Tuesday, June 5th, 2018
PETALING JAYA: Exports grew 14% to RM84.2 billion in April 2018 from a year ago, driven by electrical and electronic (E&E) products, refined petroleum, crude petroleum, timber and timber-based products, palm oil and palm oil-based products, while liquefied natural gas (LNG) and natural rubber recorded decreases in export volume and average unit value.
This is the second highest monthly export value recorded for the year after March's exports of RM84.5 billion.
Imports expanded by 9.1% from a year ago to RM71.2 billion, supported mainly by capital goods, as intermediate goods and consumption goods imports fell.
Malaysia's total trade grew 11.7% from a year ago to RM155.4 billion in April, bringing the total trade balance to a surplus of RM13.1 billion (50.9%), according to the Statistics Department.
FXTM global head of currency strategy & market research Jameel Ahmad said the annualised 14% growth in exports for April will certainly help provide positive momentum for the country's second quarter gross domestic product (GDP), which is expected to continue growing above 5%.
He noted that this will take away some concerns in the manufacturing sector which experienced the biggest decline in new orders since late 2016 and reduce risks, which could weigh down GDP prospects.
Re-exports were valued at RM20.1 billion (+84.3%) in April and accounted for 23.9% of total exports. Domestic exports increased RM1.2 billion (1.8%) to RM64.1 billion.
On a month-on-month (m-o-m) basis, Malaysia's total trade in April saw an increase of RM1.2 billion or 0.8% from March, while the trade surplus stood 11% or RM1.6 billion, lower.
Meanwhile, on a m-o-m basis, April exports decreased 0.3% or RM224.7 million from RM84.5 billion in March, mainly attributable to decreases in mineral fuels (1.3%) followed by animal and vegetable oils and fats (0.7%) and inedible crude materials (0.5%). However, in seasonally adjusted terms, exports registered an increase of 9.5%.
Imports rose RM1.4 billion or 2.0% from RM69.8 billion contributed by consumption goods although on a seasonally adjusted terms, imports increased RM6 billion (8.8%) to RM74 billion.
PETALING JAYA: Ekovest Bhd said today it has lost the much-coveted RM2.11 billion contract to build the longest stretch of the Pan Borneo Highway after the project delivery partner, Lebuhraya Borneo Utara Sdn Bhd (LBU), vetoed the sub-contracting of the award obtained by Samling Resources Bhd in 2016.
In a filing with Bursa Malaysia, Ekovest said it received a letter on Monday from Samling Resources, informing them that LBU has not consented for the project to be sub-contracted to the JV company.
As such, Samling Resources is claiming that the JV company cannot carry out the project and that the JV agreement is now void. LBU is the project delivery partner for the Pan Borneo Highway project.
“We are reserving our rights in relation to the above matter and are seeking advice and will take all necessary action as may be required,” said Ekovest.
It does not expect the matter to have any material effect on the operations and financials of the group.
In December 2016, Samling Resources was awarded two packages under the project, one of which was Sematan to Sungai Moyan bridge plus Kuching-Serian roundabout interchanges stretch, covering 95.4km, the longest of the 11 stretches of the highway project.
This package involves the construction of six interchanges, 22 bridges, nine pedestrian bridges and 93 bus shelters along that stretch of road.
In January 2017, Ekovest’s wholly owned subsidiary Ekovest Construction Sdn Bhd entered into a JV and shareholders agreement with Samling Resources for the proposed project.
Under the agreement, Samling Resources would hold a 70% stake in the JV company, Samling-Ekovest JV Sdn Bhd while Ekovest would hold the remaining 30%.
It was reported that Samling Resources would sub-contract the project in its entirety to Samling-Ekovest at the same price at which the project was awarded to Samling Resources.
On Bursa Malaysia today, Ekovest was up 2.48% or 1.5 sen, to 62 sen on volume of 17.8 million shares.
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PETALING JAYA: Finance Minister Lim Guan Eng said today the board of directors of Suria Strategic Energy Resources Sdn Bhd (SSER) and Tan Sri Irwan Serigar in particular are responsible for the one-sided terms of the three-year long Trans-Sabah Gas Pipeline and Multi-Product Pipeline projects, which saw 88% of the project value drawn down based on timing milestones that were just months apart, resulting in the bulk of the monies paid out within a year.
Irwan was Treasury secretary-general and chairman of SSER.
According to the payment schedule released by the Ministry of Finance (MoF) today, the RM5.35 billion Multi-Product Pipeline (MPP) project saw a drawdown of RM2.67 billion for the design, procurement and supply (DPS) contract, representing 95% of the total contract value, to China Petroleum Pipeline Bureau, which was awarded the projects in November 2016.
The first payment was made on May 9, 2017, and subsequent disbursements were made within a time span of less than a year.
For the construction and commissioning (CC) contract, RM2.04 billion, or 80.75% of the total contract value, has been paid as at March 20, 2018.
It can be seen that the pace of drawdown was quicker after the second payment, with a gap of only three months from five months initially.
Similarly, the RM4.06 billion Trans-Sabah Gas Pipeline (TSGP) project's payment schedule was based on timing milestones for both the DPS and the CC contracts, with payments of RM1.81 billion and RM1.73 billion, respectively.
The drawdown for the DPS contract stood at 95% as at April 2, 2018, while 80.75% has been paid out for the CC contract as at March 20, 2018.
No details were given as to how the payment schedule was determined. Construction firms typically bill according to work progress.
Lim said the lopsided contracts have clearly jeopardised the interests of Malaysians and the government.
“In addition, we would welcome the former finance and prime minister, Datuk Seri Najib Razak, who has been active on Facebook recently, to explain how he could possibly approve the above transactions,” he added.
MoF, as the sole shareholder of SSER, said it will be taking steps to take control of the company pending investigations.
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PETALING JAYA: RHB Insurance Bhd aims to generate 10% of its gross written premium from the digital channel within the next five years, following the launch of the RHB Insurance Mobile App.
“We have built our mobile app on a digital ecosystem that will allow our customers, our agents and other business partners to interact with one another in a seamless way. Our target is to generate 10% of our gross written premium from the digital channel in three to five years,” said its managing director Kong Shu Yin.
For the fourth quarter ended Dec 31, 2017, motor insurance remained the business’ largest contributor delivering 33% of total gross premiums.
“We are confident the RHB Insurance Mobile App will be a catalyst in transforming the way customers purchase and monitor their insurance as well as road tax renewal with just a single app. This effort is in line with our digital transformation programme focusing on delivering value-added interactions, which will empower our customers,” said Kong.
The newly launched app provides customers with a single end-to-end mobile enabled application to purchase motor insurance policy and road tax. The app boasts a three minute timeframe to complete the purchase of their motor insurance policy, the fastest in the financial industry.
The app also provides customers with a quotation for their motor insurance policy and renewing their road tax.
“The app empowers customers with the ability to obtain comprehensive insurance coverage for their vehicles as well as access round-the-clock auto assistance at the touch of their smartphone screens.”
RHB Insurance also launched the “Dah Cover Campaign”, aimed at encouraging Malaysians to obtain personal accident and travel insurance coverage.
RHB Insurance is offering a 40% discount on personal accident and travel insurance during this campaign period, from now till Sept 4.
In addition, a 24/7 roadside assistance programme is provided in the event of a breakdown or accident for cars insured with RHB Insurance under the comprehensive coverage.
RHB Insurance provides general insurance for retail and corporate customers and is the 10th largest insurer in Malaysia with 4.3% market share for gross direct premium.
It is also the top 10 insurers for fire and top five insurers for medical and health coverage. RHB targets to be among the top five insurance providers in the market by 2022.
KUALA LUMPUR: Former Bank Negara Malaysia (BNM) deputy governor Datuk Nor Shamsiah Mohd Yunus is among the candidates being considered to succeed Tan Sri Muhammad Ibrahim as governor of the central bank if he resigns, two sources said today.
Malaysia is discussing exit terms for Muhammad and an announcement could be made as early as today, people aware of the discussions said.
“There are talks being arranged with Datuk Nor Shamsiah Mohd Yunus,” said one government source, speaking on condition of anonymity. No decision has yet been made.
Nor Shamsiah left BNM after her term ended in November 2016.
Meanwhile, BNM declined to comment on talk that Muhammad had offered to resign. Social media has been rife with the rumour of his resignation.
Muhammad assumed the office of governor on May 1, 2016, succeeding Tan Sri Dr Zeti Akhtar Aziz. He is the eighth governor of BNM.
BNM was embroiled in a controversy over a RM2 billion land purchase which was said to be linked to the 1Malaysia Development Bhd (1MDB) fiasco.
The Finance Ministry confirmed several news reports published in The Wall Street Journal and by Reuters claiming that the ministry had made payments on behalf of 1MDB to service the latter's debt obligations.
The sources for the payments included redemption of redeemable cumulative convertible preference shares by Khazanah Nasional Bhd amounting to RM1.199 billion and the sale of a piece of land to BNM amounting to RM2.066 billion. – Reuters, Bernama
KUALA LUMPUR: The Malaysia Retailers Association (MRA) has suggested that the Sales and Services Tax (SST) be implemented at a lower rate or less than 6% to avoid a significant impact on prices which will indirectly affect consumers.
MRA president James Loke said the lower rate was suggested during his briefing with the Council of Eminent Persons earlier today.
“We share our thoughts on SST, hopefully the (rate) is not that high. If high, it would impact the cost and selling price of products.
“We understand that the government needs revenue to support this country but we just hope (on) the wisdom of the Council (members) to come up with a good rate,” he told reporters after the briefing held at Ilham Tower today.
During the briefing, Loke said the Council had queried about the challenges faced by retailers and preparation ahead of the Goods and Services Tax abolishment, which would take effect on Sept 1.
The GST was introduced in April 2015 at 6%, replacing the SST of up to 16%.
The GST rate has been zerorised from June 1 until Aug 31.
Loke said the zero-rated GST is perceived as a positive change by consumers as they have more buying power.
“Last weekend, business was good as a lot of consumers waited for the prices to go down,” said Loke who was accompanied by his deputy president Shinobu Washizawa. – Bernama