by the Asean Telecommunications Authorities — Telekom Malaysia Bhd, CAT Telecom Public Co Ltd, Eastern Telecommunications, PT Indosat Tbk, Telekom Brunei Bhd and Singapore Telecommunications Ltd. However, with ACPL’s vessels not flagged in Malaysia, the cabotage policy prevents it from undertaking any jobs without the approval of Masa, even with Telekom Malaysia having a 16.6% stake in the company. Telekom Malaysia’s largest shareholder is government-controlled Khazanah Nasional Bhd, which has a 20.11% stake. As at mid-March 2022, government-linked agencies Khazanah, Employees’ Provident Fund, Permodalan Nasional Bhd, Kumpulan Wang Persaraan (Diperbadankan) and Pertubuhan Keselamatan Sosial controlled about 60% of Telekom Malaysia’s stock. OMS Group Sdn Bhd — another undersea cable repair company with five cable repair ships and two barges, some of which are flagged in Malaysia — has also been handling repairs for submarine cables locally. OMS is a Malaysian company controlled by businessman Datuk Lim Soon Foo.   Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/613570

HLIB Research sees stronger earnings for DNeX this year

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KUALA LUMPUR (March 25): Hong Leong Investment Bank (HLIB) Research foresees Dagang NeXchange Bhd (DNeX) registering uninterrupted back-to-back quarterly earnings growth over the next six to nine months on the back of Silterra’s surging product average selling prices (ASPs), increasing wafer shipments and soaring crude oil prices. HLIB analysts Jeremie Yap and Tan J Young said in a note they came away feeling positive from a private meeting with DNeX during their site visit to Silterra’s wafer foundry earlier this month. “From our check with the management, we gathered that wafer ASPs had continued to increase. The group reiterated that the net ASP per wafer was still on an uptrend and is expected to peak in 4QFY22 (the fourth financial quarter ending June 30, 2022) and hover at about US$600 (about RM2,531.10) to US$625 in FY22 to FY23,” they said. They also highlighted that DNeX would be a major direct beneficiary of higher oil prices amid the Russia-Ukraine conflict. “Soaring crude oil prices throughout 3QFY22 would directly benefit its 90%-owned Ping Petroleum via its oil-producing assets in Anasuria,” they said. At the analysts' time at writing, Brent crude averaged at about US$96 per barrel year-to-date (YTD), which was significantly higher than its 2QFY22 realised price of US$71 per barrel. According to the analysts, DNeX is targeting for Ping's 100%-owned Avalon oilfield (greenfield) to produce its first oil in July 2024. Based on findings, it was gathered that the Avalon oilfield will potentially more than quadruple Ping’s output from about 2,300 barrels of oil equivalent per day (boepd) to about 9,000 to 10,500 boepd, based on internal estimates, boosting Ping’s earnings by three to four times. The analysts also highlighted that the group is planning for another expansionary capital expenditure (capex) of US$150 million to US$200 million at the end of 2022 to ramp up production of emerging technology (MEMS and silicon photonics) to about 10% of its total capacity. “The capex will entail a new building, an extension of Silterra’s existing plant in Kulim. The group aims for the new plant to be operational in early 2024,” the analysts said. However, they maintained their DNeX earnings forecasts for FY22 and FY23 at RM173 million and RM211.7 million respectively as they kept their conservative assumptions for the net ASP per wafer to be at US$500 in FY22, US$550 in FY23 and US$578 in FY24. The analysts also maintained their Brent oil price forecast of US$80 per barrel for FY22 (YTD: US$82 per barrel). “Note that we are conservative in our assumptions for both of the group’s divisions, indicating significant upside risks to our earnings forecasts,” they said. DNeX registered a record-high quarterly core profit after tax and minority interest (PATAMI) of RM62.5 million for 2QFY22, bringing its first-half core PATAMI to RM92.7 million. According to Yap and Tan, the group’s strong performance was mainly attributed to Silterra’s strong net ASP per wafer at US$527 in 2QFY22. The analysts maintained their highly-convicted "buy" recommendation for DNeX, with an unchanged target price of RM1.64 per share. “We peg Silterra’s multiple to 30 times price-earnings to reflect monumental growth prospects for the semiconductor foundry over the next few quarters,” they said. Currently at only about 15.5 times FY23 forecast earnings in its entirety, the analysts believe that DNeX is a compelling case given its strong foothold in both the front-end semiconductor and upstream energy spaces. At 10.01am on Friday (March 25), DNeX had risen two sen or 1.92% to RM1.06, valuing the group at RM3.28 billion. YTD, the counter has risen 30.86%.

https://theedgemalaysia.com/node/674549

Audi in talks to buy Chinese automaker SAIC's EV platform — sources

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SHANGHAI (July 12): Germany's Audi is in talks with SAIC Motor Corp to buy an electric vehicle (EV) platform from the Chinese state-owned automaker, two people familiar with the matter said, an unprecedented effort to shore up market share. The move, coming as sales of Audi's EV products fall sharply behind those of Tesla and domestic competitors such as Nio, spotlights the pressure on all legacy and Western brands in the world's largest auto market, as they battle over EVs. The premium car brand of Volkswagen AG seeks to take over the EV platform owned by SAIC's EV unit, IM Motors, said the sources, who sought anonymity as the matter is private. Talks are at an advanced stage, one of them added. IM Motors, which started delivery of its first model, the L7 sedan, in June 2022, is a premium EV brand controlled by SAIC and its investors include e-commerce giant Alibaba Group. Audi declined to comment on whether the talks were taking place. SAIC declined to comment. Reuters was not immediately able to establish the price Audi has offered for the EV platform and whether SAIC would still be involved in making the L7 sedan after the deal. Chinese media outlet Mingjing Pro reported Audi's potential takeover of the platform on Tuesday (July 11). Earlier, Automobilwoche said Audi was in discussion with several manufacturers to acquire an EV platform, but did not identify them. Established automakers, such as Toyota, have been racing to follow the lead of Tesla and some Chinese EV makers in designing EV platforms engineered from the ground up in the effort to cut costs, improve performance and protect margins. Audi has not bought a platform from another manufacturer before and until now, has used Volkswagen's EV-dedicated MEB platform for models on offer in China, while concurrently developing a new EV platform with Porsche. Last month, Audi chief executive Markus Duesmann, who will step down from the role in September, told Reuters the brand had to speed development of new models to meet a surge in demand for electric vehicles, especially in China. However, its sales performance has fallen short of expectations, because of a lack of vehicles optimal for Chinese needs, he added. Audi offers two EV models — Q4 e-tron and Q5 e-tron — developed on Volkswagen's MEB platform in China. Sales of Audi EVs were just over 3,000 units in the first quarter in China, while BMW sold 21,646 EVs and Tesla sold 137,429 cars, figures from industry body the China Association of Automobile Manufacturers show. Audi and Porsche have also been jointly developing a new EV platform called "Premium Platform Electric", to be adopted for cars turned out from the end of 2024 at a plant the former is building in China's northeastern city of Changchun. The plant will produce adaptations of the PPE platform tailored to the Chinese market, an Audi spokesperson said.

https://theedgemalaysia.com/node/671187

APB Resources hits limit-up as Press Metal co-founder emerges as new substantial shareholder

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KUALA LUMPUR (June 14): Shares of APB Resources Bhd hit limit-up on Wednesday after Press Metal Aluminium Holdings Bhd’s co-founder and executive director Datuk Koon Poh Tat emerged as its new substantial shareholder. A filing with the stock exchange showed that Koon bought a 5.72% stake or 6.35 million shares on the open market on Tuesday. The transaction price was not disclosed. However, based on APB Resources’ closing price of RM2.25 on Tuesday, the block of shares would have cost Koon RM14.29 million. APB Resources was the top gainer on Bursa Malaysia, after climbing 67 sen or 29.78% to an all-time high of RM2.92, giving it a market capitalisation of RM329.6 million. Trading volume stood at 6.51 million, more than four times the 200-day average volume of 1.46 million. The counter has risen 94.67% year to date and 311.27% over the past year. APB Resources also announced a slew of boardroom changes including the appointment of Datuk Seri Abd Rahim Jaafar as its independent and non-executive chairman, while Liaw Way Gian and Chin Choon Wei have been appointed as the new executive directors. Kang Wei Luen is the new independent and non-executive director. Worth noting is that Abd Rahim is the independent and non-executive chairman of Artroniq Bhd. Both Liaw and Kang also sit on the board of Artroniq as directors. The group also announced the retirement of Chua Chia Cheng@ Chua Chia Kwee and Lim Kwee Yong as its directors, as well as Tan Teng Khuan as chief operating officer. APB Resources is involved in the fabrication of specialised design process equipment for the petrochemical, oleochemical, oil & gas, power as well as food and beverages industries.

https://theedgemalaysia.com/node/636031

Uzma赢得1700万合约 为国油勘探提供液压修井服务

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（吉隆坡12日讯）Uzma Bhd获得国油勘探（Petronas Carigali）价值1700万令吉的合约，提供液压修井（HWU）服务。 这家油气服务与设备供应商向大马交易所报备，工作范围包括为国油勘探在东马岸外废弃油井作业提供综合液压修井服务。 合约涉及两口井，预计于今年9月动工，并在10月完成。 Uzma预计，合约将为截至明年6月杪2023财政年的盈利作出贡献。 该股今日平盘收于39仙，市值为1亿3729万令吉。   （编译：陈慧珊）   English version：Uzma wins RM17m job to provide HWU services for Petronas Carigali’s wells

https://theedgemalaysia.com/node/675924

Cover Story: Transforming the economy through energy transition

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This article first appeared in The Edge Malaysia Weekly on July 24, 2023 - July 30, 2023 MANY are surprised that the National Energy Transition Roadmap (NETR) is under the purview of the Ministry of Economy instead of the Ministry of Natural Resources, Environment and Climate Change. But to Rafizi Ramli, the Minister of Economy, it would be even more surprising if it were the opposite. For this simple reason — the energy transition is not just about generating renewable energy and pursuing the net zero goal but it is also an economic growth catalyst.  He sees the energy transition as an avenue to transform Malaysia’s economic structure, which emphasises a low-cost and minimum value-added model, to one that is technology-driven and content-led. Rafizi clearly understands that the energy transition is not an option but a necessity, and the country has to do it fast, otherwise it will be even harder for Malaysia to catch up with its neighbours. “In terms of the decision, it sounds very simplistic. The government allows a willing seller, willing buyer; self-contained; and self-sufficient energy generation system ... but it is many things,” he says. “Energy transition is very much driven from an economic competitiveness perspective, especially when you put this into the equation — we can no longer operate as a low-cost manufacturing nation. Our task is to restructure the economy, and Malaysia needs to transform from our current state of the economy to one that is driven by technology and sustainability and one that can attract new investments,” says Rafizi in an interview at his office in Menara Prisma in Putrajaya. While the focus now is on the upcoming polls in six states, which have been fixed for Aug 12, the work to transform the country’s economy continues. The government will launch the NETR on July 27. “The successive administrations before us had policies on renewable energy, it wasn’t even called energy transition, so it had a different approach. So, while we had plans for renewable energy here and there, all the components of the ecosystem were not urgent enough,” says Rafizi, an accountant by training. “By now, it has become a national imperative, economically and socially. And that is where I think we have reached the right point, where it is possible to accelerate the transition.” Besides raising competitiveness, the NETR will enable the country to revamp the energy model, one that has the government absorbing the fluctuations in energy prices [in the form of subsidies]. “[The model] is no longer sustainable. Fiscally, we can’t go on like this,” he says. Rafizi stresses that subsidy rationalisation is a question of sequencing and the government has started its work by cutting the electricity subsidy for mid- and high-voltage users. He disagrees that the government is dragging its feet on this thorny issue, pointing out that it needs to ensure that domestic households and small and medium enterprises (SMEs) are given the option to buffer the impact first. “It cannot be that we remove the subsidies and then say good luck to you.” Earlier, the government announced industry reforms that included RE exports to generate revenue for the government’s coffers and grow the local RE industry. Malaysia also committed to doubling the speed of its initial RE installation target and achieve a 70% generation capacity by 2050, from its previous target of 40%, which will be ironed out in the upcoming Planning and Implementation of Electricity Supply and Tariff Committee (JPPPET) report. The minister highlights that Malaysia is ranked No 1 in Southeast Asia and No 35 in the world in the Energy Transition Index (ETI) by the World Economic Forum (WEF). “I don’t think anyone knows this,” he says. The ETI benchmarks countries on their current energy system performance and provides a forward-looking measure of transition readiness. The framework has been revised to incorporate a wider approach of balancing the three imperatives of the energy triangle — equity, security and sustainability. Among emerging and developing Asia, Malaysia ranks No 2, behind China, which ranks No 17 globally. Rafizi says Malaysia’s high ranking demonstrates that the country is in a rather comfortable position in terms of the energy transition and that gives little reason for it to delay any further. “The number one area where investments had poured in globally over the past two to three years was into the energy transition. So, it just matches well that we are ready, more than any other country in this region, and we are strategically located,” he says. “We have to find two or three growth narratives. And to find growth narratives, we must look at our existing advantages and leadership position.” Investments in energy transition projects have overtaken those in other sectors in terms of receiving the most investments globally. According to the United Nations Conference on Trade and Development (Unctad) in the World Investment Report 2023, international project financing in renewable energy remains the largest among all the sectors, despite falling 30% year on year to US$368 billion. Large projects included the US$15 billion construction of floating marine wind farms in Italy by Falck Renewables and Bluefloat Energy and the construction of a 4,000mw offshore wind power plant in Binh Thuan, Vietnam, by AES for US$13 billion. On the ETI, Malaysia scores highly on system performance, at 70 points, which is higher than the scores of some higher-ranked countries on the index, such as Finland (No 4), Austria (No 8), the Netherlands (No 9), Germany (No 11), the US (12), the UK (No 13), Canada (No 19), Australia (No 24) and Japan (No 27). Malaysia also scores highly in terms of energy security, due to supply diversity and reliability, according to the WEF Energy Transition Index 2023 report. The top scorers in the security dimension are mainly advanced economies, such as the US, Australia and Estonia, says the report. However, it is worth noting that the country’s transition readiness is rather low, at 49.3 points, which is lower than the scores of some lower-ranked countries on the index, such as Colombia (No 39), Vietnam (No 43), Bosnia and Herzegovina (No 50) and Singapore (No 70). Likewise, Malaysia scores low in renewable capacity buildout, with only 0.22 points out of 100, and development of environmental technologies as a percentage of all technologies (7.88 out of 50). It is also deemed quite restrictive when it comes to foreign direct investment regulations. The low scores reflect the lack of government efforts in the energy transition so far. Rafizi says a key takeaway from the Asia Zero Emission Community (AZEC) in Japan in March is that Malaysia is not considered serious about energy transition. “And part of that reason is because when compared with other countries, we spend less time focusing on energy transition projects, we did not allocate enough [and] we did not reform the market and legislations that can expedite the energy transition,” he tells The Edge, and that pushed him to set a short three-month deadline to roll out the NETR.  The launch coincides with the state polls that are just around the corner.  Rafizi attributes the low number of investments, particularly foreign direct investments, in the energy transition to such a perception. “While the global investments had gone into the energy transition in the past few years, it wasn’t as exciting in Malaysia, so the investments went to other countries. That is the bit where we have to reassert our strategic competitiveness, because we hope through NETR, the international investment community will embrace us because they have been with it,” the minister explains. In the past, the approach was to open bidding for Large Scale Solar (LSS) plants to encourage the race to the bottom, and so the tariff went down to as low as 18 sen per kWh, which is even lower than the conventional generation, says Rafizi. “So, if you are looking at 18 sen per kWh, obviously it is not going to be economical, so we may, and most probably, end up in a situation where some of those who came forward to do LSS did not have the capability or economic means to do it,” he adds. “So, these lessons learnt are reflected in the different approach that we have spelt out in the NETR, because we are looking at a transparent pricing model. We want to strike a balance between affordability and economic sustainability or RE capacity.” With the removal of subsidies for medium- and high-voltage users, which resulted in tariffs that mirror market prices, the differentials between the RE pricing and conventional tariffs are a lot closer, says Rafizi. With the surcharge, high-voltage industrial users are already paying 40.20 sen per kWh during off-peak periods and 53.7 sen per kWh during peak periods. This makes the electricity tariff for high-voltage users higher than the feed-in tariff for solar photovoltaic (PV) of about 40 sen per kWh. This would attract companies that are required to have a higher RE mix, only to find that it is no longer economically prohibitive to consume and switch their electricity sources more towards RE. This also removes the need to suppress RE tariffs, especially for the industries, says Rafizi when elaborating on the possible measures in the NETR, emphasising that the priority is to remove the impediments. “In that sense, it is a lot more economically viable now for RE capacity than before, because it also comes hand in hand with the subsidy retargeting programme which, in the case of electricity, the government has already completed,” he says. “If you compare, they [heavy industrial users] have to pay about 40 sen per kWh on average anyway. And for solar generation, anything above 25 sen per kWh, they make a profit. There is a big range where suddenly, it is economical. Before this, at 18 sen, it was quite difficult (see ‘Transparent pricing model to include grid capex and wheeling charges’).” To be sure, the NETR isn’t the first roadmap for RE in the country. However, it will be the first to lay out the path to energy transition, by making the landscape more attractive for investors to come in and set up the infrastructure, and for consumers to switch to RE as well as to become prosumers. One of the major aspects of the NETR will be unlocking the huge potential of rooftop solar, says Rafizi. This will be done by allowing rooftop owners — from private houses to commercial and industrial premises, as well as government institutions, for example schools — to monetise their assets. Under the Net Energy Metering (NEM) Rakyat programme, the current approach to residential rooftop solar requires users to fork out a huge capital expenditure. Capex for a 4.5 kWp residential rooftop solar system starts at about RM20,000 to offset a few hundred ringgit in their monthly electricity bill. A typical landed home can install even higher capacity, the bigger the size of the rooftop. For households that consume less electricity, the excess power generated is kept as credit, which can be used to offset future consumption or electricity bills for the consumer’s other properties — but it can be rolled over for just one year under the current guidelines. In a nutshell, with existing mechanisms, those who use less electricity do not benefit from a rooftop solar system and could potentially lose money in the long term. Meanwhile, NEM NOVA for commercial and industrial customers capped the inverter output at 100% of its maximum demand — which theoretically limits the amount of excess electricity generated. This is why rooftop solar has not taken off in Malaysia in a big way, despite its tropical climate with sunshine all-year round. And this is what Rafizi and the government will want to address through the NETR. “Turn the vision upside down. What the government intends to achieve, in stages, is a situation where we reform the market to allow rooftop owners, whether domestic or commercial, to monetise their rooftops. Then, they can earn money from that,” says Rafizi. “We will have companies that are willing to invest in rooftop solar installations out of their capex and pay monthly rent to rooftop owners, because they can supply to the grid. If you think about it, suddenly you have assets that households and SMEs can monetise.” According to the Malaysian Renewable Energy Roadmap (MyRER), the country has 269gw potential for solar PV, dominated by ground-mounted configurations (210gw) and including considerable potential from rooftop (42gw) and floating configurations (17gw). While the ground-mounted configurations are still bigger than the rooftop installations, with LSS, there will always be the question of whether the land should be utilised for other purposes, rather than for RE. Rafizi points out that one of the models that the ministry has studied for the NETR is the Australian model, particularly the one adopted by the South Australian government. While Australia is a continent with a small population, where land use may not be as competitive as Malaysia, yet the South Australian government has taken the rooftop solar path to generate electricity from renewable sources, rather than large-scale solar farms. According to the Department of Climate Change, Energy, the Environment and Water of Australia, the largest source of electricity in South Australia comes from renewables other than hydroelectric power, at 65% of the mix in 2021. “They have demonstrated that if you turn the solar rooftop model upside down, which allows rooftop owners to monetise, that is a catalyst for capacity build ups, compared with the approach to focus on LSS,” says Rafizi. “If you think about it, Australians have a lot of land, so the LSS is not as restrictive to them as it is to us. But South Australia has adopted the rooftop model as a pathway to energy transition, rather than focus too much on LSS.” Being an oil-producing nation,  many Malaysians are concerned that the energy transition will be a threat to the country’s oil revenue in the future. However, Rafizi sees it as an advantage, making the country’s energy transition pathway smoother than others, as we have the buffer to withstand any energy shock.  “We have to understand there is a fine line between being complacent and taking that advantageous position to move towards energy transition. We want to take the latter approach.”    By Kathy Fong It goes without saying that the National Energy Transition Roadmap (NETR) will change the landscape of the highly regulated power industry. If the impact brought on by the liberalisation of the power generation sector back in the 1990s was tremendous, that brought on by the NETR could well be a shock wave. Tenaga Nasional Bhd, which controls the national grid and distribution network, is certainly at the centre of all the action. According to the Minister of Economy Rafizi Ramli, the government is considering adopting a transparent pricing model, in which the electricity tariff will include an amount for grid infrastructures plus a sum for wheeling charges for transmission, in the green energy market. The rationale for the model is to remove the capital expenditure (capex) burden on Tenaga in terms of upgrading and maintaining the national grid as Malaysia builds more renewable energy (RE) capacity. “Currently, the upgrade of the grid is very much dependent on Tenaga’s capex availability, unless the government allocates an amount for it,” says Rafizi, adding that the government may not be able to afford it due to fiscal constraints. “So, whatever Tenaga puts in, whatever the government puts in to keep up with the need for infrastructure upgrades, that is over and above what has been set aside from the tariff, which doesn’t really exist now. And that also allows us to rebalance our energy generation in the future,” he explains. When asked if Tenaga will still own the national grid in the future, Rafizi says the grid will always be the national utility’s asset. “I think that model will not change. It is just that the current model creates a financial impediment, because grid upgrades are left to Tenaga.” Given the high tariff for green energy exports, he says it makes economic sense to include the capex for grid upgrades in the tariff. This is exactly what has been said about having RE exports cross-subsidise the development of the local RE industry by leveraging the premium pricing that foreigners are willing to pay.   Single market aggregator Rafizi says the government is considering having a single market aggregator in the RE market, playing a role to ensure that the country achieves the national objective of net zero carbon emissions by 2050 while being able to earn a lucrative profit from the export of RE. “If you don’t have a single market aggregator and it is purely on a commercial basis — willing buyer, willing seller — it will create a few complications. Number one, the supply still has to go through Tenaga, and then it is going to be a three-party commercial negotiation, between the seller, buyer and grid owner, which is Tenaga. It might create inefficiency in the whole transaction,” he says. To Rafizi, the more important role of the aggregator is to keep track of carbon credits. “What we don’t want to do is, basically the country builds all these capacities but transfers all of our carbon credits to foreign markets. So there is a need for a neutral party to manage this, and that looks from a bird’s eye perspective that there is a threshold from time to time that takes into account the total generation capacity versus the total export demand, and [to monitor] what is the threshold that we can allow for us not to disadvantage ourselves in terms of carbon credits and footprint.” However, he is lipped-tight on who the single aggregator is. According to him, the government makes reference to the European model when forming the NETR as the model there takes into account cross-border transmissions. “Conceptually, that is what we are looking at. These are major market reforms, these are not small things, so we have to go through various stages of decision-making, and then we have to see what regulations are [required],” says Rafizi. In Europe, some countries have aggregators, with a number of them not single market aggregators, to manage the consumption pattern to avoid big fluctuations in demand so that there is less need for extra capacity to cater for a sudden peak in demand. Their function is to pool electricity supply and demand and sell this capacity in the market. What the aggregators have in hand could be 1,000 electric vehicles, the owners of which are willing to charge them during hours when demand is low for some incentives. In a nutshell, an aggregator helps to bring down the peak and raise the trough of the demand and supply of electricity.   Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's App Store and Android's Google Play.

https://theedgemalaysia.com/node/661801

My Say: De-infantilising politics and government

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This article first appeared in Forum, The Edge Malaysia Weekly on April 3, 2023 - April 9, 2023 Mariana Mazzucato’s latest book, co-authored with Rosie Collington, has an eye-catching title — The Big Con: How the consulting industry weakens our businesses, infantilises our governments, and warps our economies. The University College London economist, whose earlier book, The Entrepreneurial State, advocated the role of government in advancing major innovations, lamented in her new work the reliance of governments on consultants in the last few decades. The subtitle of the book clearly spells out how that reliance has weakened governments, and therefore undermined their potential to be entrepreneurial and innovative in the face of the challenges we face today. The book looked behind the curtains at the relationships and the influence of big consulting firms on decisions taken by governments, under the pretext that they are neutral and objective sources of expertise during a period that saw governments outsourcing not just their “thinking” but also their “doing” in the attempt to be “business-friendly”. The juxtaposition is always that of an incapable government relying on the capable private sector for economic growth and solving problems, hence the conclusion that such a perspective infantilises governments. I find that description to be apt, one that is true in many dimensions. The Big Con looks at the way the British government responded to the Covid-19 pandemic as a case study. The National Health Service (NHS) was sidelined in favour of private parties in its tracing and testing programme, where billions in public funds were spent without much to show for it. The parts of government that actually have real competencies and experience to do things were sidelined in favour of private parties — big consultancies — with neither the competency nor the experience. That is the “big con”, a con that weakens governments. We in Malaysia are well reminded of the MySejahtera fiasco during the Covid-19 pandemic. The tracking and tracing software could have easily been developed by the public sector at no additional cost to the government, given the capabilities within the various parts of the public sector. The Public Accounts Committee report at the end of last year instead revealed that the cabinet eventually authorised an allocation of RM196 million to pay a private party for MySejahtera. In our case, it was not some big global consultancy but a small unknown company that supposedly — initially — developed it as a corporate social responsibility project that which eventually became something akin to a directly negotiated procurement of services by the government. It was mind-boggling in its audacity. The minister then, however, took pride that the RM196 million ceiling was less than the RM300 million sought by the private party. Indeed, he said, it was less than what was paid by the UK government for the same thing! In the end, MySejahtera became what has happened to many government initiatives — a one-off, specific solution that does not build new capabilities. Despite paying for it, it is not a sticky thing, a thing that can be used for other purposes, a capability within the government that can be used to improve overall governing. A public good of sorts. Yes, there should be rigorous conceptualisation of any solution to a problem, but the real learning and growth take place in the doing. Nothing beats doing, but it is futile if there is no growth and learning by doing. There certainly will not be any learning if we just pay others to do what needs doing. It is true that the public sector is wanting in many ways. There is much discussion about issues of integrity and corruption within the public sector, but I dare say there is a much larger problem of competency. The technical government departments, from health to engineering, remain competent and indeed represent a big part of national competencies in those areas, but the general administrative part of government, including the supposedly elite administrative and diplomatic service, could be much more competent. In particular, central agencies such as the Treasury and Economic Planning Unit, key economic agencies, are manned by these general administrative officers instead of technical specialists found in health or public works departments. These central agencies need technical specialists — from accountants to public finance and tax experts to those with various specialities in economics — which require specific in-depth training. They cannot just be general administrative officers with exposure to these areas. They will not have the required depth and technical competency. These shortcomings are, however, a reflection of poor organisational design and poor leadership in the public service. It is not an inherent problem, not something that cannot be remedied and certainly not a reason to infantilise the public service. Public sector reform, however, is made difficult because of politics, which has been infantilised even more than the public service. It was both politics and poor leadership that have resulted in the public service becoming predominantly Malay or bumiputera, making any attempt at public sector reform being seen through the racial-religious lens; a critic of the public service as a critic of the Malays and Islam since these have been conflated. That is how politics has been infantilised, that is how the Malays have been infantilised, to be ever protected by these pretenders, claiming to be their custodians while furthering their own personal interests. So, what we have is therefore a private sector that feeds on this weak eco-system defined by an infantilised public sector and politics. That infantilised them as well. The private sector too has lost its innovativeness and competitive edge. In that sense, Mazzucato is right; the whole thing eventually warps our economy. It infantilises the government, it weakens businesses and eventually warps the economy. The country has to get out of this warped existence. The public sector needs to be reformed and the private sector needs to regain its animal spirits. The economy certainly needs fiscal policy to be more efficient and effective and private investments as a percentage of gross domestic product to be much higher. We need a better production function for the economy, which will be possible only with more investments in better and newer things. The Gordian knot of the Malaysian conundrum is its politics — its toxic and infantile politics. Listening to some of the speeches in parliament provides ample evidence of this. Unfortunately, the political Gordian knot cannot be cut in one swoop. It requires a mature collective disposition that itself is a challenge, one that does not forsake the right directional change because of its imperfections. Time is a necessary, if not a sufficient, condition to effect change. We should have the maturity to agree on the fundamentals of what should be prioritised, overall imperfections notwithstanding, as long as the knot is loosened progressively. Let me propose five areas that we should agree on: • That governance should be improved; from passing legislation to effect parliamentary reforms, making political funding more transparent, separating the roles of the attorney-general to better manage hate speech while preserving the freedom of the press. The legislative agenda should focus on these; • Addressing inequality as a central focus, be it at the household level or in the business sector, by prioritising public resources to the provision of an effective safety net and levelling the playing field for those on the lower end of the spectrum. We must prevent the emergence of a sizeable permanent underclass. This requires hard choices on the prioritisation of spending and use of taxation; • Reforming the public sector; improve competency in its policymaking and regulatory roles and delivery of public programmes, and to have greater accountability in managing public resources via new procedures and legislation. The Fiscal Responsibility Act is one such initiative; • Redefining public-private partnership by sharpening, not blurring, their respective roles, or making the public sector subservient, in achieving common national goals. We have to move away from socialising costs and privatising gains in this relationship; and • The third sector, civil society organisations and the non-profit sector, is an important sector whose roles in all spheres of life, in the social and economic life of communities in the country, will need to be broadened in the light of the severe fiscal constraints. Therefore, policy and regulations including taxation policy will need to be supportive of this development objective. Reasonable Malaysians who do not agree with each other can perhaps agree on these, and that the government and the legislative body should focus on these initiatives. Let us stop this endless dumbing-down of everything and end infantilism. Dr Nungsari A Radhi is an economist Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/665335

MIDF maintains buy call on UMW and MBM Resources amid Daihatsu admitting fudging crash test

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KUALA LUMPUR (May 2): MIDF Research maintains a “buy” call on UMW Holdings Bhd and MBM Resources Bhd (MBMR) at an unchanged target price of RM5.28 and RM4.70 respectively, following Perusahaan Otomobil Kedua Sdn Bhd (Perodua)’s clarification that Perodua Axia remains safe for driving.    On April 28 (Friday), Daihatsu Motor Co Ltd (Daihatsu) had confirmed that it had committed “procedural irregularity” on the Japanese firm’s side collision impact safety testing for four models,including the new Perodua Axia.  The other three models were Toyota Agya, Toyota Yaris Ativ, and an undisclosed upcoming product.    However, MIDF in a note on Tuesday (May 2) said Perodua’s clarification should provide some relief to investors and could present an opportunity to buy.    MBM Resources Bhd (MBMR), which is an automotive trader and parts manufacturer that also supplies Perodua vehicles, fell almost 2% on April 28.    “[This] could have been influenced by Daihatsu’s revelation on the incident and the resultant concerns on the recently launched Perodua Axia.    “The latest positive developments following the incident should provide some relief to investors and could present an opportunity to buy on dips, in our opinion,” the research outfit said.    The stock now trades at 5.7 times FY23 PER, a 25% discount to historical mean, and at current price, entails an attractive 7% dividend yield (FY23F: 40% dividend payout).    Perodua’s management explained that despite the revelation by Daihatsu, the UN-R95 certification accorded to Perodua Axia remains intact, based on its engagement with the relevant safety testing authorities and agencies, following the news.    “As such, no recall will be issued, nor will there be a halt in production of the Axia,” MIDF added.    Perodua Axia attained a 4-star ASEAN NCAP rating during its test conducted in January 2023. The UN-R95 is one of the tests required to be carried out, specifically, in terms of passenger safety in the event of a side collision, whereby it is a pre-requisite for a 3-star (and above) ASEAN NCAP rating.    A similar statement was issued by UMW on the Toyota Vios, highlighting that subsequent testing has validated that the Vios meets the UN-R95 certification and there is no need for the model to be recalled, while sales and production will continue without disruption.     Daihatsu Motor’s “procedural irregularities” in regard to the side collision impact safety testing for the four models, arose from the addition of a “notch” to minimise the risk of door panels breaking into sharp edges and causing injuries when the side airbag is deployed, whereby the modification is not present in production vehicles.    According to Daihatsu, of the 88,000 units affected, the majority 76,000 is reported to be the Yaris Ativ bound for Thailand, Mexico and the Gulf Cooperation Council countries.    Daihatsu also announced that production and sales of the affected models will be halted until a re-inspection is done in the presence of inspection and certification authorities.  UMW shares closed 0.78% or three sen lower to RM3.84 on Tuesday, valuing the company at RM4.49 billion; while MBMR shed 1.67% or six sen to RM3.53, giving the company a market capitalisation of RM1.38 billion.  Read also: Perodua says there will be no recall of Axia model

https://theedgemalaysia.com/node/667145

SC seeks public feedback as it reviews Capital Markets and Services Act

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KUALA LUMPUR (May 16): The Securities Commission Malaysia (SC) is undertaking a holistic review of the Capital Markets and Services Act 2007 (CMSA) — a key legislation that regulates the Malaysian capital market — to ensure that securities laws remain fit for purpose and to promote efficiency to keep the capital market competitive while maintaining adequate investor protection. In a statement on Tuesday (May 16), the regulator said it is requesting the public’s feedback on parts and areas under the CMSA relating to product governance, disclosure, the approval process for corporate proposals and takeover. “This public feedback is aimed at ensuring the comprehensiveness of its review, complementing ongoing industry engagements and focus group consultations. “This inclusive approach will help the SC to take into consideration all issues of concerns through a transparent review process. By seeking input from stakeholders across the industry, the SC can also identify potential gaps and gain valuable insights into how best to improve the CMSA,” said the SC. It added that interested parties and members of the public are encouraged to submit their comments, feedback and queries to the SC by June 16 at [email protected].

https://theedgemalaysia.com/node/601176

Local Twitch streamers carve out personal space on internet

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This article first appeared in Digital Edge, The Edge Malaysia Weekly on December 27, 2021 - January 2, 2022 Social media giants such as Facebook, Instagram and YouTube have long occupied the livestreaming space, catering to the general public with content ranging from mukbang (where the host broadcasts his or her binge eating) to business webinars. A large segment of internet dwellers may, however, find Twitch synonymous with livestreaming. Launched in 2011, Twitch had always been a livestreaming service focusing on video games, becoming the go-to platform for major e-Sports competition broadcasts. Viewership figures exploded during the pandemic, with concurrent viewers more than doubling from 1.26 million in 2019 to 2.84 million in 2021, according to Twitchtracker. After it was acquired by Amazon in 2014, Twitch gradually branched out into other forms of content, such as tapping into artwork, music or in-real-life (IRL) broadcasts. In fact, Twitch launched 350 new tags in May this year, allowing users to search for local streamers under the “Malaysian” tag. Despite the explosive growth of Twitch, the local Twitch streaming community is a little bit left behind. While local celebrity YouTube videos can easily reach millions of views, local Twitch streamers may find it hard to garner more than 100 concurrent viewers at any given time. Who are these diligent streamers producing content regularly, and why do they like Twitch so much? Digital Edge spoke to several local Twitch streamers for answers.   Livestreaming is part of the gig economy — a career option for those who appreciate not having to work for someone or having a fixed work schedule. This is exactly why Izzat Asyraf got into the livestreaming scene in 2014. Izzat was studying computer science but could not complete his degree after he was diagnosed with clinical insomnia. Because of this, he found it difficult to land a job in either the public or private sector and, while there were several job openings available, most of them were for contract work. “I couldn’t finish my studies because the doctor said my insomnia was serious — I did not sleep for three days in a row. The doctor suggested that I put my semester on hold, which is why I have only a diploma now,” says Izzat. “I then went into streaming because I already had an online community of my own, from Discord and Facebook, so promoting my channel was easy. Going into livestreaming seemed obvious at that point in time.” These days, Izzat focuses on making gaming content while cosplaying as Zhongli, a video game character from Genshin Impact. He explains that cosplaying while streaming is still a niche category, as many others have opted to create virtual avatars instead — also known as Vtubers. In the streaming space, there are still many creators that stream for fun without turning on their webcams or providing commentary, he says. To further differentiate himself, Izzat provides commentary in a mix of English, Malay and, sometimes, Japanese, which he picked up while attending language classes at university. Although YouTube has a significantly larger audience base, Izzat finds it easier to garner viewership via streaming instead. There is a lot more work that goes into becoming successful on platforms such as YouTube, including designing video thumbnails and coming up with the correct tags. On Twitch, subscribers would always receive a notification when a creator goes live, making it easier to grow a fan base and attract repeat viewers. “One of the most life-changing events I had was obtaining a sponsorship. If streamers keep making good content, sponsors will reach out via e-mail and WhatsApp, and they offer different kinds of deals. I get paid for playing a particular game three days in a row or playing a game consistently for a few months. But they will sponsor you based only on how much marketing potential you have,” he says. Izzat has no regrets over going down the path of livestreaming, explaining that he currently earns more than he would have a full-time job. The ability to determine his own streaming schedule or go on hiatus whenever he pleases is what made him stick to the platform for so long.   Elise Wong is perhaps one of the more active participants in the local Twitch art community, with several streamers interviewed for this story speaking fondly of her content. Wong started streaming in 2017 and produces primarily art content, with some gaming streams sprinkled in now and then. She started streaming as a full-time career only in June. Before that, she worked in her family business, running an insurance company. She always had a deep passion for the arts, and it was difficult to tell her family she did not plan to take over the business. “They were sad but very supportive, for which I am truly grateful. I even had to teach my boomer parents what livestreaming is. It was kind of cute because my brother taught them how to browse Twitch, and they actually watch my stream and contribute to the views as well,” she tells Digital Edge. Anybody with a laptop can easily set up a livestream, she says, but getting viewers on Twitch can be quite difficult. A beginner streamer on Facebook could easily garner the same viewership figures that took years to cultivate on Twitch. There is a unique charm to Twitch, however, that is hard to replicate. While Facebook and other platforms are populated by mass corporations and business entities, Twitch is still centred on individual creators. On Twitch, creators base their worth on the quality and number of interactions with viewers, rather than the number of likes and followers. For Wong, it is much easier to build more personal and meaningful relationships on Twitch, and she views YouTube and Instagram simply as platforms to archive her portfolio and art content. “I have tried livestreaming on Instagram and YouTube, but one thing great about Twitch is how streamer-friendly it is. Twitch is like your favourite TV show, but you get to chat with the creator. You can support their content through subscriptions and donations, making it possible for them to continue creating content,” she says. When Wong started streaming in 2017, it was difficult for local streamers to meet each other unless they produced similar content and played the same video games. Each content creator was like a tiny island dotting the vast ocean of the Twitch universe. As such, it was hard to determine what exactly Twitch culture was, because it depended on who the viewer was watching. She explains that professional e-Sports players with more than 1,000 concurrent viewers may find it hard to interact with their audience, owing to the sheer amount of activity going on in the chat. Being a female gaming streamer also tends to attract the more toxic segments of the Twitch audience base. Wong finds smaller streamers have an easier time shaping a much more wholesome and supportive viewership base than larger ones. Fortunately, the art community on Twitch tends to be more wholesome regardless of audience size, with the chat often offering words of encouragement to artists who are less confident about their work. “It was really difficult to build communities back then. There was a category called Malaysian Streamers, but if you clicked on it, there were hardly any Malaysians on it. For some reason, Twitch decided to remove the category, so we could not even find any Malaysian streamers at all,” says Wong. “Only recently did Twitch launch the Malaysian tag. Because of that, I found a whole lot more Malaysians, and more Malaysians found my channel as well. It was interesting because I always knew Malaysia had the talent [to stream and entertain], but it was hard to find them because we are not known to advertise ourselves. I am still shocked at how much great content we can produce.”   Creators do not necessarily need to stream full-time to find success on the platform. Jeevan Raj Menon streams gaming content only a few hours a day but is currently the most viewed creator on Twitch for the zombie game World War Z. For the rest of his day, Jeevan focuses on running Cove eSports, an agency he founded upon returning to Malaysia after a long stint in the US. “My life’s trajectory was very different. I did my music degree in Berklee [College of Music] and was in the music industry for about 10 years. Prior to e-Sports, I was a professional music composer and producer, based in both the US and India,” he tells Digital Edge. “I was really into gaming since I was 16 or 17, but I had other passions as well. When I went into music, I completely gave up gaming and did not play much for about a decade. Gaming was not something that I ever saw myself coming back to at all. “I returned to Malaysia in 2017 for a particular music project, which required me to stay here for about half a year. While I was here, I still had friends in the gaming scene. We started talking about opportunities in this space. One thing led to another, and here we are at Cove.” It was challenging to make the transition, especially obtaining the buy-in from his family. Jeevan’s mother was worried that all the years, resources and effort that went into music education would go down the drain. Jeevan felt, however, that music was not a sustainable avenue, as the industry required a lot of luck and hustle to succeed. Jeevan, who is in his mid-30s, found more freedom in the e-Sports and streaming space. His journey as a music composer was a lone venture, whereas he has more control over his life’s direction via Cove. Today, the company operates a cybercafé in Subang Jaya with an emphasis on simulator racing and helps companies run e-Sports campaigns. With Jeevan’s handle on the e-Sports industry and passion for gaming, livestreaming on Twitch is a natural progression. He tends to avoid playing competitive games, where players tend to be toxic because of the nature of these games. He finds it easier to destress by playing zombie games that promote player collaboration instead. “What I came to realise after studying my streams is that I could now meet and interact with people not only from Malaysia but also from countries around the world. As a non-professional player, gaming without an impactful cause was something that I could not afford to do, especially as a working adult,” he says. “But, now, I look at streaming very differently from when I started out. Say, I meet someone from Pakistan. I have often Googled and looked at the images of the places they are from and imagined what it would be like to be in their shoes. Now, I can interact with them; streaming has allowed me to live vicariously through other people.” While the definition of success may vary from streamer to streamer, Jeevan says building an extensive following requires tireless effort and business acumen. Being the most watched streamer for World War Z pales in comparison to the viewership numbers of top streamers from popular games such as Valorant or Counter-Strike. Reaching a large number of followers requires analysing the market and making calculated moves, says Jeevan, such as going for newly launched games that have the potential to gather a high number of viewers. Streamers may also need to leverage other platforms apart from Twitch, for instance, by sharing gameplay footage on YouTube and Facebook. He finds it difficult, however, to allocate the time and effort needed to grow the business aspects of livestreaming as he has a company to run. However, Jeevan firmly believes that as long as streamers take the initiative and treat streaming seriously, success will come naturally.   Tan Kang Meng, a local art streamer who goes by the online persona Zeonz, started streaming because of circumstances brought about by the pandemic. Tan has a background in applied engineering and had worked as a machinist for more than a decade, operating advanced computer numerical controls — machines that process materials by following programmed instructions. The pandemic hit when he had just resigned and it was difficult to secure a new job in a lockdown. Tan was also a self-taught artist and photographer, so he turned to streaming as a stop-gap measure. What started out as something temporary has gradually become more permanent, as he finds that the more he streams, the less he misses his old life as a machinist. “The STEM (science, technology, engineering and mathematics) industry does pay well. But companies are always looking for ways to reduce costs and often skim the top off the labour department. Working with heavy machinery, there are many aspects that you have to take care of. With a small team, each member is bound to have an increased workload,” says Tan. In addition to the added work stress, he found the work to be routine without much to look forward to in terms of prospects. He has worked with three companies throughout his career and developed trust issues along the way, owing poor communications and company politics. “I worked for one of the companies for three years, hoping to get the position that I wanted — as a drafter, who basically creates the technical drawing and blueprints. Because I did not have experience in those aspects, my boss put me under administrative training, where my role was purely to carry out my boss’ instructions. “My boss kept cycling me through many departments and positions, but didn’t put me in the engineer draft position until the fifth year. I was disappointed because I had expected to have the position by the third year. A new colleague with only a diploma managed to get the position despite having no background in engineering design, and I was a little bit upset.” Streaming became Tan’s way of reinventing himself and gaining more control over his life. While browsing Twitch one day, he learnt that very few people actually edit photos while livestreaming. Since he took photographs as a hobby, he started out livestreaming his photo editing process. His rig could not cope with the intense computing requirements, however, so he turned to drawing instead. He had always had an interest in drawing but stopped doing it the moment he entered the workforce. His drawing tablet sat hidden in a box for almost a decade. After blowing off the layers of dust, he started offering free art commissions to new subscribers. His channel slowly grew and he gradually pushed himself into taking increasingly difficult art projects to catch up on years of neglected practice. Tan admits that it is difficult to stream full-time without tapping alternate sources of income, such as art commissions, YouTube AdSense and Patreon subscriptions. After having streamed for more than a year, Tan describes his income as not loss-making, but stagnant. “I am still thinking very hard about my options and future. Part of me thinks that I am very content with just streaming for a living. One way or another, I need to think of ways to outperform what I have built over the past year,” he says. “But I also do not want my parents to be worried about me. They are unsure about streaming as a career, and would rather I get a job. But I also know that if I were to return to that life, it might also affect my self-respect, because this is the choice I have made for myself.” Nevertheless, Tan has benefitted a lot from being on the platform. He says Twitch is a unique entity on the internet, which made him realise that there are millions of people in the world looking to improve themselves and their circumstances. It also reminded him that the process could be fun.   Anne-Marie Choon is a fresh graduate who majored in history. Although she enjoyed studying the subject in theory, applying it as a career was a different matter. She has a knack for entertaining people and, today, she regularly streams on Twitch as a singer and voice actress. “I have been singing my whole life and started a YouTube channel in 2015 uploading covers, which has been going on for six years now. I got into voice acting only last year,” she explains. “Voice acting was something I am interested in, and there was a casting call for a local game production. I auditioned for that and landed the job and, since then, I have been taking voice acting lessons and auditioning for similar roles. “I got into livestreaming because it was hard to land a job during the pandemic. I wanted to try something different and I like the interactive aspect of livestreaming on Twitch that you don’t really get on YouTube.” Choon started her Twitch Channel in February this year. Although she has close to 100,000 subscribers on YouTube, she made a conscious effort to keep both platforms separate. While YouTube is dedicated to music, she focuses on gaming and art content on Twitch. Although Choon does receive requests to sing on stream now and then, she is still not comfortable doing so spontaneously, but she has cultivated a community supportive of her goal. She now focuses on streaming gameplays of indie games such as Oxen Free and Kingdom Hearts. For now, Choon streams five days a week between 10am and 2pm, catering for overseas audiences who view her stream in the evenings. Although she is growing as a content creator and professional voice actress, she is still unsure about whether she should pursue this path full-time. None of these individual avenues are enough to support her financially, and she hopes combining these sources of income will be able to keep her going. As a matter of fact, she started streaming to build her own community, and not for the money. “Finding social interaction during the pandemic and creating a sense of community in real life is difficult, but Twitch allows me to do that. I enjoy doing the things on stream, which started out as a hobby. But now I also have a community that enjoys it as well, and I wanted to share the things I love doing,” she says. “It is like creating your own little space on the internet for people you know and who are like you. You make your own rules on your channel, create a little corner for yourself and welcome people in. “ Some of Choon’s best interactions on the platform come from running charity streams, and she finds satisfaction in bringing people together to support a cause. One of her first charity streams was for the International Bipolar Foundation, as she is bipolar herself. It provides a safe space for her to meet and share experiences with people who are struggling with similar issues, as it is difficult to open up such discussions on other sites such as YouTube, owing to the lack of immediate feedback and response. Choon highlights the struggles of being a female streamer on the platform. There are always anonymous viewers sexualising women and making uncomfortable comments about their physical appearance. She says most of them are empty threats by online trolls looking to get a reaction out of people. “If someone is harassing you, you can call them out or just ban them. It’s a great thing that the ban button exists, because you don’t want to encourage or foster that sort of toxic behaviour in your own community. If you are lenient, it will compound further,” Choon says. “What makes a successful streamer is the ability to build a community. I watch Twitch streamers not just for the content and personalities, but also the communities that surround them. Twitch streamers who cultivate a healthy community probably have to go through a lot of harassment, and slowly filter out the bad ones and find the ones who are supportive.” Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/606175

威立：第二大股东通过直接商业交易售股 非遭逼仓

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（吉隆坡4日讯）威立（KPower Bhd）今日澄清说，第二大股东Grand Deal Vision私人有限公司是通过商业直接交易（DBT）脱售股份。 针对昨日向大马交易所的报备，该集团今日作出修改，称是通过直接商业交易售股，而非之前提及的遭逼仓。 该集团昨日指出，Grand Deal Vision于1月31日，以每股35仙的价格，脱售威立的50万股或0.092%股权，这使得执行主席兼集团董事经理Mustakim Mat Nun和非独立非执行董事Sarah Azreen Abdul Samat的持股权下降。 另外，威立财务总监Amirul Afif Abd Aziz亦于1月31日脱售65万股或0.12%股权。 根据彭博社数据，肯纳格投资（Kenanga Investors Bhd）是威立最大股东，持股16.3%，其次是Grand Deal Vision（8.52%）和Mustakim（6.7%）。 由于姐妹公司Serba Dinamik Holdings Bhd的审计事件，威立自2021年5月以来一直呈下跌趋势。 Serba Dinamik董事经理兼总执行长Datuk Dr Mohd Abdul Karim Abdullah曾是威立的非独立非执行主席，但已于去年12月辞职。 他也于1月13日退出威立的大股东之列，在2021年2月至2022年1月期间通过一系列交易出售了7905万股。 该股从去年2月3日的2.40令吉收盘价，挫跌了85%。 闭市时，跌1仙或2.8%，收报35仙，市值为1亿9000万令吉。   （编译：陈慧珊）   English version：In amended filings, KPower clarifies that Grand Deal Vision disposed of shares via DBT, not forced selling

https://theedgemalaysia.com/node/600601

重量级股项掀购兴 马股欲振乏力

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（吉隆坡21日讯）交易商表示，尽管金融服务股及通讯与服务股等重量级股项掀起购兴，但马股欲振乏力。 截至中午12时30分，富时隆综指微跌0.42点，至1493.48点，周一收报1493.9点。 富时隆综指低开1.1点，报1492.8点，盘中游走于1491.39点至1496.24点之间。 下跌股398只，上升股286只，371只无起落，1245只无交易及15只暂停交易。 总成交量为12亿3000万股，总值8亿1446万令吉。 乐天交易预计，富时隆综指今日将徘徊于1490点至1500点之间。 “虽然估值仍然便宜，但我们预计富时隆综指不会在市场波动加剧和情绪减弱的情况下，出现任何重大变动。” 重量级股项马银行（Malayan Banking Bhd）持平于8.11令吉，大众银行（Public Bank Bhd）升3仙，至4.10令吉，国油化学（Petronas Chemicals Group Bhd）涨2仙，报8.80令吉，IHH医疗保健（IHH Healthcare Bhd）和联昌国际集团（CIMB Group Holdings Bhd）各扬1仙，分别报6.54令吉和5.30令吉。 热门股方面，Swift Haulage Bhd降2仙，至1.01令吉，实科工业（Scope Industries Bhd）挫2.5仙，报26仙，蓝宝集团（Lambo Group Bhd）企于4.5仙，而马来西亚基因组学资源中心有限公司（Malaysian Genomics Resource Centre Bhd）则升5仙，至98仙。   （编译：魏素雯）   English version：Bursa Malaysia slightly lower at midday

https://theedgemalaysia.com/node/601730

2021 Newsmakers: Veteran leaders hope for another dawn

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This article first appeared in The Edge Malaysia Weekly on December 27, 2021 - January 2, 2022 President of Pan-Malaysian Islamic Party, special envoy to the Middle East and member of parliament for Marang For the ninth time, PAS president Tan Sri Abdul Hadi Awang, 74, who has helmed the Islamic party since 2002, was returned unopposed to the post at the party’s 67th annual assembly in November. Hadi’s endurance as party head reflects its political culture that stresses allegiance among followers over contesting for leadership, which is more visible in other political parties. Hadi’s position was therefore secure despite questions about his health, which arose following a spate of hospital stays due to exhaustion in February, April and June. In September, he was retained as a special envoy to the Middle East in the Cabinet of Prime Minister Datuk Seri Ismail Sabri Yaakob, carrying on in that position from the administration of the previous premier, Tan Sri Muhyiddin Yassin. As one of three special envoys with ministerial status in Ismail Sabri’s Cabinet, Hadi’s inclusion in the government shows the leverage which the party continues to enjoy as a member of the Perikatan Nasional (PN) coalition that it formed with Muhyiddin’s Bersatu and Sabah-based parties in 2020. Nevertheless, the cost of these positions to the public purse has provided fodder for the government’s critics, who see the appointments as a reward for backing the premier in parliament. PAS’ attempt to strengthen its electoral prospects through its alliance with Umno, in the form of Muafakat Nasional, came under strain towards year end as the two parties aired their differences over whether to admit Bersatu, which is an Umno splinter party. Leaning towards PN following a dismal outing by PAS in the Melaka state election in November, Hadi said his party was being shackled by its pact with Umno. — By Rash Behari Bhattacharjee   Former two-time prime minister, chairman of Parti Pejuang Tanah Air and member of parliament for Langkawi Former prime minister Tun Dr Mahathir Mohamad, 96, continued to make the headlines this year with his characteristically controversial views. Most recently, a remark about Chinese Malaysians using chopsticks rather than their hands to eat rankled public sentiment when he equated it to a failure to assimilate with local culture. His party, Pejuang, later issued a statement that the remark had been taken out of context and blown out of proportion. Showing no sign of leaving politics, he told a news conference in December that he still feels the need to bring down the current government because it did not come into power through an election. He was speaking at the launch of his latest memoir, titled Capturing Hope: The Struggle Continues for a New Malaysia. The book, which gives his account of the 22 months of the Pakatan Harapan government that he led, ignited a row with Damansara MP Tony Pua, whom he refers to only as a trusted adviser to his then finance minister Lim Guan Eng. In his memoir, Mahathir accuses Lim’s political secretary of being arrogant and behaving like a minister. Hinting at his plans for the next general election, which is due by 2023 but could be called next year, Mahathir said in November that he may contest “as a last resort”. Earlier this year, his readiness to do battle was evident when he told Tan Sri Khalid Abu Bakar in May that he would see the former inspector-general of police in court. Khalid had sued Mahathir for defamation over a statement that, in 2015, he had leaked information on the progress of an investigation into 1Malaysia Development Bhd to then prime minister Datuk Seri Najib Razak. — By Rash Behari Bhattacharjee   Chairman of the central policy and strategic planning commission of the Democratic Action Party and member of parliament for Iskandar Puteri Lim Kit Siang, 80, has been a standard-bearer for the DAP for more than five decades and shows no signs of slowing down. For almost the entire time, he has kept the government of the day on its toes, except for about two years after the 2018 general election, when Pakatan Harapan, in which the DAP is a senior partner, took control of Putrajaya. In the just concluded Sarawak state election, the DAP suffered a major reversal, winning just two seats compared to seven in the last election. Lim’s campaign had focused on issues ranging from the disparity in development between the Borneo states and Peninsular Malaysia to the party’s fight for Sarawak’s rights under the Malaysia Agreement 1963 to be fully recognised. It was the latest rerun of his lifelong mission as the champion of justice. That story was captured in his biography, Lim Kit Siang: Malaysian First, Volume One — None But the Bold, launched in November. Three years after he joined the DAP, Lim was named as its secretary-general in 1969, a post he retained until 1999. Since his political debut, he has spent a lifetime in political battles as the people’s representative in both the state assembly and parliament. It included almost three decades as opposition leader in parliament, much of it spent holding the government of the then prime minister Tun Dr Mahathir Mohamad to account. A cancer scare in 2017 failed to dampen Lim’s appetite for the political joust. — By Rash Behari Bhattacharjee   Opposition leader, president of Parti Keadilan Rakyat and member of parliament for Port Dickson In November, Datuk Seri Anwar Ibrahim had to face down new calls for him to resign as the Pakatan Harapan (PH) chief after the coalition was mauled in the Melaka state election. PH won only five seats, compared with 15 in the 2018 general election. The PKR president has spent two decades in his quest for the premiership, stretching back to his sacking when he was deputy to then prime minister Tun Dr Mahathir Mohamad in 1998. Over the years, he had claimed several times to have gathered enough support from MPs to form the government, but failed to clinch the post on each attempt. This year, too, Anwar, who is opposition leader, claimed to have the majority in parliament after Tan Sri Muhyiddin Yassin resigned as prime minister in August. In the end, Umno vice-president Datuk Seri Ismail Sabri Yaakob secured the necessary backing to become the country’s ninth prime minister. In September 2020, some seven months after Muhyiddin — president of Bersatu — had become prime minister following the Sheraton Move, Anwar said he had the support of a strong majority and was ready to form the government. However, he failed to convince the King despite showing him documents to prove his case. Anwar’s repeated attempts to claim the anointed position is eroding his support among his political allies and voters. Fatigue over the endless manoeuvrings of ageing political actors is fuelling calls for new blood to take over from the old guard and could make it more difficult for the PKR president to stay relevant in the new year. The issue will gain more urgency with the implementation of the Undi18 law, which lowers the voting age from 21 to 18 by the end of the year. — By Rash Behari Bhattacharjee   Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/645503

安华宣誓就任我国第十任首相

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（吉隆坡24日讯）拿督斯里安华宣誓就任我国第十任首相。 安华是于今日下午5时，在国家元首苏丹阿都拉陛下面前完成宣誓。 现年75岁的安华，曾在2008至2015年及2020至2022年担任两届反对党领袖。他将接替自2021年8月出任首相的拿督斯里依斯迈沙比里（国阵）。 出席者还有政府首席秘书丹斯里丹斯里莫哈末祖基、首席大法官东姑麦润，以及下议院议长丹斯里阿兹哈。   （编译：陈慧珊）   English version：Anwar sworn in as 10th prime minister of Malaysia

https://theedgemalaysia.com/node/613823

My Say: Be pragmatic, not dogmatic, about the stagflation threat

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This article first appeared in Forum, The Edge Malaysia Weekly on March 28, 2022 - April 3, 2022 "If your only tool is a hammer, every problem looks like a nail.” Still haunted by the clever preaching of the late monetarist guru Milton Friedman, all too many monetary authorities address every inflationary threat or sign they see by raising interest rates. Friedman’s dictum that “inflation is always and everywhere a monetary phenomenon” still defines the orthodoxy. Despite changed circumstances in the world today, for Friedmanites, inflation must be curbed by monetary tightening, especially interest rate hikes. The threat of higher inflation has risen with Russia’s Ukraine incursion and the punitive Western “sanctions from hell” in response. International Monetary Fund managing director Kristalina Georgieva warns that wide-ranging sanctions on Russia will worsen inflation. European Central Bank (ECB) president Christine Lagarde fears that “the Russia-Ukraine war will have a material impact on economic activity and inflation”. US Treasury Secretary Janet Yellen has also acknowledged the new threat. She recognises that tighter monetary policy could be contractionary, but expresses confidence in the US Federal Reserve’s ability to balance that. Meanwhile, Fed chair Jerome Powell has pledged to be “careful”. Terming Russia’s invasion “a game changer” with unpredictable consequences, he stressed readiness to move more aggressively if needed. On March 16, the Fed raised its benchmark short-term interest rate while signalling up to six more rate hikes this year. But other central bankers do not agree on how best to respond. Bank of Japan governor Kuroda Haruhiko has ruled out tightening monetary policy. He recently noted, “It’s inappropriate to deal with [cost-push inflation] by scaling back stimulus or tightening monetary policy.” To Kuroda, an interest rate hike is inappropriate to deal with inflation due to surging fuel and food prices. Friedman’s disciples at some central banks began tightening monetary policy from mid-2021. The Reserve Bank of New Zealand, the first to adopt strict inflation targeting in 1989, raised interest rates in August for the second time in two months. The Bank of England (BoE) raised interest rates for the first time in more than three years in December. Going further, Norway’s central bank doubled its policy rate on the same day. Anticipating interest rate rises in the US and under pressure from financial markets, central banks in some emerging market and developing economies (EMDEs) — such as Brazil, Russia and Mexico — began raising policy interest rates after inflation warning bells went off in mid-2021. Indonesia and South Africa jumped on the bandwagon in January this year. With inflation surging after the Ukraine incursion, the Bank of Canada doubled its key rate on March 2 — its first increase since October 2018. The ECB has a more hawkish stance, dropping its more cautious earlier language. Its governing council has reiterated an old pledge to “take whatever action is needed” to pursue price stability and safeguard financial stability. Following the Fed’s move, the BoE raised its interest rate the next day. A month before, in February, the BoE chief economist was against raising interest rates, favouring a more nuanced approach. However, instead of knee-jerk interest rate responses, Reserve Bank of Australia governor Philip Lowe is “prepared to be patient” while monitoring developments. EMDE central bankers have also responded differently. Brazil has raised its benchmark interest rate after the Fed, and signalled more increases could follow this year. But Indonesia has been more circumspect. The interest rate is a blunt policy tool. It does not differentiate between activities facing rising demand and those experiencing supply disruptions. Thus, interest rate hikes adversely impact investments in sectors facing supply bottlenecks and needing more investment. In short, the interest rate is indiscriminate. But the prevailing policy orthodoxy of the past four decades does not differentiate among causes of inflation, prescribing higher interest rates as the miracle “cure-all”. This monetarist policy orthodoxy does not even recognise multiple causes or sources of inflation. Most observers believe that current inflationary pressures are due to both demand and supply factors. Some sectors may be experiencing surging demand while others are facing supply disruptions and rising production costs. All this has now been exacerbated by the Ukraine crisis and the ensuing sanctions interrupting supplies. Well over half a century ago, the United Nation’s World Economic Survey 1956 warned, “A single economic policy seems no more likely to overcome all sources of imbalance which produce rising prices and wages than is a single medicine likely to cure all diseases which produce a fever.” Addressing “cost-push” inflation using measures designed for “demand-pull” phenomena is not only inappropriate but also damaging. It can increase unemployment significantly without dampening inflation, warned the UN’s World Economic Survey 1955 as Friedman’s anti-Keynesian arguments were emerging. Interest rates do not discriminate between credit for consumer and investment spending. In efforts to dampen demand sufficiently, interest rates are raised sharply. Such monetary tightening can do much lasting economic damage. Declining or lower investment is harmful for the progress needed for sustainable development, which requires innovation and productivity growth. After all, improved technologies typically require new machines and tools. Dealing with stagflation — economic stagnation with inflation — caused by multiple factors requires both fiscal and monetary policies working together complementarily. They also need particular tools and regulatory measures for specific purposes. Monetary authorities should also create government fiscal space by financing unanticipated urgent needs and long-term sustainable development projects, for example, for renewable energy. Governments need to first provide some immediate cost of living relief to defuse unrest as food and fuel prices surge. This can be done with measures that may include food vouchers and suspending some taxes on key consumer products. In the medium to long term, governments can expand subsidised public provisioning of healthcare, transport, housing, education and childcare to offset rising living costs. Such public provisioning — increasing the “social wage” — diffuses wage demands, preventing wage-price spirals. Such policy initiatives brought down inflation in Australia during the 1980s without causing large-scale unemployment. This contrasted with the deep recessions in the UK and the US then due to high interest rates. But to do so, governments need more fiscal space. Hence, tax reforms are critical. Progressive tax reforms — such as introducing wealth taxes and raising marginal tax rates for high-income earners — also mitigate inequality. Governments also need to align their short- and long-term fiscal policy frameworks. Monetary authorities need to apply a combination of tools, such as reserve requirements for commercial bank deposits; more credit, including differential interest rate facilities; and more inclusive financing. For example, central banks should restrict credit growth in overheated sectors, while expanding affordable credit for those facing supply bottlenecks. Central banks also need to curb credit growth likely to be used for speculation. Governments need regulatory measures to prevent unscrupulous monopolies or cartels trying to manipulate markets and create artificial shortages. Regulatory measures are also needed to check commodity futures and other speculation. These increase food and fuel prices and a number of other problems. Relying exclusively on the interest rate hammer is an article of monetarist faith, not macroeconomic wisdom. Pragmatic policymakers have demonstrated much ingenuity in designing more appropriate macroeconomic policy responses — not only against inflation, but worse, the stagflation now threatening the world. Anis Chowdhury, a former professor of economics at the University of Western Sydney, held senior United Nations positions from 2008 to 2015 in New York and Bangkok. Jomo Kwame Sundaram, a former economics professor, was United Nations assistant secretary-general for economic development. He is the recipient of the Wassily Leontief Prize for Advancing the Frontiers of Economic Thought. Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/625820

S&P revises Malaysia's outlook to stable from negative, expects 2022 GDP growth to hit 6.1%

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KUALA LUMPUR (June 27): S&P Global Ratings has revised upward its rating outlook on Malaysia’s long term sovereign credit ratings to stable from negative, reflecting its expectation that the country’s steady growth momentum and strong external position will remain in place for the next two years. At the same time, it anticipates that the policymaking environment will be supportive of restoring fiscal settings to a firmer footing. “We revised the outlook to stable in recognition of Malaysia's consistently strong growth trend that is faster than sovereigns of similar income level. Though Malaysia's budget deficits remain high, we expect its growth dynamics to offset vulnerabilities associated with its weak fiscal settings. In addition, political commitment to resume fiscal consolidation post-pandemic is strong, in our view," S&P said in a statement on Monday (June 27). At the same time, it affirmed its 'A-' long-term and 'A-2' short-term foreign currency sovereign credit ratings on Malaysia, as well as its 'A' long-term and 'A-1' short-term local currency ratings on the country. “Our affirmed ratings on Malaysia reflect the country's strong external position, monetary policy flexibility, and record of supporting sustainable economic growth. The country's elevated government debt stock and weak fiscal performance temper these strengths,” it said. The ratings agency previously revised Malaysia's outlook to negative from stable in June 2020, citing heightened risks to fiscal metrics due to the Covid-19 pandemic. On GDP, S&P is projecting a strong pick up in Malaysia’s GDP growth to hit 6.1% for 2022. It believes that the strong growth momentum will persist in the second half of the year, as Malaysia is a net energy exporter and major producer of crude palm oil (CPO). “The country is well positioned to benefit from the high commodity price environment. Despite pressures from the Russia-Ukraine war and global supply-chain disruptions, we envisage the easing of domestic Covid-19 restrictions, sustained demand and strong labour market to contribute to economic recovery. “The Malaysian economy is well-diversified and has a record of resilience, following periods of adversity. It has a mature electrical and electronics (E&E) sector that supplies components and finished products to major global players. “We expect E&E, along with the oil and gas sector, taking gains from high energy prices, to drive strong exports over the next one to two years. We forecast that the economy will expand on average 4.7% per annum over 2023-2025,” it said. With this, S&P expects Malaysia's 10-year weighted average per capita GDP will be close to 3%, which it said is well above the global median for peers at similar income levels. "We project Malaysia's GDP per capita to be about US$11,900 by end-2022, lower than most peers' in the same rating category but notably higher than that of most of its Southeast Asian neighbours, except Singapore and Brunei." S&P also noted that while there remains political fluidity, uncertainties regarding policymaking have somewhat subsided. "In September 2021, the government signed a memorandum of understanding (MOU) with the opposition. The MOU addresses bipartisan cooperation on Budget 2022, political stability and long-term political reforms. Hence, we expect fewer disruptions to policy directions until at least the next general elections (which are due by September 2023)." It also expects the government to be committed to resume its consolidation trajectory from next year, following the full reopening of the economy and reduced need for fiscal stimuli and a more conducive policy-making environment. "As a result, we forecast net general government debt to stabilize at about 70% of GDP from 2022-2025, with the annual change averaging 4%," it noted. As for legacy liabilities associated with state-linked investment firm 1Malaysia Development Bhd (1MDB), S&P estimates that this stood at MYR17.5 billion at end 2022. "Come 2023, most of the 1MDB liabilities would be extinguished, with one remaining RM5 billion (0.3% of GDP) sukuk maturing in 2039," it noted. "Committed guarantees excluding the 1MDB obligations have consistently risen in recent years, and we believe this will remain the case over the next three years, as the government continues to support key infrastructure projects and associated firms. But as a share of GDP, these committed guarantees should be steady, in our view," it added. On foreign reserves, it estimates that Malaysia's reserves coverage will be 4.7 months of current account payments at the end of this year. "Though lower than historical levels, it remains sufficient, and we expect Malaysia's deep capital markets to support financial stability. Our forecast assumes that reserve coverage will continue to decline to 4.3 months through 2025," it added. In a separate statement, minister of finance Tengku Datuk Seri Zafrul Abdul Aziz said S&P's latest outlook for Malaysia is in line with the government's expectation of higher GDP growth in the coming quarters, and at the higher end of Bank Negara Malaysia's official estimate of 5.3%-6.3%. The minister also reiterated the government’s commitment towards fiscal consolidation and ensuring fiscal sustainability. “As part of its reform initiatives to strengthen public finances by improving fiscal discipline, expenditure effectiveness, and transparency, the Government is also working to enact the Fiscal Responsibility Act (FRA),” he said. Expected to be tabled by end of this year, the FRA will increase transparency and accountability in particular by publishing a tax expenditure statement, a midyear budget report, and a fiscal risk statement, he added.

https://theedgemalaysia.com/node/650189

Penang inks MOU with Indonesia's Citilink Airlines to boost medical tourism

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GEORGE TOWN (Jan 2): Penang Centre of Medical Tourism (P.MED), an initiative of the Penang state government, has inked a Memorandum of Understanding (MOU) with Citilink Airlines operator PT Citilink Indonesia to bolster medical tourist arrivals from Indonesia to the state. P.MED chairman Yeoh Soon Hin said Indonesia has always been a major source market for Penang's medical tourism given its language and cultural similarities with Malaysia. Yeoh, who is also the state executive councillor for tourism and the creative economy, said the total revenue for Penang's medical tourism has increased exponentially from RM66 million in 2021 to RM285 million in 2022 after the reopening of the country’s international borders. "In the first 11 months of 2022, Penang welcomed 144,975 international medical arrivals, of which Indonesia contributed 54%, followed closely by Bangladesh and India. "To facilitate travel (from) Indonesia, we are now signing this MoU between P.MED and Citilink Airlines to bring more medical tourists to Penang," he said during the P.MED video launch and MoU signing event with PT Citilink Indonesia, witnessed by Chief Minister Chow Kon Yeow here on Monday. Also present were Indonesia’s consul-general in Penang Bambang Suharto, Thai consul-general in Penang Khun Raschada Jiwalai, as well as the airline’s chief commercial and cargo officer Ichwan F Argus and vice president of sales and distribution Emir Bustamam. Meanwhile, in his speech, Chow said that while the numbers achieved this year have yet to surpass that of the pre-Covid-19 pandemic levels, the resurgence of medical tourists to Penang has been very encouraging. “We have attained nearly 50% of what we used to earn in 2019 (and) this is very good for our economy. “It is also something that we are very proud of because it shows that Penang has survived as a tourism destination, and we continue to attract visitors because we have so much to offer,” he said. Chow said that according to the Malaysian Healthcare Travel Council, from 2015 to 2019 the industry recorded a cumulative average growth rate of 17%. “In 2019, Penang received nearly 480,000 medical tourists, generating RM730 million in revenue, and this amounted to nearly 50% of the total (medical tourism) revenue for Malaysia,” he added. Established in 2015, the P.MED initiative is now home to 13 member hospitals and 16 associate members spread over various strategic locations throughout Penang to provide excellent healthcare encompassing a wide range of specialist medical services.

https://theedgemalaysia.com/node/667722

Adani stocks lose US$10b in value as MSCI exclusion weighs

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(March 19): Stocks part of Adani Group have lost a combined US$10 billion (RM45.5 billion) in market value this week, weighed down by MSCI Inc’s move to exclude two entities from its India gauge and concerns over potential dilution from a fundraising plan. Adani Total Gas Ltd and Adani Transmission Ltd — the two stocks to be dropped from the MSCI India gauge at the end of this month — headed for their worst weeks since late February. The exclusions will probably trigger around US$390 million of selling by passive funds, Brian Freitas, an independent equities analyst who publishes on Smartkarma, predicted earlier. Flagship Adani Enterprises Ltd, incubator for many of the group’s investments, is also set for a weekly loss of almost 4%, the biggest since March. The company and the transmission unit last week flagged plans to raise US$2.6 billion via a qualified institutional placement or other modes, triggering concerns of equity dilution. “If the shares are priced too low in a QIP issue, it could be seen as a sign of weakness or desperation,” Arpit Shah, a fund manager at Care Portfolio Managers, wrote via email. Adani stocks have been trying to regain their footing after fraud allegations by Hindenburg Research in late January spurred a rout that at one point wiped out over US$150 billion from the group’s market value. Stocks recovered after GQG Partners in early March bought stakes in four of the group’s entities, offering a vote of confidence. The market-cap loss currently stands at about US$128 billion. Adani has denied Hindenburg’s allegations, while taking steps in the aftermath of the report to assuage investor concerns over debt and corporate governance.

https://theedgemalaysia.com/node/621348

IOI Properties 3Q net profit drops 67% y-o-y but revenue grows

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KUALA LUMPUR (May 25): IOI Properties Group Bhd’s net profit for the third quarter ended March 31, 2022 (3QFY22) plunged 66.59% year-on-year to RM59.72 million from RM178.75 million partly because of property development costs written down. However, quarterly revenue in 3QFY22 grew 27.44% to RM737.79 million from RM578.95 million in 3QFY21 mainly attributable to better performance contributed from all business segments. “Excluding property development costs written down of RM111 million and net foreign currency translation gain on foreign denominated borrowings and deposits, the group’s underlying profit before taxation (PBT) of RM324.6 million for the current year quarter is RM42.9 million or 15% higher than the preceding year corresponding quarter of RM281.7 million. “However, the underlying PBT is partly offset by higher share of associate’s profit in the preceding year corresponding quarter arising from the sale of land. In the current year quarter, the group recognised property development costs written down of RM111 million attributable to the launched development project in IOI International Parkhouse, Xiang’an,” said IOI Properties. The property development segment’s revenue grew to RM605.9 million from RM485.2 million mainly attributable to higher progress works from ongoing development and higher number of vacant possession of the completed projects as the construction activities of the past quarters have been disrupted by lockdown in Malaysia.   The property investment segment recorded revenue of RM99.7 million, higher than the RM72.5 million a year ago amid the commencement of recurring leasing income from IOI Mall, Xiamen and lower rent rebate given to tenants following the improvement in mall traffic in Malaysia operations. Revenue in the hospitality and leisure segment increased to RM30 million from RM19.1 million mainly due to robust domestic demand pursuant to the relaxation of travel restrictions. Amidst the challenges in Malaysia, proactive measures have been taken to drive sales of its mid priced range of products by leveraging on the group’s digital marketing capabilities and aggressive campaigns. In response to the current challenges arising from the strict operating procedures and movement controls implemented by the China government which has affected its mall operations in Xiamen, the group will adopt an active and pragmatic tenant retention strategy to maintain occupancy rates. Meanwhile, the completed residential developments of IOI Palm City and IOI Palm International Parkhouse in Xiamen, China will continue to contribute towards IOI Properties’ financial performance. “Across the border, the group’s new acquisition of a mixed-use development site in Singapore, comprising residential and hotel components in the Marina Bay area, complements its existing developments in the Lion City. Since the acquisition, the group is in the midst of planning the development of the land. At IOI Central Boulevard Towers, leasing activities have received strong response from reputable multinational companies. This is in anticipation of its expected completion in 2023. “We foresee robust recovery of all sectors of the economy as we reopen our borders and transition into the endemic phase. Therefore, we expect an increase in consumer confidence nationwide that will generate a steady rise of demand within the property market,” added the group’s chief executive officer Datuk Voon Tin Yow in a separate statement. IOI Properties shares closed down one sen or 0.98% at RM1.01, valuing the group at RM5.56 billion.

https://theedgemalaysia.com/node/638867

American journalist claims no one in M'sian Govt is trying to find Jho Low

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KUALA LUMPUR (Oct 5): American journalist Tom Wright has claimed that no one in the Malaysian Government is trying to find fugitive financier Low Taek Jho (Jho Low). In a tweet following a report citing Home Minister Datuk Seri Hamzah Zainudin that Malaysia will not offer rewards for information leading to Jho Low, Wright said “Not only that. No one in the Malaysian Government is trying to find him.” On Tuesday (Oct 4), Hamzah was replying to a question by Kepong Member of Parliament Lim Lip Eng on why the Government had not offered any rewards for those with information regarding Jho Low’s whereabouts. Lim queried if the Royal Malaysian Police (PDRM) had contacted Wright and his colleague Bradley Hope, following their claims that Jho Low and his family were spotted in China and Hong Kong in 2018 and 2019. He also asked why the Malaysian Government had not offered any rewards for individuals with information on Jho Low’s whereabouts. In his reply to Lim, Hamzah said in the Dewan Rakyat that PDRM was of the view that the Red Notice issued by Interpol was a better avenue than offering rewards as elements of cooperation and definitive information were involved. He added that this required the 195 member states of Interpol to channel any information to Malaysian authorities to facilitate any extradition process. Read also: No Interpol member state has confirmed Jho Low's whereabouts — IGP

https://theedgemalaysia.com/node/620915

Cover Story: Southeast Asian stock markets still attractive despite dollar headwinds

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This article first appeared in The Edge Malaysia Weekly on May 23, 2022 - May 29, 2022 A strong US dollar poses obvious challenges for most emerging markets, particularly those shouldering hefty foreign currency debt. Yet, investment experts contacted say most economies in Southeast Asia, including Malaysia, remain attractive for their economic growth potential as the world reopens post-pandemic, though things will not be smooth sailing in the near term as markets digest a very hawkish stance by US Federal Reserve. Historically, Asean markets have had mixed reactions to the past four periods of strong US dollar cycles since 1980, stock market data for the past four decades shows. Malaysia did not do well in all four periods, recording negative returns ranging from 2.4% (June 2021 to May 2022) to as much as 29% (April 2008 to March 2009) (see table). Thailand, the Philippines and Vietnam also incurred losses in almost all the strong US dollar periods, except for the May 2014 to December 2016 period, during which their markets grew 8.5%, 1.5% and 17.5% respectively. For June 2021 to May 2022, Malaysia, Thailand, the Philippines and Vietnam lost 2.4%, 0.2%, 0.2% and 5.7% respectively. Indonesia, which chalked up a 14.7% gain for the June 2021 to May 2022 period, lost 30.9% in the February 2018 to March 2020 period and gave up 37.6% during the April 2008 to March 2009 period. Singapore, the only other Asean market to have a positive return during the reviewed period of US dollar strengthening, saw negative returns of 46.4% (April 2008 to March 2009) and 27.4% (February 2018 to March 2020). Measured from the start of the year, the ringgit had weakened 5.8% against the greenback at the time of writing, underperforming other currencies in the region that had eased between 0.8% and 3.1% over the same period. Still, there may well be opportunities to profit while others are fearful. Regional private equity investor and former dealer Ian Yoong tells The Edge it could be a tumultuous ride, with more negative newsflow ahead — ranging from high inflation and souring energy costs to global food shortages — weighing on portfolios. He advises investors to have a diversified portfolio in terms of sector, currency and geography and reckons that clearer skies may come only by the second or third quarter of 2023. Even so, Yoong says Southeast Asia is still the place to invest in in the coming decade, thanks to excellent demographics with a large young population and good work ethics. Those familiar with the region would also be well acquainted with the countries with higher risks from politics and economic mismanagement. Pankaj C Kumar, a former head of research and fund manager, agrees that the growth momentum and investment opportunities remain abundant in Southeast Asia. For investors who want exposure outside Malaysia to avoid single-country risk, LeInves PLT chief investment officer William Ng suggests looking for Malaysian firms that have exposure in emerging markets such as Indonesia and Vietnam. Some Malaysian manufacturing firms, for instance, have set up plants in Vietnam to manage risks, including those worker-related. While Singapore has always been a top choice when it comes to investing in foreign markets, Ng says its stock market is more suitable for long-term investors because of stricter rules and regulations. “The market is dominated by long-term investors with less speculative activity, so it is less volatile,” he explains. Though the glove, plantation, furniture and semiconductor industries are seen as the beneficiaries of a weak ringgit, Ng stresses that factors such as skyrocketing raw material prices and labour shortage need to be considered. “In this case, palm oil is the pure export sector, but it looks a bit neutral because of the labour issue.” The head of a local research house who declined to be named says commodity and finance are the two main themes for investing in Southeast Asia. “Commodity is still the key for markets like Malaysia and Indonesia, although some say prices could come down substantially when the Russia-Ukraine war is over. And as the reopening momentum picks up, banks are a safe bet.” While financial results thus far have been satisfactory this year against 2021, Yoong does not rule out the possibility of corporate earnings of regional firms declining in the second half of 2022, owing to inflation caused by supply shortages as well as weak currencies. “I expect corporate earnings of the majority of listed companies to taper off in 2023, with higher raw material prices and wage inflation. The tremendous potential of the Southeast Asian economies is in the medium to long term. The best investment opportunities present themselves when fear is greatest.” With growth projected to pick up once economic recovery gains pace, Ng believes the momentum will translate into a rise in corporate earnings for Asean firms — despite the short-term blip from high inflation and forex volatility. He says: “Asean is getting more important for global superpowers. At the same time, regional corporates need to look for a more balanced trading policy. They can source raw materials from other places and not necessarily have to use the US dollar for transactions.” There are still undervalued gems for those who care to do their homework. Yoong points out that many small- and mid-cap stocks — especially those involved in the technology manufacturing sector — in Singapore and Hong Kong are very undervalued because of low institutional and retail investor interest. He says: “Many listed companies are trading at earnings multiples in the low teens and respectable returns on equity.” As commodity companies stand to benefit from inflation, the energy crisis and the global food shortage — which will persist for at least a year until demand destruction sets in — Yoong says that small- and mid-cap plantation stocks will be fairly attractive in the next 12 months. He also favours oil and gas services companies with sound balance sheets that are mainly dependent on Petroliam Nasional Bhd (Petronas) and other upstream companies in Malaysia. He says: “These companies have been in the doldrums since 2016. Petronas will most likely increase its capital expenditure for 2023, with oil price expected to stay above US$80 for the next two to three years. The oil and gas industry (O&G) has been at the lowest end of the capital cycle for the past three years. “Petronas plans to allocate an average of RM20 billion in capex in upstream activities over the next five years. It was much lower over the past couple of years at RM12 billion a year on average.” Ng prefers O&G-related firms such as Hibiscus Petroleum Bhd and Dagang NeXchange Bhd, which have been riding the oil price rally. Rather than a strong US dollar, Yoong is more concerned about rampant inflation. “The US dollar strength is not sustainable. There is still headroom for the US dollar/ringgit exchange rate to move to 4.70 in the next 12 months, as Bank Negara Malaysia will be less aggressive than the Fed in raising interest rates,” he says. “The US dollar strength is currently driven by the Fed chairman taking a hawkish stance in increasing interest rates beyond neutral. It is pricing in many rate hikes. Many reserve banks globally are still hesitant about increasing interest rates lest economic activity is adversely affected.” Pankaj reckons that the US dollar is almost reaching its peak, as he believes the market has overestimated the pace of interest rate increases. “We could see a withdrawal of liquidity from the market through tightening. That would mean the economic momentum will start to slow down considerably. Then the inflation reading will also ease and the likelihood of the Fed raising interest rates will not be there. “While the Fed is still behind the curve, I don’t believe the rate hike will be that aggressive as predicted by the market. Slower economic momentum will result in the Fed turning dovish and weakening the dollar,” Pankaj explains. Ng estimates that the ringgit will bottom at the 4.40-to-4.50 level in view of the country’s robust forex reserves and trade surplus. He believes that when currency prospects improve, regional currencies will attract foreign funds again. “We cannot say the valuation of regional markets is very attractive because we are still living with Covid, coupled with lingering issues such as the US-China trade war, Russia-Ukraine conflicts and rising raw material prices. There are many external factors, but Asean is still a good place to park your investment.” Domestically, Ng says, the impact of the one-off prosperity tax should not cloud longer-term prospects. For those with the stomach for risk, Ng suggests a small exposure to cryptocurrencies. “If you are not familiar, I would strongly advise against investing in alternative investments like cryptocurrencies. It should not be the core investment.” Pankaj says investors must be mindful of where they put their money before making any investment decision in the cryptocurrency space, where prices have taken a severe beating recently, with Bitcoin slumping to a 17-month low of US$25,400 (RM111,770), after the collapse of stablecoin TerraUSD. “There is no fundamental value to some of the cryptocurrencies in the first place. They will also never be a replacement of legal tender,” Pankaj adds. Overall, investment experts believe equities are still a better investment choice than more esoteric asset classes. “Well-managed companies with good pricing power and strong cash flow can overcome the scourge of inflation,” says Yoong.   Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/608484

国行截至2月15日国际储备金报1158亿美元

Mandarin

（吉隆坡22日讯）国家银行宣布，截至2月15日的国际储备金报1158亿美元，相比1月杪的1161亿美元。 国行今日发布文告指出，储备金水平足以应付6.1个月的进口和1.2倍的短期外债。 占最大比重的外汇储备报1024亿美元、国际货币基金组织（IMF）储备为14亿美元、特别提款权（SDR）60亿美元、黄金23亿美元，以及其他储备资产37亿美元。   （编译：陈慧珊）   English version：Bank Negara Malaysia's international reserves at US$115.8b as at Feb 15

https://theedgemalaysia.com/node/610386

Two years after global equity rout, market faces war threat

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KUALA LUMPUR (March 5): Just as many started to see a ray of hope for a steady economic recovery — as the Omicron variant of Covid-19 has proved to be more infectious but less severe, judging by the death toll and hospitalisation rate — Russian President Vladimir Putin's troops rolled into Ukraine. The Russian military move has wreaked havoc in the commodity markets and raised fears of economic headwinds. Indeed, this month is the second anniversary of the global equity rout of 2020, when Covid-19 infection rates started to accelerate, spreading rapidly outside of China. The world was enveloped by pandemic fears. When the World Health Organization officially declared the Covid-19 outbreak a "pandemic" on March 11 that year, the world entered into uncharted territory, international borders were closed and the rest is history. On Wall Street, the S&P 500 Index fell a total of 27.6% to a low of 2,237.40 points on March 23, 2020 from March 2, while the Dow Jones Industrial Average plunged 30.4% to a low of 18,591.93 points. Malaysia's benchmark FBM KLCI, too, felt the effects of the Covid-19 virus, surrendering 16.9% to fall to a low of 1,219.72 points on March 19 from March 2. Public Bank Bhd, usually described as rock solid, suffered its largest single-day percentage drop in a decade. Nevertheless, the equity market rebounded quickly, with the S&P 500 and Dow Jones erasing all their losses by June 2020 and reaching new peaks over the next 18 months. While key US indices continued their rally throughout 2021, Malaysia's benchmark index failed to perform, ending the year in the red and retreating 3.67% as the economy and sentiment were affected by repeated lockdowns to contain Covid-19 infections. Like it or not, the KLCI has been a laggard among its regional peers. With the Russian invasion into Ukraine — which seems to be nowhere near its end at this juncture — thrown into the mix of other known uncertainties, the question now is whether the equity market will be better or worse off this year. Read more in The Edge Malaysia weekly's March 7 edition. Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/632717

EVENING 5: Five things you need to know today

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EVENING 5: Sime Darby expects ‘tough’ FY23 Dirty dealings. Corporate battles. Consumer woes. Here are five things you need to know today.  1. Sime Darby Bhd expects FY23 to be tough as it sees more headwinds than in the past.  2. Tenaga Nasional Bhd has committed to investing around RM20 billion in capital expenditure annually to fast-track its transformation plan.  3. AMMB Holdings Bhd’s 1QFY23 net profit rose 8% on lower impairment charges.  4. Kuala Lumpur Kepong Bhd saw a softer 3QFY22 but expects a favourable rest of the year.  5. AME Real Estate Investment Trust has plans to acquire industrial properties from third-party vendors in the central and northern regions of Peninsular Malaysia.   

https://theedgemalaysia.com/node/669049

US House Rules panel to meet Tuesday on debt ceiling bill

English

WASHINGTON (May 29): The US House Rules Committee said it will meet on Tuesday (May 30) afternoon to discuss the debt ceiling bill, which needs to pass a narrowly divided Congress before June 5, when the US Treasury says it would run short of money to cover all its obligations. Democratic President Joe Biden and Republican House of Representatives Speaker Kevin McCarthy on Sunday signed off on an agreement to temporarily suspend the debt ceiling and cap some federal spending in order to prevent a US debt default. Biden said the deal was ready to move to Congress for a vote. "The Committee on Rules will meet Tuesday, May 30, 2023 at 3:00PM ET (7:00PM GMT)," the panel said in a statement on Monday. The deal, if approved, will prevent the US government from defaulting on its debt and comes after weeks of heated negotiations between Biden and House Republicans. It has drawn fire from both hardline Republicans and progressive Democrats, but Biden and McCarthy are banking on getting enough votes from both sides. McCarthy on Sunday predicted he would have the support of a majority of his fellow Republicans, and House Democratic leader Hakeem Jeffries said he expected Democratic support. The agreement would suspend the debt limit through Jan 1 of 2025, cap spending in the 2024 and 2025 budgets, claw back unused Covid funds, speed up the permitting process for some energy projects, and include extra work requirements for food aid programs for poor Americans. The 99-page bill would authorise more than US$886 billion (RM4 trillion) for security spending in fiscal year 2024 and over US$703 billion in non-security spending for the same year, not including some adjustments. It would also authorise a 1% increase for security spending in fiscal year 2025.

https://theedgemalaysia.com/node/641913

What impact will EKVE have on AZRB?

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This article first appeared in The Edge Malaysia Weekly on October 31, 2022 - November 6, 2022 WILL the fortunes of loss-making diversified company Ahmad Zaki Resources Bhd (AZRB) change with the completion of the East Klang Valley Expressway (EKVE)? After numerous delays, construction of the EKVE seems likely to be concluded at the end of this year and toll collection may begin in early 2023. AZRB managing director Datuk Seri Wan Zakariah Wan Muda could not be contacted for comment as he was travelling. AZRB via wholly-owned EKVE Sdn Bhd has a 50-year concession with the Ministry of Works for the design, construction, operation and maintenance of the expressway that was signed in mid-February 2013. The expressway was slated for completion in September 2019, but issues with land acquisition, rock blasting works, bridge designs and, more recently, the Covid-19 pandemic, which resulted in stringent movement control measures, further delayed its construction. At least five extensions have already been accorded to AZRB. The RM1.55 billion EKVE, which spans 39km and links Ukay Perdana in Ampang to Bandar Sungai Long in Kajang, could contribute to AZRB’s bottom line, possibly nudging up the company’s languishing share price. AZRB’s stock hit a 52-week low of 15 sen on July 13 this year, and is yet to recover. It closed at 16.5 sen last Friday, giving the company a market capitalisation of RM98.4 million. A fund manager says he does not expect any change in AZRB’s share price as a result of EKVE commencing operations. “The impact of EKVE on AZRB’s stock would have been accounted for when the concession was awarded sometime back (February 2013), so I don’t foresee any renewed interest … but to be honest, I have not looked at AZRB for a long time,” he concedes. AZRB is an orphan stock, without any research coverage. In its annual report for FY2021, AZRB says, “The group as a whole is eagerly anticipating the completion and opening of our maiden highway concession, the EKVE, which will take its place as the group’s primary strategic asset. With toll operations targeted to start soon after completion, the EKVE will be an additional source of revenue for the group. We expect that [it] will be a major income contributor to the group.” While AZRB seems optimistic on the EKVE’s prospects, there are those who feel that its traffic volumes may be adversely impacted by the Sungai Besi-Ulu Kelang Expressway (SUKE), which connects Sri Petaling to Ulu Kelang, and links Cheras to Ampang as well. The MRT Putrajaya Line (previously known as the Sungai Buloh-Serdang-Putrajaya Line) could also eat into EKVE’s traffic. SUKE commenced operations in September, while the MRT Putrajaya Line will be fully operational by the first half of 2023. A RAM Rating Services Bhd media release at end-August indicated that AZRB was hard-pressed to meet its financial commitments related to EKVE’s RM1 billion issue of sukuk, and that efforts to secure a new shareholder were unsuccessful. The release, however, said that “AZRB remains committed to financially backing the project, evident from a completion guarantee and letter of undertaking from AZRB to see the project through to completion”. RAM added, “AZRB’s weakened financial profile over the past few years, however, may limit its capacity to extend support or provide the required equity capital.” For its financial year ended June 2022, AZRB suffered a net loss of RM58.15 million from RM722.49 million in revenue. In the preceding year, it made a net loss of RM68.64 million on the back of RM846.98 million in turnover. It is noteworthy that FY2022 marks the third consecutive year that AZRB has suffered losses. As at end-June, the company had cash and cash deposits of RM189.88 million, while on the other side of the balance sheet, it had long-term debt commitments of RM2.53 billion and short-term borrowings of RM464.61 million. AZRB’s finance expenses for the 12 months ended June were RM68.38 million. Its reserves stood at RM33.52 million. At the same time, AZRB’s cash flow from operations was negative RM28.16 million, albeit lower than FY2021’s negative RM72.38 million. On its prospects, AZRB says it has an outstanding order book of RM919 million as at end-June this year, which should keep it busy in FY2023. It is also noteworthy that AZRB has other businesses under its belt, such as a 95% stake in Indonesian plantation outfit PT Ichtiar Gusti Pudi (PT IGP), which was acquired in December 2004 for IDR17 billion, or US$1.8 million. According to 2004 news reports, PT IGP had approvals to cultivate 20,500ha of plantation land. AZRB’s 2021 annual report stated that it has 6,763.89ha of plantation land in Kalimantan, Indonesia, with its concession expiring in about 10 years, or 2033. In AZRB’s annual report, PT IGP is pegged at a net book value of RM18.35 million. AZRB also has a property development arm with slightly less than 15ha of development land in Kuantan, with a net book value of RM13.6 million; 1.88ha of land and a hotel building (Residence Inn) in Cherating in Pahang, valued at RM51.34 million; close to 27ha in Marang, Terengganu, pegged at a net book value of RM7.5 million; and a few other small parcels including a 0.27ha tract in Setapak Kuala Lumpur, with a net book value of RM9.03 million. The company’s oil and gas business is via wholly-owned Inter-Century Sdn Bhd, which supplies marine fuel products and lubricants to offshore support vessels at Kemaman Supply Base in Terengganu. AZRB’s 53%-controlled Matrix Reservoir Sdn Bhd is the owner of Tok Bali Supply Base, which is an offshore oil and gas supply base, offering companies fuel, water, mechanical handling and equipment, bonded warehouse, customs and immigration services and office space, among others. AZRB also wholly owns Peninsular Medical Sdn Bhd, which has a 25-year build, lease, maintain and transfer concession for a 300-bed teaching hospital in Kuantan, from Sultan Ahmad Shah Medical Centre and the Ministry of Higher Education. The agreement was signed in September 2011. Peninsular Medical also undertakes maintenance, cleaning, security and medical equipment maintenance at the medical centre.   Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/677289

Nomura to hire over 40 private bankers in Asia, Middle East — senior exec

English

TOKYO (Aug 3): Nomura Holdings plans to hire more than 40 private bankers in Asia and the Middle East in two years to tap an expanding pool of rich families and entrepreneurs in the regions, its international wealth management chief told Reuters. Enhancing wealth management is part of Nomura's goal of increasing revenue less vulnerable to market swings, as Japan's top investment bank has had occasional major financial hits in its attempts to expand globally. "The plan for us is to grow to about 135 relationship managers in the next two years, which will help us double our business," Ravi Raju, who heads Nomura's wealth management business ex-Japan, said in an interview. The business currently employs 91 private bankers in Singapore, Hong Kong and Dubai to serve affluent clients in Greater China, Southeast Asia and the Middle East, he said. Nomura has repositioned the business to be part of the wholesale division to provide high net-worth individuals with a broad range of investment products and services in everything from equity to structured products — similar to what it offers to institutional clients. The bank aims to boost assets under its international wealth management business to US$35 billion (RM159.5 billion) from US$15 billion by March 2025, following three years of business overhaul that doubled the assets under management and created 1,200 new client accounts. Revenue totalled about US$100 million in the year to March. Asia Pacific and Middle East account for 37% of the world's 21.7 million population of high net worth individuals, or those with investable assets of US$1 million or more, according to Capgemini's 2023 wealth report. Nomura, still outside the top-20 ranks of private banks in Asia, has advantages of being "small and entrepreneurial" in its hunt for talent in the main battleground for global wealth managers, said Raju, a veteran private banker who joined Nomura in 2020. "Many of the talent out there are looking for ability to expand their client coverage," which may be difficult at some big banks already covering many clients, he said. Nomura's strengths in Japan and Asia will allow the bank to offer "the best value for any client who wants to look at Japan and Asia, he added.

https://theedgemalaysia.com/node/676992

Sabah hopes to get autonomy for education, health soon — Hajiji

English

KOTA KINABALU (Aug 1): The Sabah government hopes that the unity government led by Prime Minister Datuk Seri Anwar Ibrahim can finalise the granting of administrative authority in the education and healthcare sectors soon, as discussed through the Malaysia Agreement 1963 (MA63) secretariat. Chief Minister Datuk Seri Hajiji Noor, who welcomed the announcement made by deputy prime minister Datuk Seri Fadillah Yusof regarding the matter, said granting more autonomy to the state government would enable them to ensure that Sabah’s education system is in line with that of the peninsula. He said the proposed autonomy in administration and management would also make it easier for the Sabah government to implement and expedite every educational development project, in addition to the appointment of teachers. “The decentralisation of power in education also indirectly proves the Federal government’s trust in the state government’s machinery, especially in improving the capacity of the education system in Sabah. “We are confident that with this autonomy, the state government, through the Ministry of Science, Technology, and Innovation, will have the flexibility to address various issues related to education in the state,” he said in his speech at the 34th Sabah Scholarship Award Presentation Ceremony here on Tuesday (Aug 1). On May 15, Fadillah, who is also MA63 Technical Committee chairman, said the granting of administrative authority in the education and health sectors in Sabah and Sarawak, especially the recruitment of staff, is one of the important matters being discussed by the federal government via the MA63 secretariat. Fadillah said Sabah and Sarawak faced challenges because planning for these sectors was being carried out in Putrajaya, which included important matters such as the recruitment of staff. Hajiji further explained that officials in charge of both fields at the state level possess greater knowledge about the issues faced by people in their respective areas. “As a result, improved control and supervision can be put in place, ultimately leading to more efficient and prompt management of people’s problems,” he said. Meanwhile, speaking to reporters after the ceremony, Hajiji said the state government was currently scrutinising the carbon trade agreement because it is a good area to explore. “We can gain lucrative income from carbon trading. However, matters involving management, areas and others must be carried out in a good and orderly manner,” he said when asked about the Sabah government’s stance on the matter. Last Thursday (July 27), Deputy Chief Minister 1 Datuk Seri Dr Jeffrey Kitingan said that the Nature Conservation Agreement (NCA) for the state’s carbon trading is currently experiencing delays and is estimated to take around 18 months before producing results.  

https://theedgemalaysia.com/node/634747

EVENING 5: Five things you need to know today

English

EVENING 5: Rosmah in tears after guilty verdict Dirty dealings. Corporate battles. Consumer woes. Here are five things you need to know today.  1. Datin Seri Rosmah Mansor was tearful after she was found guilty on all counts in her solar hybrid graft trial and was fined a record RM970 million.  2. U Mobile Sdn Bhd has officially declined to invest in Digital Nasional Bhd.  3. Hartalega Holdings Bhd has slowed down on its expansion as the company still sees an oversupply of gloves in the market.  4. Farm Fresh Bhd says that the milk producer is “still very profitable” despite margin pressures.  5. Malaysian retail sales rose a record 62.5% in 2Q22 compared with the same period last year.   

https://theedgemalaysia.com/node/624663

新冠肺炎：大马单日零死亡病例

English

（吉隆坡20日讯）卫生部长凯里表示，这是自2020年12月18日以来，我国没有人死于新冠肺炎。 他周日（6月19日）发布推文说：“我们过渡到地方性流行病，是采取数据为依据。希望在未来继续看到成效。” 同时，截至周日，在儿童疫苗接种计划（PICKids）下，全国共有129万4225名或36.5%年龄介于5岁至11岁的孩童接种了新冠疫苗。 根据COVIDNOW网站，共有173万7624名或49%年龄介于5岁至11岁的孩童至少接种了一剂疫苗。   （编译：魏素雯）   English version：Malaysia reports zero Covid-19 deaths  

https://theedgemalaysia.com/node/628000

安联银行委任Kellee Kam为新总执行长

English

（吉隆坡13日讯）安联银行（Alliance Bank Malaysia Bhd）委任Kellee Kam Chee Khiong为新任集团总执行长，从9月1日起生效，接替将于8月31日完成任期的Joel Kornreich。Joel在安联银行服务了超过7年。 根据文告，Kam（48岁）将会卸下从2016年起担任的大马美国银行（Bank of America Malaysia Bhd）主席兼独立董事职务。 加入大马美国银行之前，Kam纵横银行业逾23年，曾在2011年至2015年期间，担任兴业银行集团（RHB Banking group）的集团董事经理。 闭市时，安联银行降2仙或0.6%，报3.28令吉，市值达50亿8000万令吉。   （编译：魏素雯）   English version：Alliance Bank names BoA Malaysia’s Kellee Kam as new CEO

https://theedgemalaysia.com/node/650025

FBM KLCI stays above 1,500 level at midday

English

KUALA LUMPUR (Dec 30): Bursa Malaysia remained above the 1,500 level at midday as investors continued to snap up bargains amid year-end window-dressing activities. The benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) ended the morning session 9.51 points higher at 1,501.14 from Thursday’s closing of 1,491.63. The market bellwether opened 0.3 points higher at 1,491.93 and moved between 1,491.93 and 1,503.33 throughout the session. Market breadth was positive with gainers outpacing losers 435 to 321, while 374 counters were unchanged, 1,125 untraded, and 49 others suspended. Turnover amounted to 1.33 billion units worth RM842.4 million. Rakuten Trade Sdn Bhd vice president of equity research Thong Pak Leng told Bernama that after breaking the 1,500 mark, the composite index will face the next resistance at the 1,530 level. Regional bullishness also contributed to Friday’s positive sentiment on the local front, with gains almost across all sectors except for telecommunications, property blue chips, and selected lower liners. Among the heavyweights, Petronas Chemicals Group Bhd gained 18 sen to RM8.71, Public Bank Bhd added six sen to RM4.41, Hong Leong Bank Bhd soared 28 sen to RM20.82, while CIMB Group Holdings Bhd edged up five sen to RM5.85, and Sime Darby Plantation Bhd increased five sen to RM4.70. Malayan Banking Bhd (Maybank) was flat at RM8.74, and Axiata Group Bhd lost six sen to RM3.04. As for the actives, Vinvest Capital Holdings Bhd was flat at 19.5 sen, Top Glove Corp Bhd was unchanged at 91 sen, Advance Synergy Bhd added half-a-sen to 18 sen, AHB Holdings Bhd gained one sen to 12.5 sen, while Infoline Tec Group Bhd lost two sen to 87.5 sen. On the index board, the FBM Emas Index increased 58.15 points to 10,739.35, the FBMT 100 Index went up 56.13 points to 10,456.71, the FBM Emas Shariah Index garnered 43.87 points to 10,928.27, the FBM 70 Index rose 25.92 points to 13,050.35, while the FBM ACE Index eased 1.21 points to 5,345. Sector-wise, the Financial Services Index climbed 112.05 points to 16,648.76, the Plantation Index added 40.49 points to 7,088.41, the Industrial Products and Services Index put on 1.97 points to 183.2, and the Energy Index perked up 6.21 points to 780.52.

https://theedgemalaysia.com/node/650726

财政部秘书长阿斯里辞去国能董事职

English

（吉隆坡6日讯）国家能源（Tenaga Nasional Bhd）宣布，财政部秘书长拿督斯里阿斯里已辞去非独立非执行董事职务。 国能今日向大马交易所报备，随着阿斯里于周四辞职，他的替代董事Faisal @ Pisal Abdul Ghani也卸任。 这是主席兼云冰前国会议员拿督斯里哈山阿里芬于1月1日呈辞后不到一周，最新的董事部变动。 国能特别股东财政部机构（MoF Inc）委任阿斯里为董事，他在2020年7月1日加入国能董事部。   English version：Treasury sec-gen Asri Hamidon resigns from TNB board

https://theedgemalaysia.com/node/636161

马交所：8月净外资流入飙至19.8亿

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（吉隆坡13日讯）大马交易所表示，8月净外资流入狂飙至19亿8000万令吉，7月为1亿7500万令吉，原因是新冠疫苗推动经济重新开放，促使外国基金将资金转移到东盟市场。 马交所研究臂膀大马交易所数字研究（Bursa Digital Research）分析员在报告中写道：“本月（8月）外国基金仍是本地交易所的最大净买家，在过去8个月中，有7个月是净买入，年初至今净流入为82亿令吉。” 分析员指出，由于第二季业绩乐观及预期升息，流入金融股的外国资金从7月的4亿5800万令吉，飙升至16亿9000万令吉。 国家银行货币政策委员会上周四（8日）上调隔夜政策利率（OPR）25个基点至2.5%，符合市场预期。 马交所表示，年初至今，金融股在外资流入继续领先，达52亿令吉。 本地机构则恢复抛售，净卖额达24亿令吉，相比7月的4100万令吉。 “本地机构是8月的唯一净卖家，减持金融股16亿8000万令吉。年内则净卖41亿令吉。” 马交所称，在7月资金外流后，本地散户8月净买1亿4100万令吉。 此外，马交所上市公司市值从7月的1.69兆令吉，按月增长0.8%至1.71兆令吉。 “第二季国内生产总值（GDP）增长8.9%，相比首季的5%，以及大多大盘股的业绩报捷，超出市场预期，都提振了整体市场情绪。” “相应地，8月日均交易值从7月的13亿令吉，按月增29.5%至17亿令吉。”   （编译：魏素雯 & 陈慧珊）   English version：Bursa: Net foreign inflow into Malaysian stocks spiked to RM1.98 bil in August

https://theedgemalaysia.com/node/639754

缺乏催化剂 马股走低

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（吉隆坡12日讯）全球市场波动，在缺乏新催化剂，马股休盘走低，跟随亚洲股市走势。 休市时，富时隆综指跌7.04点，挂1379.78点。 综指今早以1388.28点报开，较昨日闭市的1386.82点，微扬1.46点，尔后在中盘转跌。 下跌股达500只、上升股212只，另有339只无起落、1307只无交易，以及17只暂停交易。 成交量9亿8010万股，值7亿2316万令吉。 乐天交易股票研究副总裁唐柏麟指出，在周四公布美国通胀数据之前，全球投资者保持谨慎态度。 他向马新社说：“我们认为，科技股将持续遭抛售，追随隔夜纳斯达克综合指数的跌势。” 重量级股中，马银行（Malayan Banking Bhd）扬7仙，报8.51令吉、大众银行（Public Bank Bhd）升4仙，挂4.24令吉、联昌国际集团（CIMB Group Holdings Bhd）增2仙，至5.31令吉，而国油化学（Petronas Chemicals Group Bhd）跌2仙，挂8.57令吉，以及IHH医疗集团（IHH Healthcare Bhd）降10仙，至5.55令吉。 至于热门股，Privasia Technology Bhd涨1.5仙，挂12.5仙、稳达集团（Widad Group Bhd）和NWP控股（NWP Holdings Bhd）分别持平于37.5仙和23.5仙，以及Advance Synergy Bhd挫0.5仙，报6.5仙。   （编译：陈慧珊）   English version：Bursa ends morning session lower on lack of catalyst

https://theedgemalaysia.com/node/658524

Anwar reiterates he is not involved in corruption prosecution cases linked to Jana Wibawa

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Anwar reiterates he is not involved in corruption prosecution cases linked to Jana Wibawa

https://theedgemalaysia.com/node/614994

Genting Malaysia seeks shareholders' nod for share buy-back

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KUALA LUMPUR (April 5): Genting Malaysia Bhd (GENM) is seeking its shareholders' approval to buy back its own shares in the upcoming annual general meeting (AGM). In a bourse filing on Monday (April 4), the group said it intends to seek the approval of its shareholders for the proposed renewal of the authority for GENM to purchase its own shares of an amount which, when aggregated with the treasury shares, does not exceed 10% of its prevailing total number of issued shares at any time. “A statement containing the details of the proposed share buy-back renewal will be made available via electronic means to the shareholders of GENM in due course,” said the group. At GENM's postponed 41st AGM held on Sept 22 last year, the group announced that its shareholders had approved the renewal of the authority to acquire its own shares in an amount that, together with treasury shares, does not exceed 10% of the current total number of issued shares at any time. “The renewed share buy-back authority will expire at the conclusion of GENM’s forthcoming AGM,” it added. At the time of writing on Tuesday, GENM shares had risen one sen or 0.34% to RM2.98, valuing the group at RM17.7 billion.

https://theedgemalaysia.com/node/676557

State polls: Straight fights for Umno deputy president, DAP sec gen

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KUALA LUMPUR (July 29): Umno deputy president Datuk Seri Mohamad Hasan and DAP secretary general Anthony Loke Siew Fook are among the big names facing a straight fight in the state polls next month. Mohamad, who is also the defence minister, will be in a straight fight with Rozmal Malakan (Perikatan Nasional-PAS) to defend the Rantau state seat on a Barisan Nasional (BN) ticket for the fifth term since 2004. Loke (Pakatan Harapan-DAP), who is also the transport minister, will face Rosmadi Arif (PN-Bersatu) to defend the Chennah seat, which he has held since the 2013 general election. Meanwhile, three caretaker menteris besar facing a straight fight are: Kelantan's Datuk Ahmad Yakob (PN-PAS), who is fielded against Zamakh Sari Ibrahim (PH-PKR) in Pasir Pekan; Kedah's Muhammad Sanusi Md Nor (PN-PAS) against Datuk Muhamad Khizri Abu Kassim (PH-BN) in Jeneri; and Terengganu's Datuk Seri Dr Ahmad Samsuri Mokhtar versus Suhaimi Sulaiman (PH-Amanah) in Ru Rendang. Also facing a straight fight is caretaker Penang chief minister Chow Kon Yeow (PH-DAP), who is challenged by H'ng Khoon Leng (PN-Gerakan), to defend the Padang Kota seat, which Chow has held for three terms since 2008. Caretaker Selangor Menteri Besar Datuk Seri Amirudin Shari (PH-PKR) is facing a three-cornered fight against Muhammad Hanif Jamaluddin (PN-PAS) and independent candidate Suman Gopal to defend the Sungai Tua seat. Caretaker Negeri Sembilan Menteri Besar Datuk Seri Aminuddin Harun (PH-PKR) is facing a four-cornered contest to defend the Sikamat seat that he has held since 2008. He is challenged by Ahmad Raihan Muhamad Hilal (PN-Bersatu), and independent candidates Bujang Abu and Mohammed Hafiz Baharudin. Meanwhile, the Kuala Terengganu parliamentary by-election will see a straight fight between the previous incumbent, Datuk Ahmad Amzad Mohamed @ Hashim (PN-PAS) and Kuala Terengganu PKR division chief Azan Ismail, who is contesting on a PH ticket. The 14-day campaign period will run from until 11.59pm on Aug 11. Visit this link for everything about the State Polls 2023

https://theedgemalaysia.com/node/648521

Coffee Break: If it ain’t broke, don’t fix it

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This article first appeared in Capital, The Edge Malaysia Weekly on December 19, 2022 - December 25, 2022 “Eh, why?” I asked, pointing to the changes made to the menu. “New boss,” the waitress simply said. Ah yes, that explains it. And that may be where the trouble begins. In the years that the owners have run this joint, they have mastered the art of serving great food, with the added bonus of being staffed by people who worked tirelessly to serve diners. Few would argue that the place or its menu needed to be changed. Then, it got a new manager, and the individual had different ideas. We are often told that change is good for us, that it eliminates boredom and complacency. But the irony is that when you get a new boss, it is often the case that they become fixated on making their mark and putting their own spin on the role, never mind that their changes may cause more harm than good. Many also feel the need to cancel or change the business processes or projects implemented by their predecessors on the pretext that they do not fit in with the new plans for the company, even though their predecessors would have done some good things. And it happens to even the most seasoned of entrepreneurs. We saw it in Twitter after billionaire Elon Musk took full control in October and began making major changes to the social media platform, including firing top executives and laying off half of its staff before proceeding to rehire them after he fired too many by mistake. Twitter reportedly experienced a massive drop in revenue, following Musk’s arrival. Recently, change also happened to my favourite TV show. For 12 years, I have looked forward to watching Detective Amanda Rollins — portrayed by actress Kelli Giddish — and the team at the Special Victims Unit catch bad guys. Then, the creative team behind Law & Order: SVU had a bright idea and decided to write her character out of the show. While it is understandable that writers feel that removing a character improves the storyline, it is sometimes unnecessary — Law & Order: SVU being a case in point. Giddish’s departure left fans like myself devastated after having gradually warmed up to her character in the series. When questioned by Variety about her departure, Giddish said it was a call made from above to keep the show current. Similar sentiments must have been in play when a skincare brand that I regularly use tinkered around with the look and packaging of its products ... yet again. “The management thought the brand had begun to look tired and wanted to give it a facelift,” the salesperson explained. I cannot help but wonder why companies that have products that are long established, valued by their customers and profitable to their business should seek to improve and change them — not because their customers want them to do so, but just because they can? Human beings are creatures of habit and when we get very comfortable with something, we do not want to waste any brainpower seeking an alternative. As the saying goes, “If it ain’t broke, don’t fix it.” The same thought arises when a big corporation splashes out a lot of money for a new logo that looks like it took just minutes to design. Rebranding is dangerous work because not all branding efforts are well received. Some rebranding is totally unnecessary and can come off as confusing. In this case, the company had decided to join the corporate minimalist logo trend and it featured the company’s name in just one colour. If a rebranding leaves consumers wondering, why bother? On Dec 10, the new government led by Prime Minister Datuk Seri Anwar Ibrahim completed its cabinet lineup. As it begins reviewing government projects old and new, it is hoped that the government will not be too quick to terminate projects or dismiss proposals that are with merit and can benefit the country. After all, recent history has shown that the termination of contracts led to legal dispute, only for the contracts to be reinstated in the end, causing further delays to the projects. Of course, some changes are simply overdue, such as the Kuala Lumpur light rail transit system. Resources were needed for proper maintenance but, perhaps more crucially, so were individuals with the foresight to plan for the future and drive the execution as planned. But like the old adage says: “Don’t make a change for the sake of change.” Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/634417

Cover Story: A revamp of Malaysia’s defence spending necessary to prevent leakages

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This article first appeared in The Edge Malaysia Weekly on August 29, 2022 - September 4, 2022 DEFENCE spending is a hotly debated topic globally, with the discussions focusing on whether a country is spending too much or too little in safeguarding the nation’s sovereignty. Earlier this year, the Stockholm International Peace Research Institute (SIPRI) reported that the total global military expenditure in 2021 exceeded US$2 trillion for the first time. The biggest spenders were the US, China, India, the UK and Russia, accounting for 62% of the total expenditure. When compared with the military spending of these five countries, Malaysia’s defence budget appears rather insignificant. The Ministry of Defence (Mindef) has spent between RM13 billion and RM17 billion, or about 4% to 6% of the total federal government expenditure, annually over the past decade. This is no more than 2% of the country’s gross domestic product (GDP) in the last 10 years. In terms of allocation, operating expenditure makes up the bulk of the annual defence budget at about 70% to 80%, while the rest goes to development expenditure. It should be no surprise that 50% to 60% of the budget is spent on emoluments for the armed forces. The budget for assets under development spending is small each year relative to the total. For the 2022 Mindef budget, the ministry estimated an allocation of RM5 billion for assets under development expenditure. That is roughly 28% of the ministry’s total budget for this year. Looking at the details of the budget, the three services — the army, navy and air force — were given an allocation of slightly more than RM1 billion for arms procurement. The rest of the allocation for development expenditure goes towards maintenance of assets, building new facilities and housing for service personnel. As for high-value assets such as warships and aircraft, industry experts say the cost of purchasing these is also part of Mindef’s budget and is usually divided over several years. The question one may ask is whether Malaysia is allocating enough to its military spending, especially when geopolitical tensions are high and the threat of war is increasing. Globally, there is no international benchmark on how much a country should spend on its defence as it would largely depend on the country’s defence policies and strategies. Perhaps the closest thing to a benchmark is Nato, whose members pledge to spend a minimum of 2% of their GDP on defence. But many of the member countries are unable to meet that pledge. The US is the highest spender among the Nato members, with its defence spending exceeding 3% of GDP each year. In Southeast Asia, data provided by SIPRI show that Brunei, Myanmar and Singapore spend the most on their defence in terms of percentage of GDP, of about 3%. “Singapore is able to spend the amount it does on defence because it sets aside a fixed percentage of its budget on defence spending annually. This allows the relevant ministry to plan the procurement of assets as well as better plan the operating and development expenditure,” notes a researcher who specialises in security studies. Industry experts point out that Malaysia’s defence spending, ironically, is not focused on defence but on growing the economy and improving bilateral relations and trade. “Defence spending is always subservient to the economy. Not much is allocated and it usually gets sidelined if there is an economic crunch,” says the researcher. However, it should be noted that this is not a problem exclusive to Malaysia as developing countries tend to prioritise economic growth over defence. Defence journalist Marhalim Abas opines that the thought process behind this is that the government thinks the risk of a conflict with countries in the region is low. Notably, the inaugural Defence White Paper that was released in 2020 states that the primary role of the Malaysian Armed Forces is to maintain peace and be prepared for any armed conflict, in order to effectively defend Malaysia’s sovereignty, territorial integrity and other national interests against external threats. “The Latin proverb ‘Si vis pacem, para bellum’ means ‘If you want peace, prepare for war’. Thus, defence preparedness is the best guarantee for peace,” says the white paper. Marhalim opines that defence spending in Malaysia is usually determined by the interests of the government of the day. He cites the example of the request by the Royal Malaysian Air Force back in the late 1990s, in which it listed the requirements for multi-role combat aircraft. The government decided that it would be in the best interests of the country to purchase Russian fighter jets, the Sukhoi Su-30MKM, instead of RMAF’s choice of the US made Boeing Super Hornets. The deal was sealed in 2003 with Malaysia purchasing 18 fighter jets from Russia. It was a cheaper deal for the country. However, maintenance became an issue because Malaysia was the only user of that type of jet, says Marhalim. In 2018, then defence minister Mohamad Sabu revealed that only four of the 28 Russian fighter jets owned by the Royal Malaysian Air Force were able to fly. He added that the air force was unable to properly maintain the airworthiness of the fighter jets. Marhalim’s view is that Malaysia does not spend enough on defence, evident by the long-standing issue of replacing old equipment and modernising facilities. It is known that Malaysia’s decades-old ambition is to build and develop the local defence industry. Yet many wonder whether it is the right move, especially when it comes to complex military assets. “A local defence industry must be viable. For a country like Malaysia, we don’t need an industry for complex battleships because we will be the only purchaser of such assets. Other countries are unlikely to buy such assets from us,” says the researcher who wishes to remain anonymous. He cites the example of the littoral mission ships (LMS), where the initial plan was to have two built in China and another two constructed in Malaysia. In the revised plan, the government decided to build all four LMS in China as it would save the government RM122 million. He also highlights that small arms such as ammunition, explosives and small patrol vessels can be developed locally. Malaysia does have a handful of successful players in such industries that cater for the export market, he says. Maharlim agrees that it would make more economic sense to buy complex assets from other countries. But more importantly, he says, buying them in a government-to-government deal as it would reduce the cost and risk. “The current practice of buying via marketing agents, in turn, opens the risk of corruption and other nefarious deal-making. We have stopped buying local ammo since late 2018 as it is apparently cheaper to buy from overseas,” he adds. “We are likely the only country in Asean to import ammunition. A vibrant local defence industry may look good on paper but we never allocate enough money to make it viable over the long term.” As demonstrated by the recent littoral combat ship (LCS) scandal, Malaysia’s defence spending is no stranger to leakages. The researcher points out that although Malaysia doesn’t spend much on defence, it is in itself expensive. Hence, when probl ems like corruption or leakages are added to the tab, it becomes even more expensive than it needs to be. “Leakages and scandals are nothing new. What we need is a revamp to take place because until that happens, such scandals will continue to happen,” he says.   Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/675837

JPMorgan sees 35% downside for Country Garden as woes mount

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(July 24): Shares in Country Garden Holdings Co are expected to drop 35%, as liquidity concerns surrounding China’s private builders are unlikely to ease anytime soon, according to JPMorgan Chase & Co.  The Wall Street bank downgraded the Chinese property developer and its property management unit Country Garden Services Holdings Co to "underweight", according to a note on Sunday (July 23). It warned that government measures won’t stem the decline, given the sector’s weakening sales, default risks and a slowdown in refinancing support from the authorities. “Until confirmation of more government support, we believe liquidity concerns on privately-owned developers will linger,” analysts including Karl Chan wrote in the note. Country Garden shares slid the most in seven months on Monday, while its dollar bonds were on track to log an unprecedented decline. Concerns about Country Garden mirror the jitters surrounding China’s ailing property sector, as signs mount that some developers may struggle to repay their borrowings. An asset sale plan by Dalian Wanda Group Co has helped allay some worries, although muted expectations for big-bang stimulus continue to weigh on the outlook. JPMorgan’s latest target price (TP) for Country Garden — HK$0.90 (53 sen) — is the most bearish on the Street, according to data compiled by Bloomberg. Investors who followed its recommendation would have earned a 8.6% return over the past year. Country Garden’s stock has plunged over 50% since end-December, and taken against last Friday’s close, the TP would represent a drop of another 35%.  Shares in the developer slumped 8.7%, while its property management unit Country Garden Services was 18% lower, on Monday, alongside a drop in the broader real estate sector. Its dollar notes also retreated, with a bond due in April 2024 falling the most on record to 16 cents. A gauge of China’s developer stocks declined 3.3%, the most in over a month. JPMorgan’s call comes amid rising scrutiny over sell-side research in China, as Beijing attempts to counter negative sentiment in markets amid slowing growth. Goldman Sachs Group Inc’s bearish report on Chinese banks drew a backlash from a major lender, as well as state media earlier this month. Still, the JPMorgan analysts believe the builder is “working hard to avoid a public bond default”, and logically speaking, the government “should have the incentive to offer more refinancing support to Country Garden to prevent another high-profile default in the industry”. “This is to avoid further confidence crisis for other privately owned developers, and lower the likelihood of even more unfinished buildings,” they wrote.

https://theedgemalaysia.com/node/677191

BofA joins Fed in reversing recession call amid growing optimism

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(Aug 2): Economists at Bank of America Corp revoked their forecast for a recession in the US, becoming the first large Wall Street bank to officially reverse its call amid growing optimism about the economic outlook. The change comes just a week after Federal Reserve chair Jerome Powell told reporters that the central bank’s own economists are no longer forecasting a recession. “Recent incoming data has made us reassess our prior view that a mild recession in 2024 is the most likely outcome for the US economy,” BofA economists, led by Michael Gapen, wrote in a note to clients on Wednesday (Aug 2). “Growth in economic activity over the past three quarters has averaged 2.3%, the unemployment rate has remained near all-time lows, and wage and price pressures are moving in the right direction, albeit gradually,” they wrote. The resilience of the US economy this year, despite the most aggressive Fed tightening cycle in decades, has forced many on Wall Street to repeatedly revise their forecasts for when the country will fall into recession. Now, with recent data showing persistent strength in hiring alongside moderating inflation, forecasters are beginning to rethink their recession calls altogether. In addition to upward revisions to their forecasts for US GDP growth in 2023 and 2024, the BofA economists altered their expectations for when and how the Fed cuts rates. The bank’s economists now see them beginning later — June 2024 — and proceeding at a slower pace. While a few economists, including those at Morgan Stanley and Goldman Sachs Group Inc, have maintained throughout the past year that the US would skirt a recession despite the rapid run-up in interest rates, most banks have taken the other side. Still, Deutsche Bank AG’s Peter Hooper and Matthew Luzzetti say the line between a mild recession and a soft landing is “increasingly fine,” a sentiment increasingly echoed by others in the recession camp. A recent survey of business economists showed a strong majority now say the odds of the US entering a recession in the next 12 months are 50% or less. In a recent speech, Cleveland Fed president Loretta Mester nodded to the change in tune among businesses in her region. At the end of 2022, “many of our business contacts were telling us they expected the economy to enter a recession this year,” Mester said. “Now, most think there won’t be a recession this year.” The backbone of the economy and its resilience is the labor market. Low unemployment, steady hiring and solid wage growth have given American households the wherewithal to keep spending. Legislation championed by the Biden administration is also giving an unexpected boost to economic growth, a trend that could add to reasons why a US recession may be delayed or even averted. But the US is not out of the woods yet. Many economists say the cumulative impact of monetary tightening has yet to be felt, and while inflation has eased, continued resilience in the labor market and consumer spending could slow inflation’s descent, leading to more Fed tightening. Fitch Ratings also downgraded the US’s sovereign credit grade on Tuesday, with the agency arguing the country’s finances will likely deteriorate over the next three years given tax cuts, new spending initiatives, economic shocks and repeated political gridlock. Many other Wall Street economists with standing recession forecasts aren’t ready to pivot just yet. Bloomberg Economics forecasts a US recession will begin either in the fourth quarter or at the start of 2024. To drop that call, chief US economist Anna Wong says she would need to see: Wells Fargo & Co’s Jay Bryson said he’d need to see “continued disinflation in the months ahead,” something that would help support real income growth, in order to scrap the bank’s recession call. Thomas Simons at Jefferies has a longer list, including “several more months of data that show slowing wage growth, slowing inflation, a significant improvement in productivity” and a pickup in consumer spending. For Barclays Plc to change their forecast from mild recession to no recession, chief US economist Marc Giannoni said they would require a sustained decline in core inflation, a rebalancing of the labor market and a gradual moderation in aggregate demand. Yelena Shulyatyeva at BNP Paribas, on the other hand, said she’d need to see a re-acceleration in payroll growth to be convinced the US could avoid a downturn.

https://theedgemalaysia.com/node/614064

Capital A airline arm says over 99% of guest queries and refund requests resolved

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KUALA LUMPUR (March 29): Capital A Bhd’s airline arm AirAsia Aviation Group Ltd (AAAGL) said it had resolved over 99% of guest queries and refund requests set off by the Covid-19 pandemic over the past two years. In a statement on Tuesday (March 29), AAAGL group chief executive officer Bo Lingam said the airline had spoken to over five million guests since the start of the pandemic and settled the vast majority of requests relating to cancelled flights by issuing credit accounts, cash refunds or flight changes. “As one of the world’s largest airlines flying close to 100 million passengers per year before Covid-19, we have an unprecedented volume of queries, averaging around 200,000 daily during the peak period. “Given the sheer volume, this was no mean feat. Across all airlines in AAAGL, we have provided a cash refund or credit shell to over three million bookings to date. In total, we received US$1.8 billion (about RM7.6 billion) in refunds requested by guests since 2020,” he said. Lingam said that the group had resolved 99.2% of total cash refunds requested, with only US$14.66 million or 0.8% still in the process, adding that AAAGL is hard at work to resolve the remainder in the coming months. “Now as we are flying again in all of our key markets, we can fast-track any outstanding requests as soon as possible,” he said. Lingam highlighted that the majority of the group’s guests had opted for credit accounts, which he noted were processed immediately and valid for up to two years for booking from the date of issuance. “With the resumption of domestic flights and reopening of borders in most of our key markets, we are very pleased to note that 88% of credit accounts that we issued have been utilised, signifying a strong appetite and confidence for air travel among the public. “We thank all of our guests for their patience, and look forward to welcoming everyone back on board once again with our steadfast commitment to providing the best accessible, affordable and inclusive air travel in the region,” he said. At Tuesday's noon break, Capital A shares were up one sen or 1.53% at 66.5 sen, giving the group a market capitalisation of RM2.77 billion.

https://theedgemalaysia.com/node/643440

Focusing on what matters

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This article first appeared in City & Country, The Edge Malaysia Weekly on November 14, 2022 - November 20, 2022 No. 4 | Sime Darby Property Bhd Speaking with Sime Darby Property Bhd group managing director Datuk Azmir Merican, his wish that the company and its people have a clear vision and direction for a sustainable future comes through clearly. He shares during an online interview that in June this year, the group announced its new mission statement, which is “To be a value multiplier for people, businesses, economies and the planet”. Says Azmir, “This is very important because purpose gives a lot of meaning to why we are here. This new clarity of purpose will set a clear direction vis-à-vis the group’s long-term strategy towards becoming a real estate company.” He believes with discipline and keen focus on getting the best out of the organisation, the group will transform from a pure property player into a real estate company with various recurring income-generating components. Azmir also emphasises that he sees the group as a triple bottom line organisation, which takes into account social, environmental and financial results as net income. Always looking to take the organisation to greater heights, Azmir shares some of his thoughts on its financial year 2021 (FY2021) performance and his desire for a sustainable future. Datuk Azmir Merican: The turnaround was against FY2020. And 2020 was a different kind of year. In FY2020, we incurred losses of about RM337 million from Battersea Power Station (BPS). On top of that, we reviewed our current projects and markets to ascertain whether our properties were correctly priced. We also looked at problematic portfolios and rationalised the value. We basically took the time to clean up the balance sheet. The year 2021 was a much welcome one. We thought we would see full recovery from Covid-19 but did not, as we still had problems and shutdowns. The engines started revving at the end of 2020, but got shut down in early 2021. Nonetheless, sales have been strong. And I think with the Home Ownership Campaign and some pent-up demand, our team capitalised on it — as did other developers — and that drove sales. We took the position that in 2022, we would look at our cost base again. We looked at efficiency and the right costs we should have, given our size. That kind of helped instil a financial discipline in all our projects. We have minimum ratios for the project guys to present to the management team. The projects have to meet those ratios that we set. During Covid-19, we took the opportunity to review processes because typically, a process in a large company like ours isn’t reviewed very often. So, we saw the opportunity to simplify things. That kind of helped us rev up the engines for 2022. In fact, the sales for the first half of this year were pretty strong with RM1.9 billion. We are happy that our guys know the market and where we are, and we continue to hit good sales numbers. But we are not happy with the fact that we have issues on labour and materials. P&L (profit and loss) benefit from contracts we awarded one to two years ago. Sales benefit from this momentum that we have, but we are going to have to face up to lower margins soon. To address this, there are a couple of things we can do. For one, look at projects that need less labour. We brought forward some industrial launches, which are a big portion of Sime’s turnover. Thankfully, the demand has been very strong; we know which part of the market there is demand, which part is softening. Our intelligence in the industrial space has gotten a lot deeper in the last 18 months or so. We did a joint venture with LOGOS SE Asia Pte Ltd (a logistics specialist) and so that will help us. The second thing is that we have this financial discipline internally for internal numbers; we try to simplify what we can do to be able to achieve these threshold numbers before we can have a project approved. That financial discipline is key — the faster you can do something, the cheaper it is actually. What we mean by ‘real estate company’ is to have recurring income. Although we have a large landbank, what we see in more mature markets is that recurring income becomes a fundamental factor. And what we also want to do is to build in a fund management capability in the organisation as a differentiator. Typically, property companies have a REIT (real estate investment trust) but not really a fund manager per se other than just managing your REIT. For us, we want to be a fund manager and deploy all sorts of products or funds across the value chain, right from a development fund that will develop a project to a stabilisation fund to a mature REIT. So the entire real estate asset management portfolio is something we are looking at. We have done a couple of things this year that we are proud of. We launched the Elmina Rainforest Knowledge Centre. What we do is collect seeds from the rainforest and then plant them in our nursery. Then we plant the trees in places like the Klang Gates Dam. These are tropical rainforest trees and the seeds are not easy to come by and very valuable. We are working with a tropical rainforest research centre — Tropical Rainforest Conservation and Research Centre or TRCRC — which is our knowledge partner. And we are going to do a lot more in terms of educating people on what we can do. What we can do now is to rewild the areas that we have. Two things that we have learnt is that when we plant in our parks, we need to connect the parks. We want nature to flow. And it is important that we do that so that the ecological system is strong. We are looking at rewilding the fringe areas so that we can turn the palm oil land back into having the ‘right’ trees, which are native to where we are. What we are doing is also helping biodiversity. As a developer, we own a lot of land. For us, it is plantation land, and the soil isn’t very healthy. So the areas that we are not building on, we would like to think we can help the soil become healthy. Healthy soil actually absorbs CO2, while unhealthy soil emits it into the atmosphere. That is very bad. It is actually the simplest, most practical way nature has for us to absorb CO2. So making sure the soil is healthy and has microorganisms in the soil; it can even be a carbon sink. For the social component, we are looking at housing for the workers — ensuring their basic needs are met. In terms of governance, I think we have to publish how we govern the organisation and we are very serious that this is a well-governed one, second to none. For context, the UK went through Brexit and Covid-19, and I think for us to bring BPS to this stage [of opening it to the public] and preserving a profit is something that we worked for. For us, especially S P Setia and Sime Darby Property, the credibility of having that track record is enormous. I think we can walk into any place in the UK with this track record, and we want to expand that visibility. Also, it gives us a lot of brand recognition in Britain. We understand the UK market a little better; what you can get easily, what is difficult and what practices you do here, you don’t want to do there. Basically, understanding the market is quite useful. We have another 15 years [with BPS], so we need to make sure those 15 years deliver well, because we have a lot of money to bring home. We have invested quite a bit. So I think let’s focus but also, if you ask me, we can go beyond BPS and invest in other projects. We are keeping our eyes open [for opportunities]. KLGCC is our own brand. We like it and the whole KLGCC area is a KLGCC township. So, I think it is very sensible to revert [the name] to KLGCC. For us, that is a brand that we built and we want to build more value into the brand and brand the township. Not only KLGCC but the whole area will undergo a transformation. So for us, yes, it has benefited and enhanced the entire township. But [the brand] is valuable because it is a brand that we ourselves have and it benefits us also in many intangible ways. Also, almost everyone I spoke to loved it that we brought back the [KLGCC] name. Additionally, in the middle of next year, we plan to launch a high-end, low-rise development, which is still in the planning stage. Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/669977

Cover Story 1: Higher wages help more than raising contribution rates

English

This article first appeared in The Edge Malaysia Weekly on June 5, 2023 - June 11, 2023 TWO years into his contract as Employees Provident Fund CEO, Datuk Seri Amir Hamzah Azizan speaks to The Edge at the provident fund’s new headquarters, Menara KWSP in Kwasa Damansara, which is on the outskirts of Kuala Lumpur. The 56-year-old Liverpool fan reveals that the journey of managing EPF members’ hard-earned savings of RM1 trillion has been tough given the unprecedented events, including massive withdrawals, that have unfolded since he took office. Here are excerpts from the interview. The Edge: In your first interview with The Edge in June 2021, you mentioned the need to get clarity on EPF’s mandate to sort out where you want to go and translate that into executable plans. At that point, you had just passed your first 100 days. Now, it has been two years. Can you share any developments? Datuk Seri Amir Hamzah Azizan: It has been a long two years, right? Challenging times, four withdrawals. When you guys came to have a chat with me, I said that the most important thing for EPF to recognise is clarity of its mandate, not because it likes to do things for the sake of doing things. One of the key things that we were concerned about is that the social protection network for Malaysia is actually thinning out. And with the economy evolving with the informal sector becoming bigger, we were concerned about the fact that there will be quite a lot of people who will not have enough coverage by the time they get to retirement. EPF felt that it had a role to play and one of the key things that we wanted to do was to get that thinking process clear with our board. And then, once the board is aligned and has given us their support, we will take it to the government to work through the mechanism. The informal sector is an important target for us. What we’ve been doing on the ground is going out, trying to convince the people who are working in the informal sector that it is important for them to think about their retirement, and start putting in money [with EPF]. At the same time, we convinced the government that they have to give a small kicker. People without incentive move a bit slowly. So, the i-Saraan scheme was enhanced so that people who have the capacity would want to do it. When we start targeting and pushing along the informal sector, EPF has to work a lot harder, because we need to knock on doors and tell people you have to think about retirement, get [financial] literacy up, get them in, provide a methodology that they can come and put money in, making it easier rather than through the employer because they do not have a formal employer in that sense. So, a lot of changes have to be done on the EPF side. Now, our offices have mobile teams, outreach teams, to go out and conduct programmes with people and sign up when we see the Grab/Gojek of the world and so on to get their support for the mechanism, and explain to the dispatch driver, nelayan (fishermen), agriculture [entrepreneurs] and say, ‘I know it says Employees Provident Fund but you don’t need to be an employee to be in here because this is about building retirement savings’. It is getting that mindset change sorted out. We will be working through with the government to strengthen the mechanism to make it much more formulative as opposed to just going out to get voluntary contributions. But we will need to go through the legislative mechanism to get it sorted out. What is your understanding of the size of the informal sector? Based on the size of the labour force today, about 56% is covered through some scheme or another — about 47% by EPF and the balance [9%] the government pension scheme. The remaining 43% to 44% are those not covered, the exposed zone that exists today. Not all of them may come into coverage but lifting up the cover is very, very important. When we think about social protection in Malaysia, it’s not just about making sure we get coverage, but the type of coverage that needs to be put up. We are helping the thinking process about getting a more robust system, whether we need to have a better tiering mechanism so that every segment of society has some form of protection. More mature markets will always have a layering concept, where the bottom end of society gets supported through some form of intervention by the government. It is already hard enough for EPF to grow the existing funds as they reach RM1 trillion, but you’re now going out to get the other 43% to 44% of society that is uncovered. How is that also EPF’s concern? Does it have to do with the changing demographics of not just the workforce but also your members, as more baby boomers and older Gen X near retirement and start withdrawing their savings? Do you foresee any issues 10 years down the road? Let’s look at liquidity issues versus what is the fund and the social protection umbrella. The reality is that EPF looks at its role as part and parcel of the solution for social protection in Malaysia. If you want to do that, you must get coverage in a better form in Malaysia. So, we have been talking to the government about extension of coverage and EPF is a viable vehicle to actually do that. When you look at EPF simplistically, you can break it up into three parts, one of which is the investments. The second part is the servicing, where we look after the members. The fund has to stretch the reach and do more things, as opposed to what it used to do. It is not impossible as EPF already has the mechanism, the schemes are already there. We just have to go and figure out how to make it relevant for society and get society inside it. Once the contributions are in, the same mechanism gets deployed in terms of investments. The third part of EPF is always the internal servicing — how to make sure that we have good people and staff that maintain things and ensure things continue to run. So, I don’t think the issue is whether we can or cannot. Malaysia has to get better coverage so that we can protect society better. I think EPF has the best means to do that. So, we are reaching out to people to offer to do it. Demographics, I don’t think the problem is going to come to us immediately because I think the tail is still there. Our estimate is that only by 2045 or sometime around then that we will see a turn, where there are fewer contributions versus withdrawals. But what we also need to do is to think of retirement in a different form. Today, our mechanism of retirement is that by the time we get to 50, we can start withdrawing from Account 2. And by 55, you can take out all. If you have more than RM1 million, you can take out anything above RM1 million. Maybe there is some thinking that needs to be done about whether you do a lump sum mechanism or move to something more pension-like, where it is more of an income replacement mechanism. The liquidity management also changes to follow whatever scheme. The problem with our current system is that when people have the capacity to take out, it is very hard to stop individuals from spending. And our data indicates that within five years, most people clean out their account [use up their retirement savings]. How big is the group of people that contribute more than the mandatory 11%? Are they all EPF millionaires? Everybody thinks EPF is a club for millionaires. The answer is no. If you look at our data, the top 20’s mean savings is only about RM220,000. If you have RM220,000 in EPF savings, you’re not a millionaire. You have to be at T1 or T5 before you get classified as a millionaire with RM1 million savings in EPF. My team will be happy to share the numbers with you for this one. There is nothing to hide ... it’s the reality. So, the key problem with Malaysia is that the saving rate, the absolute amounts, is too small. And the big real issue for Malaysia is actually wages … wage rates are too low, too small … We are supportive of Malaysia migrating to a living wage. If you look at the contribution rates, 11% [members] plus the 12%/13% [employers], the total 23%/24% is actually not so bad. But if your wages are low, you multiply a low wage by whatever percentage, you don’t get very much. So, we need to address the root [of the problem] of low wages. If you look at the minimum wage of RM1,500 per month, a living wage indicates [that it should] probably be closer to RM2,700 to live adequately — not rich but just enough within the urban environment — so the gap is still quite stark. So, from EPF’s point of view, there needs to be a focus on getting wages right. Malaysia’s addiction to cheap labour needs to be solved along the way. We have to lift the quality of work. At the heart of all the data we have asked for, we would like to have a better gauge of the number of members who really need help. Apart from the low wages, they also keep making withdrawals. Then you have the government recently giving RM500 to people who are 40/45 years old. And by the time they get to 50/55, even if the amount doubles within 10 years, it is at most RM1,000. How much does this help towards adequacy of savings? Let’s talk about the root issue, which is wages. Wages are where we have to really push to get things right. Lifting wages helps more than lifting contribution rates. Because if you raise wages, the person gets to enjoy it today and the absolute amount of contribution also goes up [without the contribution rate changing]. That’s a better solution than lifting the contribution rate. More importantly, the lack of a good quality feeding pipeline means we continue to be trapped in middle income. And when you need to move up from this middle-income trap, you must move the quality of jobs higher in this country. You cannot continue to say, ‘Let’s bring in foreign labour’ … a small group of people enjoy the value of foreign labour but the bulk of society have to live under suppressed wage levels because foreign labour displaces local labour to go into those jobs. I think that’s the biggest headache that actually exists. When the withdrawals were conceived … RM145 billion left the system over four withdrawals. It was a challenge for EPF to manage the liquidity needs but our biggest concern was not the AUM (assets under management) or liquidity challenges because we can figure and sort those things out. [Our biggest concern was] the impact of this withdrawal on our members. Today, 50% of our members have what we call critically low savings, which is below RM10,000. And it is this group that we need to look at. There is a line of thinking that says, ‘Allow them to take out the money and don’t worry. When things are better, they can save again’ … But the reality is this: if you look at individuals, in total 8.1 million unique individuals took out money from EPF … On average, six million-plus [members withdrew from] one scheme and four million [withdrew from] another scheme but not everybody participated in all four schemes. Of that 8.1 million, 60% have started to recontribute back. But after we calculated, we think it will take them between five and six years to restore what they took out. When you say recontribute, does it mean they are putting back more than statutory requirement? Recontribute meaning they’ve started to work again, so the mandatory contributions start running and money starts coming in again into the accounts. The worse thing is they don’t even start. But the reality is that 40% have stopped [contributing], they’ve left the system. That means maybe they’ve already left the system when money was taken out anyway because they have either moved from a formal job to an informal job and never contributed again … there were some … but there were also some during Covid who left jobs and never came back. So, 40% of them [the 8.1 million] have emptied their accounts. They have no savings and they’re not rebuilding back. That’s the problem statement that we have. So, if I dissect the data, what does my data say? Which segment of society is worse hit by this? It is actually the middle and below that the rate of re-contribution is lower than the top end. So effectively, what we have to do is really focus on the middle and bottom, which is why we think that if you push [the minimum] wage [higher], the people that you help are at the bottom. When the minimum wage was lifted from RM1,200 to RM1,500, the beneficiaries were not the T20 or T1, it was actually the bottom. So, you have to fix the problem at the root. Once that is addressed, the rest will come. But if you choose not to do that, then you look at other means to address [the issue], whether it is subsidies or other forms of intervention that are hard to sustain. Did we have a moral hazard that was created through the withdrawals? It was a difficult decision. I don’t think the government willingly decided [on the withdrawals] but it had to address the fact that Covid was very unusual circumstances. When you do lockdowns and you stop people from working, there had to be consequences that had to be addressed. Maybe because our mechanisms were not mature enough, there were no other funds available. And people needed to survive, so it was the means that had to be given. But I’m glad to hear today that the government is saying those eras have stopped. Datuk Seri Anwar Ibrahim has said no more withdrawals because we are no longer in those circumstances where withdrawal was a necessity, what the Malays call ‘kelangsungan hidup’. Now, does it solve everyone’s problems? No. There will always be circumstances where some people are struggling. But the root cause — an unusual Covid scenario that called for intervention — which led to those EPF withdrawals being allowed, no longer exists. Our employment data also show that people have come back to employment and they are coming back at slightly higher wage levels. That’s why my contribution rates now have far exceeded pre-pandemic levels. So I know the system is repairing itself. It’s coming back but we cannot be happy that it’s coming back because we need to solve the problem for the long term and get us to the point where we don’t come back again [to the same scenario] and leave people stranded. You have had to bring back money. You said RM22 billion in 2021. In 2021, because of the large withdrawals, in order to prepare liquidity, we brought back US$5 billion. Plus minus, that is RM22 billion. Anything else apart from that? In 2022, we brought back US$1.6 billion. That again is linked to the special withdrawal. Before that, was any money brought home? Or only in 2021 and 2022? [It was a] normal return [of money for dividends]. But the normal flow is going to be counteracted with reinvestment. So, these 2½ years, the challenge has been on how we manage liquidity. The most important thing for us is no early terminations [of investments] or reinvestments. We have had to make sure that our returns are not jeopardised. The big effect, to us, was the member effect. What we worry the most is that if you allow the bottom to clean out their accounts, then the societal imbalance will be the biggest headache. The suggestion of lifting the employer’s contribution to 20% did not come from EPF, did it? No. There will always be ideas that get thrown in the system. The obligation from the government and EPF is to consider if it makes sense from EPF’s point of view. Wage rates have to go up. That’s the more important element that needs to be addressed because it caters for today and it caters for the future. In the wage rates, you must also address the productivity element. Productivity elements mean reinvestments in some other form are important but it actually facilitates the transition of the nation’s economy into a better state. If we continue with the low wage game, we will always be caught in this middle-income trap. Back to your mandate, you have to grow retirement savings and you’re trying to get people who are not covered into EPF. Is EPF also being tapped for other tasks like contributing to the country’s growth? When we look at it, it is not just about us increasing coverage. Increasing coverage is a natural evolution of the scheme to address where the nation is progressing. Our second focus is on the area of adequacy. For us, it is about creating mechanisms that would facilitate people to put in more. Second is lifting the voluntary contribution [ceiling] to RM100,000 to cater to people who may have additional means. Third is the means of putting in [savings]. Over time, we have added different asset classes. Having assets overseas and private assets are a natural evolution. We’ve been governed by our Strategic Asset Allocation (SAA) that we sit down with the ministry every three years to decide. Our SAA governs how much we can play within our asset allocation. It is not unusual anywhere in the world that the bulk of investment is domestic. When Datuk Seri Anwar came to launch our building in May, he said he would like to see EPF look at 2023 investment to see whether we can increase domestic investment to 70%. He said the investment for 2023. And the reality is that we have already been investing from the contribution amounts that we get, about 70% anyway. But our asset allocation may still end up like today — 36% overseas and 64% domestic. Why? Because if you look at our asset allocation, it says fixed income for this amount, real estate this much and equity this much. The domestic investments are predominantly fixed income. Fixed income, inherently we get lower income because they are the more secure assets, so the risk-reward balance is that way. If domestic returns give you slightly lower returns because of the risk-reward balance amount, and when overseas assets are riskier but give you higher returns, by nature, your asset allocation will end up bigger overseas than domestic for the year because the returns turn out that way. Let’s say I make 10% from overseas investment and 6% from domestic investment, what is the consequence to the [total] asset size? Overseas will go up by 10% and domestic by 6%, and percentage-wise, automatically my overseas investment will go up [as a percentage of total assets]. That’s how we’ve been able to grow our overseas assets, even though our domestic allocation may be 70%. The challenge for us is, over time, we need to work with the government to see how much Malaysia can absorb without ending up keeping money in money markets [the returns of which are lower than that of Malaysian Government Securities]. So it was a misunderstanding? He didn’t say that overall, domestic assets have to be 70%? [Anwar] didn’t say that. The reality is that we have been doing this and we are okay about doing this because there are still investments that we can do within this space [investing locally]. And a lot of it is actually in fixed income. So, because the global [portfolio] has been performing, the asset allocation will end up higher. You’re saying that allocation-wise, it is 70:30 but since the overseas assets have grown faster, the ratio is different? There are two parts to that. Every three years, we reset and we go to the government and say based on the availability of funds coming in and how deployment and diversification risks are and so on, and we think we can still service the domestic needs by this much. We think there is adequate capacity to do overseas by this much and we have the allocation to do it. But the pace of allocation grows depending on the returns on the assets that we’re getting. Historically, foreign assets return better than domestic. That’s why when the total assets are recalculated, the pace of change is faster on the other [international] side. Just to be absolutely clear so there is no confusion, the foreign investment cap is not reduced to 30%. Is it still 36% to 37%? The request from the prime minister is to please look at deploying 70% of your investments domestically. All said, it is not as the public expects — that EPF is to sell its overseas assets to bring back money because the prime minister has said EPF should limit its overseas investments to about 30%. It’s not that scenario at all, is it? It’s not the scenario. It’s about what is the new money that is going in. We have kept along the line. And as I have explained it to you, so far because the global [portfolio] overperforms, over time, the allocation will seem to be that we’re putting a lot of money overseas. But it is because of the performance and reinvestment that it continues to overperform. So, I’m actually okay [with having 70% allocation for domestic investments]. I can sustain that. And more importantly, I can find homes [for local investments]. The Edge wrote two stories about EPF’s overseas investments right after the prime minister’s remark, on whether EPF will bring back money and its impact on future returns. So that is not at all the situation? No, I think the money is there [overseas]. It will be recycled along the way. And again, since the economy has reopened, people are back to work and moving on, the contributions from members have hit a record. Actually, the first three months on average, the contribution number is RM8.6 billion, the biggest number ever. So I don’t have a shortage of money coming in, and that’s the money I use to reinvest back here. It would be good for members — the ones who are concerned — to hear from you if the investment decisions that you were forced to make because of the huge withdrawals impact EPF’s future returns. Usually, you don’t bring back so much money from overseas, but you had to in 2021 and 2022. In 2021, it was because we were funding i-Sinar at the time. Rather than terminating investments early, we saw opportunities because of the [global] market rally at the time that we were looking at bringing money back. The market is kind of funny, when Covid hit badly and we thought the market would tank. Can you give us a taste of what the first quarter income is like? Is equity still a star performer? First quarter hopefully, we will announce it by the end of next week (week of June 5). The details you have to wait for the end of next week. But suffice to say, I think it was a very choppy market, but we still were very, very resilient and we did better than we thought we were going to do.    Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/652170

World's oldest person, French nun Sister Andre, dies at 118 — retirement home

English

PARIS (Jan 18): French nun Sister Andre, the world's oldest person, passed away at 118 in France, her retirement home told Reuters on Tuesday. Lucile Randon, who took the name of Sister Andre when she joined a Catholic charitable order in 1944, had survived Covid last year. She was born on Feb 11, 1904, and was the world's oldest living person according to the Gerontology Research Group's (GRG) World Supercentenarian Rankings List.

https://theedgemalaysia.com/node/618984

丰隆投行对Hibiscus展研究 目标价1.85令吉

Mandarin

（吉隆坡9日讯）丰隆投资银行研究对Hibiscus Petroleum Bhd展开研究，并给予“买入”评级，目标价1.85令吉。 该研究机构今日在报告中指出，这是基于每项生产资产目标寿命期的未来现金流。 该机构认为，投资者没有计入Hibiscus未来几个季度的盈利和现金流前景，主要来自（一）2022年1月完成收购FIPC（Repsol）资产的额外产量，以及（二）原油价格大幅上涨。 “2023财政年的本益比仅为4.5倍左右，由于在上游能源领域的强大立足点，其估值明显被低估。” 丰隆投行预测，Hibiscus 2022财年的核心净利将增长超过2倍至3亿3620万令吉，并在2023财年飙升86%至6亿2560万令吉，复合年增长率达146%。 “我们对该集团的平均原油价格预测相对保守，2022和2023财年为每桶90美元。”   （编译：陈慧珊）   English version：HLIB starts coverage of Hibiscus, target price at RM1.85

https://theedgemalaysia.com/node/667342

谷中城大火 关闭至另行通知

Mandarin

（吉隆坡17日讯）谷中城（Mid Valley City）购物广场周三早上发生火灾后，将关闭至另行通知。 怡保花园（IGB Bhd）向大马交易所报备，谷中城管理层确认，购物广场外部的国能变电站发生火患，随后被紧急响应小组控制。 消防拯救局于10时42分抵达现场扑灭火势。 怡保花园指出，所幸没有造成人员伤亡。 该集团表示，消拯局目前正在事发现场，展开所有必要的调查并确保场所安全，不会进一步中断购物广场的营运。 “为了优先考虑所有在场人员的安全，将暂时中断电力供应，直到当局授权恢复供电。” “谷中城将关闭，直到另行通知。” 休市时，怡保花园跌1%或3仙，报2.97令吉，共1万4900股成交。   （编译：陈慧珊）   English version：Mid Valley City closed until further notice after fire incident

https://theedgemalaysia.com/node/652156

China's Lunar New Year travel to boost economy after Covid crunch

English

SHANGHAI (Jan 17): Urban workers crowded train stations across China's largest cities on Tuesday as travel for Lunar New Year holidays hit high gear, an early sign of economic recovery as officials confirmed a plunge due to Covid-19 curbs. The world's second-largest economy slowed sharply in the fourth quarter, data showed on Tuesday, dragging 2022 growth down to one its worst performances in nearly half a century after three years of Covid restrictions and lockdowns. With mass travel for the Lunar New Year possible for the first time in nearly three years after the relaxing of some of the world's tightest Covid curbs, the economy stands to gain from hundreds of thousands of people a day spending more as they return to China's hinterland. While many analysts say a return to economic normality will be gradual as the impact of Covid weakens, some see the Lunar New Year as a welcome early consumption boost. "Peak infections passed in major cities in January, and with the Spring Festival coming, tourism is back, and the signs of a recovery in consumption are obvious," said Nie Wen, a Shanghai-based economist at the investment firm Hwabao Trust. But with so many people on the move, health experts fear a deepening of the Covid outbreak, leaving the elderly in rural villages particularly vulnerable. Despite authorities confirming a huge increase in deaths on Saturday — announcing that nearly 60,000 people with Covid had died in hospitals between Dec 8 and Jan 12 — World Health Organization (WHO) officials are seeking more accounting of death rates. The WHO earlier welcomed Saturday's announcement after last week warning that China was heavily under-reporting deaths from the virus. Reuters reported on Tuesday that doctors in both public and private hospitals were being actively discouraged from attributing deaths to Covid. Specifically, the UN agency wants information on so-called excess mortality — the number of all deaths beyond the norm during a crisis, the WHO said in a statement. "This is especially important during periods of surges when the health system is severely constrained," it said. The WHO added that it would continue working with China to provide advice and support, but had not yet fixed another formal meeting with Chinese officials after WHO Director General Tedros Adhanom Ghebreyesus spoke with Ma Xiaowei, director of China's National Health Commission, at the weekend. The Ministry of Transport has estimated the rush will see a total of 2.1 billion passenger trips nationwide between Jan 7 and Feb 15 as many city dwellers make the most of their first chance for Lunar New Year trips to see extended family in home regions since the pandemic began. Chinese officials jettisoned Beijing's "zero Covid" policy — an approach previously championed by ruling Communist Party leader Xi Jinping — in early December, letting the virus run unchecked across its population of 1.4 billion people. Those stringent policies have further damaged China's demographic outlook, now at the start of a historic decline with government figures released on Tuesday showing the population fell for the first time in six decades. State media reported that some 390,000 passengers were expected to travel from Shanghai train stations on Tuesday alone for what is known as the Spring Festival holiday — seen as the world's largest annual mass migration before Covid. As travellers moved through stations in Shanghai, China's largest city, some expressed optimism despite the risks. "I am not worried about the virus. Because we are young, our immunity is okay," 37-year-old migrant worker Zhou Ning told Reuters outside the Shanghai Railway Station as he prepared to head back to his home area in Bazhong in the northeastern province of Sichuan. "Back in my hometown, there are many people who have tested positive, but I am not worried about it." On a train leaving Shanghai, fellow migrant worker Feng Hongwei, aged 21, said he was "so happy, so excited" as he began a trek home to Puyang, Henan. "I haven't seen my parents in two years". The holiday season has also sparked a revival in domestic air travel with more than 70,000 flights across China between Jan 7-13, according to industry data reported by Shanghai Securities News on Monday. That is equivalent to more than 80% of the levels seen before the pandemic.

https://theedgemalaysia.com/node/664280

Maxis unit gets RM72 mil additional tax bill from IRB

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KUALA LUMPUR (April 20): Maxis Bhd said its subsidiary has been served with an additional tax bill, including penalty, of RM71.7 million for the year of assessment 2021. Its wholly-owned subsidiary, Maxis Broadband Sdn Bhd (MBSB), was served with the notice from the Inland Revenue Board on Wednesday, Maxis said in a bourse filing on Thursday (April 20). “The notice was raised mainly pursuant to the disallowance of MBSB’s deduction of interest expenses incurred during the said year of assessment and hence, similar in nature with the notices received in the past years in respect of years of assessment 2016 up till 2020. “Based on legal advice obtained, MBSB will initiate legal proceedings to challenge the basis and validity of the disputed notice raised by the Director General of IRB and the penalty imposed,” Maxis said. The group added that there will not be any imminent financial effects on Maxis pending the outcome of the legal proceedings. In a separate bourse filing on Thursday, Maxis announced that Raja Tan Sri Arshad Raja Tun Uda, 76, is retiring from his post as a non independent and non executive director of the group from May 18. Raja Arshad holds 750,000 ordinary shares in Maxis. Raja Arshad earlier stepped down as the group’s chairman on April 22, 2021 after chairing the group for 11 years since its listing in 2009. On Thursday, share price of Maxis settled up five sen or 1.17% at RM4.34, valuing the group at RM33.98 billion.

https://theedgemalaysia.com/node/671564

Britain faces recession and flood of job losses if rates hit 6%

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(June 17): Economists are warning that the UK economy faces a sharp recession and a flood of job losses if interest rates hit the 6% level financial markets believe is on the cards. Household budgets are under increasing strain again as mortgage costs spike, while rocketing corporate insolvencies suggest firms, particularly the smaller ones that account for the bulk of employment, are struggling to cope with higher borrowing costs. The UK has so far weathered the cost of living crisis without falling into recession. The growth outlook was even upgraded recently by the International Monetary Fund. But economists now fear the BOE will have no choice but induce a downturn to curtail inflation, which is coming down more slowly than Governor Andrew Bailey and his colleagues expected. Markets expect another quarter point hike next week to 4.75% and for rates to reach 5.75%, or possibly even 6%, next year. That would be a 22 year high and add £250 (RM1,479) a month to the average mortgage payment, according to the Resolution Foundation — five times more than the saving from the recent drop in energy prices. Neal Hudson, a property market analyst at BuiltPlace, has calculated that homeowners would be spending almost a quarter of their income on mortgage costs, up from 17% in 2020, with rates at 6%. For those who have to remortgage at the higher rates, or who are on tracker deals, the cost of living crisis will feel more severe than during the energy price shock. “If the bank does push rates up as much as markets expect there will be a recession,” said Gerard Lyons, chief economist at wealth manager Netwealth. Erik Britton, chief executive of Fathom Consulting, agreed: “A recession is in the post if rates hit 6%.” Mortgage borrowers already are hurting from the 12 rate rises the BOE has delivered since 2021, putting the benchmark lending rate at its highest since 2008. That along with jitters in financial markets has driven up the cost of both mortgages and business loans, with both Britton and Rob Wood, chief UK economist at Bank of America Merrill Lynch, saying the corporate sector is near a tipping point. They fear that a spike in insolvencies will drive up unemployment and trigger a second wave of layoffs as companies that are currently hoarding labour due to worker shortages let people go. Consumer spending would collapse at that point, and a downturn would be inevitable. House prices would crash as people who could no longer meet their mortgage payments turn forced sellers. Megan Greene, who joins the BOE’s rate-setting committee next month, told Parliament this week that an “abrupt” end to “labour market hoarding … would have significant implications for consumer confidence and for consumption and could prompt a recession”. As companies released staff they were hanging on to, unemployment would suddenly spike, said Raghuram Rajan, a former International monetary fund chief economist and professor of finance at University of Chicago Booth School of Business. “Then you have more unemployment than you want, because these things move in a non-linear fashion. Unemployment is terrible for demand and terrible for housing because unemployed workers who can’t make their mortgage payments will sell.” It’s a gloomy scenario that Britain may well avoid. Most economists think rates will peak below the levels markets have priced in. The current worries among investors were triggered after a jobs market report showed inflationary pressures remained much stronger than expected, and figures due in the next few weeks could well surprise to the downside. Even so, the outlook puts Prime Minister Rishi Sunak in a tough position ahead of an election widely expected next year. While he shares the BOE’s determination to rein in runaway prices, the bitter medicine of a recession could hurt him at the polls. Rate rises are almost as much a constraint on what the government can offer to voters as they are on households. The Liberal Democrats have called for a £3 billion mortgage support fund to help distressed borrowers but every percentage point increase in rates adds £20 billion to cost of servicing the government debt. With only £6.5 billion to spare in March, Chancellor Jeremy Hunt has no room to move without blowing up his fiscal rules. Even without a recession, the BOE estimates the UK’s medium-term growth prospects point to a sputtering expansion of 1% a year, slow enough that living standards will slip behind G7 nations. As higher borrowing costs squeeze households, consumer spending will fall and consumer price inflation should decline with it. But Wood said the pass through will be slower than in previous cycles because so many people are on fixed term mortgages these days. He estimates consumer spending will shrink just 0.5%. If the same proportion of borrowers were on floating rates today as in the 2008 financial crash, the impact would be three times worse. Although many individuals will suffer, the aggregate economic impact only becomes catastrophic if people start losing their jobs consumer demand dries up on a far wider scale, Wood said. For that reason, Wood and Britton believe the trigger for a recession this time be in the corporate sector. Fathom analysis shows that 12% of publicly listed UK companies are already technically “zombies”, unable to pay interest costs out of earnings. The proportion will double with rates at 6%, Britton said. At that point a quarter of listed businesses would be struggling to survive. Official government figures Friday showed insolvencies at a new high, up 40% compared with last year. “Interest rates and inflation will continue to create challenges for businesses over the summer, and could be the tipping point for those business hanging in there,” said Nicky Fisher, president of R3, the UK’s insolvency and restructuring trade body. According to Naresh Aggarwal, associate director at the Association of Corporate Treasurers, businesses with lots of debt, such as those backed by private equity and those in interest-rate sensitive sectors like property, are already struggling to get hold of credit. “Larger businesses that are in good shape are now much more wary of credit risk across their supply chain,” he added. Central banks have been trying to strike the perfect balance between tightening financial conditions enough to bring down inflation and going so far that they cause a crash. Persistently high prices and wages keep piling the pressure on the BOE to raise rates further, though, adding to the risk of a “policy error” of doing more harm than necessary, said George Buckley, European economist at Nomura. In that event, Britton said the BOE would only have itself to blame for not moving against inflation fast enough early last year. “The BOE left it too long and was too vague about what it was trying to achieve,” Britton said. “A deep recession will be seen as a failure.”

https://theedgemalaysia.com/node/672407

Johor govt to hold discussions with Orang Asli regarding Sultanate Land

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JOHOR BAHRU (June 23): Any discussions on the status and suggested gazettement of Orang Asli settlements under Sultanate Land need to be done through roundtable discussions and not openly. State Agriculture, Agro-Industry and Rural Development Committee chairman Datuk Zahari Sarip said that he voiced the matter during a meeting with the Orang Asli community at several of their villages recently. “There were some who asked about the matter. I asked them to hold a roundtable discussion, and not to do it openly as I am concerned there are parties who may take advantage. “I myself was taken to look at an area in Kampung Sayong Pinang, Kota Tinggi where oil palm and rubber are being cultivated by the Orang Asli, so there’s actually not an issue. “The state government, however, is still in discussions with the Orang Asli community and we hope to resolve this matter,” he told reporters when asked about discussions between the state government and the Orang Asli community regarding the Sultanate Land issue on Friday. Sultan of Johor, Sultan Ibrahim Almarhum Sultan Iskandar had on March 16 voiced his disappointment over some Orang Asli trespassing on government forest reserves for the purported large-scale cultivation of rubber and oil palm. The Sultan expressed his belief that there were some outside parties behind the acts and were taking advantage through the use of Orang Asli rights and urged the government to re-gazette the Orang Asli settlements and reserves under Sultanate Land. This led to over 200 Orang Asli in the state to gather in front of Dato Jaafar Muhammad Building, Kota Iskandar, Iskandar Puteri, and hand in a memorandum protesting against the suggestion to turn Orang Asli customary lands into Sultanate Land on May 8.

https://theedgemalaysia.com/node/645925

Tomei on track to propel towards RM1.00 level, says RHB Retail Research

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KUALA LUMPUR (Nov 29): RHB Retail Research said Tomei Consolidated Bhd is on track to propel towards the RM1.00 psychological level as it reclaimed above the previous immediate resistance of 92 sen last Thursday and sustained above it last Friday with strong trading volume. In a trading stocks note on Tuesday (Nov 29), the research house said as the stock stayed firmly above the 21-day average line in an attempt to form a fresh “higher high” bullish pattern, the bulls are expected to propel the stock towards the RM1.00 psychological level, before reclaiming Aug’s high of RM1.05. “Conversely, the stock may reverse direction if it falls below the 88 sen support, forming a 'lower low' bearish structure beneath the average line,” it said.  

https://theedgemalaysia.com/node/624129

It’s all in the numbers

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When Dr Kok Chin Yong asks if you know your numbers, it’s not about maths or stats but your well-being. “The levels of your blood pressure, weight, cholesterol and blood sugar all have a bearing on your health. These numbers, if abnormal, can carry the risk of blood vessels being blocked in the body,” says the consultant neurologist and internal medicine physician at Sunway Medical Centre Velocity (SMCV). When blockages occur in the heart, it is called a heart attack. When they occur in the brain, it is called stroke (cerebrovascular disease), he explains. There is a reason to “ring the bell” because, contrary to the general view that stroke incidence increases with age, doctors are seeing younger cases today. The 2017 Monitoring Stroke Burden study in Malaysia says 40% of patients are under the age of 60. Another stroke study in 2020 shows a parallel rise in modifiable vascular risk factors such as hypertension, diabetes, obesity, physical inactivity, smoking and air pollution in young adults globally. And, it is twice as common for young patients to have these risk factors compared to their peers. “One needs to be aware of their own numbers, to know them by heart, starting from as early as age 35. Prevention is key in reducing the incidence of stroke. One can start from simple things like jogging for 30 minutes daily. This alone is enough to alter many of the risk factors,” Dr Kok says. Some people may need to make major lifestyle changes to reduce the risk of stroke but the trade-off is definitely worth it, he emphasises. Stroke, Malaysia’s third leading cause of death, with 47,911 incident cases and 19,928 deaths reported in 2019, can be divided into two categories. Ischemic stroke (75% of cases) occurs when blood clots or other particles block the blood vessels to the brain. Fatty deposits called plaque can also cause blockages by building up in the blood vessels. Haemorrhagic stroke (25% of cases), which is more deadly, happens when an artery in the brain leaks blood or ruptures. The leaked blood puts too much pressure on brain cells, which damages them. By nature, the disease occurs suddenly and often without any warning, says SMCV consultant neurosurgeon Dr Gerard Arvind Martin. The stresses that come with modern living, coupled with unhealthy diets and lifestyle habits such as smoking, all contribute towards a tendency to develop these diseases, he reasons. “In the case of a subarachnoid haemorrhage (SAH) due to a ruptured aneurysm, the bleeding in the brain may present with a sentinel headache far in advance of the actual rupture, which itself presents the patient with a host of symptoms ranging from a very severe headache and neck pain to downright impaired consciousness and threat to life. “Several factors affect the outcomes of haemorrhagic stroke, including a patient’s age, his level of consciousness when he was first brought to the hospital and the extent of bleeding,” Dr Gerard adds. “Every minute counts and can make a difference between a potentially good recovery and a downright poor one, with the patient’s life being at risk. “Survivors tend to be younger patients who present initially with better levels of consciousness. CT scan findings that show a smaller volume of blood within the brain and those without blood in the natural spaces within the brain, called ventricles, also tend to fare better. The main factor that can have a bearing on surviving a stroke is always prompt medical attention, as oxygen deprivation in brain cells is detrimental and the effects are irreversible.” As for who are at risk, both doctors say it is those who have diabetes, hypertension, obesity and high cholesterol, or a strong family history of stroke and other cardiovascular diseases. The main issue in stroke among the young is that all these vascular risks were detected late and often during their first stroke. Hence, education and regular health screening are important. Beware of these warning signs: weakness or numbness of the arm or leg, difficulty speaking, blurring of vision, facial drooping and loss of balance. Less commonly, dizziness or vertigo and clumsiness can occur. Symptoms show suddenly and some may experience them for a very short period of time. So, it is crucial to identify them early and act fast to avert a major disabling stroke, which can be devastating. A stroke puts additional burden on households and caregivers, Dr Gerard notes. Apart from rising hospital costs, families need to be part of the patient’s rehabilitation, which may involve modifying their homes and engaging in programmes prepared by a rehabilitation physician or physiotherapist. The costs go far beyond that of treatment, Dr Kok observes. “This is a real issue, given that young stroke is on the rise. Young patients are mostly breadwinners of their growing families and losing their jobs and productivity would have a huge impact on them. Some could use up their medical leave and Socso claims. Some would have to rely on their family for financial support. Patients with major disabilities need constant care and that could mean yet another financial burden.” There are also the emotional effects of stroke. Up to 40% of patients have depression, a problem usually under-diagnosed because they themselves, or the doctors, often overlook the symptoms as part of the disease. “Yes, this psychological disorder would definitely slow their recovery by hampering rehabilitation, which is a period when patients need to be constantly engaged with the exercises.” The upbeat news is rehabilitation can help patients recover and even retrain functions that remain, resulting in many being competent enough to live fairly independent lives. A balanced diet, regular exercise, physiotherapy, and good management of weight and stress can further boost recovery, which is never immediate, Dr Gerard adds. Dr Kok reckons it takes a village to help patients recover and SMCV aims for a multi-disciplinary approach. “Acute stroke treatment, such as thrombolysis, is given to those who recognise their symptoms early and seek help fast. For those who did not, we aim to commence good preventative medical therapy. As for those with major disability, we provide basic to advanced physiotherapy.” SMCV’s stroke services include emergency treatment during working hours, handled by a team trained by its emergency physician to quickly identify cases. There are also in-house neurologists to manage cases and a group of young enthusiastic physiotherapists to aid recovery. Post-hospitalisation is the beginning of the end of this life-changing episode, Dr Kok believes. Patients will be advised on medications and how to control risk factors. A rehabilitation programme will be drawn up to hasten recovery and avoid complications such as spasticity and pain. Physiotherapists will provide a framework for rehabilitation and the patient usually needs to make return visits for further training. Follow-ups are also crucial to prevent a second stroke. The road to recovery is not necessarily strenuous, but patience and consistency are vital. “With milder forms of stroke, recovery is almost certain, albeit not completely,” Dr Kok notes. “Engaging in a good rehabilitation programme may be as important as the treatment itself. Our brain has the unique capacity to recover lost functions, to a certain extent, with proper rehabilitation.”

https://theedgemalaysia.com/node/625400

Sunway REIT acquires industrial property in PJ for RM60m

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KUALA LUMPUR (June 23): Sunway Real Estate Investment Trust (Sunway REIT) has acquired a 3.63-acre freehold industrial land in Sungei Way, Petaling Jaya for RM60.05 million. The asset includes a double-storey building and a five-storey building with a total gross floor area of 497,487 sq ft, said a statement issued by Sunway REIT’s manager, Sunway REIT Management Sdn Bhd. It said the acquisition is expected to be completed in the second half of 2022, after which Sunway REIT’s property value will increase to RM8.80 billion from RM8.74 billion as at Dec 31, 2021. The acquisition will be fully funded by Sunway REIT’s existing debt programme, with its gearing ratio expected to increase from 37.2% as at Dec 31, 2021 to 37.6% upon completion of the exercise, the statement said. “Our strong balance sheet places Sunway REIT in a position of strength to continue our active pursuit of yield-accretive acquisition opportunities that are present in the market,” said Sunway REIT Management CEO Datuk Jeffrey Ng.  Ng said the acquisition is in line with Sunway REIT’s direction to expand its asset portfolio in the industrial segment. “The property is strategically located in an established industrial zone in Petaling Jaya, easily accessible via major roads and expressways such as the Federal Highway and Lebuhraya Damansara-Puchong. The manager is actively looking for quality anchor lessees, given the size and strategic location of the property,” he said. Sunway REIT’s share price settled three sen or 1.97% lower at RM1.49 on Thursday (June 23), bringing a market capitalisation of RM5.1 billion. 

https://theedgemalaysia.com/node/673772

Report: Japan’s Nagoya Port container operations crippled by ransomware attack

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KUALA LUMPUR (July 6): Container operations have been suspended at the Port of Nagoya, the largest port in Japan for the past two decades, as it works to recover from a ransomware attack. In a report on Wednesday (July 5), industry magazine The Maritime Executive (TME) cited Japanese media which linked the attack to a pro-Russian group while noting this was the second but far more consequential attack on the port’s systems in less than a year. It claimed media reports in Japan as saying that the attack was discovered around 6:30am Tuesday, when workers attempted to boot the computer systems at the port and received a message that it was suffering a ransomware attack. Kyodo News, citing port officials, attributed the attack to a Russia-based group Lockbit 3.0. Nagoya accounts for approximately 10% of Japan’s total trade. The port complex includes 21 piers and 290 berths, handling over two million containers and 165 million tonnes of cargo each year. Critically, it is the homeport for Toyota Motor Corp, which handles all its imports and exports in Nagoya. Company officials said they have not been able to move parts shipments but that production at its factories is not affected at this time. They are however closely monitoring the progress to restore the port's systems. TME said port officials issued an announcement initially saying that they would restore the systems by Wednesday night but subsequently said they were targeting a resumption of work Thursday morning. Port officials said the gates would remain closed until its systems are back up, but will permit the loading and unloading of containerships by the prime contractor.

https://theedgemalaysia.com/node/661852

My Say: In the middle for once: Markets, governments and innovation

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This article first appeared in Forum, The Edge Malaysia Weekly on April 3, 2023 - April 9, 2023 One of my favourite NBA commercials is Nike Basketball’s “Bring Your Game”. In the commercial, a group of four teenagers are trying to pick their favourite basketball players. To do so, they go around the US to meet some of basketball’s biggest stars — or at least the ones who signed with Nike — including Lebron James, Elena Delle Donne, Anthony Davis, Kyrie Irving, Kevin Durant, Paul George and the late great Kobe Bryant. I rewatched the commercial a couple of days ago (it’s on YouTube) and one kind of throwaway line in the commercial really struck me. The teenagers are discussing the merits of Paul George and trying to decide if he is a “loud” player or a “quiet” player. And as they are discussing George on the subway, one of the teenagers yells out, “He’s in the middle for once!” Maybe I’m reading more into it, and I’m certainly not sure if Nike meant it as such, but I do think the line is pretty profound. The line from the commercial basically says there may be a more nuanced position (“He’s in the middle…”) but that more nuanced position is typically ignored or completely set aside (…for once!”). So, in the context of the NBA, one might take a nuanced position to debate the merits of, say, Michael Jordan, Kareem Abdul Jabbar or Lebron James as the “GOAT” (greatest of all time) or, as is more common on Twitter, YouTube, Reddit and everywhere else such discussions happen, it’s all or nothing on a single player. The thing is, just like how territorial we can get when we are discussing fandoms — be it the NBA, the Premier League, The Lord of the Rings, Harry Potter, whatever else — the same may also be true of our intellectual or ideological public policy positions. At present, there is plenty of debate on the topic of industrial policy and, more specifically, the efficacy of government-led attempts to change the composition of economic activity in a given country. A common perspective is that government-led attempts to do business are necessarily sub-optimal and are ultimately doomed to failure. After all, what do bureaucrats know about running businesses? And how can governments “pick winners” when it doesn’t necessarily have skin in the game, nor is it sufficiently close to the pulse of the market and the consumers? In fairness, history is replete — Malaysia included — of governments picking winners only to see colossal losses and failures. And yes, while there are also successful cases of governments picking winners (see TSMC and Samsung in Taiwan and South Korea respectively), we can’t deny that governments don’t always do a good job of picking winners, even at the sectoral level. Chile, for example, experimented with a bunch of sectors before succeeding in developing a thriving salmon sector. But here’s the catch, and here’s where I think there’s room for a lot more nuance. Government failures are common everywhere, but so are market failures. Are we so sure that the private sector or the market necessarily picks winners well? If that were the case, the venture capital model wouldn’t be firing a bunch of bullets in the hope that one or two ventures make enough money to cover the rest. And sure, it’s probably true that if a given venture capital fund’s hit rate is, say, one in 10, the government’s might be one in 20 or worse. But one in 10 is still not a great hit rate, especially if resources are scarce. In a recent paper titled “Distorted Innovation: Does the Market Get the Direction of Technology Right?” Massachusetts Institute of Technology economist Daron Acemoglu provides evidence that distortions in the direction of market-driven innovation and technology — where the optimal direction is taken to be the most socially beneficial one — can be substantial. In the paper, he provides the example of antibiotics and dietary supplements, stating, “Both antibiotics and dietary supplements have resulted from new innovations and have led to products that have been consumed by billions of people around the world. But most would agree that antibiotics constitute a bigger technological breakthrough and have been socially more beneficial.” Acemoglu argues that there are at least five factors that distort the alignment between market incentives and social objectives when it comes to innovation. The first is that some technologies generate negative externalities which, if unpriced, means more research and innovation being directed towards those technologies. The clearest example of this is in innovation in fossil-fuel technologies over time. Another example Acemoglu provides is the direction of technology towards automation of work, as opposed to worker-complementary technologies. The second factor is strictly commercial — incentives for innovation are unsurprisingly tilted towards higher-markup sectors and technologies. This is the profit motive and shareholder value maximisation in action. The third is on social trends that may favour a particular direction ahead of others. For instance, many start-ups seem to advertise to be the “Uber” of something or other, providing incremental gains to market efficiency, as opposed to disrupting entire markets completely or even focusing on hardware technology. Fourth, as Acemoglu argues, when different technologies create distinct distributional effects (that is, inequality), the market isn’t built to redistribute these effects. Finally, the direction of innovation may be distorted because of coordination failures where firms or innovators stay too long with an inferior technology as entire ecosystems are built around that inferior technology. Notice that these five factors are forms of market failure and can therefore prevent private sector firms and innovators from “picking winners” or pushing innovation and technology into socially beneficial ways. As such, while it’s certainly true that governments can’t always be relied on to make terrific business decisions, it’s also true that the private sector may not always get it right either (see Silicon Valley Bank’s asset management decisions). Innovations in financial derivatives in the early 2000s were a key contributor to the 2008 global financial crisis after all. So where does this leave us? In the spirit of, “It’s in the middle for once!”, Acemoglu writes, “I assume that the market is best placed to experiment with new methods and carry out innovations, even if it is possible for systemic factors to distort the direction of technology.” The reality is that markets can fail and governments can fail. An ideological bent that the government should never be in business and thus, industrial policy is doomed from the start, is entirely unhelpful. In fact, for democratically elected governments, where the market is distorting the direction of technology away from socially beneficial ends, one might argue it is the responsibility of the government to intervene to shift economic activities back towards those socially beneficial ends. Therefore, it’s never “only the private sector should be in business” or “the government should always intervene in business”. Reality is far more complex and there are certainly pockets of market failures where the government does have a more direct role in economic activities. Beyond the old chestnut of providing a secure policy and regulatory base, these include the provision of more long-term patient risk capital (de-risking new economic activities for the investors who may find it too risky to invest in completely new technologies or those with very high fixed capital expenditure, among others), taking on lower-than-commercial returns for crucial economic activities, and shaping the direction of technology and markets towards more socially beneficial ends. We really should view this market-government relationship in business as being in the middle, for once. Nicholas Khaw is an economist and head of research at Khazanah Nasional Bhd Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/641292

Formosa Prosonic resuming upwards trajectory, says RHB Retail Research

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KUALA LUMPUR (Oct 26): RHB Retail Research said Formosa Prosonic Industries Bhd is resuming an upwards trajectory after breaking past the RM3.06 resistance on strong volume. In a trading stocks note on Wednesday (Oct 26), the research house said that for the past one month, the stock has been undergoing a correction, trending below the 21-day simple moving average line. It said the latest breakout shows the stock has completed the correction phase and is slated to move higher. “The bulls are eyeing to test the next resistance pegged at RM3.20, followed by RM3.40. “Meanwhile, breaching below the RM2.92 support will signal that the bears have regained control and a negative price action may follow through,” it said.

https://theedgemalaysia.com/node/673380

Johor Port signs MOC with HR Ministry relating to implementation of TVET programme

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KUALA LUMPUR (July 3): Johor Port Bhd, a member of MMC Group, has signed a three-year memorandum of cooperation (MOC) with the Ministry of Human Resources (MOHR) on June 27, 2023 relating to the implementation of technical and vocational education and training (TVET) programme. Through the MOC, Johor Port will be directly involved in the implementation of the nation’s TVET programme, especially in the development of curriculum and training materials, and providing the training facility for the port operations programme. “Johor Port is eager to share and extend its notable experience and expertise in the ports and logistics industry through the facilitation of knowledge transfers and opportunities for industry exposure, to elevate the nation’s vocational training,” Johor Port chief executive officer Derick Basir said. He said Johor Port is also committed to growing its business responsibly, sustainably and inclusively. “Plus, this three-year partnership with the MOHR is a testament to our commitment to giving back to the communities, while empowering the industry with good talents,” he said. Additionally, the high-quality training programmes designed by Johor Port Skills Centre (JPSC) have also received numerous recognitions locally and globally. Established in 2014 as the training division of Johor Port, JPSC is the centre of excellence for MMC Ports, and has trained more than 8,000 port and logistics officers in Malaysia, Taiwan, Singapore, Philippines, Indonesia, Cambodia, Vietnam, Ghana and Nigeria.

https://theedgemalaysia.com/node/619587

Pentamaster 1Q net profit jumps 27% to RM20.4m on higher revenue

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KUALA LUMPUR (May 12): Pentamaster Corp Bhd's net profit jumped by 27% in the first quarter ended March 31, 2022 (1QFY22) to RM20.4 million from RM16.07 million a year ago, underpinned by higher revenue contribution from its automated test equipment segment. Earnings per share grew to 2.86 sen from 2.26 sen, its Bursa Malaysia filing showed. Quarterly revenue climbed by 26.8% to RM146.02 million from RM115.17 million. The group did not declare any dividend in the quarter under review. On a quarterly basis, the quantum of growth was smaller. The group's net profit increased by 3.81% against RM19.65 million reported in the immediate preceding quarter (4QFY21) while revenue was 19.2% higher compared with RM122.49 million in 4QFY21. Moving forward, Pentamaster said while the supply chain environment remains disruptive and challenging, it will continue to work closely with both its customers and suppliers for better capacity planning and visibility. "The current immediate aim for the group is to be able to deliver its order as scheduled barring any significant adverse impact from the supply chain bottlenecks, logistics constraints and geopolitical knots. "Overall, the group is optimistic about achieving another record year of business growth while placing its continuous focus on developing a broader product portfolio across key markets and segments, while upskilling its workforce," it said. Pentamaster's share price dropped six sen to RM3.02, giving it a market capitalisation of RM2.15 billion. Year to date, the stock has fallen by 46%.

https://theedgemalaysia.com/node/649001

Scomi, UWC, Poh Kong, Opcom, PBA, JAKS, TDM, GIIB, Citaglobal and MAHB

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KUALA LUMPUR (Dec 20): Here is a brief recap of some corporate announcements that made news on Tuesday (Dec 20), involving Scomi Group Bhd, UWC Bhd, Poh Kong Holdings Bhd, Opcom Holdings Bhd, PBA Holdings Bhd, JAKS Resources Bhd, TDM Bhd, GIIB Holdings Bhd, Citaglobal Bhd and Malaysia Airports Holdings Bhd (MAHB). Scomi Group Bhd’s proposed scheme of arrangements with its creditors has received the High Court’s approval. The decision came after the majority of its creditors voted in favour of the proposed scheme at a court-convened meeting on Nov 15. Scomi fell into Practice Note 17 status in December 2019, after its shareholders’ equity spread slipped below 25% of its issued share capital and its equity dropped below RM40 million. UWC Bhd’s net profit rose 27% to RM29.25 million for its first quarter ended Oct 31, 2022, from RM23.04 million a year ago, while revenue grew 22% to RM92.12 million from RM75.25 million. The improved profit was due to the appreciation of the US dollar against the ringgit, and an expansion in capacity to cater for the rising order book from the semiconductor industry. Poh Kong Holdings Bhd’s net profit jumped to RM15.67 million for first quarter ended Oct 31, 2022, from RM5.42 million a year ago, while revenue more than doubled to RM370.36 million from RM175.29 million. The company cited rising demand for gold jewellery and investment products, amid a rebound of the economy for its higher earnings. Opcom Holdings Bhd’s shareholders have approved the acquisition of the entire equity interest in T&J Engineering Sdn Bhd for RM90 million and its subsequent diversification into telecommunication network infrastructure solutions business. The acquisition and diversification are expected to be completed in the first half of 2023. PBA Holdings Bhd said the water intake fee in Penang for 2023 remains at three sen per cubic metre, based on the annual actual production volume for the year. This was informed by the Penang government in a letter to PBA’s subsidiary Perbadanan Bekalan Air Pulau Pinang Sdn Bhd. PBA said the water intake fee will not have any effect on its issued share capital and shareholdings of the substantial shareholders, while the fee is not expected to have any material effect on the net assets and the earnings of the group for 2023. JAKS Resources Bhd has proposed to undertake a private placement of up to 292.2 million new shares, to raise up to RM74.4 million, based on an illustrated issue price of 25.4 sen per share. Of the amount, RM43 million will be used to repay credit facilities and lower the group’s net gearing ratio to 0.21 times, from 0.28 times as at end September. Another RM30.7 million will be used as working capital and the remainder will be used to cover expenses related to the placement. TDM Bhd’s 3.75%-owned Indonesian unit, PT Rafi Kamajaya Abadi, has failed in its appeal against Indonesia’s Ministry of Environment and Forestry in relation to a fire incident in 2019 at its land in West Kalimantan province. The unit was ordered by the Pontianak High Court to pay a compensation of 188.98 billion rupiah (RM53.5 million) to the National Account of Indonesia for environmental loss in relation to the year 2019 fire that occurred at the unit’s plantation. GIIB Holdings Bhd said three shareholders — Tai Boon Wee, Wong Ping Kiong and Teng Pik Sun — with a combined stake of more than 10% in the group, have requisitioned for an extraordinary general meeting to remove Wong Weng Yew as a non-executive director of the group. Formerly an executive director (ED) of the company, Wong was suspended from his ED role from March 28, to facilitate investigations into his management and handling of the group’s glove business and accounts, and subsequently terminated on May 19. Citaglobal Bhd’s major shareholders’ takeover offer for the remaining shares in the group received a lukewarm response from minority shareholders. Only 17,365 shares, or less than 0.01% of the group’s total share base, were sold to the offerors, namely TIZA Global Sdn Bhd, Tan Sri Mohamad Norza Zakaria and persons acting in concert. This raised the offerors’ collective shareholding to 943.32 million shares, from 943.31 million. In percentage terms, their stake remains at 50.23%. Malaysia Airports Holdings Bhd (MAHB) recorded 5.2 million passenger movements for its 39 airports in the country in November, reaching 60% of what was posted for the same month in 2019, before the Covid-19 outbreak in 2020. This was more than double the 2.3 million passenger movements recorded for the same month last year. Airports in Malaysia recorded 2.9 million domestic passenger movements last month, despite November being a typically slower month. Malaysia’s international passenger movement volume also continued to recover in November, recording 2.2 million, a significant increase from the 150,000 seen in the same month last year, when international borders had yet to reopen.

https://theedgemalaysia.com/node/659019

Sustained consumer spending to bolster retail counters

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This article first appeared in The Edge Malaysia Weekly on March 13, 2023 - March 19, 2023 THE retail sector, which has seen a robust rebound since the reopening of the economy last April, is expected to remain strong this year despite inflationary pressures and higher interest rates, say analysts. Indicators such as healthy footfall in shopping malls and the Malaysian Institute of Economic Research’s Consumer Sentiment Index for the fourth quarter last year rising to 105.3 from 98.4 in the previous quarter have been telling of better job and income prospects, as well as the softening of inflationary pressures. “[These have been] pointing towards sustained consumer spending, supported by the reopening of the economy and the return of shoppers, commuters, the office crowd and international tourists. Second, financial assistance to the low-income group and subsidies for fuels, electricity and selected food items have [helped to] keep the cost of living in check. Third, the job market is relatively stable and the M40 group has healthy household balance sheets,” Kenanga Research analyst Tan Jia Hui tells The Edge. Similarly, analysts at MIDF Research expect inflation to trend downwards this year, which will bring about a corresponding pause in interest rate hikes. In addition, the festive season of Hari Raya next month, coupled with the various assistance packages provided by the government as well as the lower rate of unemployment, is expected to continue to drive momentum in the retail sector and boost the earnings of consumer companies, in particular those selling consumer staples, says the research house. As for the implementation of the 20 sen per kWh electricity surcharge for medium and high voltage users for the period from January to June, a fivefold increase from 3.7 sen per kWh last year, retailers and hoteliers are awaiting a response from the government after pleading for a moratorium until December so that their businesses can recover from the impact of the pandemic. In a joint statement on Feb 8, seven associations representing retailers and the owners and operators of hotels, theme parks and shopping malls — including the Malaysia Retailers Association, the Malaysia Shopping Malls Association, Malaysian Association of Hotels and Malaysian Association of Hotel Owners — lamented to the government that their monthly energy bills had gone up by at least 20% to 30% from the previous year, despite similar usage levels. The higher electricity tariff is expected to increase the operating costs of retail real estate investment trusts (REITs) as electricity cost typically makes up about 30% of property operating expenses, MIDF Research notes. It explains that there are limited measures to blunt the impact of higher electricity costs apart from replacing lighting with energy­-saving bulbs. An analyst who declines to be named notes that Aeon Co (M) Bhd and Padini Holdings Bhd, which are major tenants in shopping centres, have installed solar panels in their buildings and warehouses respectively to blunt the impact of the higher electricity costs. “Overall, the electricity cost will remain higher as more activities [are taking place] at malls now, such as events that consume more electricity. However, the higher rental income is expected to cushion the higher operating cost. Margins were squeezed last year, but most companies have been able to pass on the additional costs to consumers,” says MIDF Research. RHB Research associate Ammar Affan adds that the impact of the new electricity tariff on REITs is manageable. “While electricity makes up about 90% of REITs’ utility costs (making up about 20% of the total property operating expense), some of the trusts’ management teams have guided for a minimal impact on distribution per unit of about 3%. Furthermore, REITs could opt to pass on the increase in electricity cost to tenants to further mitigate the rate hike,” he says. For the second quarter ended Dec 31, 2022 (2QFY2023), Padini’s net profit rose 20.1% to RM73.14 million from RM60.89 million the previous year. The apparel retailer attributed the higher earnings to the sustained recovery from the pandemic, which also resulted in a 19.3% increase in quarterly revenue to RM509.48 million from RM427.17 million. Padini has declared a third interim dividend per share (DPS) of 2.5 sen, to be paid on March 31. Kenanga Research’s Tan, who has an “outperform” call on the counter with a target price of RM6, acknowledges that it is a lofty target price for the stock, which is currently trading at the RM3.79 level, as she believes the brand will benefit on several fronts, such as wardrobe replenishments, affordability for impulse buys and strong spending power of its primary group of buyers, the M40. She says the group’s strong net cash position enables it to purchase inventory ahead of price hikes and potential supply disruptions, and that the impact of escalated raw material costs came off for Padini as supply chain disruptions in China eased. “The higher tourist arrivals, especially from China, are anticipated to prosper retail trade in Malaysia, and the better retail sales outlook will help retailers of general products like AEON Co. Moreover, the potential cash aid and incentives to low-income groups in the forthcoming Budget 2023 could raise disposable incomes and boost consumer spending on essential items,” says MIDF Research, which has a “buy” call on AEON Co with a target price of RM1.81 as it believes the general merchandise store (GMS) will continue to see steady sales ahead in the trading of daily essential goods. AEON Co’s net profit for 4QFY2022 sank 64.9% to RM24.92 million from RM70.98 million in the year before on account of an increase in promotional activities, maintenance costs and lower reversal of impairment for receivables. It declared a final DPS of four sen for FY2022, which is higher than the three sen paid in FY2021. Despite AEON Co’s lower net profit, analysts believe the GSM operator will chart steady sales ahead in its daily trading of essential goods. Kenanga’s Tan, who has an “outperform” call on AEON Co with a target price of RM1.80, notes that the group has completed its digital transformation and has begun introducing self-checkout terminals at its 42 stores. She believes this will result in cost savings and partial mitigation of labour shortage issues. Bonia Corp Bhd posted a net profit of RM20.3 million for 2QFY2023, a slight improvement from RM19.4 million the year before. Revenue came in at RM112 million, up 9.6% from RM102.2 million earlier. The retailer, which carries brands such as its namesake, Renoma and Valentino Rudy, declared an interim DPS of two sen for 2QFY2023, bringing the cumulative FY2023 dividend to four sen per share. Bonia attributed the higher revenue to its brand building strategy, opening of new stores and retail facelift of its existing stores and effective digital marketing programme. The company also declared an interim DPS of two sen for 2QFY2023, bringing the cumulative FY2023 dividend to four sen per share. CGS-CIMB analysts Walter Aw and Khoo Zhen Ye say in a Feb 21 note that they expect “solid 2HFY23F results despite high inflationary pressures, driven by Bonia’s strong brand equity, novel product launches, effective marketing campaigns and growing loyal customer base”. Aw and Khoo believe the group’s 2HFY2023F sales could be driven by festive sales, namely Chinese New Year and Hari Raya, as well as the company’s ongoing store expansion, in which there are plans this year to open two to three new boutique outlets with attractive designs, making up about 4% of its total boutiques. Aw and Khoo point out that Bonia’s 1HFY2023 core net profit of RM31.5 million “beat expectations and accounted for 70% of our estimates and 78% of Bloomberg consensus’ FY2023F estimates”. The research house has an “add” call on Bonia with an unchanged target price of RM3.50. The net profit of eyewear retailer Focus Point Holdings Bhd, which has a food and beverage (F&B) arm as well as franchise businesses, including Lasik centres, rose 12.5% to RM10.45 million for 4QFY2022, from RM9.29 million the year before. Revenue was RM68.4 million, rising 7.4% from RM63.7 million earlier. “We believe it will be an exciting year ahead for Focus Point’s F&B division as more corporate customers have been secured for the supply of products from its central kitchens. Note, however, it may be challenging to further grow its optical business from the elevated FY2022 earnings base that was partially boosted by pent-up demand, particularly tourists from Singapore and the various spending boosters,” says a second analyst who declines to be named. Bloomberg data show that the only analysts covering the stock, TA Securities Holdings’ Kevin Tan Kong Jin and Hong Leong Investment Bank’s Syifaa Mahsuri Imail, have “buy” calls on Focus Point, with target prices of RM1.59 and RM1.61 respectively. Meanwhile, MIDF Research is also positive on the outlook for owner/operators of retail malls Pavilion REIT, IGB REIT and Sunway REIT, thanks to “high occupancy rates of malls in their portfolio, namely Pavilion Kuala Lumpur, Mid Valley Megamall and Sunway Pyramid respectively”. “Shopper footfall has recovered to pre-pandemic levels and tenant sales have improved. Hence, rental reversion of the malls is expected to be positive going forward and support earnings growth,” says the research house, which has “buy” calls for all three REITs  with target prices of RM1.63, RM1.86 and RM1.73, in the order above. Meanwhile, AmInvestment Bank research analyst Zing Sheng Khoo has a “buy” call with a target price of 81 sen for Hektar REIT, which has an average portfolio occupancy rate of 82% for the six neighbourhood malls it operates. While the year-end to Chinese New Year stretch, as well as Hari Raya, are typically high-growth periods in the retail calendar, it remains to be seen whether the sales momentum will actually extend into the coming quarters, bearing in mind that the industry is still coming off last year’s low base.   Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/637706

油价狂泻至8个月新低 能源指数应声下挫

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（吉隆坡26日讯）原油价格上周五下跌约5%至每桶80美元以下，写下8个月新低纪录，导致追踪油气相关公司股价的大马交易所能源指数今日跌逾4%，成为马交所跌幅最大的指数。 路透社报导：“油价上周五狂泻约5%至8个月新低，因美元触及20多年来的最高水平，加上担心利率上升将导致主要经济体陷入衰退，从而削减石油需求。” 闭市时，能源指数挫30.29点或4.25%，收于682.35点，盘中游走于677.59点至704.94点之间。 富时隆综指则跌11.94点或0.84%，挂1413.04点。 能源成分股Velesto Energy Bhd和Hibiscus Petroleum Bhd在交投活络中走低。 交投冠全场的Velesto达1亿100万股易手，全天挫1仙或7.69%，报12仙。 第八热门股Hibiscus则有约3600万股成交，终场跌4仙或4.44%，至86仙。   （编译：魏素雯 & 陈慧珊）   English version：Bursa's Energy Index falls the most after oil prices plunged to eight-month low

https://theedgemalaysia.com/node/612727

Post-pandemic Asean: Reframing development priorities in Asean

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This article first appeared in Forum, The Edge Malaysia Weekly on March 21, 2022 - March 27, 2022 As was perhaps inevitable, the Association of Southeast Asian Nations is facing the spread of the Omicron variant of coronavirus, with cases rapidly rising over the past few weeks — Malaysia, for example, is seeing its highest-ever infection numbers. However, as most countries in Asean have now received vaccine supplies sufficient for double-dosing, the economy and businesses are regaining their full capacities. As at February 2022, the Philippines, Thailand and Vietnam are open to visitors, with certain limitations, and the rest of Asean is expected to follow suit in the coming months. Despite the pandemic, investors are clearly optimistic about the region’s immense economic potential and market prospects — particularly in tech. For example, Southeast Asian tech start-ups raised an unprecedented US$8.2 billion in 2021. In Malaysia, the Malaysian Digital Economy Corporation (MDEC) announced its Digital Investments Future5 (DIF5) Strategy, which hopes to attract RM50 billion (US$12 billion) in investment into the country’s digital economy by 2025. Even as the pandemic continues to sweep through Asean’s underdeveloped communities, money is still being pledged to 5G and tech. The economic story of the past two decades has centred around digital opportunities and the internet. Ask anyone what the world’s most successful companies are, and you would get a list of tech companies: Google, Apple, Facebook, Netflix, Alibaba, Tencent and so on. In fact, development priorities shifted to accommodate the rise of the internet and deepening smartphone penetration. Telecommunication towers, cheap mobile devices and rapidly expanding tech sectors were favourites of development budgets. “Access to information” was one of the main reasons for this: Organisations across Asean discussed how to deliver development priorities through smartphones and the internet to attract funding. This was despite the lack of any real evidence that this was what poorer communities truly wanted or needed. In this digital fog, development needs were often forgotten, yet billions of dollars would be directed towards the “digitalisation” of anything possible. But in the last two years, there has been a rising pushback against certain aspects of the proliferation of digital technology. Social media is a good example: In November 2021, hundreds of Rohingya refugees sued Facebook, saying that the social media giant assisted the spread of anti-Rohingya hate speech. They are suing Facebook for more than US$150 billion in damages, claiming that the company’s services incited violence against persecuted minorities. When Facebook first arrived in the nation in 2010 following the easing of military control, it allowed users to use its app without incurring data charges, allowing it to swiftly gain popularity. It came pre-installed on store-bought phones and was a cultural fit. However, as the decade progressed, tensions began to rise between the Buddhist majority and Rohingya minorities. A widely popular accusation of domestic violence by Muslims on Buddhists started spreading on Facebook and led to mob attacks on the Rohingya. Days later, it was found that the accusation was completely fabricated. According to UN human rights investigators, hate speech on Facebook had a critical role in instigating violence in Myanmar. The company admitted that it had failed to prevent its platform from being used to “incite offline violence” in Myanmar. The problem with the focus on digital technology is that it lost sight of what technology is for: a means to an end, rather than an end in itself. Funders and policymakers in Asean — as with the majority of the world — quickly latched onto the growing popularity of the internet and the smartphone and thus worked to deepen this as their objective, rather than thinking critically about how this would relate to solving the most pressing problems faced by developing Asean countries. The obsession with digital technology has meant that there is underinvestment in the things that would have helped to fight this current pandemic (and help reduce the risk of the next one): clean water systems, better nutrition, improved sanitation and broader public health infrastructure. These do not look as interesting when compared to the flashy projects backed by Silicon Valley. But initiatives that focus on basic needs, like water, sanitation and hygiene (WASH) programmes consistently lead to improved social outcomes. The UN has estimated that every US$1 spent on sanitation brings a US$5.5 return by keeping people healthy and productive, whereas the internet’s use in poorer communities is complex and unclear. The pandemic may have highlighted the importance of hygiene and sanitation (to an extreme degree), but it is not the only development priority that has gone ignored. Millions around the world still lack safe and secure housing: India lacks about 50 million homes for its people (not including homes that are of poor quality). Asean is only slightly better equipped on this front, and many families still lack stable access to electricity or important public services like education. These are issues that erode the foundations of each state, disrupting their progress. Even if we accept that digital connectivity does improve quality of life — which of course it can — abdicating the responsibility of uplifting poorer communities to the tech sector constrains our solutions, and is not fair on these communities. The easiest way to provide digital connectivity would be to treat it like a public utility: The government should invest in laying cheap internet cables to any community that needs it and provide access at a minimal cost. However, this would damage the business interests of existing internet providers and tech firms, and so this solution has been taken off the table. Society should constrain the use of any development or public money towards digital technology unless an independent body — and not one dominated by the tech companies — can make a compelling case as to why it would improve development outcomes. A high burden of proof should be on the tech company to say exactly how its products would benefit society. Otherwise, governments should focus on spending money in a way that provides basic needs, so that no one is left behind. This may also lead to a more honest appreciation and less wasteful use of technology. New technologies really could make a difference in specific circumstances: for example, the development of decent text-to-speech and speech-to-text software appears to allow those with lower literacy skills (such as those living in remote poor rural communities) to engage with the modern economy. But these are specific interventions that achieve a specific purpose: smarter use of money, resources and technology than the broad applications being promoted today. Chandran Nair is the founder and CEO of the Global Institute for Tomorrow. This article is part of a series on key areas in which Asean, as part of a regional and global system, needs to consider transforming itself if it is to learn from the pandemic, identify future opportunities and achieve social change for the better. Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/625856

FGV: No hike in cash received by chairman, he just gets a company car now

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KUALA LUMPUR (June 27): Amid criticism over the sharp increase in the remuneration of its non-executive directors, FGV Holdings Bhd clarified on Monday (June 27) that it had earlier this year appointed an independent consultant to conduct a review and benchmarking on the remuneration.   The plantation giant said its board was advised by the independent consultant that the car allowance accorded to the non-executive chairman Datuk Dzulkifli Abd Wahab be replaced with the provision of a company car. This was because the car allowance is not reflective of market and sectorial norms, as companies do not generally monetise the provision of a company car benefit in the form of allowances, said FGV in a statement. “Pursuant to the advice, FGV Board proposed to provide a company car to the non-executive chairman and maintain the amount of cash accorded to him previously by converting the car allowance of RM180,000 [per annum] to board fees. Hence, there is no increase in the total cash received by the non-executive chairman.   “Datuk Dzulkifli Abd Wahab intends to use an existing car belonging to a subsidiary company to be the company car, with an annual budgeted expense of not more than RM180,000 as approved at the AGM,” the group said. At FGV's annual general meeting on June 23, shareholders approved a resolution to raise the annual board fees of the non-executive chairman by 60% to RM480,000, from RM300,000. The board members also approved a 25% increase in their fees to RM150,000, from RM120,000. In its statement, FGV noted that Dzulkifli had agreed to waive his additional fees as chairman of FGV's Board Sustainability Committee until the next AGM, amounting to RM40,000 per annum, and meeting allowances of RM2,000 per meeting.   It further noted that Dzulkifli did not utilise his entitlement for benefits relating to entertainment allowance, club membership and personal bodyguard.   FGV received flak from the public after it tabled the resolutions relating to the fees and benefits of the non-executive chairman and directors at its June 23 AGM. The group — which recently reported its best result since its debut on Bursa Malaysia in 2012 — said in its statement that the non-executive chairman’s fees was reduced from RM600,000 to RM300,000 in 2019, together with some abolishment and reduction in certain benefits.   It also highlighted that it had contributed RM11.2 million last year to assist Felda settlers by channelling the fund to Yayasan Felda, which helps fund a number of charitable causes and initiatives focused primarily on education, healthcare and other philanthropic causes. “Aside from this, the contribution also goes to programmes like Waqaf Felda and zakat for the community welfare,” Dzulkifli was quoted as saying.   Felda, or the Federal Land Development Authority, owns 81% of FGV.

https://theedgemalaysia.com/node/637203

United Malacca's 1Q net profit up 17% on higher palm oil prices

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KUALA LUMPUR (Sept 21): United Malacca Bhd’s net profit rose 16.59% to RM24.3 million for the first quarter ended July 31, 2022 (1QFY23), from RM20.85 million a year earlier, on higher earnings contribution from its Malaysia operations on the back of higher palm oil prices. Earnings per share increased to 11.59 sen from 9.94 sen, the group’s bourse filing showed. Quarterly revenue climbed 45.77% to RM167.44 million — its highest to date — from RM114.87 million for 1QFY22. United Malacca said its Malaysian operations saw a quarterly profit of RM36.2 million, which was 50% higher than the RM24.1 million reported for 1QFY22. In contrast, the group’s Indonesian operations recorded a plantation loss of RM3.2 million compared with a profit of RM900,000 previously, due to lower production, as well as a higher unit cost of production despite higher crude palm oil (CPO) prices. The average CPO price during the quarter increased by 48% in Malaysia and by 37% in Indonesia year-on-year, while the average price for palm kernel rose by 15% and 78% respectively. Looking ahead, United Malacca expects fresh fruit bunches (FFB) production to increase during FY23, due to higher yields and better palm age profile. Additionally, the group’s priority remains focused on improving labour productivity, mechanisation initiatives and cost efficiency, as well as increasing FFB yield. However, United Malacca expects an increase in operating costs resulting from higher material and labour costs. “In addition, continuing acute labour shortage for [the] Malaysian operations and high rainfall could lead to lower FFB production in the first half year of FY23,” it said. United Malacca’s share price closed three sen or 0.56% higher at RM5.43 on Wednesday (Sept 21), bringing it a market capitalisation of RM1.14 billion.

https://theedgemalaysia.com/node/634369

Karex stays in the red in 4Q despite record high revenue

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KUALA LUMPUR (Aug 29): Karex Bhd remained in the red in its fourth quarter ended June 30, 2022 (4QFY22) due to higher raw material prices, the implementation of a higher minimum wage and continued disruptions to logistic networks.  However, it managed to narrow its net loss to RM3.4 million or 0.32 sen per share, from RM5.1 million or 0.48 sen per share in 4QFY21. Quarterly revenue grew 14.93% to RM122.65 million — a new record high — from RM106.72 million a year earlier, due to a significant increase in condom sales volumes from the commercial and tender markets, leading to a higher contribution from the sexual wellness segment.  On a quarter-on-quarter basis, Karex’s net loss widened from RM748,000 in 3QFY22 on high raw material prices and the implementation of a new minimum wage, in spite of revenue increasing by 23.28% from RM99.49 million, driven by an increase in condom sales across all markets, as well as an increase in the sale of personal lubricants. Additionally, Karex said in its bourse filing that several shipments to the Asia and Americas regions that were previously delayed by vessel shortages, were successfully shipped in the quarter. For the full year, Karex’s net loss expanded to RM6.19 million — largest to date — from a net loss of RM1.02 million in FY21, despite revenue rising to a record RM421.64 million from RM419.82 million. Although the slowdown in international tenders and disruptions to global supply chains made it particularly difficult to deliver orders to certain regions such as Africa, Karex said growth in sales from the group’s own brand markets helped offset lower sales from the tender market.  “The lingering effects of the Covid-19 pandemic meant that the group continued to incur additional expenses, while dealing with elevated raw material and distribution expenses that negatively affected profits,” the group said.  On prospects, Karex noted that the global economy was hit hard by Covid-19 over the past two years, with lockdowns and quarantine measures dramatically affecting social interactions around the world, which in turn had a dramatic impact on the sexual wellness industry.  Nevertheless, condom demand has already begun to recover, as vaccination rates ramp up and economies begin to embrace post-pandemic life. Looking ahead, Karex said it has already begun to experience an exceptional demand for products in certain markets, following consumer goods distributors beginning to address their inventory shortfalls and new avenues of sales having opened up during the pandemic.  “In order to capitalize on the opportunities presented, it will be critical for the group to leverage on our manufacturing expertise and portfolio of product offerings, as demand for condoms continues to rapidly shift from a social welfare model towards the private sector,” it said. Karex’s share price finished half a sen or 1.37% lower at 36 sen on Monday (Aug 29), bringing the condom maker a market capitalisation of RM379.2 million.

https://theedgemalaysia.com/node/638627

EVENING 5: Five things you need to know today

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EVENING 5: No need to hoard US dollar, says BNM Dirty dealings. Corporate battles. Consumer woes. Here are five things you need to know today. 1. Bank Negara Governor Tan Sri Nor Shamsiah Mohd Yunus tells Corporate Malaysia not to hoard the US dollar. 2. Putrajaya lowers the ceiling price for bottled pure palm cooking oil following the drop in crude palm oil prices. 3. The concessionaire of the proposed PJD Link Expressway seeks a listing via a reverse takeover of Scomi Energy Services. 4. Shell is said to have announced its second investment in Malaysia's oil and gas sector in a month. 5. EP Manufacturing gets MITI approval to assemble and manufacture two-wheeled electric vehicles.

https://theedgemalaysia.com/node/669120

Malaysia to roll out Energy Transition Roadmap in phases, says Rafizi

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KUALA LUMPUR (May 30): Malaysia is set to roll out its Energy Transition Roadmap in phases starting next month, putting the country's net zero ambition into action by identifying key impact initiatives and implementation plans for the next two decades. Economy Minister Mohd Rafizi Ramli said the road map outlines the government’s move to achieve its renewable energy (RE) capacity target of 70% by 2050. “We will launch the first phase by end-June, which includes strategic projects and initiatives, such as hydrogen and solar farms, as well as an RE special zone.  "Phase 2 will be in August this year [involving] the enablers — by that I mean the legislative reforms, incentive funding that are available that we will put through to accelerate the transition," he told reporters at the Affin Conference Series 2023 here on Tuesday (May 30).  He said the government had to drive change by working closely with the industry, as the country’s energy transition plan is a major undertaking. "I think for the first phase in June and in August for the second phase, there will be a lot more clarity, because I also talk about the challenges that we have to overcome, [such as] cynicism. "I do understand that. If I were on the outside, I will be cynical as well, because I have heard it before. People want to see action, and by action, [that means] real things being built," he added.  Earlier, in his keynote speech, Rafizi said a road map is an important step in putting money in strategic growth areas, not merely paying environmental sustainability lip service, and no longer seeing economic growth and carbon emissions as incompatible goals. "While some may still debate the financial returns of certain renewables projects, we are willing to put in money there, and open up the field to as many interested investors as possible to come along. "We estimate that this ambition would require an investment of RM637 billion (or US$150 billion), an amount that would substantially reshape the landscape and conversation about renewables in the region," he said.  Meanwhile, on whether the government has any plans to peg the ringgit, Rafizi was non-committal and said "not yet".  "Our next National Economic Action Council meeting will be in two weeks' time, but I think it will be a general discussion on the economy. We will also discuss all the other structural reforms, but so far there has not been any discussion on anything drastic [with regard to] riding through this market volatility," he added.  Rafizi said he will wait for Bank Negara Malaysia (BNM) to decide on [actions regarding] the ringgit, as the central bank has a long-term view on it, while politicians have a short-term focus.  "We will wait for BNM...we will have our views and exchange views, but we hope that our monetary policy will not have hazards in the short term, and for that, I think the central bank is still the best avenue for us to discuss monetary policy," he said.  Read also: Foreign cheap labour the biggest policy issue in Malaysia, says Andrew Sheng  EC chairman: Renewable energy export guidelines to be revealed in energy transition roadmap by end-June 

https://theedgemalaysia.com/node/635765

Safetyware首开价20仙 LEAP亮丽登场

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（吉隆坡9日讯）综合安全与健康解决方案供应商Safetyware Group Bhd今日在大马交易所杰出企业家加速平台（LEAP）上市，首开价为20仙，比发售价15仙，溢价5仙或33%。 开市时，约1万股转手。 该集团是今年以来第五家在LEAP上市的公司，以及第26家在马股挂牌的公司。 董事经理Wong Kee Wei表示，随着各行业的投资涌入，经济活动恢复为公司增长提供了更大的机会。 “随着越来越多工厂恢复生产，对职业安全和健康产品的需求也将增加。” 他出席上市活动后告诉记者：“此外，我们的业务不仅专注于大马，还专注于东盟地区。我们还计划进军新市场，即中东国家和非洲地区。” Wong还表示，新兴经济体对安全的兴趣越来越大，因此他们的安全和健康法规变得更加严格。 “与由知名和更大业者主导的成熟市场相比，我们认为进入这些市场相对容易。” 该集团供应超过3000种产品，包括安全鞋、安全服装、安全头盔和呼吸器。 其产品出口到20多个国家，包括中国、加拿大、美国、印尼和泰国。 Wong表示，集团上市共筹集648万令吉，将用于为制造部门购买机器和设备，并将开设更多零售店，以增加分销范围。 “我们希望能够在未来3年内转至创业板上市。”   （编译：魏素雯）   English version：Safetyware makes positive debut on LEAP Market at 20 sen

https://theedgemalaysia.com/node/672920

Petrol, diesel prices unchanged till July 5

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KUALA LUMPUR (June 28): The retail prices of RON97 and RON95 petrol as well as diesel will remain unchanged for the June 29 to July 5 period, the Finance Ministry (MOF) said. MOF, in a statement on Wednesday (June 28), said RON97 would remain at RM3.37 per litre, RON95 at RM2.05 per litre and diesel at RM2.15 per litre. “To protect consumers from the increase of global oil price, the government will maintain the ceiling price of RON95 at RM2.05 per litre and diesel at RM2.15 per litre, even though the market price for both products has increased beyond the current ceiling price,” it said. The ministry said the government would continue to monitor the trends of global crude oil prices and take appropriate measures to ensure the continued welfare and well-being of the people.

https://theedgemalaysia.com/node/661411

Feel safe, be free

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After 95 years of a relentless drive to make cars safer, Volvo is turning from machine to man and looking at the person behind the wheel as it takes the next step towards safer roads through psychological safety. Peace of mind makes for a safer drive and no automaker knows this better than Volvo Cars, a name synonymous with safety. Going by that, it is looking at safety differently, to understand how driver behaviour has a bearing on what happens on the road. Does heartbreak affect your braking distance? Is joy a safety hazard? Love can distract the best of us, but does it impact your driving? Can love steer you wrong? Why these questions? Because, feeling safe sets us free. And safer cars means safer roads and a safer world. The company created a vision to have zero fatal injuries in a Volvo car. The commitment to that vision encouraged Volvo Cars to look inwards and examine safety differently. In doing so, it found a blind spot: No matter how safe you make a car, it is only as safe as the mind that drives it. Life goes on once we rev up the engine, and our thoughts, feelings and emotions come along for the ride. To redefine "safe" as it journeys into the next century of safety, Volvo has introduced a new chapter in its long-term brand platform, "For Life", with a campaign that advocates psychological safety, which is anchored to the mindset. Memories of our parents holding our hands as we crossed the road or learning to cycle equipped with training wheels, helmet and knee pads are reminders that we must feel "safe" first before the physical aspects of safety come into play. Volvo's For Life campaign features a 60-second video centred on real-life stories of everyday people who have the courage and confidence to do what they want because they know they are in good hands. A professional skateboarder whizzing down a ramp; a Paralympian competing in a race with her guide; a pop artist driving out to a gathering - they all know about encouragement and trust. Just like the child whose mother pulls on his floats before he leaps into the sea, peace of mind helps them conquer their fears and gives them the freedom to explore and experience the new. Being in the driver's seat is exhilarating for many, but driving safely, for life, requires a fresh perspective of how our state of mind affects how we steer our vehicles. As Volvo aims to remind us, we don't put our lives on hold when we get behind the wheel. Fatigue, distractions and absence of mind are common factors that cause untoward incidents on the road. Moving forward, the company wants to better understand how life affects our drive. It seeks the help of drivers to gain insights into how they behave in different situations when at the wheel, through a global survey under its For Life platform. The survey poses questions such as the time of day you generally feel most distracted. What feelings distract you the most on the road? Does the way you drive have a bearing on how you feel? How do you cope with anger, sadness or even joy while on the road? Life affects your drive. When you feel safe, you can be truly free. That is assurance from the Swedish brand for whom safety is company culture and central to everything it does.

https://theedgemalaysia.com/node/675136

Destini plans one-for-one rights issue with warrants to raise at least RM20.93m

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KUALA LUMPUR (July 17): Destini Bhd plans to undertake a renounceable rights issue of up to 1.66 billion new shares coupled with free warrants to raise at least RM20.93 million, mostly for its working capital. According to Destini’s filing, the rights issue entails the issuance of one rights share for every existing share held, while the warrants will be issued on the basis of one warrant for every rights share subscribed for by entitled shareholders, on an entitlement date to be announced. At an issue price of four sen per rights share — a discount of 40.56% to the theoretical ex-rights price (TERP) of 6.73 sen (calculated based on the five-day volume weighted average market price of 9.45 sen) — Destini is expected to raise RM20.93 million based on the minimum subscription level, whereby only the undertaking shareholders subscribe for their respective rights shares and additional undertaking, while no other entitled shareholders do so. This minimum subscription level refers to the irrevocable and unconditional undertaking given by Destini’s non-independent and non-executive director Datuk Abd Aziz Sheikh Fadzir, as well as his nominee companies Dayanine Equity Sdn Bhd and Dayatahan Sdn Bhd — vide their letters on Monday (July 17), to subscribe in full for their respective entitlements, which totalled 123.3 million rights shares, and Dayanine's promise to take up another 400 million more rights shares that remain unsubscribed by entitled shareholders. From the proceeds raised, 84.81% will be allocated for working capital and 11.84% for repayment of bank borrowings; 3.35% will be used to defray the rights issue's expenses. On completing the proposed rights issue with warrants under the minimum scenario, the collective shareholders of the undertaking shareholders will increase from 7.41% to 29.57%. And on the full exercise of the warrants, their collective shareholdings may further increase to 43.16%. “Such exercise of the warrants may potentially result in the shareholdings of the undertaking shareholders to collectively exceed 33% controlling threshold in Destini and pursuant to the rules, the undertaking shareholders would in such event be obliged to extend a MGO [mandatory general offer] in Destini,” said the group. The rights issue is slated to be completed by the fourth quarter of this year. Destini’s share price, which has risen over 18% year-to-date, finished at 9.5 sen on Monday. This gives the group a market value of RM150.13 million.  

https://theedgemalaysia.com/node/675094

The State of the Nation: Respite seen for the ringgit

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This article first appeared in The Edge Malaysia Weekly on July 17, 2023 - July 23, 2023 THE ringgit’s weakness has been making headlines this year, especially after it reached a 24-year low against the US dollar earlier this month, making it the worst-performing currency in the region. It also weakened against other regional currencies, in particular, the Singapore dollar. Ahead of the elections in six states — Kedah, Kelantan, Negeri Sembilan, Penang, Terengganu and Selangor — the soft ringgit is also a test for the federal government. As the US Federal Reserve’s aggressive rate hikes since 2022 outpaced Bank Negara Malaysia’s more conservative increases, the interest rate differential has widened to 2.25%, leading to the depreciation of the ringgit against the greenback. Nonetheless, Bank Negara’s Financial Markets Committee indicated last month that the central bank stands ready to intervene to stem foreign exchange (forex) movements that are “deemed excessive”. It pointed out that the ringgit’s weakness doesn’t reflect Malaysia’s fundamentals and the drop had been fuelled by the monetary tightening in major economies. Maybank Group regional head of FX Research and strategy Saktiandi Supaat points out that “typically”, Bank Negara does not use the interest rate to defend the ringgit. “Central banks can usually use various methods to defend their currency, including forex interventions, and unless really required, would as much as possible avoid currency controls such as the conversion of export proceeds to domestic currency, if the country has a flexible exchange rate system,” he tells The Edge. By looking at the recent Bank Negara data on its foreign currency reserves, it shows that the central bank has in a way already intervened in the forex market, buying the ringgit. According to a July 10 report by Kenanga Research, Bank Negara’s foreign currency reserves dipped below US$100 billion for the first time since November 2022 to US$99.2 billion in June, “reflecting Bank Negara intervention in the forex market and loss from the quarterly foreign exchange revaluation due to a 0.4% rise in the US dollar”. Then there are also concerns that many exporters prefer not to convert their proceeds in foreign currencies to ringgit, causing imbalances in the supply and demand of the local currency, further exacerbating ringgit weakness. In Saktiandi’s view, currency undervaluation needs to be addressed before it affects the real economy significantly. “If the ringgit’s weakness intensifies, it may also affect the inflation objectives of the current monetary policy stance,” he says, adding that Maybank is expecting a rate hike by Bank Negara in September by another 25 basis points to 3.25%. “Overall, Bank Negara believes the ringgit’s performance should improve as uncertainties from global market developments subside and this, in turn, will better reflect Malaysia’s sound economic fundamentals. “From a macro policy mix perspective, any clear future long-term structural policy and fiscal rebalancing strategies could also help encourage future FDI [foreign direct investment] and portfolio investment interests and support the currency,” Saktiandi says. He expects the ringgit to hover at 4.60 per US dollar for this quarter and improve to 4.50 in the fourth quarter, as he expects the global economic situation to improve then. “The Fed could also eventually soften its stance closer towards year-end as inflation gradually falls. China, we believe would show a more discernible level of recovery over the tail end of 2023 and we factor in some significant levels of targeted stimulus to help the economy and that should give a boost to commodities prices eventually. “Domestically, for the state elections, if the results lend credence to the extended stability of the current government, [we] could see positive effects on both cold foreign direct investment and equity and bond markets portfolio flows. An eventual Fed pause and softer US dollar expectations may lead exporters to start to sell their US dollar holdings from exports proceeds, which may have grown,” Saktiadi says. Nonetheless, last week, the US dollar seemed to have lost some steam on the back of softer June inflation data. As a result, the ringgit saw a swift rebound, rising to 4.5267 against the dollar last Friday, compared with 4.65 two days earlier. Standard Chartered chief investment officer Steve Brice reckons the ringgit could see better days ahead on the expectation of a weaker US dollar. He deems the US dollar “overvalued” at the moment, and that weakness in the currency would be a boon for the emerging economies’ stock and debt markets. “Historically, when the US dollar weakens, investments do better almost across the board. The same goes for equities, bonds and gold. If the US dollar does weaken, then that should be a tailwind for Asian assets,” Brice says.    Save by subscribing to us for your print and/or digital copy. P/S: The Edge is also available on Apple's AppStore and Androids' Google Play.

https://theedgemalaysia.com/node/622394

Sapura Energy appoints ex-Velesto president Rohaizad and Lim Fu Yen to its board

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KUALA LUMPUR (June 1): Sapura Energy Bhd said it has appointed former Velesto Energy Bhd president Rohaizad Darus and Lim Fu Yen as directors of the Practice Note 17 company, effective June 1 (Wednesday). In a bourse filing, Sapura Energy said it has appointed Rohaizad Darus as its non-independent and non-executive director, and noted that the 57-year-old’s last position prior to his retirement was president of Velesto, a position he held since 2012. “In his career spanning over 30 years, he has worked with both local and multinational companies. These include Petronas Gas, SapuraKencana — a predecessor of Sapura Energy, and Velesto. He has also served Texas Instruments and Esso Production Malaysia. “Presently, he is actively involved in the oil and gas (O&G) industry as advisor to the Malaysian O&G Services Council, a member of Industry Advisory Panel of Malaysian Petroleum Resource Corp, besides being adjunct professor at Universiti Teknologi Petronas,” the company added. In a separate filing, the oil and gas service provider said it has appointed Lim as an independent and non-executive director of the company. The company noted that the 43-year-old is also currently an independent non-executive chairman of Malaysian Transformer Manufacturing and director of Malay-Sino Chemical Industries. “Lim was attached to Ekuiti Nasional Bhd (Ekuinas) from April 2014 to July 2020. He has extensive experience in investment, business management, financial restructuring, and operational turnaround, with his last position as senior director (investment) of Ekuinas. “He was the chief subsidiary management officer (CSMO) of Tenaga Nasional Bhd from August 2020 to August 2021. As CSMO, he oversaw the performance improvement of 12 TNB subsidiaries across four sectors; including manufacturing, services, power and telco,” it added. Shares in Sapura Energy finished 1.5 sen or 17.65% lower at seven sen on Wednesday, giving the company a market capitalisation of RM1.06 billion.

https://theedgemalaysia.com/node/669352

Thailand raises key rate to eight-year high to win inflation fight

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(May 31): Thailand’s central bank raised its benchmark interest rate to the highest level in eight years to anchor inflation expectations more firmly in an economy on track for faster expansion amid a rebound in tourism. The Bank of Thailand’s Monetary Policy Committee voted unanimously to raise the one-day repurchase rate by 25 basis points to 2% on Wednesday (May 31), as seen by 22 of 24 economists in a Bloomberg survey, with two predicting no change. The key rate was at 2% back in January 2015. Although headline inflation has eased every month since January, returning within the BOT’s 1%-3% target in March, the central bank has emphasised the need to keep price gains in check over time. The key risks are increased consumption from a tourism-led pickup in economic activity and possibly higher spending by a new government following the May 14 election that saw several populist political pledges. Wednesday’s tightening will help narrow Thailand’s real interest rate to a negative 0.67% from 0.92% previously — still making it Southeast Asia’s lowest after adjusting for prices. The Thai baht has weakened about 1.5% in the past month, while foreign investors turned net sellers of local bonds and stocks on concerns about possible delay in formation of a new government, which will affect budget spending and investment. 

https://theedgemalaysia.com/node/671534

Indian ports remain shut as cyclone unleashes powerful winds

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(June 16): Major ports in the western Indian state of Gujarat, including Adani Group’s flagship Mundra operation, remained shut as winds are still strong after cyclone Biparjoy made landfall. The powerful storm brought heavy rains in several areas of India and Pakistan and saw winds gusting to as high as 140km an hour. Both nations have evacuated about 150,000 people, restricted air and rail transport, and shut port operations in the affected areas. Pipavav port operated by APM Terminals resumed land side operations, the company said in a statement late Friday, though marine and quay-side operations remained suspended. “We are hoping that the wind speed should start coming down by evening or tomorrow morning, and the ports should start calling back the vessels,” Ashwin Solanki, chief nautical officer at Gujarat Maritime Board, said by phone. Sikka may be the first one to resume operations due to its importance as an oil port serving mostly to Reliance Industries Ltd’s refinery, he said. The cyclone has weakened and its intensity will decline further by Friday evening, with wind speeds falling to 40 kilometers to 50km per hour, the India Meteorological Department said in a statement. India and Pakistan have sought to mitigate the damage from Biparjoy — a name which means disaster. Besides evacuating people, they sent specialized army personnel to provide medical assistance and help in the recovery, and deployed disaster management teams to carry out relief and rescue operations. Pakistan is expected to come out of the storm’s impact completely by Saturday morning, the country’s Power Minister Khurram Dastgir Khan said at a press conference. The cyclone followed devastating rains in Pakistan last year that flooded about a third of the nation, killing 1,700 people, displacing millions, and causing about $30 billion in losses and damages. The latest natural calamity is another example of extreme weather events in South Asia, with scientists blaming climate change for a rise in the frequency of cyclones, heat waves, floods and droughts in the region.

https://theedgemalaysia.com/node/639799

MPOA urges govt to revise windfall, state sales taxes for East Malaysian oil palm growers

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KUALA LUMPUR (Oct 12): The Malaysian Palm Oil Association’s (MPOA) chief executive Joseph Tek Choon Yee has urged the East Malaysian states and federal governments to revise the state sales tax (SST) and windfall profit levy (WPL), respectively, that are imposed on East Malaysian oil palm growers. Tek said the proposed price threshold review of the SST in Sabah and Sarawak would take into account the current high cost of palm oil production, while the windfall tax should be revised back to the original 1.5% from the present 3%, after factoring in the existing SST. According to him, the SST started at RM50 per metric tonne of crude palm oil (CPO) in 1999, before it was revised to 5% per metric tonne of CPO in 2002 and 7.5% per metric tonne of CPO in 2005. He said the price thresholds which were set around 1998 to 1999 were appropriate, as the costs then were around RM750 per metric tonne of CPO. However, Tek noted that the cost of production has risen amid the minimum wages and high input costs of fertilisers and fuel in particular, among others. Tek said the proposed tax review would entail revising the price threshold, which would not change the present collection of SST set against the current CPO price realised today, but would fix the tax threshold to accommodate the current cost structure. Meanwhile, he said the WPL should be brought back to its original 1.5% for East Malaysian growers from the current 3%, as their cost of production is higher than that of their Peninsular Malaysia counterparts. CPO production year-on-year from January to September in Malaysia only rose a mere 0.25% or 34,000 metric tonnes to 13.34 million tonnes this year, from 13.31 million tonnes in 2021. Tek said national CPO production this year is only expected to hit 18 million tonnes due to the slow return of foreign workers who have missed the peak cropping season, the destructive impacts from the monsoon season, and the likelihood that the rains will intensify, hammering plantations, resulting in further crop losses in the last quarter. Because of this, there had been no growth in CPO production for the past three years, he said. Tek was speaking at Bursa Malaysia’s inaugural East Malaysia Palm & Lauric Oils Price Outlook Conference & Exhibition (emPOC2022) in Sabah, where he was delivering a special paper entitled “The East Malaysian Palm Oil Supply Chain Equation: Snippets of History, Curret Realities and Some Food for Thought”.