Steady increase in Air Traffic Rights applications: Mavcom (Tue, 31 Jan 2023)
PETALING JAYA: There is a steady recovery in the uptrend of Air Traffic Rights (ATR) allocations for fourth-quarter 2022 (Q4’22) as the aviation
industry navigates the post-pandemic phase of Covid-19, according to the Malaysian Aviation Commission (Mavcom) which published its ATR report for Q4’22, which included 44 ATR allocations for
Malaysian civil aviation from October to December 2022.
In total, the Commission received a 15.8% increase in ATR applications compared to the third quarter of 2022 (Q3’22), during which the Commission approved 100% of ATR applications received. The
ATR allocations for the fourth quarter of 2022 included 28 international and 16 domestic routes.
“Wrapping up a year of recovery for airlines and the aviation industry, the Commission is pleased to report that ATR applications submitted in Q4 2022 reached 12.8% of ATR applications received
before the pandemic in Q4 2019,” said executive chairman of Mavcom, Datuk Seri Saripuddin Kasim
He said the gradual resumption of air travel since the reopening of regional and international borders has boosted the ATR applications rate for the quarter, which was especially driven by the
opening of new domestic routes.
“Reflecting this is the significant 220% increase in ATR applications received and awarded for local destinations in Q4 2022, which is mostly attributed to MYAirline, the country’s newest low-cost
passenger airline that began operating in December 2022,” he added.
In terms of year-on-year comparison, Mavcom reported a 31% increase in ATR applications in 2022 versus 2021, and a 29% increase versus 2020. Following a steady recovery through 2022, ATR
applications reached 78% of the commission’s pre-pandemic ATR applications in 2019.
Furthermore, Mavcom approved 52 more ATRs for international passenger travel in 2022 than in 2021, indicating the positive impact of global border re-openings which set the industry on the road to
ATR applications for the cargo sector, however, were down by 80% in the current quarter, with only two applications submitted, compared with 10 in Q3’22. Year-on-year, ATR cargo applications fell
by 85% in Q4’22 compared with Q4’21, owing to lower demand for cargo freighter business as passenger belly space has increased significantly following the surge in air travel.
>> Continua a leggere
MISC welcomes two new vessels to eco-efficient fleet of LNG carriers (Tue, 31 Jan 2023)
KUALA LUMPUR: MISC Group has added two new-generation liquefied natural gas (LNG) carriers, Seri Damai and Seri Daya, to its fleet of LNG carriers.
These 174,000-cubic metre LNG carriers are equipped with smart and sustainable technologies and were built for MISC by Samsung Heavy Industries Co Ltd.
These LNG carriers will be on long-term charters to ExxonMobil’s wholly owned subsidiary, SeaRiver Maritime LLC, and will be managed by Eaglestar Shipmanagenent (S) Pte Ltd.
MISC’s president & group CEO, Captain Rajalingam Subramaniam, said the delivery of Seri Damai and Seri Daya marks a strong start to the year and a significant milestone in MISC’s
partnership with SeaRiver Maritime.
“Seri Daya and Seri Damai represent another major milestone in the valued relationship between SeaRiver Maritime, MISC Bhd and Samsung Heavy Industries Shipyard,” said Andre
Kostelnik, president and CEO of SeaRiver Maritime Inc, “This is a step forward in supporting a
net-zero future as we add modern, energy-efficient LNG carriers to support ExxonMobil’s growing LNG business.”
Seri Damai and Seri Daya will now add to MISC’s fleet strength, which currently totals 31 LNG carriers for its gas business, in addition to six very large ethane carriers and two LNG
Floating storage units, which have a combined capacity of over two million deadweight tonnes.
>> Continua a leggere
Malaysian economy capable of facing global challenges (Tue, 31 Jan 2023)
PETALING JAYA: Based on Malaysia’s socioeconomic scenario, the country’s economy has the potential to address global challenges, evidenced by its improved labour market and continuous
external demand, according to Malaysian Economics Statistics Review Vol 1/2023 released by the Department of Statistics Malaysia today.
This is also backed up by upward trends for several key indicators, which have consistently shown positive annual growth.
Malaysia’s trade sustained its robust performance in December 2022 with exports increasing 6.0% to record RM131.9 billion, while imports rose 12.1% to RM104.1 billion.
Summarising 2022, Malaysia’s trade surpassed the RM2 trillion mark for the second year in a row, and surged 27.8% year-on-year to RM2.8 trillion.
The Industrial Production Index in November 2022 increased 4.8% year-on-year while the sales value of the manufacturing sector soared 11.8% to record RM159.2 billion.
In addition, sales value of wholesale and retail trade recorded a double-digit growth of 13.9% year-on-year to reach RM133.9 billion in November 2022.
Looking into the labour market’s performance, the number of employed persons increased 3.2% year-on-year in November 2022 to record 16.11 million persons while the unemployment rate remained at
3.6% for three consecutive months.
In terms of prices, the Consumer Price Index and the Producer Price Index in December 2022 recorded increases of 3.8% and 3.5% respectively compared with the same month in 2021. For the whole of
2022, inflation rose to 3.3% compared with a rate of 2.5% in the preceding year.
The production of oil palm fresh fruit bunches in December 2022 surged 14.9%, amounted to 8,299,936 tonnes compared with that in December of the previous year. However, the production of natural
rubber declined 8.0% year-on-year to record 28,048 tonnes in November 2022.
Moving forward, the Malaysian economy is anticipated to experience a modest growth tendency in 2023, signalled by the Leading Index as it decreased by 0.4% to 110.5 points in November 2022
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Miti bags RM13b in FDI via investment mission to Singapore (Tue, 31 Jan 2023)
KUALA LUMPUR: The Ministry of International Trade and Industry (Miti) has achieved an additional RM13 billion of committed foreign direct investment (FDI) from three investors via its
investment mission to Singapore.
Minister Tengku Datuk Seri Zafrul Abdul Aziz (pix) said the three companies - Sea Ltd, Yondr Group, and INSEACT - have collectively committed to invest RM13 billion in Malaysia.
These investments are scheduled to be operationalised within the next three years, said Tengku Zafrul, who led the mission during Prime Minister Datuk Seri Anwar Ibrahim’s visit to Singapore
The cumulative value of RM13 billion reflects Malaysia’s attractiveness as an investment destination, he added.
“It is also a testimony of the long-standing, mutually beneficial relationship between Malaysia and Singapore in trade and investments,” he said in a statement here today.
Miti intends to grow and strengthen this special relationship, particularly in building supply chain resilience for our respective industries, premised on cooperation in digital and green
economies, the minister added.
Sea Ltd, the parent company of Shopee and the largest pan-regional e-commerce platform in Southeast Asia and Taiwan, has committed to expanding its investments in Malaysia, creating over 2,000 job
opportunities. The company intends to set up cloud services, data hosting and processing, and a new e-commerce logistics warehouse in the country.
Another investor is the Yondr Group, a UK headquartered global leader in the development and operation of data centres. Yondr group - which has delivered more than 500MW globally to leading
hyperscale clients - has entered the Malaysian market with the acquisition of a 75-acre plot in Johor and is developing a 300MW IT load hyperscale datacentre campus.
Its deployment in Johor is expected to become Southeast Asia’s largest hyperscale datacentre campus and will be a major part of Malaysia’s growing digital ecosystem, said Miti.
The third company, INSEACT, is a Singapore-based alternative protein company specialising in insect protein for aquaculture feed. It intends to set up a production facility in Johor, its first in
Southeast Asia. The company’s unique approach to alternative protein production has the potential to address Asia’s growing demand for sustainable food sources.
“We are determined to prove to investors that Malaysia is pro-trade, pro-business, and pro-investment.
“Miti and its agencies like Mida (Malaysian Investment Development Authority) will continue to pursue high quality, strategic and sustainable investments that will not only grow our GDP and boost
the development of the local digital economy but also create new job opportunities for our people,” Tengku Zafrul continued.
The investment mission, attended by senior officials from Miti and Mida, is an important milestone towards realising Malaysia’s goal of becoming a hi-tech, global innovation hub with a resilient
and sustainable investment ecosystem. - Bernama
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Perodua to maximise production capacity to 330,000 units this year (Tue, 31 Jan 2023)
PETALING JAYA: Carmaker Perusahaan Otomobil Kedua Sdn Bhd (Perodua) intends to maximise its production capacity to 330,000 units this year from
282,019 units last year (14.2% higher) to fulfil outstanding orders carried forward from 2022 and to meet demand so far in 2023.
Perodua president and CEO Datuk Seri Zainal Abidin Ahmad said it has 220,000 units of outstanding bookings and is facing difficulties in managing operations because it has reached maximum capacity
due to high demand.
“Perodua has earmarked RM10 billion to purchase parts from local suppliers to meet our 2023 targets. Hopefully by maximising our production to 330,000 this year, we will also be able to fulfil our
average normal orders,” he said during the Perodua 2023 Outlook Media Conference in Kuala Lumpur today.
Currently, the normal installed annual production capacity for Perodua Manufacturing and Perodua Global Manufacturing plants is at 320,000 units on a two-shift cycle, and Zainal said it can
increase the volume by improving productivity and by instituting overtime.
He said the impact of such production growth on the Malaysian automotive industry would be significant as Perodua purchase commitment is expected to encourage the Malaysian automotive ecosystem to
improve its production capabilities and quality standards.
“In short, the increase in production will give a much-needed boost for our local industries to improve economies of scale and to better compete with counterparts abroad,” he added.
Zainal also affirmed that Perodua will make sure customers who booked vehicles during the National Economic Recovery Plan (Penjana) scheme period and are supposed to get their orders by March 31
will still be able to enjoy the sales and services tax (SST) exemption intended for them.
In addition, Perodua is targeting sales of more than 314,000 units this year, or 11.3% higher than the preceding year’s 282,019.
Based on the waiting period for most brands, as well as the still strong demand for Perodua’s vehicles, Zainal said, total industry volume has the potential to reach 700,000 units this year.
“In terms of the overall market, we believe that there is still a bright silver lining for the industry despite the cost pressures. We believe that the total industry volume (TIV) can go beyond
the 650,000 units announced by the Malaysia Automotive Association,” he added.
Perodua, he said, will not increase the prices of existing models but there will be some price increases for newer models due to new and enhanced specification features rather than due to the
impact of inflation or higher material prices.
Perodua has allocated RM1.15 billion in capital expenditure this year to improve its group operations. One key area for improvement is its new business division where Perodua is expanding its
Pre-Owned Vehicle and Subscription business.
“We have allocated RM537.1 million for the development of multiple new models that we are planning to launch in 2024 and 2025. In addition, we will allocate RM247.1 million to modernise
operations, which also includes upgrading existing 1S (sales showroom) and 2S (service and spare parts centres) into 3S centres (a combination of the two),” he said.
With these improvements planned for its network, Perodua is targeting an increase in its vehicle intake at its service centres.
“For 2023, we target to see an increase in vehicle intakes to 2.8 million units from 2.6 million recorded in 2022. This growth would be a combination of improved service time as well as increasing
our service bays throughout the country,” said Zainal.
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Aeon credit secures RM600m in sustainability-linked loans (Tue, 31 Jan 2023)
KUALA LUMPUR: Aeon Credit Service (M) Bhd has secured RM600 million in sustainability-linked loans (SLLs) with three-year tenure from two Japanese banks and a local bank, namely Mizuho Bank
(Malaysia) Bhd, MUFG Bank (Malaysia) Bhd and CIMB Bank Bhd.
The group said the SLLs are a recognition of its efforts in environmental, social and governance (ESG) practices, and the proceeds will be used for general working capital and refinancing purposes
as well as to enhance its sustainability performance that would contribute to the United Nations’ Sustainable Development Goals.
In a statement today, Aeon Credit said that upon securing the SLLs, predetermined sustainability performance targets (SPTs) in accordance with the group’s existing sustainability framework are
established for assessment purposes.
“Aeon Credit will be incorporating the SPTs into the assessment of business and financial performance where interest rate adjustment is subjected to the achievement of the targets,” it said.
Managing director Daisuke Maeda commented that securing the SLLs marked another milestone for the group to continually strengthen its commitments towards ESG while creating long-term value for its
“As guided by the corporate philosophy of pursuing peace, respecting humanity and contributing to local communities, we recognise the importance of embedding the sustainability elements into our
business model and daily operations.
“We have set our commitments including to be the market leader for electric motorcycle financing, provide financial inclusion for micro-enterprises, promote ESG education in schools, while
continuing our efforts to work towards carbon neutral business and uphold good corporate governance practices,” he added. - Bernama
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ASB bullish about its prospects in O&G industry as operations remain steady (Tue, 31 Jan 2023)
LABUAN: Labuan-based Asian Supply Base Sdn Bhd (ASB), one of Malaysia’s largest supply bases for the oil and gas (O&G) industry, is bullish on its prospects this year, backed by its
steady business operations despite uncertainties ahead in the sector.
ASB chief executive officer Japar Esteban said all the O&G-related Malaysian and multinational companies are still operating normally and oil drilling works are still being carried out via
“We are optimistic about the steady business operations momentum despite numerous speculations about the uncertainty of the O&G industry this year,” he told Bernama.
Japar said a total of 88 oil and gas-related international and domestic companies are currently operating in ASB’s operation hub with 16 of them being petroleum arrangement contractors and the
remaining 71 non-petroleum arrangement contractors.
ASB will continue to deliver expectations without being affected by the uncertain situation, he added.
He cited the RHB Investment Bank Research’s analysis that the O&G industry’s outlook is anticipated to stay stable while oil prices have made a respectable comeback as of the end of September
Japar said companies with exploration interests, including Hibiscus Petroleum Bhd and Dialog Group Bhd, as well as some petrochemical firms, such as Petronas Chemicals Group Bhd, would immediately
benefit from the recovery in oil prices.
“Indirectly, the price recovery will encourage oil companies to maintain their operating and capital investment plans, which will benefit providers of upstream services.
“We are determined to offer ASB’s experience and expertise to significant clients involved in upstream activities, including Petronas Carigali, Hibiscus Petroleum, PTT Exploration and Production
(PTTEP), Kebabangan Petroleum Operating Company (KPOC), and others who are currently located in ASB’s main base.
“After years of significant underinvestment, I anticipate that global exploration and production capital expenditure spending will continue to rise in 2023, maybe even approaching pre-pandemic
levels,” he added.
Japar said that ASB could become the preferred logistic service provider for O&G companies that undertake operations in the waters of Sabah, Sarawak, Brunei, and the Philippines.
“As part of our current efforts to expand and diversify the businesses and services offered at our base, we are looking into the possibility of becoming a commercial logistics service
“Additionally, ASB is prepared to increase the size of its current 345-acre (139 hectares) base in line with the growing needs and demands of customers,” he added. - Bernama
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Teladan Setia unit acquires RM48.5m Melaka land for mixed development (Tue, 31 Jan 2023)
KUALA LUMPUR: Teladan Setia Group Bhd via its wholly-owned unit, Asal Harta Sdn Bhd, has entered into a sale and purchase agreement with Megan Mastika Sdn Bhd to acquire 3.1 hectares (ha)
of leasehold land in Melaka worth RM48.5 million.
In a statement today, its managing director Richard Teo Lay Ban said the proposed acquisition is in line with the company’s strategy to balance its landbank developments to cater to different
market environments and demands.
He said as the group strives to enhance the value proposition in its property projects, this land is earmarked for the development of a health and wellness centre and residential serviced
“The land is strategically located in the heart of the city of Melaka, which is opposite Mahkota Medical Centre and within walking distance to popular tourist spots including Jonker Street.
“As this is a prime area amongst local and international tourists, we are confident that the projects will do well,” he said.
Teo said Teladan Setia would also benefit from the pent-up demand for residential properties arising from the recovery of economic activities and rebound in the tourism industry.
“In addition, we continue to pursue our strategy of accumulating strategic land parcels that bring potential economic value and positive future earnings to our group,” he said.
Teladan Setia said that over the past two years, it has acquired new landbanks in Melaka amounting to 347.2ha.
Including this deal, it said that the group’s total landbank will further increase to 447.9ha, allowing it to scale up its property development activities and generate long-term sustainable
The acquisition is expected to be completed by the fourth quarter of 2023, barring any unforeseen circumstances and subject to approval from the authority, it said. - Bernama
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Bursa Malaysia targets 39 IPO with market cap of RM10b this year (Tue, 31 Jan 2023)
PETALING JAYA: Bursa Malaysia Bhd targets to list 39 initial public offerings (IPO) and total market capitalisation of RM10 billion this year, said CEO Datuk Muhamad Umar Swift.
The exchange recorded 35 IPO last year, with 25 listed on the ACE Market and a total market cap of RM11.5 billion.
Year to date, the bourse has recorded seven IPO, with one and six listed on the Main and ACE markets respectively.
Muhamad Umar remarked that the bourse aims to record a profit before tax of between a range of RM295 million to RM326 million, this year.
He said that in line with the practices promoted in its “public listed companies transformation” programme guidebook, the bourse disclosed its headline key performance indicator yesterday to
investors and stakeholders.
“They reflect the exchange’s focus to develop, intent and growth,” he told reporters at a press conference on Bursa Malaysia’s financial year 2022 financial results in Kuala Lumpur today.
Meanwhile, Bursa Malaysia chairman Tan Sri Abdul Wahid Omar said that following a resilient performance last year, the exchange’s growth this year is expected to moderate amid a slower global
“Compared to the anticipated 8% growth in 2022, most economists predict that Malaysia’s economy would grow more moderately, by some 4.0% this year. This is partly since exports to major markets
are expected to be supported by strong domestic demand and continued labour market improvements.
“Looking ahead, short-term market volatility is expected to persist in the coming months. Nonetheless, a number of positive and domestic catalysts could boost market sentiment, potentially
providing further fundamental support to the domestic market in the medium term,” he said.
Abdul Wahid opined that given the current global macroeconomic headwinds will persist, the operating environment is anticipated to remain challenging.
In addition, he remarked that it will continue to improve its current offerings and deepening its capabilities in venturing into new products and services.
“We will leverage technology and work on innovations to improve our customers’ experiences with us and better serve them.
“We will strive to strengthen our position as the leader in the Islamic capital market by developing novel shariah-compliant instruments to meet the needs of investors, such as sustainable and
responsible investments and waqf-featured products,” Abdul Wahid said.
He added that in 2023, the bourse remains committed to further develop its marketplace for the betterment of all stakeholders as well as to make it a more thriving and attractive investing and
listing destination, in line with its mission of ‘creating opportunities, growing value’.
Bursa Malaysia’s net profit decreased 24.55% to RM49.01 million in its fourth quarter ended Dec 31, 2022 compared with RM64.95 million in the corresponding quarter in the previous year, due to
lower overall trading revenue as well as higher total operating expenses for the full financial year of 2022 (FY22).
Revenue fell 11.79% to RM145.70 million from RM165.18 million for the same quarter last year, driven by lower overall trading revenue of RM377.1 million in FY22.
For the full year, the group’s net profit decreased 36.22% to RM226.57 million compared with RM355.25 million. Its revenue decreased by 21.41% to RM603.25 million from RM767.54 million.
The exchange declared a final dividend of 11.5 sen per share amounting to about RM93.1 million, which brings the total dividend payout for FY’22 to 26.5 sen per share, which includes the interim
dividend of 15 sen per share paid out in August 2022.
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BNM: Malaysia’s official reserve assets at US$114.65b as of end-Dec 2022 (Tue, 31 Jan 2023)
KUALA LUMPUR: Malaysia’s official reserve assets amounted to US$114.65 billion (US$1=RM4.24) as of end-December 2022, while other foreign currency assets stood at US$5.40 million, said Bank
Negara Malaysia (BNM).
The central bank said in accordance with the International Monetary Fund’s (IMF) Special Data Dissemination Standard (SDDS) format, the detailed breakdown of international reserves provides
forward-looking information on the size, composition and usability of reserves and other foreign currency assets.
It also provides guidance on the expected and potential future inflows and outflows of foreign exchange of the federal government and BNM over the next 12-month period.
“For the next 12 months, the pre-determined short-term outflows of foreign currency loans, securities and deposits, which include, among others, scheduled repayment of external borrowings by the
government and the maturity of foreign currency Bank Negara interbank bills, amounted to US$16.94 billion.
“The short forward positions amounted to US$26.39 billion as of end-December 2022, reflecting the management of ringgit liquidity in the money market,” it said in a statement today.
BNM said in line with the practice adopted since April 2006, the data excludes projected foreign currency inflows arising from interest income and the drawdown of project loans.
It added that foreign currency inflows are projected to amount to US$2.25 billion in the next 12 months.
BNM noted that the only contingent short-term net drain on foreign currency assets is government guarantees of foreign currency debt due within one year, amounting to US$378.50 million.
“There are no foreign currency loans with embedded options, no undrawn, unconditional credit lines provided by or to other central banks, international organisations, banks, and other financial
“BNM also does not engage in foreign currency options vis-à-vis ringgit,” it said.
Overall, the detailed breakdown of international reserves under the IMF SDDS format indicated that as of end-December 2022, Malaysia’s international reserves remained usable. -Bernama
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IMF revises global growth forecast upward to 2.9% for 2023: WEO (Tue, 31 Jan 2023)
WASHINGTON: Global economic growth will slow to 2.9 per cent in 2023, the International Monetary Fund (IMF) said, revising its previous forecast upward by 0.2 percentage points, reported
“Global growth is projected to fall from an estimated 3.4 per cent in 2022 to 2.9 per cent in 2023, then rise to 3.1 per cent in 2024. The forecast for 2023 is 0.2 percentage point higher than
predicted in the October 2022 World Economic Outlook (WEO) but below the historical (2000–19) average of 3.8 per cent,“ the IMF said.
Global inflation will slow to 6.6 per cent this year and 4.3 per cent in 2024, still remaining well above pre-pandemic levels, it added.
“Global inflation is expected to fall from 8.8 per cent in 2022 to 6.6 per cent in 2023 and 4.3 per cent in 2024, still above pre-pandemic (2017–19) levels of about 3.5 per cent.”
The global fight against inflation, the conflict in Ukraine and new Covid-19 breakouts in China weighed on global economic activity in 2022, the report noted.
“The first two factors will continue to do so in 2023,“ the IMF added.
In the US, economic growth is projected to fall from 2.0 per cent in 2022 to 1.4 per cent in 2023 and 1.0 per cent in 2024.
“There is a 0.4 percentage point upward revision for annual growth in 2023, reflecting carryover effects from domestic demand resilience in 2022, but a 0.2 percentage point downward revision of
growth in 2024 due to the steeper path of Federal Reserve rate hikes, to a peak of about 5.1 per cent in 2023,“ the IMF said.
In the euro area, economic growth will bottom out at 0.7 per cent in 2023 before rebounding to reach 1.6 per cent in 2024.
“Growth in the euro area is projected to bottom out at 0.7 per cent in 2023 before rising to 1.6 per cent in 2024,” the WEO said on Monday.
The 0.2 percentage point upward revision to the forecast for 2023 reflects the effects of faster rate hikes by the European Central Bank and eroding real incomes, the report added.
Economic growth in China is projected to increase to 5.2 per cent this year and drop to 4.55 in 2024.
“Growth in China is projected to rise to 5.2 per cent in 2023, reflecting rapidly improving mobility, and to fall to 4.5 per cent in 2024 before settling at below 4 per cent over the medium term
amid declining business dynamism and slow progress on structural reforms,” the report said. -Bernama
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Samsung says Q4 profits plunge 69% to 8 year low on demand slump (Tue, 31 Jan 2023)
SEOUL: Samsung Electronics said Tuesday that its fourth-quarter operating profits plunged nearly 70 percent, its biggest such quarterly drop in more than eight years, as the global economic
slowdown dealt a blow to electronics and chips sales.
The South Korean tech giant said operating profits for the October-December period slumped to 4.3 trillion won, a 69 percent drop from a year earlier. -AFP
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Japan Inc woos skilled workers as inflation, labour crunch bite (Tue, 31 Jan 2023)
TOKYO: From inflation allowances to the reskilling of workers, firms in Japan are stepping up efforts to help employees fight rising prices and a labour crunch, even though some cannot
afford pay hikes that do more than offset cost-push inflation.
As annual “shunto” labour talks get into full swing, momentum from both labour and management is growing for firms to offer such increases to cushion, even if not beat, consumer inflation, which
hit a 41-year high of 4% in December.
At the spring session of the labour talks, set to wrap in mid-March, major firms, such as Toyota Motor Corp, negotiate with in-house unions to set wages for the coming fiscal year from April.
Labour shortages and rising consumer inflation, which is double the central bank's target of 2%, are spurring cautious firms, with a ¥500 trillion (RM16.3 trillion) hoard of internal reserves, to
About a quarter of Japanese firms have offered inflation allowances or plan to do so, said corporate credit research firm Teikoku Databank. Such allowances range from ¥6,500 for monthly payments
to ¥54,000 in lump sums, on average.
“I received the money just when we had our second baby,” said Shinichiro Mori, who received a one-off allowance of ¥150,000 last summer from groupware developer Cybozu Inc, one of about 800
employees to do so.
“I appreciated the money,” Mori, 41, told Reuters. “We spent it on baby goods, utility bills and other living expenses, as we stayed home all day taking care of our baby.”
News that Fast Retailing Co, operator of the Uniqlo clothing chain, will revise its pay system for employees, with raises as much as 40%, provides another example.
The private sector expects the drive to help boost productivity, meshing with Prime Minister Fumio Kishida’s “new capitalism” initiative on wealth distribution that put a top priority on wage
Such demands by Japanese policymakers come against the backdrop of 15 years of grinding deflation that saw firms shelve increases in base salary from the early 2000s to the early 2010s, when
rounds of stimulus spending failed to spark economic growth, but piled up public debt instead.
Organisation for Economic Cooperation and Development data shows Japanese workers’ wages have grown about 5% over a period of 30 years from 1990, during which US pay rose 1.5 times and pay for
South Koreans doubled.
Takahide Kiuchi, a former member of the board of the Bank of Japan, called for wage increases to be sustained over time so that cumulative pay rises could offset price hikes in the long run.
“Bonuses or inflation allowances would have only a limited impact on easing the pain of cost-push inflation, as consumers tend to save one-off payouts rather than spend,” added Kiuchi, now an
executive economist at the Nomura Research Institute.
The government and the central bank say inflation must grow in tandem with wage growth to fuel private consumption, which accounts for more than half the economy, paving the way for the Bank of
Japan to achieve its inflation target in a sustainable, stable fashion.
But one-off payments do not make consumers more confident about increasing spending, although a rise in base pay, a salary component that is hard to reverse, is more likely to boost such
confidence and set workers spending more.
Real wages fell 2.5% in November, down for the ninth straight month, following the previous month's decline of 3.8%, the latest data shows.
Mori’s employer, Cybozu, has offered employees a record pay increase in the upper reaches of the 1% to 10% range this year.
That would surpass the 3% target of Kishida's government, and even the 5% sought by the Japan Trade Union Confederation (Rengo), while Japan’s biggest business lobby Keidanren urged companies to
offer positive wage increases, including base pay.
“We always feel the need to respond to labour shortages of engineers, in particular,” said Yumika Nakane, the firm’s human resources head. “We set pay scales as we’re fully aware salary is one of
the keys to attract workers.”
Despite a jobless rate of 2.5% in November that reflects the tight labour market, and steady job availability, at a ratio of 1.35 per seeker, policymakers complain about the absence of demand-pull
inflation that entails wage growth.
At this year’s shunto talks, large firms are likely to offer the biggest pay increases in 26 years, or an average of 2.85% for the financial year starting in April, a poll of 33 economists by the
Japan Economic Research Center showed.
However, small firms, which employ seven of every 10 workers, face a severe situation, and more than 70% of them have no plan to raise wages, a separate poll by the Jonan Shinkin Bank and the
Tokyo Shimbun newspaper showed.
To push small firms in this direction, authorities want to improve labour productivity and encourage more workers to switch to industries with better prospects for growth, provided that they will
not lack for employment.
Kishida’s government plans to tap 1 trillion yen over the next five years in human resources, providing new support for firms hiring mid-career workers as well as for reskilling efforts to spur
Workers have high expectations from this year’s labour talks, which they hope will counter cost-push inflation while tackling the tight labour market to help boost the economy.
Some companies are ready to take the initiative.
For instance, Internet media firm Cyberagent’s “reskilling centre” has trained 200 information technology engineers, upgrading their skills to match its needs, besides wooing engineers from
From this spring, it will also raise the starting salary for new graduates by 12% to ¥420,000.
“As the IT industry faces a lack of engineers, we can contribute to resolving the labour crunch by cultivating human resources, which is our strength,” said Hiroto Minegishi, the firm’s general
manager for technical human resources.
“As a result, we can help wages growth and enhance productivity across the IT industry.” – Reuters
>> Continua a leggere
US said to have stopped granting export licences for Huawei (Tue, 31 Jan 2023)
WASHINGTON/SAN FRANCISCO: The Biden administration has stopped approving licences for US companies to export most items to China’s Huawei, according to three people familiar with the
Huawei has faced US export restrictions around items for 5G and other technologies for several years, but officials in the US Department of Commerce have granted licences for some American firms
to sell certain goods and technologies to the company. Qualcomm Inc in 2020 received permission to sell 4G smartphone chips to Huawei.
A Commerce Department spokesperson said officials “continually assess our policies and regulations” but do not comment on talks with specific companies. Qualcomm declined to comment. Bloomberg and
the Financial Times earlier reported the move.
One person familiar with the matter said US officials are creating a new formal policy of denial for shipping items to Huawei that would include items below the 5G level, including 4G items, Wifi
6 and 7, artificial intelligence, and high-performance computing and cloud items.
Another person said the move was expected to reflect the Biden administration’s tightening of policy on Huawei over the past year. Licences for 4G chips that could not be used for 5G, which might
have been approved earlier, were being denied, the person said. Towards the end of the Trump administration and early in the Biden administration, officials had still granted licences for items
specific to 4G applications.
American officials placed Huawei on a trade blacklist in 2019 restricting most US suppliers from shipping goods and technology to the company unless they were granted licences. Officials continued
to tighten the controls to cut off Huawei’s ability to buy or design the semiconductor chips that power most of its products.
But US officials granted licences that allowed Huawei to receive some products. For example, suppliers to Huawei got licences worth US$61 billion (RM259 billion) to sell to the telecoms equipment
giant from April through November 2021.
In December, Huawei said its overall revenue was about US$91.53 billion, down only slightly from 2021 when US sanctions caused its sales to fall by nearly a third. – Reuters
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Ringgit slips ahead of US interest rate decision (Tue, 31 Jan 2023)
KUALA LUMPUR: The ringgit slipped in early trade on Tuesday as the greenback gained strength ahead of the US Federal Reserve (Fed) meeting in the middle of this week on interest rates.
At 9.05 am, the ringgit stood at 4.2450/2500 against the greenback compared with 4.2410/2460 at Monday’s close.
SPI Asset Management managing partner Stephen Innes said although most market participants anticipate that the Fed will slow its pace of tightening to a 25 basis points rate hike, a “great debate”
has continued on whether the American central bank will signal that there is a long way to go in the rate upcycle.
This, he said, has dampened sentiment with investors “unwilling to fix their wagons to bulls” ahead of the US meeting.
“Risky assets, like the ringgit, have benefited greatly from the China reopening theme and a drop in US inflation but concerns the Fed may not play ball and keep rates higher despite falling US
inflation has traders reducing some risks.
“We are hitting the upper band of my weekly ranges, where I expected exporters to sell at the 4.2475-4.2500 level. I don’t think the market will move above 4.2525 after the positive holiday data
from China over the Lunar New Year holiday,‘’ he told Bernama.
The US central bank meeting will take place from today until tomorrow. Bank of England and European Central Bank meetings are scheduled on Feb 2.
At home, the ringgit traded higher against a basket of major currencies.
The local note appreciated against the Singapore dollar to 3.2306/2346 from 3.2315/2358 on Monday and rose vis-a-vis the British pound to 5.2472/2534 from 5.2571/2633.
It strengthened versus the euro to 4.6071/6125 from 4.6257/6311 and improved against the Japanese yen at 3.2584/2627 from 3.2638/2679 at the end of yesterday. -Bernama
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Adani Group plans independent audit of its companies: Report (Tue, 31 Jan 2023)
BENGALURU: India’s Adani Group is planning to hire one of the “big six” accounting firms to assess its corporate governance and audit practices following allegations of fraud by
short-selling firm Hindenburg, Mint newspaper reported on Monday (Jan 30).
The audit will be commissioned after the group’s unit, Adani Enterprises Ltd, completes a follow-on public offering, and based on its findings legal options will be sought, Mint reported,
citing two people with direct knowledge of the matter.
“The audit will include eight of the group’s listed firms. The independent audit report will be presented to the board, and basis the findings, the matter be taken to the court if the board of
Adani Enterprises decides so,” the newspaper quoted one of the sources as saying.
The audit will include a review of certain related party transactions, accounting practices and compliance with corporate governance standards at the firms, the report said, adding that it will
also attempt to check whether Hindenburg's allegations are correct.
Adani did not immediately respond to a Reuters request for comment outside regular business hours.
Separately, Indian bourse National Stock Exchange of India (NSE) revised the circuit limits on Adani Transmission Ltd, Adani Total Gas Ltd and Adani Green Energy Ltd to 10% from 20%, according to
the bourse’s website on Monday.
These limits are set by the exchange to prevent large movements in the price of stocks in a very short time.
The research report by Hindenburg last week accused the conglomerate of improper use of offshore tax havens and flagging concerns about high debt, eroding US$65 billion (RM276 billion) of the
group’s combined market value.
Adani on Sunday issued a 413-page rebuttal to the Hindenburg report, saying it complies with all local laws and had made the necessary regulatory disclosures.
Adani Enterprises’ US$2.5 billion secondary share sale, launched on Jan 27, closed its second day amid weak investor sentiment. The stock closed at 2,892.85 rupees (RM150.51), 7% below the 3,112
rupees lower end of the offer price band. The upper band is 3,276 rupees. – Reuters
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European Union crafts response to US green tech subsidies (Tue, 31 Jan 2023)
BRUSSELS: The Europoea Union (EU) will present long-awaited proposals on Wednesday (Feb 1) to counter sweeping US subsidies on green tech that threaten Europe’s industry, already struggling
with soaring energy prices and unfair competition from China.
Faced with member states divided between free market supporters and state aid advocates, European Commission President Ursula von der Leyen is under pressure to urgently respond to the US
Inflation Reduction Act (IRA).
Why must the EU respond?
The United States adopted the IRA last year, lavishing subsidies and tax cuts worth US$370 billion (RM1.57 billion) for US buyers of electric vehicles – if they “Buy American” – and leaving
European car manufacturers aghast.
European industry has sounded the alarm over the IRA’s impact on the continent, as high energy costs and US subsidies could push companies to leave.
Unlike their American counterparts, European businesses already face massive energy bills, unable to turn to cheap Russian gas after Moscow’s invasion of Ukraine. Gas prices imposed on European
manufacturers have tripled compared with the average for the past decade, while gas bills have remained stable in Asia and North America.
The EU has already committed to invest hundreds of billions of euros in green tech including solar panels, batteries and hydrogen. The bloc, however, risks becoming dependent on Chinese companies
that benefit from both massive subsidies and fewer environmental constraints.
“Many companies already relocate partially or totally their production outside Europe,” said BusinessEurope, the EU’s main business lobby.
Thousands of jobs are at stake in the chemicals, steel and other sectors.
What are the available options?
Mandated in December by EU member states to develop a European response, von der Leyen seeks to ease regulatory constraints weighing on green industries.
She has already announced plans for a new law that will make it possible to support strategic European projects, by speeding up and simplifying permits and financing.
Draft proposals by the commission seen by AFP include temporary relief from state aid rules, targeted at priority sectors, as well as support for investments in factories via tax benefits.
But relaxing state aid rules is controversial. It would help the bloc’s richest countries, especially France and Germany, since they could pour money into their businesses at the expense of EU
Germany and France represent respectively 53% and 24% of state aid notified to Brussels since March 2022 when the rules were relaxed following the war in Ukraine. Italy came in third, representing
In a letter signed by seven countries including Austria, Denmark and Finland, they stressed that the bloc’s “competitiveness and better investment environment ... cannot be built on permanent or
excessive non-targeted subsidies”.
Some EU members including France and Italy are calling for new common funds. Von der Leyen promised to work on a new European sovereignty fund paid for by an increase in the bloc's budget.
But such a mechanism will only be possible with the support of Germany and other “frugal” northern EU members, which oppose joint borrowing or any increase to their budgetary contributions.
The EU’s single market commissioner, Thierry Breton, has suggested other ways to finance the response including the mobilisation of the €800 billion (RM3.69 billion) European recovery plan’s
remaining funds and loans from the European Investment Bank.
When will the EU decide?
EU leaders are expected to decide on von der Leyen’s proposals at a summit in Brussels next week.
While there is consensus on the need to act fast, an idea for a sovereignty fund will be pushed back to later this year, according to the draft proposals, as countries including Germany, the
Netherlands and Sweden oppose it.
The extent of Wednesday’s package beyond easing regulatory pressures and relaxing state aid rules is uncertain. There are real fears in Europe of a trade war with the United States, while many
remain concerned about a response that violates free market principles.
The EU and the US “have so much more to gain when we work with each other”, the commission’s three executive vice presidents wrote in the Financial Times last Thursday.
Valdis Dombrovskis, Frans Timmermans and Margrethe Vestager also called for “an open, thriving transatlantic marketplace” and warned of the risk to the single market of a “massive surge” in state
subsidies. – AFP
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Russia bans oil exporters from adhering to Western price caps (Tue, 31 Jan 2023)
MOSCOW: The Russian government on Monday (Jan 30) banned domestic oil exporters and customs bodies from adhering to Western-imposed price caps on Russian crude.
The measure was issued to help enforce President Vladimir Putin's decree of Dec 27 that prohibited the supply of crude oil and oil products from Feb 1, for five months, to nations that abide by
The Group of Seven economies, the European Union and Australia agreed on Dec 5 to ban the use of Western-supplied maritime insurance, finance and brokering for seaborne Russian oil priced above
US$60 (RM255) per barrel as part of Western sanctions on Moscow over its actions in Ukraine.
The new Russian act bans corporates and individuals from including oil price cap mechanisms in their contracts. They also have to report to customs officials and the energy ministry any attempts
to impose oil price caps. In addition, customs bodies have to prevent goods from leaving Russia if they find such mechanisms have been applied.
The Western allies plan from Feb 5 to set two caps on Russian oil products, one on products that trade at a premium to crude, such as diesel or gas oil, and one for products that trade at a
discount to crude, such as fuel oil.
The Russian government's act also calls on the energy ministry, with the approval of finance ministry, to work out an approach for monitoring prices of Russian oil exports by March
Meanwhile, Asian markets are showing no let-up in their demand for Russian oil, absorbing a big rise in seaborne exports of Urals crude this month and helping Moscow cope even as most Western
buyers stay away, according to traders’ and Refinitiv Eikon data.
At least 5.1 million tonnes of Urals are being shipped from Russia’s European ports of Primorsk, Ust-Luga and Novorossiysk to Asia in January, the data show.
The final destinations for another 1.9 million tonnes of the grade have yet to be identified, but traders expect most of them will also end up in India or China.
As a result, Urals crude loadings bound for Asia in January could reach some 7 million tonnes, up by some 2 million tonnes from December, according to Reuters calculations.
Turkey and Bulgaria remain the only buyers of the grade in Europe’s seaports, the data show.
The rise in Urals shipments to Asia comes amid a general increase in Russia's seaborne oil supplies. Crude loadings from Primorsk and Ust-Luga this month are set to rise 50% from December to above
7 million tonnes - the highest in four years.
Urals supplies for ship-to-ship transfers for further deliveries to Asia in January are expected to reach at least 1.4 million tonnes. – Reuters
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US stocks begin eventful week on downcast note (Mon, 30 Jan 2023)
NEW YORK: Wall Street stocks started an eventful week on a downcast note in Monday (Jan 30), retreating ahead of key central bank announcements and corporate earnings.
Analysts pointed to profit taking as a factor in the bruising session after equities spent much of January pushing higher.
“People are getting out of long positions in stocks, particularly in the tech sector which has led the recent rally,” said Karl Haeling of LBBW. “People are taking some risk off.”
The Dow Jones Industrial Average fell 260.99 points, or 0.77%, to 33,717.09, the S&P 500 lost 52.79 points, or 1.30%, to 4,017.77 and the Nasdaq Composite dropped 227.90 points, or 1.96%, to
“The market has had a big run and the trading is a bit more cautious heading into a week which likely will be an inflection point for the overall market,“ said Keith Lerner, co-chief investment
officer at Truist Advisory Services.
This week’s calendar includes several major central bank announcements, with the Federal Reserve set to unveil its rate decision on Wednesday.
The US central bank is seen raising the Fed funds rate by 25 basis points at the end of its two-day policy meeting, following a 2022 in which the Fed aggressively boosted rates to control soaring
Fed chair Jerome Powell's news conference will be scrutinised for whether the rate-hiking cycle may be coming to a close and for signs of how long rates could stay elevated.
“It’s probably one of the most important meetings since the whole thing began,” said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute. “Unless the Fed extends
that timeline meaningfully from what the market expects, which is that the Fed will be done in the next meeting or two, this may end up marking the pause, so to speak.”
Analysts expressed unease after Spanish consumer prices unexpectedly accelerated, raising worries about a European Central Bank meeting later in the week. The bank is expected to deliver another
large rate increase on Thursday.
The economic agenda also includes quarterly results from tech heavyweights such as Apple and Amazon, as well as from industrial companies including ExxonMobil and General Motors.
Earnings have generally topped expectations so far, but investors have been troubled by downbeat forecasts by many companies, said Hugh Johnson of Hugh Johnson Economics.
With more than 140 companies having reported so far, S&P 500 earnings are expected to have fallen 3% in the fourth quarter compared with the prior-year period, according to Refinitiv IBES. –
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Sunway REIT’s FY22 net profit surges to RM323.56m (Mon, 30 Jan 2023)
KUALA LUMPUR: Sunway REIT Management Sdn Bhd, the manager of Sunway Real Estate Investment Trust (Sunway REIT), saw its net profit surge to RM323.56 million for the financial year ended Dec
31, 2022 (FY22) from RM127.59 million a year earlier, underpinned mainly by higher contribution from all segments.
Revenue for FY22 increased to RM651.45 million from RM472.35 million.
In a statement today, Sunway REIT said its financial performance was further buoyed by new income contributions from Sunway Carnival Mall’s new wing and the resumption of lease rental from Sunway
Resort Hotel as the hotel reopened in phases beginning May 2022.
CEO Datuk Jeffrey Ng said the manager’s financial performance in FY22 has surpassed the pre-pandemic level of FY19.
“As a result of the improved financial performance and cash flow, Sunway REIT has increased its income distribution payout to 100% in the fourth quarter of 2022, and endeavours to maintain an
income distribution payout of 100% in FY2023,” he said.
For FY22, Sunway REIT’s retail segment recorded a jump in revenue to RM426.9 million from RM269.5 million, representing a growth of 58%.
The growth was driven by a significant reduction in rental rebate, higher turnover rent, promotion and car park income as retail footfall and retail sales returned to normalcy.
“The hotel segment has demonstrated encouraging recovery signs as business and leisure activities picked up during the year with revenue and net property income (NPI) leaping 62% year-on-year
(y-o-y) and 83% y-o-y to RM63.3 million and RM59.4 million, respectively,” it said.
Meanwhile, the office segment remained stable in FY22, with revenue growing 4% y-o-y to RM79.3 million, from RM76.6 million in the preceding year, while NPI was marginally higher at RM51.8
Sunway REIT announced a final income distribution of 5.00 sen per unit for FY22.
On the outlook for FY23, Ng said Sunway REIT maintained a positive outlook, underpinned by stable domestic economic growth, sustained growth momentum for the retail segment, further recovery in
the hotel segment, as well as full-year income contribution from Sunway Carnival Mall (new wing) and Sunway Resort Hotel.
“Although inflation has tapered in recent months, we are closely monitoring inflationary and interest rate trends.
“We strive to negate the impact of higher interest costs through dynamic capital management strategy and strive to achieve higher NPI from existing assets portfolio and new acquisitions,” he
Ng said Sunway REIT has been actively pursuing acquisition opportunities and expects to make headway on the acquisitions front in FY23.
“Sunway REIT’s healthy gearing of 37.6% cent and debt headroom of approximately RM1.2 billion will enable it to fund yield accretive acquisitions,” he said. – Bernama
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