Thursday, August 8th, 2019
BEIJING, Aug 8 — Beijing today said US rules banning technology giant Huawei and other Chinese firms from government contracts amounted to “abuse of state power” amid an escalating China-US trade war. The interim rule, which will preclude any…
WASHINGTON, Aug 8 — President Donald Trump said today he is not happy with the strong US dollar, which is hurting American manufacturing, and blamed the Federal Reserve for keeping interest rates too high. Breaking with decades of US policy, Trump…
NEW YORK, Aug 8 — US stocks rose today as better-than-expected domestic and Chinese data as well as a steadying yuan offered some comfort to investors rattled by an escalation in trade tensions. However, the consumer staples sector came under…
KUALA LUMPUR: Malaysia plans to set up a “special channel” led by the Finance Ministry to facilitate more investments from China, said Finance Minister Lim Guan Eng.
The special channel, he said, will be able to double approved foreign direct investments (FDIs) in manufacturing from China to about RM8.8 billion from RM4.4 billion in the first quarter of this year.
“We should be able to use the existing institutions (to set up the channel).
“I think when I go to China for the investment mission, we will be fleshing out the details for the Chinese investors,” he said while confirming of his upcoming visit to Shenzhen later this month.
Lim met reporters after officiating at the Malaysia-China Belt and Road Economic Cooperation Forum 2019 here today.
On the Shenzhen’s investment mission, Lim said he is confident that Malaysia could offer itself as a safe haven for Chinese companies, particularly amid the intensifying trade war between the US and China.
“When we talk about the trade war, that is basically between the US and Shenzhen, a manufacturing and export market in China. Since the Chinese manufacturing investors are looking for a safe haven, I think we are able to offer it to them,” he said.
Lim also believes that Malaysia will be able to offer a more compatible mix in manufacturing as well as expertise to the Chinese investors.
“They are not very familiar with what Malaysia has to offer; in fact, what we can offer is the compatible mix. So we want to promote Malaysia and let the Chinese investors be aware that we are much better, not only in terms of manufacturing mix but also cost, compared to other countries,” he said.
Asked on updates surrounding issuance of Panda bonds, Lim said at the moment, the pricing is still not attractive enough for Malaysia to raise money from the bonds, but discussions on the matter are continuing.
“If there is any further announcement, we will make it later,” he added.
PETALING JAYA: Kenanga Research foresees the possibility of Bank Negara Malaysia (BNM) opting for another interest rate cut by year-end after a 25 basis point cut in May, given the heightened prospects of a slower global economy.
“BNM has room to embark on another rate cut as soon as September if the economic outlook continues to deteriorate and if the Fed signals another rate cut this year,” the research house said in a report today, referring to the US Federal Reserve.
On the currency front, it is revising its US dollar-ringgit year-end forecast to 4.20 from 4.10 in view that China may allow the yuan to depreciate, a steady fall in oil prices and the higher probability that BNM may cut rates.
BNM’s international reserves rose by 1.2% month-on-month or US$1.2 billion to US$103.9 billion as at July 31, remaining on an uptrend for two consecutive months.
The reserves position is sufficient to finance 7.6 months of retained imports and is 1.2 times the total short-term external debt, the central bank said.
The increase was driven by a rise in foreign currency reserves and reserves position with the International Monetary Fund (IMF). In particular, foreign currency reserves rose 1.1% month-on-month (June: +0.3%) to US$97.7 billion in July, suggesting a widening trade surplus amid slowing trade performance, while the IMF reserves position increased 9.1% month-on-month to US$1.2 billion. Meanwhile, Special Drawing Rights, gold and other reserve assets were unchanged.
In ringgit terms, the value of forex reserves rose by 1.2% month-on-month or RM4.9 billion to RM430.3 billion as at end-July, marking its highest level in 20 months. In July, the US dollar-ringgit was traded at an average of RM4.12 versus RM4.16 in the preceding month, reflecting a ringgit appreciation of 0.9% month-on-month.
This marked its second month of appreciation, primarily lifted by an increasingly dovish Fed and lower capital outflows. Similarly, other regional currencies also trended higher in July with the Philippine peso and Indonesian rupiah appreciating by 1.3% month-on-month, while the Thai baht strengthened by 1.0%.
“Despite ample foreign reserves, heightened risk from the external sector, particularly the escalation of US-China trade war continues to exert risk to the domestic financial market and economic growth,” Kenanga said.
Furthermore, the Japan-South Korea trade spat and the growth slowdown in key export markets may weigh on Malaysia’s economic growth, said Kenanga.
TOKYO: Japan has approved the export to South Korea of some key products for the first time since introducing stricter trading rules amid an ongoing row between the two US allies.
Economy, Trade and Industry Minister Hiroshige Seko said today that Tokyo had given the green light to export to South Korea chemicals used in chipmaking and smartphone manufacturing.
“We don’t usually announce individual cases of export permits but I’m making this public exceptionally because South Korea’s government has made the unfair criticism that our move is something like an export embargo,” he told reporters.
On July 4, Japan tightened the rules on awarding official permits, meaning that screening applications could take up to 90 days.
The move was widely seen as hitting out at South Korea amid a long-running dispute between the two countries – both democracies and market economies — over the use of forced labour during World War II.
But Seko said some applications made after July 4 had already cleared “strict” screening and officials had ruled out “security concerns”.
“We want South Korea to understand this is not an export embargo but an export management measure,” said Seko.
Japan has argued the measure was necessary on national security grounds.
Last week, Japan announced it would remove South Korea from a list of favoured export partners from Aug 28.
South Korea quickly fired back, rescinding Japan’s favoured export partner status and saying it would also review a military information agreement.
NEW YORK, Aug 8 — Wall Street was set to open higher today as better-than-expected trade data from China and a steadying of its currency offered some comfort to investors rattled by an escalation in trade tensions and signals pointing to a…
WASHINGTON, Aug 8 — The number of Americans filing applications for unemployment benefits unexpectedly fell last week, suggesting the labour market remains strong even as the economy is slowing. Initial claims for state unemployment benefits…
PETALING JAYA: The Malaysia External Trade Development Corp (Matrade) and Aker Solutions have established a partnership to further grow the global footprint of Malaysian small and medium enterprises (SMEs) in the energy industry.
The collaboration, which is part of Matrade’s global sourcing programme initiative, is targeted towards local companies to leverage on Aker Solutions’ procurement network, via a customised business matching engagement programme between Malaysian manufacturers and different procurement teams within Aker Solutions.
“We trust such programmes will provide further impetus for the local oil and gas and related sectors to seek new customers and markets, amidst a very competitive landscape brought about by low crude oil prices,” Matrade CEO Sharimahton Mat Saleh said in a statement today.
She said that the agency is certain that Malaysian companies selected to be Aker Solutions’ suppliers will be able to serve its other hubs around the world too.
Aker Solutions managing director and country manager for Malaysia and Brunei Hatta Kamaruzzaman said that the group’s engagement with existing and potential Malaysian suppliers are part of its commitment to develop local competencies and provide opportunities into the energy industry.
“We are growing our supplier base in Malaysia to provide products and services to our customers globally. Our suppliers are vital to our continued success in this region, they add value to our solutions,” he added.
For the first phase of engagement, 50 participants from 35 local SMEs were selected for a series of customised briefings and workshops sessions with Aker Solutions’ team in Malaysia.
These sessions focused on products and services required by Aker Solutions, allowing the participants to understand the group’s sourcing needs and be part of its supply chain network.
For 2018, Malaysia’s trade of oil and gas products stood at RM266.26 billion, while the trade figure for the sector in the first half of this year stood at RM125.94 billion.
Sharimahton urged Malaysian companies to reach out to the agency, to inquire how they could expand their businesses abroad as it has a number of exporters development and export promotion programmes.
“These efforts are targeted to boost their export capabilities and secure them business deals with foreign buyers,” she said.
LONDON, Aug 8 — The dollar steadied today as risk sentiment rose after resilient Chinese trade data and as Beijing’s efforts to slow a slide in the value of the renminbi encouraged investors to buy riskier currencies. Data showed Chinese exports…