Malaysia Update: June 6, 2019

Malaysia Update | June 6, 2019
Authors: Kim Yaeger, Dim Mang
 
LOOKING AHEAD
 
 
June 13: Roundtable with Santiago Davila, Commercial Officer, U.S. Embassy Kuala Lumpur, Washington DC
 
THE COUNCIL'S TAKE
 
 

Review of Infrastructure Projects Continues

The Rapid Transit System (RTS) link project, a rail connecting Singapore and Malaysia, is the latest infrastructure project in Malaysia to be suspended, in line with Prime Minister Mahathir Mohamad’s efforts to review large infrastructure deals negotiated by the previous administration. The project, estimated at $1 billion, has been suspended until September 30, 2019. As previously negotiated, Malaysia will cover the costs of the suspension. The deal was signed in January 2018 to address congestion for the 300,000 commuters that cross the border daily.

While progress has stalled with many large infrastructure deals, last month Malaysia was able to renegotiate the deal with China for the previously delayed East Coast Rail Link (ECRL). After further negotiations, the construction cost of Phases 1 and 2 of the ECRL was reduced to RM44 billion ($10.55 million), a savings ofRM21.5 billion ($5.16 million). The route will be altered from Kota Baru in Kelantan to Port Klang in Selangor, about 40km shorter in length. Along with a cost and slight route reduction, it was negotiated that Malaysians would be used for 40 percent of the sub-contracting work.  Of that amount, the Malaysian Bumiputera Contractors Association recently requested that 20 percent be awarded to Bumiputera contractors. Prime Minister Mahathir has stated to the press that the bumiputera will continue to receive preferential treatment, but a quota has not yet been set for the ECRL. The project will be implemented by a 50:50 joint-venture established between Malaysia Rail Link Sdn Bhd (MRL) and China Communications Construction Company Ltd (CCCC).

Additionally, there is great debate on whether these infrastructure investments will positively impact the Malaysian economy, which is still forecasted to remain at 4.2 percent in 2019 growth. Fitch Solutions have predicted that the boost from the infrastructure projects will not be enough to offset the impact of the US-China trade war while PwC Growth Markets Center leader and partner David Wijeratne claims construction will still be one of the top three high growth areas in Malaysia for the next couple of years.

IDEAS report card reviews Pakatan Harapan's First Year

The Institute for Democracy and Economic Affairs (IDEAS) released a report card after reviewing Prime Minister Mahathir’s government's first year in office. During the 2018 election, Pakatan Harapan campaigned on an ambitious plan, guided by five main pillars and ten promises the coalition hoped to fulfill during their first 100 days in office. IDEAS tracked and analyzed 192-subpromises that branched from the 23 primary pledges in the coalition’s election manifesto. Each sub-target was rated from zero to five, with zero meaning no progress had been achieved and five indicating fulfillment.

One notable success was the abolition of the Goods and Services Tax (GST). While the government was able to follow through on one of their major campaign promises, IDEAS notes that the zero rating of the GST occurred a few months before the implementation of the Sales and Service Tax (SST), further straining the government’s finances. It’s also noted that abolishing the GST tax has had marginal impact on living cost pressures for Malaysians.

The ECRL is another example of Pakatan Harapan’s successes. The recent renegotiation of the contract and the general transparency of the progress is an encouraging step. As IDEAS notes, the government still needs to outline and implement concrete policies for their Promise 23, which is ensuring that government procurement policies produce the best value for taxpayer’s money, to ensure consistency and transparency.

The Pakatan Harapan also pledged to make the governance of government-linked companies (GLCs) world class and on par with international standards. Further, according to the manifesto, GLCs should operate in sectors that suffer from market failure and will not compete against private companies and their corporate governance would be reviewed with appointment of GLC board members made based on merit and professionalism, not politics. The Prime Minister has stated that GLC candidates will be vetted first, instituting five procedures for verification, but according to IDEAS, this has done little to change the entrenched GLC framework and corruption that has plagued Malaysia for years. There is no clear strategy in place to address GLC monopolies and this ambitious reform has not yet been implemented. Other key criticism from IDEAS includes a health budget far below the level needed to reach four percent of GPP, and though the coalition has formed a Tax Reform Committee, it’s not clear how they will balance the competing demands of raising addition revenue for public services and reducing the tax burden.

A year after their historic win, Prime Minister Mahathir and his Pakatan Harapan government have seen their approval rating plunge to 46 percent, down from 71 percent in August 2018. A nationwide poll conducted in March 2019 also shows that only 39 percent of Malaysian voters gave the government positive ratings. Though the IDEAS report card shows that the Pakatan government has achieved or is on track for about 29 percent of their economic promises, there is work still to be done in government transparency, strategy, and implementation.

 
ADVOCACY UPDATE
 
 
In response to the Ministry of International Trade and Industry’s request for input on issues and challenges facing industry, the Council requested feedback from members and submitted the attached overview to MITI on June 3. MITI has requested this feedback as they prepare for their annual Consultative Dialogue on July 15-18. 
 
IN THIS UPDATE
 
 
National Affairs
Malaysia's anti-corruption chief resigns and is replaced by ex-PKR lawyer
Come study in Malaysia, Dr M tells international students
'China and Malaysia shall be friends forever'
PM: Japanese conglomerates pledge to expand investments in Malaysia
Malaysia's inclusion in US watchlist shows strong economy, competitiveness
26 political parties demand meeting with UEC to discuss election matters
President urges faster reforms to build federal union
Govt mulling corporate governance taskforce
PM: Any good delivery system will fail without good users
Liew Vui Keong: Sedition act to be abolished this year
PM reflects on PH's successes

Customs
Southeast Asia Struggles with Trash Rejected by China

Defense & Security
US to sell RM80 million spy drones to Malaysia as tension mounts over China

Economics
Malaysia -- a trade war safe haven?
Malaysia’s April exports seen falling 1% year-on-year
Dr M condemns stupidity of trade wars
Ringgit needs to brace through unfavourable perception in the next three to six months
Malaysia remains the world's 22nd most competitive economy

Energy
OCBC Bank finances large scale solar project
Malaysia prepares to boost palm-biofuel use in wake of EU limits
Petron posts Q1 net profit of RM57.5m
Sarawak CM launches South-east Asia’s first integrated hydrogen production plant | Malay Mail
OCBC Bank takes lead in financing Perlis large scale solar plant
Malaysia committed to key role as biofuel technology player | Malay Mail
Malaysia in discussion with China firms on pipeline compensation

Financial Services
Malaysia to host MyFintech Week 2019 in June
Securities Commission Malaysia Releases Property Crowdfunding Framework and Announces 8 New Market Operators
Chart of the Day: Singapore's life insurance take-up still far ahead of Malaysia

Health & Life Sciences
Plan for special council to propel health tourism in Sabah
Govt tackling nurse shortage

ICT
Malaysia set to become preferred location for semiconductor industry
Huawei gains support in Malaysia
Over 50% of Malaysians use e-commerce platforms: MCMC survey
Local companies urged to make 'intelligent enterprise' transformation
2019 Malaysian ICT job market grows tepid; slowest salary growth in a decade
Dr M worried about job losses from planned Telenor, Axiata merger

Infrastructure
Residents say 'no' to Khalid's win-win proposal on park project
Dr M: Govt will conduct six-month study on RTS viability
Rising confidence in govt initiatives?
Kg Baru redevelopment: Settlement to boast high-rise dwellings

Travel & Tourism
Tough terrain for Malaysia's tourism industry
Malaysia Airlines CEO objects to shutting down airline
Asean tourists visiting Malaysia down seven per cent in 2018
 
ARTICLE CLIPS
 
 
National Affairs

Malaysia's anti-corruption chief resigns and is replaced by ex-PKR lawyer The Straits Times 4th Jun 2019
Malaysia's top anti-graft chief Mohd Shukri Abdull has resigned, just over a year into his two-year tenure, according to local news reports quoting a statement from the Prime Minister's Office (PMO). He has been replaced by a prominent woman lawyer who was a member of Parti Keadilan Rakyat (PKR), one of the four parties under the country's governing alliance Pakatan Harapan (PH). Lawyers for Liberty executive director Latheefa Beebi Koya is the new Malaysian Anti-Corruption Commission (MACC) chief commissioner.

Come study in Malaysia, Dr M tells international students NST Online 3rd Jun 2019
Prime Minister Tun Dr Mahathir Mohamad today called on international students to come and study in Malaysia. Dr Mahathir said Malaysia offered a proven well-balanced private and public education system that has successfully produced graduates who excelled in their careers. “Students who study abroad become explorers and we are in that amazing part of the world where so many cultures co-exist harmoniously, where you will find incredible customs and traditions, exotic and wonderful food as well as astonishing social dynamics.

'China and Malaysia shall be friends forever' New Straits Times 31st May 2019
China’s Ambassador to Malaysia Bai Tian said the friendship between China and Malaysia was established on mutual trust, respect, equality and sincerity. In a special article penned and signed by him and posted on the Embassy’s official Facebook page today, the Ambassador said the bilateral relations between China and Malaysia has “grown from a small sapling of friendship 45 years ago to a towering tree” today. “If (we) compare the China-Malaysia friendship to a tree, political mutual trust would be the soil for the planting of the tree. The successive leaders of the two countries have played an important guiding role in promoting China-Malaysia friendship,” he said. He added that although both countries do not always agree on every issue, the two sides have always insisted on handling the differences through friendly consultations, consensus, and mutual trust.

PM: Japanese conglomerates pledge to expand investments in Malaysia NST Online 31st May 2019
Japanese conglomerates have pledged to expand their investments and businesses in Malaysia. Prime Minister Tun Dr Mahathir Mohamad told Malaysian journalists here today that representatives of the 19 Japanese companies that he met in a business dialogue on Thursday had expressed their support for the country and would campaign to get more Japanese companies to invest in the country. “The Japanese conglomerates were from various sectors, ranging from health to financial services, and all of them have expressed their desire to expand their business, or invest in new projects in Malaysia,” he said after concluding his three-day working visit to Japan today.

Malaysia Airlines and Japan Airlines pursue business partnership to enhance services New Straits Times 28th May 2019
Malaysia Airlines Bhd (MAB) and Japan Airlines (JAL) have teamed up to pursue a joint business agreement to improve customer convenience. The national carrier said the memorandum of understanding would enhance the quality of services provided by both carriers on flights between Malaysia and Japan. MAB group chief executive officer Captain Izham Ismail said JAL has always had strong commercial links with MAB together with oneworld affiliation.

26 political parties demand meeting with UEC to discuss election matters Eleven Media Group Co., Ltd 28th May 2019
Twenty six political parties including Union Solidarity and Development Party (USDP) have demanded a meeting with the Union Election Commission (UEC) to discuss election matters. The parties sent an open letter carrying nine points to the commission, according to the Facebook page of USDP on May 26. The letter called for a suitable timeline for a face-to-face meeting for mutual discussion because the UEC has met with the political parties only three times in three years since it took office.

President urges faster reforms to build federal union The Myanmar Times 28th May 2019
He made the comment in a meeting with senior staff of government agencies, legislators and judicial officials last week to underscore the need to speed up reforms. “Some are worried about reforms so they are hesitant and frightened (to implement them). Actually, reform is a good friend of the country,” he said. U Win Myint said reforms pose no threat and are a good way to develop the country and the people’s happiness. He said civil servants can heed the example of independence hero Bogyoke Aung San’s short-lived administration, which was anchored in justice.

Govt mulling corporate governance taskforce NST Online 14th May 2019
The government is looking into establishing a taskforce to coordinate efforts to make Malaysia an excellent nation under Corporate Governance Watch (CGW). Prime Minister Tun Dr Mahathir Mohamad said the taskforce would be spearheaded by former Bank Negara governor Tan Seri Dr Zeti Akhtar Aziz. “Tan Seri Zeti will set up the committee and will also study the report by CGW,” he told a press conference after chairing the eighth Special Cabinet Committee on Anti-Corruption meeting at Perdana Putra, here, today.

PM: Any good delivery system will fail without good users NST Online 14th May 2019
Any good system will fall apart if its users fail to use it properly, Prime Minister tells civil servants today. He said this during the launch of myPortfolio, an enhanced desk file and work manual procedures for the public sector aimed at improving the government's delivery system. "My advice to all civil servants, a system or any method of doing things, no matter how good it is, will not take off successfully if the users fail to use it honestly, with discipline and enthusiasm," he said after chairing the 8th Special Cabinet Committee on Anti-Corruption (JKKMAR).

Liew Vui Keong: Sedition act to be abolished this year NST Online 10th May 2019
The Sedition Act 1948 is expected to be abolished this year, said Law Minister in the Prime Minister’s Department Datuk Liew Vui Keong. He said the government has decided in the Cabinet meeting for the act to be abolished and currently looking into various factors for the implementation. “We want to ensure that not necessarily all statements made can be seditious because we want to ensure certain statements can enjoy some form of freedom... but not that we want to allow everybody to simply make statements that defame our rulers and leaders especially,” he told a recent press conference in conjunction with the first anniversary of the Pakatan Harapan government in power, here.

PM reflects on PH's successes NST Online 10th May 2019
Tun Dr Mahathir Mohamad yesterday maintained his narrative on the government’s commitment in charting the direction of New Malaysia, despite setbacks stemming from legacy issues from the previous administration. In a message to mark the Pakatan Harapan government’s one-year anniversary, the 93-year-old was firm in outlining the ruling party’s success stories, which included achievements in eradicating corruption and elevating women to crucial positions, with the latest being the appointment of Datuk Tengku Maimun Tuan Mat as chief justice.

Customs

Southeast Asia Struggles with Trash Rejected by China Radio Free Asia 20th May 2019
Residents of Tamanmekar, a village in Indonesia’s West Java province, search for recyclables amid a mountain of imported plastic trash, May 17. Southeast Asian nations are facing increased dumping of waste from industrialized nations, with Malaysia and the Philippines threatening to send back trash to countries of origin.

Defense & Security

US to sell RM80 million spy drones to Malaysia as tension mounts over China Free Malaysia Today 4th Jun 2019
Malaysia is buying 12 surveillance drones worth US$19 million (RM79.5 million) from the US, in a move seen as part of President Donald Trump’s efforts to boost its allies’ intelligence-gathering capabilities amid the escalating tension with China. Reuters reported that the sale is part of a US$47 million deal to sell 34 ScanEagle drones made by Boeing Co to the governments of Malaysia, Indonesia, the Philippines and Vietnam. The ScanEagle is an unarmed drone manufactured by Boeing’s Insitu, which also makes the RQ-21A Blackjack, the armed drone used by the US Navy and Marine Corps.

Economics

Malaysia -- a trade war safe haven? Nikkei Asian Review 3rd Jun 2019
Is Malaysia an unlikely safe haven as Donald Trump and Xi Jinping escalate their trade war? Absolutely, says Finance Minister Lim Guan Eng. Well, what else is Malaysia's economic czar going to say? To some, though, the numbers back up Lim's optimistic spin. Economic growth is holding up nicely -- rising 4.5% from a year earlier in the first quarter. Foreign direct investment surged 95% year-on-year the three months to March to $5.18 billion. Not a bad showing for Malaysia's newish government at the one-year mark.

Malaysia’s April exports seen falling 1% year-on-year The Star Online 31st May 2019
Malaysia’s exports in April are likely to have eased for the third successive month, declining at a faster annual pace than in March, a Reuters poll showed on Friday. The median forecast among the 11 economists surveyed was for exports to fall 1% in April from a year earlier, quicker than the 0.5% decline recorded in March. Individual estimates, however, ranged widely between an annual decline of 9% and a rise of 1.9%. Imports were also seen falling 0.2% year-on-year in April, marginally faster than the 0.1% decline in the previous month, the poll showed.

Dr M condemns stupidity of trade wars The Star Online 30th May 2019
Trade wars are stupid as it does not serve any purpose and disturbs the economic progress of countries – including Malaysia, says Tun Dr Mahathir Mohamad. "We would not like to have the US-China trade war if more reasonable minds take over. But at the moment we have to accept that there is a trade war and it affects us. "We want China to be rich enough for it to be a great market for us and the rest of the world," the Prime Minister told reporters at the Foreign Correspondents' Club of Japan here Thursday (May 30). He said China's 1.4 billion people could definitely become a big market for the whole world, thus its prosperity is good for the world.

Ringgit needs to brace through unfavourable perception in the next three to six months NST Online 30th May 2019
Malaysia may be taken off the US Treasury list of potential currency manipulators in a year or so, but it needs to contend with the unfavourable perception of investors in the next three to six months. Kenanga Research said the US Treasury’s decision to include Malaysia in its “Monitoring List of Potential Currency Manipulators” came as no big surprise, but it would weigh on the ringgit in the short term. Coupled with the uncertainty over the impact of the protracted the US-China trade negotiation as well as an increasingly dovish US Federal Reserve, the ringgit was expected to hover between 4.15 and 4.25 against US dollar in the short term.

Malaysia remains the world's 22nd most competitive economy NST Online 29th May 2019
Malaysia has maintained its 22nd rank, among 63 countries, in the World Competitiveness Yearbook (WCY) 2019 published by IMD World Competitiveness Centre, based in Lausanne, Switzerland. With a score of 82.54 out of 100 points, Malaysia sustained its position for the second year, reflecting positive sentiments of the business community towards the new government, announced International Trade and Industry Minister Datuk Darell Leiking. “The report showed improvements in institutional related indicators such as bribery and corruption, transparency, bureaucracy, justice, social cohesion and public finance in terms of rankings and value scored compared to the previous year.

Energy

OCBC Bank finances large scale solar project New Straits Times 28th May 2019
A consortium of lenders led by OCBC Bank (Malaysia) Bhd is financing a large-scale-solar (LSS) plant in Bukit Keteri, Perlis, setting benchmarks for green syndicated project financing involving LSS plants in the country. OCBC Bank said the project financing structure for project owner KBJ HECMY Sdn Bhd (KHSB), was aligned to meet the Asia Pacific Loan Market Association’s Green Loan Principles to ensure global acceptance and benchmarking. OCBC Bank is the bookrunner and mandated lead arranger of the syndicated project financing.

Malaysia prepares to boost palm-biofuel use in wake of EU limits New Straits Times 28th May 2019
MALAYSIA’S national automotive policy is expected to allow for a higher percentage of palm-biodiesel blends over the next few decades, according to International Trade and Industry Minister Darell Leiking. The government plans to include a “B20/B30-ready” specification for vehicles in a review of the policy, Leiking said in a statement on Saturday. Malaysia, the world’s second-largest palm oil producer, plans to double its biofuel programme to B20 by 2020, which mandates fuel be blended with 20 per cent palm-biodiesel.

Petron posts Q1 net profit of RM57.5m The Sun Daily 30th May 2019
Petron Malaysia Refining & Marketing Bhd’s net profit for the first quarter ended March 31, 2019 fell 20.25% to RM57.52 million from RM72.12 million a year ago due to unrealised commodity loss this year. Revenue for the quarter rose marginally to RM2.75 billion from RM2.73 billion a year ago due to the overall drop in product prices, despite total sales volume rising by nearly 6% to 9.1 million barrels.

Sarawak CM launches South-east Asia’s first integrated hydrogen production plant MalayMail 27th May 2019
A significant milestone was achieved today for Sarawak’s Green Energy Agenda with the official launch of South-east Asia’s first integrated hydrogen production plant and refuelling station and the introduction of the state’s first hydrogen-powered vehicles. Chief Minister Datuk Patinggi Abang Johari Openg, who launched the facility, said the state government allocated RM10 million to SEB to build the plant two years ago. He said the state government must do its part in reducing the current reliance on fossil fuel which has been proven to be unsustainable in the long run and is also bad for the environment.

OCBC Bank takes lead in financing Perlis large scale solar plant The Star Online 27th May 2019
OCBC Bank (Malaysia) Bhd is leading a consortium of lenders to finance a large-scale solar (LSS) plant, in Bukit Keteri, Perlis. OCBC Bank said its was setting fresh benchmarks for “green” syndicated project financing involving LSS plants in the country. The project financing effort comes on the heels of the OCBC Group’s announcement last month that it will stop financing coal-fired power plants globally in order to inspire a shift to cleaner and greener sources of energy. “OCBC Bank is committed to the development of renewable energy in Malaysia, in support of the Malaysian government’s target to increase the country’s generation mix from renewable energy to 20% by 2025. 

Malaysia committed to key role as biofuel technology player MalayMail 25th May 2019
As one the world’s major palm oil producers, Malaysia will continue to play a key role in ensuring that the commodity remains a sustainable and eco-friendly fuel replacement for world markets. “As the largest exporter and second largest producer of the palm oil in the world, we sit in a position of ensuring this commodity evolves into an industry that brings much benefits to global market, in particular, the energy and transportation ecosystem,” Minister of International Trade and Industry (MITI) Datuk Darell Leiking added.

Malaysia in discussion with China firms on pipeline compensation The Straits Times 25th May 2019
The government is negotiating with China Petroleum Pipeline Engineering Co and Huanqiu Project Management Beijing Co on the total compensation to be paid by Suria Strategic Energy Resources Sdn, which was overseeing the projects, for the termination of the work. Malaysia undertook a sweeping review of public projects after a change in government in May 2018. It has revived billion-dollar projects this year, including the East Coast Rail Link done in partnership with Chinese companies.

Financial Services

Malaysia to host MyFintech Week 2019 in June Digital News Asia 31st May 2019
MYFINTECH Week 2019 (MyFW2019), Malaysia’s first flagship fintech event will take place from June 17 to 21, 2019 in Sasana Kijang, Kuala Lumpur. Organised by Bank Negara Malaysia, this event is held in conjunction with Malaysia Digital Economy Corporation (MDEC)’s Malaysia Tech Week 2019. MyFW2019 will bring together more than 100 visionary and leading voices in the world of fintech under one roof. With the theme, “Shifting Tides: Future of Finance”, MyFW2019 will focus on five key areas i.e. Financial Inclusion (FI), Digital Economy, Insurtech, Islamic Finance and Cybersecurity.

Securities Commission Malaysia Releases Property Crowdfunding Framework and Announces 8 New Market Operators Digital News Asia 17th May 2019
The Securities Commission Malaysia (SC) announced, today, eight new recognized market operators comprising three equity crowdfunding (ECF) and five peer-to-peer (P2P) financing platforms. They received their letters of registration from the SC chairman Syed Zaid Albar, witnessed by Minister of Finance, Lim Guan Eng, before the start of the Fintech Roundtable organised by the SC. The roundtable discussed the progress of the fintech industry in fostering digital innovation to meet the financing needs of small and medium enterprises (SMEs) and enable greater financial inclusion for Malaysian issuers and investors.

Chart of the Day: Singapore's life insurance take-up still far ahead of Malaysia Singapore Business Review 27th May 2019
Penetration rate in the Lion City is around 250% compared to around 40% in Malaysia. Charts from Maybank Kim Eng display although life insurance take-up has been rising in both Singapore and Malaysia, the Lion City is still significantly ahead of its neighbour with 250% penetration rate in 2018 compared to 40% in Malaysia. There are around 12 million life insurance policies in both Singapore and Malaysia.

Health & Life Sciences

Plan for special council to propel health tourism in Sabah Free Malaysia Today 4th Jun 2019
Sabah Deputy Chief Minister Christina Liew plans to set up a Sabah Health Tourism Council (SHTC) under her tourism and culture ministry. Liew said the SHTC would play a key role in enhancing medical tourism in the state. She discussed the prospect of developing Sabah as a health tourism destination during a courtesy call by Commonwealth Pharmacists Association vice-president Dr Anil Kumar and several tourism players today. “The role of the proposed SHTC would be to formulate policies, regulate and promote the health tourism industry as well as monitor its growth.

Govt tackling nurse shortage NST Online 13th May 2019
THE Health Ministry is pulling out all the stops to resolve the shortage of nurses in government clinics and hospitals. Health Minister Datuk Seri Dr Dzulkefly Ahmad said the ministry has sought the Public Service Department’s (PSD) approval to allow the employment of nurses, in spite of the moratorium placed on their appointment. He said the ministry was working to address the shortage. He agreed that Malaysia lacked nurses, given its ratio of one nurse per 300 patients, as opposed to the World Health Organisation’s optimum number, which is one nurse per 200 patients.

ICT

Malaysia set to become preferred location for semiconductor industry The Star Online 6th Jun 2019
Malaysia is poised to become the preferred location for international companies looking to expand their semiconductor businesses, especially in the wafer fabrication (fab) industry. IGSS Ventures founder and group chief executive officer Raj Kumar said the country has a "multinational companies appeal” that is attractive to international businesses looking to carve a foothold here. "By this, I mean factors like ready access to a pool of highly skilled manpower for research and development, English-speaking population, business-friendly laws, well-developed infrastructure including excellent transportation connectivity, and integrated telecommunication systems,” he told Bernama.

Huawei gains support in Malaysia The Star Online 4th Jun 2019
Sales increased in flagship product among local consumers and recognition by Prime Minister. Prime Minister Tun Dr Mahathir Mohamad announced the continued use of Huawei technology as much as possible during the 25th International Conference on The Future of Asia, held in Tokyo. Dr Mahathir said Huawei had access to research “far bigger than the whole of Malaysia’s research equivalent”. “So we try to make use of their technology as much as possible,” he told a media conference.

Over 50% of Malaysians use e-commerce platforms: MCMC survey Digital News Asia 4th Jun 2019
THE e-Commerce Consumers Survey 2018 (ECS 2018), released by the Malaysian Communications and Multimedia Commission (MCMC) on June 3 revealed that 51.2% of Malaysians used e-commerce platforms to shop and sell online in the past 12 months. In the World Bank Group 2018 report, Malaysia came in at number two in the Southeast Asian region after Singapore in terms of percentage of e-commerce users. At the state level, Wilayah Persekutuan Putrajaya topped the list of e-commerce adoption at 70.5%, followed by Wilayah Persekutuan Labuan and Perlis at 60.5% and 44.5% respectively.

Local companies urged to make 'intelligent enterprise' transformation New Straits Times 3rd Jun 2019
Local companies have been encouraged to embrace latest technologies to better future-proof their business models and to make the transition into becoming 'intelligent enterprises'. Malaysia Digital Economy Corporation (MDEC) vice president (growth ecosystem development) Norhizam Kadir said with the Fourth Industrial Revolution (4IR) now in full-swing, companies can no longer second guess themselves as newer innovations continue to emerge and shake-up the existing state of affairs. “Industrial trends like artificial intelligence, machine learning and advanced analytics have already broken the proverbial glass ceiling as they move to digitise the world,” said Norhizam at the Asian Innovators’ Summit organised by SAP Malaysia Sdn Bhd and held in Kuala Lumpur recently.

2019 Malaysian ICT job market grows tepid; slowest salary growth in a decade Digital News Asia 30th May 2019
THE latest ICT Job Market Outlook in Malaysia report – published anually by the National ICT Association of Malaysia (Pikom) in collaboration with job portal JobStreet – brought with it a sense of gloom. The report found that while the ICT industry continues to grow in size and contribution to the economy, the pace of its growth is slower than the desired rate. The share of national gross domestic product (GDP) by the industry increased by only 0.1 percentage point to 18.3% in 2017, from 18.2% in 2016. It’s certainly not fast enough to hit 20% of GDP by 2020 – the report noted that the 11th Malaysia Plan envisioned a growth rate of at least 17% per annum from 2016 to 2020 in order for the industry’s GDP contribution to reach the 20% milestone.

Dr M worried about job losses from planned Telenor, Axiata merger The Star Online 30th May 2019
Prime Minister Tun Dr Mahathir Mohamad has asked for more details on the planned merger of the Asian telecommunications operations of Norway's Telenor ASA and Axiata Group Bhd on concerns over potential job losses. Telenor and Axiata announced the move earlier this month to create a company with 300 million customers in nine countries. This is a result of Telenor merging its Asian assets -- Digi -- with Axiata. A representative for Dr Mahathir's office confirmed his concerns over job cuts after Bloomberg sought comment. The representative, who asked not to be named citing policy, didn't provide further details.

Infrastructure

Residents say 'no' to Khalid's win-win proposal on park project Free Malaysia Today 4th Jun 2019
Taman Tun Dr Ismail (TTDI) residents have rejected a win-win proposal on the controversial Taman Rimba Kiara development project put forward yesterday by Federal Territories Minister Khalid Abdul Samad, saying it is “tainted by a RM160 million conflict of interest”. The response came following a video clip Khalid posted on his Facebook page, proposing a solution where “everyone gets something”. In the 2.46-minute recording, Khalid said that under the proposal, Malton Berhad, the developer of a high-rise project next to Taman Rimba Kiara, would get “half a development” than what it had proposed previously.

Dr M: Govt will conduct six-month study on RTS viability The Star Online 30th May 2019
The Government will conduct a six-month study on the Johor Baru-Singapore Rapid Transit System Link (RTS) project to determine whether it would be beneficial to the country, says Prime Minister Tun Dr Mahathir Mohamad. "The previous government entered into some kind of agreement on several projects in Malaysia. "We felt that the contracts were overpriced and there was some evidence of corruption and we decided long before we became the government to do away with the projects. "However, doing away with the projects or cancelling them would involve very high compensation," he said at the Foreign Correspondents' Club of Japan in Tokyo, Japan on Wednesday (May 30).

Rising confidence in govt initiatives? New Straits Times 30th May 2019
Is the current poor market sentiment a domino effect from the various cooling measures implemented by the previous government to curb speculation and runaway inflation on property prices? Among the measures implemented since 2010 were interest rate hikes, abolishment of Developer Interest Bearing Scheme (DIBS), raising the Real Property Price Index, raising the minimum property purchase price for foreign investors from RM500,000 to RM1 million, and introducing the maximum 70 per cent Loan-To-Value for third residential mortgage loan onwards. Market consultants said these measures, especially the removal of DIBS and interest rate hikes, had caused a knee-jerk reaction and the market to go downhill.

Kg Baru redevelopment: Settlement to boast high-rise dwellings New Straits Times 30th May 2019
The new redevelopment plan for Kampung Baru (Kg Baru) in Kuala Lumpur will have 83 million sq ft of residential and commercial floor space, says Kampung Baru Development Corp (KBDC) chief executive officer Zulkurnain Hassan. He said 70 per cent of the floor space would comprise residential dwellings and 30 per cent would be iconic corporate towers and retail complexes. Zulkurnain said Kg Baru would no longer have landed houses, except for a few “kampung” houses which would be duplicated in a public area in order to preserve the history of the 120-year-old settlement. 

Travel & Tourism

Tough terrain for Malaysia's tourism industry The Edge Markets 6th Jun 2019
This article first appeared as 'Tough terrain for tourism' in the May 27, 209, 2019 issue of The Edge Malaysia. In 2016, an Indian national’s 8 days/7 nights holiday to Malaysia with his wife, parents and a child through klia2 would have cost him RM250 in passenger service charge (PSC). Today, the same holiday would cost the five-member family from India RM505. And from Sept 1, the various levies imposed could set them back by RM755 — equivalent to the cost of a flight ticket from India. This is the result of a slew of tourism-related charges and levies imposed since September 2017 and a departure levy scheduled to commence in September this year (see Table 1).

Malaysia Airlines CEO objects to shutting down airline The Star Online 3rd Jun 2019
Malaysia Airlines should not be shut down, according to its CEO, Izham Ismail as he believed it would incur high costs and also impact its 13,500 employees. “Shutting down Malaysia Airlines would be a wrong move. This is my personal opinion,” Izham was quoted as saying in Seoul by various reports. He opined that shutting down the flag carrier not only incur high costs and impact its 13,500 staff, but also those in the supply chain such as suppliers, vendors and aircraft lessors.

Asean tourists visiting Malaysia down seven per cent in 2018 The Phenom Penh Post 30th May 2019
The total number of Asean tourists visiting Malaysia declined by seven per cent last year due to a lower number of tourists from Singapore and Brunei. Asean tourists made up of 70.1 per cent of the total number of tourists visiting Malaysia but traffic congestion at Malaysia-Singapore customs checkpoint as well as intense competition in the tourism industry have led to declines. Malaysia is currently working to implement visa-on-arrival for India and Chinese tourists and correct their traffic congestion issues at custom checkpoints.

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