Tuesday, September 18th, 2018


Awer: Revoke direct-award power deals first before reforming industry

KUALA LUMPUR: Even as Minister of Energy, Science, Technology, Environment and Climate Change Yeo Bee Yin said her ministry plans to revive MyPower Corp for another round of power industry reform, Association of Water and Energy Research Malaysia (Awer) president S. Piarapakaran urged that previous direct awards of projects be revoked first.

Speaking to SunBiz, Piarapakaran said the government should settle baggage from Malaysia Electricity Supply Industry (MESI 1.0) in terms of shelving all direct negotiation contracts and questionable contract awards before initiating MESI 2.0. He also called on the government to name the independent power producers whose contracts were cancelled, in accordance with the previous announcement.

“The industry is already properly structured. It is just that the transparency part is lacking and when they award these projects, many of them go through direct negotiations.

“You cannot jump a few steps ahead by not solving the existing problems. All the direct negotiations that were given, you have not put a balancing factor into the tariffs,” Piarapakaran said.

He opined that Malaysia does not need another MESI, but instead needs to firm up the current model to promote transparency in terms of cost structure and improve efficiency as well as ensuring the right people are helming MyPower.

“The current model is quite a win-win model. The only thing lacking in the current model is transparency in terms of tariff setting and the regulatory mechanisms,” he said, adding that tariffs should not be politicised, but government involvement in terms of regulation is needed.

Yeo, speaking at a press conference after the opening ceremony of the Conference of the Electric Power Supply Industry 2018 (Cepsi 2018) today, said her ministry will conduct a six- to eight-month study to firm up the dynamics of the revival of MyPower Corp, which will be manned by between 12 and 20 people. However, she did not elaborate on the leadership for MyPower.

Yeo said MyPower will be entrusted with increasing the industry's efficiency, future-proof industry structure regulations and key processes, as well as empowering customers by democratising and decentralising the electricity supply industry for three years.

MyPower drove reforms under MESI 1.0, under the helm of former Energy Commission chairman Datuk Abdul Razak Majid.

After the reform, Yeo said, the domestic electricity industry is expected to be efficient, transparent, market-based, competitive, sustainable and be more prepared to move towards renewable energy.

She said the electricity tariff is unlikely to be increased after MESI 2.0.
Currently, fuel prices are a major determinant of electricity tariffs, accounting for two-thirds of the pricing mechanism.

MESI 2.0 is likely to see greater utilisation of market-based competition across the value chain, reduced government intervention, increased transparency, adoption of more cost reflective and time-based tariffs and targeted subsidies for those in need.

“We are not saying the government will not be intervening. If we have a competitive market based structure it will be the more cost-effective tariff for the people. We need to depoliticise the industry which cannot be done without reform because there is room for improvement in our market structure and operation,” she said.

On another note, Yeo said the government will announce a new electricity subsidy scheme for the lower income group comprising the 179,000 people registered under e-kasih in the next few weeks.

Apple escapes China tariff hit for now, but threats loom

WASHINGTON, Sept 18 — The latest round of tariffs that US President Donald Trump has imposed on China appeared to largely spare Apple and other consumer electronics makers but they face increasing threats from the deepening trade war between the…

SC: Retaining Multi-Sports chairman and CEO as directors ‘prejudicial to public interest’

PETALING JAYA: The Securities Commission of Malaysia (SC) today issued a statement warning investors in Multi Sports Holdings Bhd against the continued appointment of executive chairman Lin Huozhi and CEO Lin Liying as directors after they were issued reprimands in June 2018 for furnishing false and misleading financial statements to Bursa Malaysia.

The SC believes the presence of the two as executive directors on the board of the company is “prejudicial to public interest”.

The SC's sanctions were made after finding that Practice Note 17-status Multi Sports had failed to disclose outstanding liabilities incurred by its wholly owned China subsidiary, Jinjiang Baixing Shoe Materials Co Ltd, in its financial statements for the period of March 31, 2015 to March 31, 2016. These liabilities relate to eight loans amounting to 169.55 million renminbi.

“Although Wong Wang Lam (a former independent non-executive director) has resigned from Multi Sports, Lin Huozhi and Lin Liying, whose last known addresses are
in Fujian City, China, remain as executive directors of Multi Sports. Their current whereabouts cannot be ascertained,” the SC said.

All those in breach of the regulations have not appealed against the SC's reprimand issued on June 27, 2018.

China sets retaliatory tariffs on US$60b in US goods

BEIJING, Sept 18 — China today announced tariffs on US goods worth US$60 billion (RM248 billion) in retaliation for President Donald Trump’s decision to slap duties on US$200 billion in Chinese products next week. Tariffs of between 5 and 10 per…

Apple CEO says optimistic on US-China trade talks

SAN FRANCISCO, Sept 18 — Apple Inc Chief Executive Tim Cook, whose products have been spared from new US tariffs imposed on Chinese goods, said today he was optimistic that the United States and China will eventually work through their trade…

US-China trade war boon for Malaysian exporters

PETALING JAYA: As US is imposing new tariffs on US$200 billion (RM828 billion) worth of Chinese goods, local exporters are expected to see some increase in orders from the affected players in the two big economies over the next few months.

It is understood that the US tariffs will take effect on almost 6,000 goods from Sept 24, starting at 10% and increasing to 25% from the start of 2019. Items taxed include everyday items such as suitcases, handbags, toilet paper and wool; and food items from frozen cuts of meat, to almost all types of fish, soybeans, various types of fruit and cereal and rice.

Sunway Business School Economics Professor Dr Yeah Kim Leng told SunBiz that he believes the affected firms in both respected countries will be looking at sourcing for other countries and relocate part of their production plants to other countries including Malaysia.

“Of course they will be exploring and we (Malaysia) already seeing some inquiries. Based on their feedbacks, they are seeking on how they can divert some of their orders to Malaysian companies.

“Now that the lists of goods are much more wider, they (local firms) are likely to see greater inquiries and look into securing some of the production contracts,” Yeah said, as affected companies are looking to reduce their costs due to the additional tariffs.

He opined that while the 10% tax is less damaging, the 25% tax will add to the cost pressures for both consumers and businesses in the respective industries.

Yeah however believes that the slowdown in global growth may deter the affected players from expanding their capacities or relocating their plants to other countries, and instead have them look at existing companies to supply their orders for those affected goods.

“In the short term, Malaysia may also not be able to capitalise on that given our full capacity constraints.

“There might be a capacity constraint for Malaysian companies to ramp up production but those with spare capacities will stand to benefit to complete some of the orders,” he added.

Meanwhile, FXTM global head of currency strategy & market research Jameel Ahmad said that the US’ new tariffs has encouraged further risk aversion across the markets as expected.

Jameel opined that this move will make investors more sensitive to the ongoing uncertain external environment and expects those currencies belong to markets with weaker external positions to be hit hardest in the aftermath of this decision.

“The US dollar has once again strengthened on increased trade tensions, while a wide basket of different emerging market currencies is once again on the back foot due to a lack of risk appetite for emerging market assets.This probably means another blow for the likes of the Indian rupee, Indonesian rupiah and South African rand.

“The outcome is negative for the Chinese yuan, however it has been priced in throughout recent weeks and the reaction in the yuan has not been as negative as would have been first feared. The yuan is down just over 0.10% at time of writing.
“The ringgit and rupiah are example of two Asian currencies that are trading more negatively than the Yuan, in reaction to this news,” Jameel added.

The local note was down to 4.146 to the dollar. The FBM KLCI was down about 10 points to 1,792.94 points.

On another matter, Yeah said the escalating trade war will likely give greater impetus for both China and US to pursue on their respective regional trade agreements and divert them from each other economies.

MMAG acquires 26.37% stake in Panpages

PETALING JAYA: Total business ICT solution provider MMAG Holdings Bhd bought a 26.37% in Panpages Bhd for RM10.25 million to leverage on the company’s business search platform and tap into its customer database for use of its courier and logistics services business, Line Clear Express & Logistics Sdn Bhd.

MMAG said PanPages, which has been in the news after surprise changes to its management and board, is planning to develop an e-commerce online restaurant procurement platform, which comprises the online and fulfilment centres which are critical to ensure timely delivery and quality of food ingredients.

This will complement Line Clear’s strategic direction of providing cold rooms and the last mile delivery services to all its business partners,” MMAG said in its filing with Bursa Malaysia.

This is MMAG’s second acquisition in less than two weeks. On Sept 7, it announced that a unit, Ingenuity Microsystems Sdn Bhd, had bought over property investment company H&H Ecowood Products Sdn Bhd for RM2.3 milion.

Last week, Panpages CEO Fong Wai Leong and independent director Wong Mun Wai resigned, citing personal reasons, after shareholders delivered a shock at the company’s AGM, by voting against five of the seven ordinary resolutions tabled, including one on directors’ fees.

MMAG’s share price Panpages’s share price was up 1.5 sen to close at 24 sen with some 566,400 shares done.

18/09/2018 21:43:36

Westports paid double the reserve price for undersea land

PETALING JAYA: Westports Holdings Bhd, which is buying a parcel of leasehold land below sea from Perbadanan Kemajuan Negeri Selangor (PKNS) for RM116.19 million, said it paid double the reserve price for the land in order to secure the bid essential for the future container terminal expansion of Westports.

“PKNS conducted an open tender process for the land and as announced on May 4, 2018, Westports Malaysia Sdn Bhd (WMSB) did not conduct a valuation on the land,” it said in response to Bursa Malaysia’s query on the basis of the tender price of RM116.19 million.

On the net assets of the land, the group said WMSB approached PKNS for the information and is awaiting its response.

Last week, the group announced that it is buying 381 acres of land below sea, off Pulau Indah in Selangor, from PKNS for RM116.19 million cash.

It said that the acquisition is to expand the container terminals as the current preliminary port design for Container Terminal 10 to Container Terminal 19 requires additional land acreage to accommodate new wharf and container yard space, to facilitate the effective operations of the new container terminals.

The lease for the land expires on Aug 14, 2101.

In response to further queries from Bursa Malaysia, Westports said the proposed land acquisition is subject to state authority consent, which is the responsibility of PKNS to procure.

“The time frame to obtain the said state consent by PKNS is about 45 to 60 days from the date of the submission of the application for the state consent. The application is to be submitted by PKNS within 30 days from the date of the SPA,” it said.

Westports’ share price rose 0.27% or 1 sen to close at RM3.76 today with 532,800 shares done.

18/09/2018 21:23:16