Monday, July 1st, 2019
VIENNA, July 1 — Opec agreed today to extend oil supply cuts until March 2020, three Opec sources said, as the group’s members overcame their differences in order to prop up the price of crude amid a weakening global economy and soaring US…
NEW YORK, July 1 — Warren Buffett is donating roughly US$3.6 billion (RM14.9 billion) of Berkshire Hathaway Inc stock to five charities, including the Bill & Melinda Gates Foundation, the biggest contribution in Buffett’s plan to give away…
LONDON, July 1 — Britain’s economy has lost momentum and might have shrunk in the second quarter of 2019, according to data that showed the double impact of Brexit and the slowdown in the global economy. Manufacturers had their worst month in…
NEW YORK, July 1 — Gains in technology stocks lifted the S&P 500 to a record high today, powered by growing optimism around US-China trade talks and a likely reprieve for Chinese telecoms company Huawei. The benchmark index hit an intraday…
PUTRAJAYA: The World Bank has trimmed its forecast for Malaysia’s 2019 economic growth to 4.6% from 4.7% earlier, due to weaker-than-expected investment and export activity in the first quarter.
World Bank Group lead economist Richard Record said it is maintaining its forecast of 4.6% for 2020.
“We’re still optimistic that we’ll see a recovery in global trade flows. We expect to see global growth returning closer to its trend rate by 2020 and the technology sector would also begin to move up again by 2020. 4.6% is around Malaysia’s potential rate of growth at this stage and this development,” he told a press conference at the launch of World Bank Group’s “Malaysia Economic Monitor on Re-Energising the Public Service” report in conjunction with the 12th Malaysia Plan: Kick-off Conference here today.
Given Malaysia’s deep financial and trade integration with the global economy, unresolved trade tensions, heightened protectionist tendencies among major economies, a sharper-than-expected slowdown in larger economies, as well as volatility in financial and commodity markets pose risks to growth in the near term, according to the 20th edition of the Malaysia Economic Monitor.
With an uncertain external environment and subdued business confidence, the report said, policy actions should aim to strengthen fiscal buffers, facilitate private investment and ensure adequate social protection for lower-income households. In the medium term, bold reforms and measures are needed, particularly to boost human capital and to increase the level of public sector revenues.
At present, Malaysia’s revenue from personal income taxes and consumption taxes both fall well below the average levels seen in other upper middle-income economies and high-income countries. Record said reforms to widen the tax base should be accompanied by measures to expand and improve the existing social protection system to boost resilience and protect the vulnerable.
“Malaysia collects around 2.2% of GDP (gross domestic product) in personal in-come taxes, about a quarter of the average in high income economies. Over time, if Malaysia seeks to provide an increased range in quality of public services and aspires to become a high-income economy, then over time, Malaysia will need to collect more in personal income taxes,” he said.
Meanwhile, federal government debt as a percentage of GDP increased to 51.2% in 2018 (2017: 50.1%) due to the upward adjustment in the fiscal deficit to 3.7% of GDP in 2018. Total committed government guarantees that are serviced by the govern-ment to finance the ongoing infrastructure projects also increased in 2018, to 9.2% of GDP (2017: 7.4%). The overall value of the federal government debt and liabilities is estimated to stand at RM1.1 trillion, or 75.4% to GDP (2017: 79.3%).
“Malaysia’s debt, while elevated, is certainly manageable. Over the medium term, it’s important to rebuild Malaysia’s fiscal buffers, both in terms of the deficit and level of debt, so that there is more space to absorb shocks if they hit the economy in the future,” Record said.
The report said Malaysia remains on track to achieve high-income economy status by 2024. Malaysia’s GNI per capita stood at US$10,460 in 2018, US$1,915 below the thresh-old of US$12,375 that the World Bank defines as high-income country status. The latest World Bank projections indicate that Malaysia could exceed the threshold some time between 2021 and 2024.
PETALING JAYA: Bank Muamalat Malaysia Bhd posted a profit before tax (PBT) of RM241.2 million for its financial year ended March 31, 2019, a 4.6% increase from RM230.5 million recorded in the previous financial year.
“The improved performance was underpinned by a steady growth in revenue driven by growth in gross financing and other operating income as well as our continuous effort in managing the cost of operations,” said its CEO Datuk Mohd Redza Shah Abdul Wahid said in a statement today.
Bank Muamalat’s revenue also grew 9.3% to RM1.33 billion from RM1.22 billion in the previous year, largely due to higher financing income of RM903.8 million, higher income in investment securities as well as higher gain recorded in foreign exchange transactions.
The group’s total gross financing grew 4% to RM15.5 billion as of March 31, 2019 against RM14.9 billion a year ago.
Asset quality-wise, its gross impairment ratio improved to 1.92% from 1.43%.
“These improvements are the results of our constant effort on prudent recovery, credit risk management initiatives and better quality financing base expansion,” said the CEO.
The bank’s capital position remained healthy with tier-I capital ratio and total capital ratio standing at 15.8% and 18.6%, respectively.
Moving forward, Bank Mualamat is making efforts to further strengthen its business in the gold and investment account as well as to concentrate its digitalisation efforts to keep up with current market demands.
PUTRAJAYA: The policies, pro-grammes and initiatives of the 12th Malaysia Plan (2021-2025) will revolve around three main dimensions, namely economic empowerment, environmental sustainability and social re-engineering.
Minister of Economic Affairs Datuk Seri Mohamed Azmin Ali said these dimensions will complement each other towards realising Malaysia’s new development model of shared prosperity.
“They are also in line with our efforts to attain the sustainable development goals by 2030. These dimensions are to be underpinned by the principles of enhanced governance and new policy tools,” he said in a pre-recorded video keynote address at the 12th Malaysia Plan: Kick-off Conference today.
Azmin is currently attending the 6th Opec and non-Opec Ministerial Meeting in Vienna.
This 12th Malaysia Plan: Kick-off Conference is the first of several initiatives to engage experts and all stakeholders in the process of formulating the 12th Malaysia Plan. The outcomes of the conference will support 13 inter-agency planning groups and 47 technical working groups that have been established in preparation of the 12th Malaysia Plan.
“As we look towards the 12th Malaysia Plan, we have the opportunity for a fresh start to our policy framework. This is especially important as we chart out course towards achieving high-income and developed country status over the 12th Malaysia Plan period.
“In addition, we need to ensure that the benefits of growth are shared and distributed fairly and equitably as we strive towards enhancing the standard of living for all Malaysians.”
He said current, as well as emerging challenges and global trends will be considered while new policy tools and valuable lessons gained from the experience of its key development partners will be leveraged.
PUTRAJAYA: While Malaysia’s public service performs well by regional standards, it falls short relative to advanced economies, particularly in terms of openness and transparency.
According to the 20th Malaysia Economic Monitor, which includes a special focus on re-energising the public service, Malaysia’s perfor-mance has been largely stagnant and falls short relative to high-income aspirational comparators.
“As Malaysia aspires to be a high income economy by 2024, East Asia Pacific will no longer be the right competitor for Malaysia. You need to be compared to high income economies like OECD (Organisation for Economic Cooperation and Development). When you compare Malaysia’s performance with OECD-like countries, there are still some gaps that Malaysia needs to fill,” said World Bank lead public sector specialist Rajni Bajpai.
Malaysia is one of the top performers in the region according to the World Bank’s Doing Business index, but its performance on the Government Effectiveness indicator has remained stagnant or fallen in recent years.
The report said Malaysia’s index for voice and accountability is well below what would be expected, given its level of per-capita income, and some indicators like political stability and the rule of law have worsened over time, with a widening gap with OECD com-parators.
Malaysia fares poorly in terms of citizen perceptions related to equal treatment in public sector employment and ranks below regional and OECD comparators in terms of the impartiality of its public administration. However, it has done well on measures related to gender equality, with women constituting nearly 50% of em-ployees in the public service.
World Bank country director for Brunei, Malaysia, Philippines and Thailand Mara Warwick said there is a well-established connection between the quality of state institutions and economic growth. With increased affluence, societal expectations regarding the range and quality of services delivered by the state also tend to grow. There-fore, enhancing the effectiveness of state institutions is an integral part of a successful transition to a higher level of economic and social development.
“The focus now until the 12th Malaysia Plan is about making the public sector future-ready for Malaysia. It’s important for Malaysia to put in place the foundations now of an effective public sector that will be able to carry forward and the government’s priorities on building the public sector further and on transparency and accountability are important,” said Warwick.
For the public service to fully realise its potential, Malaysia will need to invest in human resources management; to encourage and develop a more open, transparent environment; to undertake reforms to attract, manage and retain the best talent, and to embrace new and emerging trends, including those related to rapidly-evolving technological innovations and digitalisation.
PARIS, July 1 — Paris authorities reintroduced rent controls today in a bid to get a grip on the spiralling cost of living in the City of Light. Real estate prices have surged in the French capital, mirroring spurts in other major European cities…