Sunday, September 2nd, 2018


RBS says ‘planning for worst’ in Brexit

LONDON, Sept 2 — The Royal Bank of Scotland warned today that it is planning “for the worst” amid increased talk of no deal over Brexit. Chief executive Ross McEwan said RBS is setting up a new European subsidiary in Amsterdam to serve…

Economists laud higher Petronas dividend, but caution govt against over-reliance

PETALING JAYA: While welcoming Petroliam Nasional Bhd's (Petronas) announcement to increase its dividend payout to the government to RM24 billion this year, economists said the move was timely but cautioned the government against depending heavily on dividends to bolster its finances as Petronas' performance is subject to movements in crude oil prices.

Last Thursday, Petronas, which previously said that it will be paying out RM19 billion in dividends to the government of Malaysia, its sole shareholder, decided to increase the dividends by RM5 billion. Last year, Petronas' dividend payout amounted to RM16 billion.

Sunway University Business School professor of economics Dr Yeah Kim Leng and Socio-Economic Research Centre executive director Lee Heng Guie agreed that the announcement comes at the right time to offset the revenue shortfall that could arise from the transition from the goods and services tax (GST) to the sales and service tax.

However, both agreed that the government should not only bank heavily on Petronas' dividends as the amount would vary depending on crude oil prices and should remain prudent with its spending.

Noting that the dividend has helped Malaysia “escape” from the instance of widening its fiscal deficit gap, Yeah said the fiscal deficit target of 2.8% to gross domestic product this year is within reach.

“The question is whether the oil price will stay high next year or not, because you must understand while the government takes more from the oil revenue, dividend or income tax they also stabilise petrol prices at RM2.20 a litre for RON95.There is offset here and there. You know you gain more from revenue but you also have to pay for a subsidy,” Lee said.

He believes the government will remain disciplined in its expenditure.
Petronas' net profit stood at RM13.6 billion for the April-June period against RM7 billion in the same period last year, underpinned by higher revenue, lower net impairment on assets and other expenses. Revenue for the period grew 15% to RM59.2 billion from RM51.6 billion.

For the first half of the year, the oil major's net profit soared 54% to RM26.6 billion from RM17.3 billion, while revenue increased to RM117.2 billion from RM108.1 billion.

Petronas, Petros give courts a miss, sit down to discuss Sarawak oil & gas activities

KUALA LUMPUR: After initially opting for a resolution at the courts, Petroliam Nasional Bhd (Petronas) and the Sarawak state government have now taken to the negotiation table as the national oil company holds active discussions with Petroleum Sarawak Bhd (Petros) to come up with a working arrangement that is acceptable for all parties in relation to oil and gas (O&G) activities in Sarawak.

Asked if Petronas will be looking at other legal avenues following the Federal Court's dismissal of its application for leave to commence legal proceedings against the Sarawak state government, Petronas president and group CEO Tan Sri Wan Zulkiflee Wan Ariffin said that national oil company is engaging with Petros and hopes to find resolutions that way.

Petronas and Petros have until the end of next year to firm up arrangements, which include matters such as licensing.

On increasing the royalty payment to oil-producing states to 20% from 5% now, Wan Zulkiflee said discussions on this have been between the state and federal governments.

“We are leaving the discussions to the federal and state governments. We will be guided by the outcome of those discussions. Of course we will provide input, implications of decisions or scenarios but we are not involved in the discussions,” he told reporters in conjunction with the announcement of the group's first-half financial results on Thursday.

“However, for Sarawak, we are in active discussions with Petros, (as) that is the nominated entity by the Sarawak state government (to come up with a) working arrangement,” he explained.

The Sarawak state government has been regulating oil and gas activities in the state since July 1. It has given oil and gas players to operate their business as usual until the end of 2019, while working to comply with the state's new laws on the O&G sector.

Wan Zulkiflee said for production sharing contracts, the agreements were made with Petronas and will remain that way.

Besides Sarawak, Petronas has not engaged in discussions with any other oil-producing state.

Germany dismisses Bild report on VW petrol cars, no indication of fraud so far

FRANKFURT, Sept 2 — Germany’s Transport Ministry said today there was no fresh news in a Bild am Sonntag report that Volkswagen engineers told investigators certain petrol engines in VW, Audi and Porsche vehicles can be used to manipulate…

Amid US trade war, China’s Xi reiterates reform commitment

BEIJING, Sept 2 — China is still determined to reform and wants to work with all parties to build an open world economy, Chinese President Xi Jinping said today, reiterating Beijing’s message amid a bitter trade war with Washington. The two…

TRX Lifestyle Quarter to be fully occupied by 2020

KUALA LUMPUR: Lendlease, a joint-venture partner of the 6.88ha TRX Lifestyle Quarter development, aims for the centre to be fully occupied in 2020, says managing director and country head (Malaysia) Stuart Mendel.

He said the development comprised residential, entertainment, leisure, public park, hotel and retail, of which, the retail segment was currently 26% leased by its anchor tenants.

“Among anchor tenants include a departmental store operator of Japanese origin. We are working with them to bring a new concept of departmental store to Kuala Lumpur. We are also working with a dairy farm group to set up a supermarket there and with Golden Screen Cinemas for the entertainment portion.

“This will offer a unique experience because the cinema is located adjacent to the park, which enables us to have a red carpet experience for movie premiers or screenings,” he told Bernama.

Mendel said Lendlease would continue to work with secured tenants so that they would also continue to be committed to the project and jointly help them design their space to fit into the overall concept.

The tenants would be a mixture of local and international brands but the vast majority of the actual ownership of the tenants would be locals.

The TRX Lifestyle Quarter, a development that Lendlease dubbed its largest urban regeneration project, has the potential to become the natural extension to the Kuala Lumpur City Centre area as it is well-connected to public transport, accessible by road and is pedestrian-friendly.

“The design of the development is quite advanced. We want it to be sustainable in the long-term because we are not just building a shopping centre.

“The idea is for it to become a major public place where the community can come and play,” he added.

Meanwhile, Lendlease CEO (Asia) Tony Lombardo said the development was one of the company’s best urban regeneration project, given its location.

He believed the TRX Lifestyle Quarter could make a huge impact on Malaysia’s retail tourism sector.

“We picked this project because Malaysia is one of our core markets and we believe Kuala Lumpur is the key gateway city, globally.

“With its young and growing population, we definitely see a steady requirement for property over time,” he added.

‘Lehman Weekend’: The biggest bankruptcy in American history

WASHINGTON, Sept 2 — It was “Lehman Weekend.” The moment in September 2008 when the 150-year-old investment bank Lehman Brothers collapsed, precipitating the worst global economic crisis since the 1930s.  After failing to find buyers for…

China’s ‘Silk Road’ project runs into debt jam

BEIJING, Sept 2 — China’s massive and expanding “Belt and Road” trade infrastructure project is running into speed bumps as some countries begin to grumble about being buried under Chinese debt. First announced in 2013 by President Xi…

Trump says Canada not needed in Nafta deal, warns Congress not to interfere

WASHINGTON, Sept 2 — US President Donald Trump said yesterday there was no need to keep Canada in the North American Free Trade Agreement and warned Congress not to meddle with the trade negotiations or he would terminate the trilateral trade pact…

Former Eurogroup head Dijsselbloem says demands on Greeks were too heavy

AMSTERDAM, Sept 2 — Euro zone countries have asked for too much from the Greek people in return for international bailout loans, former Eurogroup chief Jeroen Dijsselbloem said in an interview on Dutch television yesterday. “On reforms, we have…