Monday, January 28th, 2019


Greece to raise minimum wage by 11pc, PM Tsipras says

ATHENS, Jan 28 — Greek Prime Minister Alexis Tsipras announced today plans to increase the standard minimum monthly wage by about 11 per cent, the first such hike since the country's debt crisis erupted almost a decade ago. Greece emerged in…

US shutdown subtracted US$11b from GDP, according to congressional report

WASHINGTON, Jan 28 — The five-week US government shutdown subtracted US$11 billion (RM45.2 billion) from the economy, about twice the amount President Donald Trump sought to fund a border wall, a congressional body said today. However, all but…

Tesco says changes to UK business to impact up to 9,000 jobs

LONDON, Jan 28 — Tesco, Britain's biggest retailer, said today it was making changes to its UK business that could impact up to 9,000 jobs. It estimated that half of that number could be re-deployed across the business. Tesco, Britain's biggest…

Ceiling price of affordable houses lowered to RM300,000

KUALA LUMPUR: After much criticism over the years, the ceiling price for affordable housing is now capped at RM300,000 from RM500,000 previously, which is deemed to be unaffordable for most of the those in the middle- and low-income groups.

It was announced by Housing and Local Government Minister Zuraida Kamaruddin, who launched the National Hous-ing Policy 2018-2025 (DRN), today.

Meanwhile, she said prices for affordable houses will start from RM95,000– RM100,000.

“The fixing of prices for affordable house will depend on location and the local mean income. This will be determined before the project commences… not more than RM300,000 definitely. In Alor Star, the price may differ, in KL it will differ,” she told a press conference here today.

She said the affordable houses also have a moratorium of five years, and houses can only be sold to the Housing and Local Government Ministry (KPKT), based on market price.

The latest DRN is the first national policy launched under the Pakatan Harapan government. It outlines five focuses, 16 strategies and 57 action plans.

The five focuses are: quality housing for all; improving accessibility and affordability; cohesive neighbourhood; improving coordination between housing development and transport; and strengthening institutional capability for the DRN.

In 2018 and 2019, 15 action plans have started, including policy implementation, laws, guidelines, governance, community development, maintenance, construction technology improvement and data digitalisation.

A sub-policy of the DRN is the National Affordable Housing Policy that draws the standard, main specifications and guides for the development of affordable homes.

This includes public and social housing developed by the federal government, state government or private entity to provide sufficient, conducive, safe affordable and social homes with facilities.

Under DRN, three agencies, namely Perbadanan Prima Malaysia and Malaysia Civil Servants Housing Programme under the Prime Minister’s Department, as well as Syarikat Perumahan Nasional Bhd under the Finance Ministry will now come under the purview of KPKT.

“All (agencies for the development of affordable houses) will be centralised under one – the National Housing Depart-ment” Zuraida said.

She also witnessed the signing of a memorandum of understanding for the youth transit housing (Rumah Transit Belia) and affordable homes, between the government and TISY Sdn Bhd and Pembinaan Kery Sdn Bhd.

The government, via KPKT, will provide the land without having to come out with the development cost. This initiative is in line with the government’s aim to build 10,000 units of transit houses to help the youths and M40 group especially in the main cities in Malaysia.

Meanwhile, Zuraida said the Home Ownership Exposition in March will provide a minimum 10% discount for 22,000 unsold units from 180 developers worth RM22.5 billion. Of this, 24% is below RM300,0000.

The expo will be held at the Kuala Lumpur Convention Centre.

Rent-to-own for now, build-then-sell by 2023

KUALA LUMPUR: Malaysia will focus on the rent-to-own (RTO) concept in the housing market for now and later move towards build-then-sell (BTS) by 2023, said Housing and Local Government Minister Zuraida Kamaruddin.

“To help the people own their homes, we will focus more on RTO. The BTS concept was declared in 2013 but, looking at the current situation, it’s not time yet for us to do BTS. The better way now is to RTO and buy (the house),” she told a press conference after launching the National Housing Policy 2018-2025 (DRN) here today.

She said RTO schemes are already in Selangor and Penang where, in the sixth year, renters can own their houses depending on their financial capabilities.

“BTS not yet. We will start to look at the process. In 2013, there were six (BTS) projects but they were not viable. Although we put it in our policy (DRN), as a continuity from the last policy, we need more time to further study to make it happen,” explained Zuraida.

Depending on its findings, she said, by 2023, it should come up with a BTS model.

Under DRN, the government plans to hit 90% BTS by 2020 and 100% BTS by 2023.

Customs optimistic 2019 SST collection will top RM22b target

KUALA LUMPUR: The Royal Malaysian Customs Department is optimistic that this year’s sales and service tax (SST) collection will surpass the RM22 billion target.

Customs Director-General Datuk Seri Subromaniam Tholasy said this was based on the expansion of services subjected to SST to include amusement park operations, securities, brokerage and underwriting, commercial and industrial building cleaners, as well as training and coaching.

“We can easily surpass this target and collect slightly more than RM22 billion,” he told reporters at the “Sales Tax and Service Tax – Latest Updates and Ongoing Goods and Services Tax (GST) Issues” seminar here today.

Subromaniam said the expansion of services subjected to the SST, beginning March 1, was expected to garner at least 10,000 new registrations.

“Unregistered night clubs, dance hall, cabarets, health and wellness centres, massage parlours, public houses and beer houses will also be subjected to the SST. This is to be fair to registered businesses that pay SST,” he said.

Meanwhile, Subromaniam said the exclusion of big-ticket marine vessels such as cruise ships, excursion boats, ferries and cargo ships was because these were considered to be investments.

Other big-ticket items excluded from the tax were barges, passenger and goods transportation vessels, fishing vessels, factory ships and other vessels used for processing or preserving fish products.

He said from a tax policy perspective, investment items should not be taxed as it would not benefit businesses in the country.

“If we tax investment items, people can always buy from other countries such as Singapore and Hong Kong, where there are no taxes on these items and yet, these ships can be used in Malaysia. This will not benefit anyone,” he said.

Subromaniam added that taxing big-ticket items considered to be investment items would also be detrimental to the local business as it would cause them to lose customers.

Sterling trade turns cautious ahead of parliamentary votes on Brexit

LONDON, Jan 28 — The pound slipped today after posting its biggest weekly rise in more than 15 months last week as investors took profits before crucial votes in the British parliament that will aim to break the Brexit deadlock. With less than two…

Rights issue undersubscription due to ‘unfavourable sentiment’, says Sapura Energy CEO

SERI KEMBANGAN: The undersubscription of Sapura Energy Bhd’s rights issue was due to unfavourable sentiment, said its president and group CEO Tan Sri Shahril Shamsuddin.

“The sentiments during the rights issue was a bit muddled because we had so many conflicts. There was conflict between the US and China and there were issues on trade globally, and that caused a lot of foreign investors to be a little bit shy,” he told reporters at the EGM today.

He said local investors, particularly institutional investors, were also affected by the uncertainty of the recovery of the oil and gas market.

“Unless you are in the business, you cannot see the increase in activities. I think a lot of this was going around,” he added.

However on the positive side, Shahril said Permodalan Nasional Bhd (PNB), which emerged as the largest shareholder with a 40% stake, sees the potential in Sapura Energy and this places the company on very strong footing to go through a growth phase.

Sapura Energy’s rights issue exercise saw an undersubscription rate of 18.51% after its share price fell below its rights issue price of 30 sen but the company managed to raise about RM4 billion as the remaining 1.85 billion unsubscribed rights shares will be fully taken up by the joint underwriters.

The joint underwriters are Maybank Investment, CIMB Investment Bank and RHB Investment Bank.

The company announced last week that it received 8.14 billion of valid acceptances and excess applications for its rights shares with warrants, representing a subscription rate of 81.5%.

For its Islamic redeemable convertible preference shares, the group saw just above 100% of valid acceptances and excess applications. PNB and its associated funds emerged as the single largest shareholder with 40% shareholding in the company.

In tandem with the rights issue, Sapura Energy will be forming a 50:50 strategic partnership with Austria’s OMV Aktiengesellschaft (OMV AG), which was approved by shareholders at the EGM today.

Shahril said the exercise will be completed in a few days, after which it will receive the proceeds, which will be used to pare down our debts and partially for working capital.

Upon completion of the rights issue and joint venture, Sapura Energy’s gearing ratio will drop from 1.74 times to 0.62 times, which Shahril said is a good level for the amount of activities the company has.

“This will give us the headroom to execute bigger projects because we’ll need more working capital and to try and go back to the days where we are able to increase our turnover and move towards possible profitability as soon as possible,” he added.

He said the company is well capitalised, has low debt level and is poised for growth in both the exploration and production, and services segments.

EU adopts post-Brexit import quotas for farm produce

BRUSSELS, Jan 28 —The European Union today adopted quotas for farming produce it will accept from third countries after Britain leaves the bloc and acknowledged this could happen before it has concluded talks with them on the subject. The EU has…

AirAsia carried 16% more passengers in 2018

PETALING JAYA: AirAsia Group Bhd Consolidated AOCs carried a total of 12.1 million passengers in the fourth quarter ended Dec 31, 2018 (4Q18), reflecting a 16% growth from 10.4 million passengers carried a year ago.

During the quarter, load factor was 4 percentage points lower at 84% from 88% a year ago, due to significant increase in capacity, which rose 21% to 14.3 million from 11.9 million a year ago.

The group said in a statement today that its available seat kilometres (ASK) grew 14% year-on-year, in line with the group’s strategy to grow its market share.

For the full financial year ended Dec 31, 2018 (FY18), the group carried a total of 44.4 million, an increase of 14% from 39.0 million passengers carried a year ago.

Capacity grew 18% to 52.5 million from 44.4 million a year ago while load factor fell 3 percentage points to 85% from 88% a year ago. ASK for the period grew 14%.

The consolidated AOCs refers to AOCs whose financial and operational results are consolidated for financial reporting purposes, namely the Malaysian, Indonesian and Philippines AOCs.

In 4Q18, Malaysia AirAsia carried a total of 8.5 million passengers, reflecting a 9% increase from 7.7 million passengers carried a year ago. Load factor fell 5 percentage points to 84% from 89% a year ago.

The Malaysian operations saw a 16% increase in capacity to 10.2 million from 8.8 million a year ago while ASK rose 9% year-on-year.

For FY18, Malaysia AirAsia carried 32.3 million passengers, 11% higher than 29.1 million passengers carried a year ago while load factor fell 4 percentage points to 85% from 89% a year ago.

Capacity grew 16% to 38.0 million from 32.8 million a year ago while ASK rose 12% year-on-year.

Overall, the group carried a total of 74.8 million passengers in FY18, which is an increase of 14% year-on-year. This includes all operations in Malaysia, Indonesia, Philippines, Thailand, India and Japan.

The group also expanded its capacity during the year, with ASK up by 15% and load factor of 85%. The group’s total fleet size closed at 224.