Today's Pick (31/05/12/092/786) Malaysia moves up to 14th most competitive economy in the world

Malaysia moves up to 14th most competitive economy in the world

KUALA LUMPUR: Malaysia has moved up two spots from 16th to 14th most competitive economy in the world in the Institute for Management Development's (IMD) World Competitiveness Yearbook (WCY) 2012 survey.

The survey showed that Malaysia's competitiveness ranking was now ahead of countries such as Australia (15th), Britain (18th), South Korea (22nd), China (23rd), Japan (27th) and France (29th).

The IMD survey assessed countries according to four main competitiveness factors: economic performance, government efficiency, business efficiency and infrastructure. The WCY rankings measure how well countries manage their economic and human resources to increase their prosperity and 59 countries were surveyed this year.

“Malaysia registered significant improvements in the business efficiency category (sixth position from last year's 14th) and in the government efficiency category (13th from 17th). Ranking improvements were recorded in the sub-categories of business productivity and efficiency, finance, business legislation, and societal framework,” the International Trade and Industry Ministry (MITI) said in a media statement.

“In economic performance category, although Malaysia maintains its top 10 ranking, its position slipped by three places from last year's seventh ranking. This is attributable to slower employment growth and concerns over rising prices,” MITI said.

It added that Malaysia marginally improved its ranking to 26th position from 27th position in the infrastructure category and highlighted the areas of concern were health and the environment, education and scientific infrastructure.

“We recognise there are areas where improvements in our competitiveness can still be made. Special attention will be given to address these concerns. Our overall objective remains the same: to achieve a top 10 ranking in the near future,” it noted.

The most competitive of the 59 ranked economies in 2012 were Hong Kong, the United States and Switzerland, the IMD said.

Despite all its setbacks, the United States remained at the centre of world competitiveness due to its unique economic power, the dynamism of its enterprises and its capacity for innovation, IMD added.

“US competitiveness has a deep impact on the rest of the world because it is uniquely interacting with every economy, advanced or emerging. No other nation can exercise such a strong pull effect' on the world. Europe is burdened with austerity and fragmented political leadership and is hardly a credible substitute, while a South-South bloc of emerging markets is still a work in progress,” said director of IMD's World Competitiveness Centre Professor Stephane Garelli.

“The recession has made the world economy more fragmented and diverse than ever, forcing companies to operate several parallel business models.

”Emerging economies are relying on domestic demand and national champion companies to insulate themselves from economic turmoil, while the submerging' developed economies are turning to re-industrialisation. In both cases, economic nationalism is back and protectionism is tempting,” Garelli added.

Source : The Star

Date : 31 May 2012

Today's Pick (31/05/12/092/786)

Today's Pick (30/05/12/091/785) Govt strong supporter of branding

Govt strong supporter of branding

KUALA LUMPUR: The government is a strong supporter of the private sector's efforts in branding as the country itself commands a strong brand internationally.

Minister of International Trade and Industry Datuk Seri Mustapa Mohamed said the government recognises that businesses are more successful and make more profit when they develop propriety brands rather than sell commodity products.

"The government will continue to be supportive of our businesses' efforts in this area in future and especially as they seek to establish bridgeheads in foreign markets.

"Under the ministry, we have implemented several programmes over the years to encourage local entrepreneurs to invest in developing their brands, for local market as well as for export," he said in his address at the 2012 Reader's Digest Trusted Brands Award last night.

Mustapa said there are several programmes under the ministry's agencies like SME Corp Malaysia and Malaysian External Trade Development (Matrade) which support branding initiatives by local companies.

The minister said branding has become an important tool in realising national goals as the country transforms to one offering higher value added products and services.

He said Malaysia has established a strong brand overseas with its tourism tagline "Malaysia, Truly Asia".

"And within the country, all of us realise the positive impact of the IMalaysia brand," he added.

Meanwhile, Reader's Digest managing director (Asia-Pacific) Walter Beyleveldt said the true measure of success for a brand is the extent to which it wins and keeps the trust of consumers over time.

"Winning Reader's Digest Trusted Brands Award is the ultimate seal of consumer approval," he said.

The Reader's Digest Trusted Brands Awards 2012 showed local brands rulewhen they bagged 23 out of 43 categories, which include the financial sector, telecommunications sector, cars and property development.

Among the winners were Petronas, Telekom Malaysia, Maybank, Perodua, Sime Darby Property, Universiti Teknologi MARA (UiTM), Pantai Hospital Kuala Lumpur and Public Mutual.

Source : New Straits Times

Date : 30 May 2012

Today's Pick (30/05/12/091/785)

Today's Pick (29/05/12/090/784) Retailers group offers internships to students

Retailers group offers internships to students

PETALING JAYA: Malaysian Retailer-Chains Association (MRCA) is offering 8,000 internships to students at its members' outlets.

The association currently has more than 200 members with 10,000 stores nationwide, which include Nelson's, Poh Kong, OSIM, Secret Recipe and 7-eleven.

MRCA has teamed up with SEGi University College and Universiti Utara Malaysia (UUM) to launch Wholesale and Retail Industry Centre of Excellence (ICoE).

Higher Education Minister Datuk Seri Mohamed Khaled Nordin said the ICoE was initiated in support of the Economic Transformation Programme.

Last year, four ICoE's were launched in the electric and electronic, and automotive industries. The development of the ICoE is focused on building human capital from school leavers right up to degree holders.

MRCA president Datuk said: “The current workforce in the retail industry is at 80% capacity. It is not at 100% yet, therefore there is a potential for this area in the retail industry to grow.”

He said it was important for students to have working experience so that they were exposed to the working world even before graduating from university.

“We need to make sure they are comfortable with the pay in the duration of the internship, which is usually three to four months. It also depends on location of the outlet. We want to tell the students that there is a career path available in retail.

“We are highlighting that there is career advancement in this industry. We will build them to become capable retail leaders,” Kwok said.

With SEGi providing the platform for connecting with the students and with cooperation from UUM, MRCA's role is to provide the educators with feedback within the industry.

“We expect the retail industry to grow by 5% this year,” Kwok said. Last year, it grew by 4.5%. 

MRCA hopes to increase the number of internships offered to students in 2013 to 8,800 with 11,000 outlets, 9,600 students in 2014 with 12,000 outlets and 10,400 students in 2015 with 13,000 outlets.

Source : The Star

Date : 29 May 2012

Today's Pick (29/05/12/090/784)

Today's Pick (25/05/12/090/784) RM100,000 boost for SME export development

RM100,000 boost for SME export development

GOVERNMENT GRANT: RM52 million allocation for this year, says minister

THE Market Development Grant (MDG), which provides a matching grant to assist small- and medium-sized enterprises (SMEs) undertake promotional activities for the development of exports, will be raised from RM30,000 to RM100,000 effective from July 1 this year.

International Trade and Industry Minister Datuk Seri Mustapa Mohamed said the government has set aside RM52 million for this year's MDG.

"Last year, the allocation stood at RM20 million with a total of 1,300 companies benefiting from it. But this year from July onwards, we will increase it to RM52 million," he told reporters after launching the Trade Financing Seminar for SME Exporters yesterday.

He said up to April 30 this year, 631 SMEs have utilised the grant, which is managed by Malaysian External Trade Development Corporation (Matrade).

Under the MDG, companies will be reimbursed up to 50 per cent of the total cost incurred by them when they attend trade fairs abroad.

Mustapa said the new allocation would allow SMEs to claim for overseas supermarket or hypermarket listing fee; international patent, trademark and intellectual property registration, international certification overseas and initial set-up cost of representative office overseas for service providers.

He said that services companies with annual sales turnover of less than RM25 million (previously less than RM5 million) and with fewer than 150 employers (previously 50 employees) would be eligible to apply for these grants online.

On Malaysia's trade with China, Mustapa said it has not been badly affected by the economic slowdown in both China and Europe.

"Trade (overall) will still grow between five and six per cent per annum this year. That is our forecast for the whole year," he said.

On the first quarter gross domestic product growth (GDP) of 4.7 per cent announced by Bank Negara Malaysia recently, Mustapa said that he was optimistic despite the present economic uncertainties.

"Malaysia recorded a rather encouraging performance in private investment. This is a good showing and reflects mature investment," he said.

However, the first quarter GDP growth of 4.7 per cent was lower when compared with the 5.1 per cent growth recorded in the same quarter of last year and the 5.2 per cent growth registered in the fourth quarter of 2011.

Source : New Straits Times                  Date : 25 May 2012

 

Today's Pick (25/05/12/090/784)

afternoon highlight (31/05/12/095/531) Malaysia set to show strong economic performance: Oxford Business Group

Malaysia set to show strong economic performance: Oxford Business Group

KUALA LUMPUR: Despite an uncertain international climate, Malaysia is set to put in another strong economic performance this year, says research consultancy Oxford Business Group (OBG).

While growth is not expected to hit the heights achieved in recent years, a rate of between 4.0 and 5.0 per cent would serve to keep Malaysia on the right track, it said in its latest country review of Malaysia.

In May, the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) announced a forecast 4.5 per cent growth in 2012, down somewhat from 5.1 per cent last year and 7.2 per cent in 2010. 

 

This, OBG pointed out, was broadly in line with most expectations: in March, Bank Negara Malaysia (BNM) forecast a growth of between 4.0 and 5.0 per cent while the International Monetary Fund (IMF) put the figure at 4.0 per cent.

 

Prof Dr Mohamed Ariff Abdul Kareem, a professor at the Kuala Lumpur-based Global University of Islamic Finance, commented that Malaysia's economy would be driven both by private consumption at home and commodity exports.

 

Oliver Paddison, the economic affairs officer at ESCAP, said countries in the Asia-Pacific area need to increase regional cooperation and realign their economies to increase domestic consumption. 

 

"This will help offset the effects of a potential drop in exports to the developed world, which has been suffering the effects of debt and growth crisis," he said.

 

OBG said Malaysia was already successfully moving in this direction, building trade with fast-growing emerging markets and supporting domestic demand. 

 

China is now Malaysia's largest trading partner, behind Singapore. Overall, exports grew 7.1 per cent, year-on-year, in the first two months of 2012, according to official figures.

 

OBG said the IMF reported in February that Malaysia's "growth remains supported by robust consumption and investment", praising "the ambitious reform agenda to boost potential growth, based on comprehensive diagnoses of the bottlenecks that hinder investment and productivity."

 

The IMF noted that Malaysia was implementing a number of strategic plans to boost productivity and growth in order to achieve its goal of becoming a "developed country" by 2020. 

 

These include the New Economic Model (NEM) and Economic Transformation Programme (ETP), which lay out reforms to increase the private sector's role in driving growth and expanding value-added sectors in which Malaysia has competitive advantages. 

 

Extensive infrastructure investments and urban and rural development plans would also support the economy's long-term trajectory.

 

OBG said investors remain confident about the outlook for Malaysia. A May survey by international investment management firm, Franklin Templeton, found that 44 per cent of Malaysian investors felt the domestic economy was improving, while only 24 per cent felt it had worsened.

 

The research consultancy said foreigners were similarly upbeat: official figures show that foreign investment grew 12.3 per cent in 2011 to RM33 billion (US$10.59 billion). 

 

This has been spurred largely by the implementation of the NEM and ETP, as well as, closer ties with other countries in the region.

 

Bank Negara Malaysia Governor Tan Sri Dr Zeti Akhtar Aziz had said that domestic demand and investment by the private sector remained "highly robust", despite global difficulties and some local inflationary pressures. 

 

Inflation is expected to be between 2.0 and 3.0 per cent this year, underlining Malaysia's reputation for macroeconomic stability, developed since the 1997-98 Asian financial crisis, OBG said.

 

While the outlook for this year and beyond was indeed positive, OBG also said officials and analysts are aware of the challenges Malaysia must tackle to continue its growth path.

 

In the IMF's view, foremost among these is the need to maintain fiscal consolidation. 

 

The budget deficit is expected to be around 5.1 per cent, down from 5.5 per cent in 2011, but unsustainable in the long-term, particularly given the country's relatively high public debt.

 

Over-reliance on oil and gas income (which contribute around 40 per cent of the government's revenue) and an unwieldy subsidy regime (which costs about 4.0 per cent of GDP) are issues that the government will have to address to strengthen its fiscal position in the future. 

 

Subsidy cuts proposed in 2011 are currently on hold due to concerns regarding the effect on inflation.

 

As the IMF stated, Malaysia has done well to bring down the deficit in recent years. 

 

To continue its growth path, OBG said Malaysia aimed to push on with its ambitious reform and investment programmes, which should strengthen the business environment, broaden and deepen its export markets, and accelerate diversification. -- BERNAMA

Source  : New Straits Times

Date : 31 May 2012

afternoon highlight (31/05/12/095/531)

Today's Pick (25/05/12/090/784) Construction sector shows marginal growth of 4% for 1Q

The Malaysian Reserve
21 May 2012

afternoon highlight (30/05/12/094/532) Hong Leong Bank eyes SME business

Hong Leong Bank eyes SME business

KUALA LUMPUR: Hong Leong Bank Bhd is setting its sights on the country's small and medium enterprises (SMEs) sector now that the merger with EON Capital has been completed.

“If you look at the contribution of SMEs to the economy, ours is at about 31% and is projected to reach 41% by 2020. There is still a long way for our SMEs to grow. In countries like Singapore, Hong Kong and Thailand, their contribution to GDP is far larger,” the bank's chief operating officer of group business banking Peter Chow told StarBiz at the sidelines of Invest Malaysia 2012.

“We have set up 49 of our branches to be turned into SME branches and by September we should have 51 of them,” he said, adding that 145 branches would eventually be set up.

“In terms of coverage we have the edge over our competitors. SMEs' needs are rather simple, such as term loans to buy machinery or for working capital, so the key is a fast turnaround time.”

According to the bank's group managing director and chief executive Datuk Yvonne Chia, the crux of the strategy was “for our people to go down to the ground because the infrastructure will be there.”

“In many ways our SMEs have become global SMEs, which speaks very well for the Malaysian business psyche. I've seen a lot of our clients reach that calibre,” she said.

Hong Leong Bank ranks second in Malaysia in terms of its branch network, and post-acquisition of EON Cap, the fourth largest bank by assets and customer deposits.

Chia is also upbeat that the investments created by the Economic Transformation Plan would have a spillover effect on the SME sector.

“I hope to benefit from the supply chain, the mom and pop businesses that will be hired as the subcontractors from the various projects,” she said.

On Bank Negara's responsible lending guidelines, COO of personal financial services Moey Tan explained: “The new guidelines have definitely had their desired effect and have taken a toll on consumer loans in general. I don't think we've seen the full impact yet, we will see it in the next three to six months.”

Source : The Star

Date : 30 May 2012

afternoon highlight (30/05/12/094/531)

Today's Pick (24/05/12/089/783) Ekonomi negara berkembang 4.7 peratus

Ekonomi negara berkembang 4.7 peratus

Pencapaian suku pertama tahun ini melepasi jangkaan hasil permintaan domestik kukuh

EKONOMI Malaysia berkembang 4.7 peratus dalam tempoh tiga bulan pertama tahun ini, disokong oleh permintaan domestik yang kukuh walaupun sektor eksport adalah lebih perlahan berikutan persekitaran ekonomi dunia yang lembap.

Pencapaian suku pertama itu meletakkan negara ini pada landasan kukuh untuk mencapai sasaran pertumbuhan antara empat hingga lima peratus yang ditetapkan kerajaan bagi seluruh tahun ini.

Gabenor Bank Negara Malaysia, Tan Sri Dr Zeti Akhtar Aziz, berkata pertumbuhan pada suku pertama yang melepasi jangkaan itu dicatatkan di tengah-tengah penurunan eksport bersih negara sebanyak 20.8 peratus berbanding setahun lalu.

Gabenor Bank Negara Malaysia, Tan Sri Dr Zeti Akhtar Aziz, berkata pertumbuhan pada suku pertama yang melepasi jangkaan itu dicatatkan di tengah-tengah penurunan eksport bersih negara sebanyak 20.8 peratus berbanding setahun lalu.

“Bagi ekonomi Malaysia, permintaan domestik dijangka kekal kukuh, disokong pengembangan berterusan dalam kegiatan ekonomi sektor swasta serta perbelanjaan sektor awam,” katanya pada sidang media mengumumkan prestasi Keluaran Dalam Negara Kasar (KDNK) bagi suku pertama 2012 di Kuala Lumpur, semalam.

Permintaan domestik kekal berdaya tahan pada suku pertama tahun ini apabila berkembang sebanyak 9.6 peratus.

Pertumbuhan perbelanjaan swasta kekal kukuh pada 7.4 peratus, disokong khususnya oleh peningkatan pendapatan berterusan dan keadaan pasaran pekerjaan yang stabil serta dikukuhkan lagi oleh harga komoditi yang tinggi.

Ia juga disokong oleh sentimen pengguna yang semakin bertambah baik serta pemberian bantuan kewangan menerusi beberapa program sokongan pendapatan oleh kerajaan.

Sementara itu, perbelanjaan awam dalam tempoh tiga bulan pertama tahun ini meningkat 5.9 peratus dalam keadaan pengembangan berterusan dalam perbelanjaan emolumen serta bekalan dan perkhidmatan.

Zeti berkata, unjuran pertumbuhan ekonomi negara tahun ini kekal pada lingkungan empat hingga lima peratus selepas mengambil kira persekitaran ekonomi luar.

“Jika persekitaran luar semakin merosot, kita jangkakan ekonomi Malaysia akan berkembang di paras sekitar empat peratus, tetapi jika keadaannya berterusan seperti sekarang ia diunjur berkembang 4.5 peratus dan jika keadaan lebih baik, maka ekonomi negara mampu berkembang sehingga lima peratus,” katanya sambil menambah tinjauan untuk suku kedua dijangka sama seperti suku pertama lalu.

Beliau berkata, kadar dasar semalaman (OPR) yang dikekalkan pada tiga peratus dalam suku pertama mencerminkan keadaan monetari semasa yang terus menyokong kegiatan ekonomi negara.

“Kadar inflasi utama dijangka lebih sederhana tahun ini, namun risiko peningkatan inflasi yang berpunca daripada gangguan bekalan, khususnya bahan bakar dan komoditi masih kekal.

“Begitupun, permintaan domestik akan terus menjadi pemangkin pertumbuhan ekonomi dalam keadaan persekitaran luar yang tidak menentu ini.

“Melainkan berlaku perkembangan besar yang boleh mengakibatkan kesan buruk, maka kadar faedah semasa akan kekal,” katanya.

Kadar inflasi negara susut daripada 3.2 peratus pada suku keempat tahun lalu kepada 2.3 peratus dalam tempoh tiga bulan pertama tahun ini.

Zeti turut menegaskan bahawa Malaysia memiliki jumlah kecairan serta kadar simpanan tinggi yang boleh membantu menyerap sebarang tekanan dari luar.

Ini diperkukuhkan lagi oleh tebaran hutang negara yang mana 96 peratus adalah dari domestik dengan hanya empat peratus saja adalah dari sumber luar, iaitu mewakili sekitar dua peratus kepada nilai KDNK.

“Justeru, kita tidak mempunyai pendedahan yang besar seperti negara lain,” katanya.

Source : Berita Harian                  Date : 24 May 2012

Today's Pick (24/05/12/089/783)

afternoon highlight (29/05/12/093/529) Perbadanan Nasional aims to develop more franchise entrepreneurs

Perbadanan Nasional aims to develop more franchise entrepreneurs

KUALA LUMPUR: Some people are contemplating making it out on their own, whether forced by uncertainty in economy, unpredictable career prospects or constantly being frustrated with the job market.

For some, entrepreneurship is the best option to build wealth and do something that one loves without answering to somebody else.

"There is nothing like having your own business and enjoying the rewards that go along with it," said Perbadanan Nasional Bhd (PNS) managing director Syed Kamarulzaman Syed Zainal Khodki Shahabudin.

He added, "When you think about an entrepreneur, you most likely picture a person who is extremely busy and always on the go."

However, Syed Kamarulzaman said entrepreneurship does not mean one has to be a slave to work. Rather, one has to be a good manager of how to use one's time wisely and efficiently.

"Being an entrepreneur means your actions and efforts dictate the potential outcome of your journey," he said in an interview with Business Times recently.

Entrepreneurs are important for the country's economic growth and according to Syed Kamarulzaman, schools and universities should do more to encourage entrepreneurship among the young people.

"We have people with potential in our own country and I think more needs to be done at an earlier stage to nurture new business talent in the education system.

"We need to help young people to become more employable and develop practical skills that can make a difference between a slide into benefit dependency and a ladder to economic opportunity," he said.

Syed Kamarulzaman said PNS aims to develop more franchise entrepreneurs to drive the growth of the country's franchise industry.

"One of the main objectives of PNS is to develop local products and market them abroad," he said, adding that through franchise, small and medium entrepreneurs will have a wider reach of their products and customer base as well as penetrate international markets.

To propel the local franchise business to a higher level and encourage more SMEs into the business, PNS has introduced a scheme called micro franchise.

"Through micro franchise, SMEs can venture into any kind of franchise business with a minimum capital outlay of about RM50,000 and they need not have a wide business experience," Syed Kamarulzaman said.

Under this scheme, the established franchise players are required to come out with smaller and affordable franchise concepts like the kiosk concept to encourage people to participate in the business. Prospective franchisees can enjoy a low interest rate of three per cent for loans.

"This will also encourage local franchise businesses to expand their wings abroad and benefit the country in terms of inflow of funds from royalties received," he said.

Currently, there are 48 franchise brands under this scheme. Among them are Sugarbun, Nelson's and Marrybrown Fried Chicken.

Source : New Straits Times

Date : 28 May 2012

afternoon highlight (29/05/12/093/529)

Today's Pick (23/05/12/088/782) Research houses put Q1 GDP growth at 4.26pc

Research houses put Q1 GDP growth at 4.26pc

Malaysia's economy may have grown by as much as 4.26 per cent in the first quarter of this year, a poll conducted by BusinessTimes shows.

The country’s gross domestic product (GDP)performance for the first three months of 2012 will be announced today.

A poll of 22 research houses expect the Malaysian economy to have grown by 4.26 per cent in the first quarter of 2012.

Most of them have, however, kept their outlook for 2012 and 2013 unchanged, with GDP growth averaging at 4.43 per cent and 5.16 per cent, respectively Domestic demand is likely to be growth driver for the first quarter period, helping to pick the slack from the weak external demand for Malaysian exports.

Bank Negara Malaysia governor Tan Sri Zeti Akhtar Aziz is set to release the details this afternoon.

OCBC economist Gundy Cahyadi said exports growth at 4.4 per cent (year-on-year) has outperformed expectations in the first
quarter, despite the somewhat disappointing March numbers.

“As it is, domestic demand has remained relatively constructive, especially with fiscal expenditure likely to remain robust in
the period.”

OCBC recently upgraded its 2012 GDP growth outlook to 4.2 per cent from 3.8 per cent previously.

“That said, plenty of risks are in the way, especially with the recent return of risk aversion likely to weigh on commodity prices - and this will directly hit Malaysia’s export earnings going forward,” Cahyadi said.

He pointed out that while there is still relatively high fiscal spending growth in the economy, this can actually be seen as a slight negative, if the private sector fails to keep up the pace.

Credit Suisse economist Santitarn Sathirathai is also forecasting the first quarter growth data to surprise significantly on the upside.

“We think the upside surprise in the first quarter is likely to be followed by a soft reading in the second quarter, reflecting weak Western world demand and possibly inventory correction.”

However, he said domestic demand should remain robust for a while longer, owing to the government’s pre-election pump-priming
measures and the initial effects of the Economic Transformation Programme.

A solid first quarter growth, Santitarn said, could not only increase the chances of general election soon but would also provide some comfort to Bank Negara from cutting the policy rate, amid growing concerns over Europe and softening external environment.

But Credit Suisse expects Bank Negara to intervene in the forex market to prevent the ringgit from outperforming its peers in the near term in an environment of strong domestic demand and soft manufacturing exports.

Tai Hui of Standard Chartered Bank remarked that market optimism early in the year about strong global growth in the first quarter now looks like misplaced euphoria.

"The first quarter GDP data from Thailand and Malaysia this week should confirm our view of soft growth in the first half of 2012, with improvement in the second half of the year."

For Malaysia, moderating headline growth is partly the result of a strong performance in 2011, but he noted that the country's export performance has dipped, even as domestic demand is holding up well.

US investment bank Citi says that manufacturing is likely to moderate in line with industrial production which has seen its first quarter average easing to 4.4 per cent from 5.3 per cent in the fourth quarter.

"A stabilisation of the previously soft electrical and electronics production was likely to be offset by continued weakness in motor vehicle production on supply disruptions and weak demand post-credit tightening measures on November 11," said the bank.

While mining will likely be less of a drag on the economy, it expects agricultural output to be soft, dragged down by weak crude palm oil and rubber production.

Services posted a mixed performance, with a slight moderation in consumption related and domestic demand (especially consumption) is holding up well, it added.

Source : The News Straits Times

Date : 23 May 2012
 Today's Pick (23/05/12/088/782)

afternoon highlight (24/05/12/092/528) Malaysia moves up six positions

Malaysia moves up six positions

MALAYSIA moved up six positions to 21st last year in the latest Geneva-based World Economic Forum's Global Enabling Trade Report (GETR) 2012 ranking, which covers 132 countries.

"This ranking places Malaysia among the top 20 per cent of global trade-enabled economies," International Trade and Industry Minister, Datuk Seri Mustapa Mohamed said in a statement yesterday.

In the Asia-Pacific region, Malaysia is ranked 6th (from 8th last year) ahead of Taiwan (7th) and South Korea (8th).

The top 10 most trade-enabled economies are Singapore, Hong Kong, Denmark, Sweden, New Zealand, Finland, Netherlands, Switzerland, Canada and Luxembourg.

Mustapa said Malaysia registered the biggest improvement in the business environment category, achieving an improved ranking of 21 positions to 30th from 51st position in 2010.

"This is attributed to improvements in efficiency of the financial market (8th), the strong business impact of rules (11th), strong domestic competition (13th) and solid property rights (24th)," he said.

According to WEF Report, Malaysia's improved ranking reflects the impact of the measures undertaken by the government over the last two years to improve the competitiveness of the Malaysian economy.

These wide-ranging measures include improvements in the delivery and efficiency of public services, and increased transparency and accountability.

The findings are based on an analysis of four enablers of trade namely business environment, market access, border administration and transport and communications infrastructure.

Mustapa said the government welcomes the findings of the WEF Report, and will continue with the transformation programme to make Malaysia one of the most competitive nations in the world.

Source : New Straits Times

Date : 24 May 2012

afternoon highlight (24/05/12/092/529)

Today's Pick (22/05/12/087/781) Motor vehicle sales decline to 47,736 units in April

The Malaysian Reserve
21 May 2012

afternoon highlights (23/05/12/091/527) Usaha lahir ramai usahawan berdaya saing tanpa bantuan

Usaha lahir ramai usahawan berdaya saing tanpa bantuan

KERAJAAN mahu melihat kemunculan lebih ramai usahawan yang maju dan berdaya saing tanpa mendapatkan banyak bantuan serta sokongan sejajar dengan peralihan negara kepada ekonomi berpendapatan tinggi menjelang 2020.

Menteri Kewangan Kedua, Datuk Seri Ahmad Husni Hanadzlah, berkata perubahan itu penting dalam mewujudkan keyakinan baru dan semangat jitu di kalangan usahawan tempatan bagi memperlengkapkan diri mereka untuk menjadi pemimpin dan bukannya sebagai pengikut di pasaran.

“Sehingga 2020, kita akan melalui satu perubahan yang ketara dalam ekonomi negara dan kerajaan yakin lapan tahun ini akan menjadi tempoh kegemilangan bagi Malaysia.

Sehingga 2020, kita akan melalui satu perubahan yang ketara dalam ekonomi negara dan kerajaan yakin lapan tahun ini akan menjadi tempoh kegemilangan bagi Malaysia. Dalam tempoh ini, negara akan mewujudkan kekayaan baru dan ia akan menjadi tempoh penting di mana akan muncul pemimpin korporat baru dan peneraju industri yang memacu ekonomi berpendapatan tinggi negara. - Datuk Seri Ahmad Husni Hanadzlah, Menteri Kewangan Kedua.

“Dalam tempoh ini, negara akan mewujudkan kekayaan baru dan ia akan menjadi tempoh penting di mana akan muncul pemimpin korporat baru dan peneraju industri yang memacu ekonomi berpendapatan tinggi negara,” katanya.

Beliau berkata demikian pada sidang media selepas merasmikan Persidangan Pengarah Antarabangsa 2012 yang bertemakan Membangunkan Usahawan Korporat ke Arah Ekonomi Berpendapatan Tinggi, di Kuala Lumpur semalam.

Hadir sama, Pengerusi Akademi Pengarah Malaysia (MINDA), Datuk Ahmad Pardas Senin dan Ketua Eksekutifnya, Datuk Abdul Aziz Abu Bakar serta Ketua Eksekutif Institut Strategi dan Kepemimpinan Asia (ASLI), Datuk Michael Yeoh.

Ahmad Husni berkata, Malaysia kini dalam proses beralih kepada revolusi perindustrian ketiga dan bagi tujuan itu, sektor pengilangan dan perkhidmatan perlu meningkatkan rantaian nilai masing-masing bagi mencapai matlamat itu.

Beliau berkata, revolusi itu memerlukan usahawan untuk mengembangkan keupayaan dalam penyelidikan dan pembangunan (R&D), menambah nilai kepada produk dan perkhidmatan serta meningkatkan capaian kepada persaingan yang lebih tinggi.

“Malaysia sebelum ini telah berjaya melalui revolusi perindustrian dan menerusi fasa ketiga ini dengan tumpuan diberikan kepada teknologi telekomunikasi, tenaga serta laluan hijau.

“Sejak dua tahun yang lalu, kerajaan telah bersedia dengan membangunkan persekitaran kondusif menerusi dasar, institusi dan rangka kerja perundangan bagi memastikan syarikat swasta dapat memulakan revolusi perindustrian ketiga ini,” katanya.

Dalam pada itu, Ahmad Husni berkata, kerajaan sudah memperkenalkan beberapa inisiatif bagi membangunkan usahawan termasuk penubuhan Unit Peneraju Agenda Bumiputera (TERAJU) untuk meningkatkan keupayaan usahawan Bumiputera serta Laluan Hijau bagi memberi kemudahan akses kepada usahawan.

Katanya, kerajaan juga telah mewujudkan Projek Permulaan (EPP) dalam Bidang Ekonomi Utama Negara (NKEA) dengan mengenal pasti inovasi pasaran sedia bagi pelabur untuk menyertainya dan kesemua langkah berkenaan bertujuan menjadikan usahawan sebagai penggerak kepada ekonomi baru negara.

Source : Berita Harian

Date : 22 May 2012

afternoon highlights (23/05/12/091/527)

Today's Pick (21/05/12/086/780) SMEs new credit source

SMEs new credit source

Business lending on the rise with roll-out of ETP jobs

PETALING JAYA: With consumer loans under pressure from the new lending guidelines, banks are tapping a new source of credit growth in lending to small and medium enterprises (SMEs).

Business banking is the next trend to watch as banks get prepared to finance the smaller jobs under the Economic Transformation Programme (ETP) and contract financing by SMEs.

Consumer loans will still be the biggest contributor to income, said Affin Bank chief corporate strategist Nazlee Khalifah. But SME lending will be more prominent in almost all banks portfolio at least for the next three to five years under ETP jobs and contract financing.

Affin is looking at more SMEs to beef up our contract financing business, Nazlee told StarBiz.

Previously, we were focussing on corporate which is the safer side of lending. We were in a recovery stage then. But now that we are on more stable footing, we can be more aggressive and take a bit more risk.

The margins in business banking are slightly higher than in corporate banking and help to counter the fall in consumer margins.

The jobs involved are mainly small to mid-sized of around RM10mil to RM20mil each. The source of payment is secured and usually prompt upon completion of the job, as specified. These companies are mainly assessed based on their capability to perform the jobs, and are likely to be already known to the banks.

The consumer loans market has become crowded, said Pong Teng Siew, head of research at Interpac Securities. The property market may experience a peak, after which it may slow down or flatten off.

Business loans are more capital intensive - the capital allocated to support such lending is usually higher than for consumer loans. They are also more difficult to tap than consumer loans.

OCBC Bank sees the way forward not just in the building up its business banking business - the bank is said to be beefing up its contract financing unit - but in drawing up a diversified portfolio. Banks should aim to build diversified portfolios as the revenue prospects and risk profiles of different loan/business segments can counter-balance one another, said OCBC Bank Malaysia country chief risk officer Choo Yee Kwan.

As an example, corporate lending and project financing are largely cash flow-based whilst lending to the small and medium-sized businesses are mainly on secured basis.

Within consumer lending, residential mortgage financing is a secured portfolio whilst personal financing and cards are largely extended on an unsecured basis.

To complement corporate lending, project/contract financing, SME and consumer lending, banks will add on growing opportunities in treasury business, investment banking, wealth management plus other structured products for both individuals and businesses.

It will bring additional opportunities if banks are able to distribute bancassurance/ unit trust products and offer Islamic financing products and services.

Banks that have regional networks would be able to provide their customers with cross-border support, particularly in foreign locations where the bank has subsidiaries, branches or offices on the ground.

Choo: ‘A diversification approach to loan exposures/ revenue opportunities avoids portfolio concentration risks.’

A diversification approach to loan exposures/revenue opportunities avoids portfolio concentration risks, Choo said.

Within consumer banking, there could be some diversification between residential mortgage lending (on secured basis but there has been spread compression in the industry) and personal loans which are typically unsecured but the returns currently appear to be better.

However, growth may not be a priority anymore as we could be in the stage of the credit cycle which involves margin preservation and monitoring of asset quality, said an analyst from a foreign research house.

Other areas of credit growth involve ways to improve non-interest income which are basically non-capital intensive revenue opportunities. Foreign exchange is an obvious area for hedging opportunities, the analyst said

Source : The Star

Date : 21 May 2012

Today's Pick (21/05/12/086/780)