Germany under fire for Saudi arms export ban

BERLIN, Feb 22 — Export power Germany has long had a troubled relationship with selling arms abroad, a legacy of its dark history that is now spelling deep discord with its European allies. Chancellor Angela Merkel’s government has recently…

PBOC sees benchmark rate cut as last resort, may use other tools

BEIJING: China’s central bank is not yet ready to cut benchmark interest rates to spur the slowing economy, despite cooling inflation and a stronger yuan, which have fanned market expectations of such a move, policy sources told Reuters. But the People’s Bank of China (PBOC) is likely to cut market-based rates and further lower banks’ […]

Govt in talks with China on Panda bonds: Guan Eng

KUALA LUMPUR: Finance Minister Lim Guan Eng today confirmed that Malaysia has received an offer for the issuance of Panda bonds from China and said the relevant parties are currently in discussions.

Speaking to reporters at the 12th Malaysian Property Summit, Lim said the offer from China Construction Bank has been communicated to the Prime Minister and the Cabinet.

“But we are still at the discussion stage. Unlike the Samurai bond for which the working paper has been presented to and approved by the Cabinet, and both countries have agreed on it. This one is still at the discussion stage,” he said.

Earlier this week, China’s ambassador to Malaysia, Bai Tian, said China Construction Bank is proposing to issue Panda bonds in China to Malaysia to help alleviate financial stress.

“I see this as a positive sign from other countries and foreign investors, who are confident about the administration of the new government led by Prime Minister Tun Dr Mahathir Mohamad. Because they are confident, they are willing to extend a loan, just like Japan with their Samurai bond. This is something that is being done for the first time since the 80s,” said Lim.

He said such offers from Japan and China reflect the interest of foreign investors in Malaysia and their confidence in the new government, which was not seen before.

He noted the Samurai bond’s coupon rate of 0.65% is below market rate compared with the coupon rate of a Goldman Sachs bond issuance under the previous government which was 100 basis points above the market rate.

The ¥200 billion (RM7.34 billion) 10-year Samurai bond, guaranteed by the Japanese government, will be issued next month, at a coupon rate not exceeding 0.65%. The Samurai bond was initiated by Mahathir, who requested his Japanese counterpart Shinzo Abe for yen-denominated credit in June last year.

The Samurai bond will be used to reduce debt accumulated by the previous government. The Samurai bond sale will be Malaysia’s first in three decades, having last raised such debt in 1989.

Meanwhile, Lim said the government hopes to conclude talks on the East Coast Rail Link (ECRL) but noted the challenge of ensuring that the cost is something that the country can afford while at the same time maintaining good relations with China.

“We still maintain the best of hopes that this matter can be resolved and that they can meet our request for the price reduction. Otherwise we would not be able to afford it,” he said.

Lim said the ECRL is one of the remaining projects to be concluded while most of the other projects that were being reviewed have been finalised.

As for the proposed Airport Real Estate Investment Trust (REIT), which was announced in Budget 2019, he said it is working towards appointing a REIT manager but it has not been finalised yet.

In his keynote address, Lim said the cost of living is still high although consumer price index (CPI) was at 1% in December, which is the lowest inflation rate in nine years.

He said the government is looking at how to ensure the low CPI can be filtered down and allow the public to benefit from the low inflation rate.

He said the CPI is sometimes used as a benchmark for wage increases, which is not so accurate thus the government is looking at another index that can better reflect the cost of living, so that wage rises reflect the actual situation.

China to expand agriculture reforms for growth

BEIJING: China will deepen reforms of its agriculture sector to promote its rural economy, the government said in its first policy statement of 2019, as it seeks to bolster growth and offset trade challenges. Beijing’s statement, released late on Tuesday, comes after the world’s second-largest economy saw its weakest growth in 28 years in 2018 […]

China will not change prudent monetary policy, says Li

BEIJING, Feb 20 — China has not and will not change its prudent monetary policy and will not resort to “flood-like” stimulus, Premier Li Keqiang said today. Market speculation is growing over whether authorities will take more aggressive…

Bursa Malaysia ends higher on stronger buying demand

KUALA LUMPUR: Bursa Malaysia ended the day higher as stronger buying demand in heavyweights helped lift the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI).

At 5pm, the index finished 19.62 points higher at 1,726.18 from 1,706.56 at close yesterday.

After opening 6.27 points firmer at 1,712.83, the local index moved between 1,711.44 and 1,727.25 throughout the day.

A dealer said market sentiment was positive with investors optimistic that the latest round of trade talks between the world’s two giant economies would lead to a deal to resolve their tariff war.

“This positive sentiment is reflected in the stronger performance of Wall Street and spilled over into Asian stocks, with the MSCI’s broadest index of Asia-Pacific shares outside Japan, up nearly one per cent to reach its highest level since Oct 2, 2018.

“On Wall Street, the S&P 500 index rose 4.16 points to 2,779.76, the Nasdaq Composite increased 14.36 points to 7,486.77 and the Dow Jones Industrial Average was 8.07 points better at 25,891.32,” he added.

Among local heavyweights, Maybank rose four sen to RM9.52, Public Bank and Tenaga gained six sen each to RM25.06 and RM13.38 respectively, while Petronas Chemicals surged 26 sen to RM9.15.

Of actives, Sapura Energy inched up 1.5 sen to 32.5 sen, Hibiscus Petroleum gained three sen to RM1.08 and Bumi Armada was one sen better at 22.5 sen.

Market breadth was positive with 724 gainers and 252 losers, while 346 counters remained unchanged, 532 untraded and 20 others suspended.

Total volume increased to 3.82 billion units valued at RM3.26 billion from 2.80 billion units valued at RM2.36 billion transacted yesterday.

The FBM Emas Index increased 170.21 points to 12,040.78, the FBMT 100 Index rose 166.37 points to 11,897.51 and the FBM Emas Shariah Index jumped 197.45 points to 12,041.45.

The FBM 70 rose 330.74 points to 14,486.38 and the FBM Ace Index increased 37.58 points to 4,699.69.

Sector-wise, the Financial Services Index added 117.28 points to 17,783.73, the Plantation Index rose 96.12 points to 7,498.56 and the Industrial Products and Services Index bagged 2.64 points to 168.49.

Main Market volume was higher at 2.78 billion shares valued at RM3.03 billion from 1.87 billion shares valued at RM2.18 billion recorded on Tuesday.

Warrants’ turnover rose to 741.67 million units worth RM162.26 million from 609.05 million units worth RM120.56 million yesterday.

Volume on the ACE Market decreased to 295.17 million shares worth RM68.74 million from 317.97 million shares worth RM55.18 million.

Consumer products and services accounted for 316.42 million shares traded on the Main Market, industrial products and services (309.21 million), construction (236.86 million), technology (161.16 million), SPAC (nil), financial services (73.74 million), property (220.06 million), plantations (63.60 million), REITs (16.38 million), closed/fund (24,800), energy (1.19 billion), healthcare (41.44 million), telecommunications and media (67.56 million), transportation and logistics (35.28 million), and utilities (51.02 million). — Bernama

Bursa closes higher on buying sentiment

KUALA LUMPUR, Feb 20 — Bursa Malaysia ended the day higher as stronger buying demand in heavyweights helped lift the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI). At 5pm, the index finished 19.62 points higher at 1,726.18…

Brexit: May heads back to Brussels but EU not budging

BRUSSELS: British Prime Minister Theresa May (pix) heads back to Brussels on Wednesday to renew her quest to reopen the terms of Britain’s Brexit divorce, but appears headed for disappointment.

With less than six weeks until Brexit day, European Commission president Jean-Claude Juncker has agreed to meet May once again, but EU leaders insist they will not restart negotiations.

“I have great respect for Theresa May, for her courage and her assertiveness. We will have a friendly talk tomorrow but I don’t expect a breakthrough,” Juncker said Tuesday.

May and the other 27 EU leaders approved a Brexit withdrawal agreement at a summit on November 25 last year, but the British leader’s own parliament rejected it on January 15.

Since then, May and her ministers have repeatedly met EU leaders and their negotiator Michel Barnier to urge them to reopen the text to find a way to appease eurosceptic MPs.

May will try again on Wednesday, but on this trip she will not even meet Donald Tusk who, as president of the European Council, represents the leaders of EU member states.

She will instead meet Juncker and Barnier, who have no mandate from Tusk’s council or EU capitals to renegotiate the deal, or to modify the infamous “Irish backstop” clause.

This provides for Britain to remain in the EU customs union until a way is found — such as a future free trade deal — to ensure that Ireland’s border with Northern Ireland remains open.

Brexiteers in May’s own Conservative party see this as a “trap” to keep Britain in a form of union indefinitely, and have demanded a time limit or a unilateral exit clause.

This would be seen in Brussels as a betrayal of EU member Ireland, and it has consistently got short shrift from EU officials.

“We cannot accept a time limit to the backstop or a unilateral exit clause,” Juncker’s spokesman Margaritis Schinas told reporters on Tuesday, reiterating the longstanding EU position.

This represents a direct rejection of May’s core demand.

May’s spokesman said the prime minister was “working hard to secure legally binding changes” to the backstop.

“The prime minister believes that she can secure changes in relation to the backstop MPs want — there is a majority in parliament for a deal”.

Without a deal, Britain is due to leave the Union abruptly after four decades on March 29, with no follow-on agreement or transition period to manage trade and economic relations.

Economic chaos feared

Both sides have said they want to avoid this, and many experts foresee economic chaos, even warning of food and medicine shortages or a renewed threat of unrest in Northern Ireland.

Manufacturing supply chains could be disrupted, and Brexit uncertainty has already been cited as a contributing factor in the closure or departure of several British-based businesses.

Another option would be for Brussels to accord Britain an extension to the March 29 deadline, which is enshrined in British law.

But May’s government insists it will not request a delay, all 27 remaining members would have to agree and it would be legally difficult for Britain to remain in the EU for long.

Member states are obliged to hold polls May 23-26 to elect a new European Parliament, which will start sitting from July 2, presumably without any British members.

“Any decision to ask for more time lies with the UK. If such a request were to be made, no one in Europe would oppose it,” Juncker told the Stuttgarter Nachrichten this week.

“If you are asking for how long the withdrawal can be postponed, I have no timeframe in mind… But I find it hard to imagine that British voters would again vote in the European elections.”

May is due at the EU’s Berlaymont headquarters for her meeting with the Commission president at 6:30 pm (1730 GMT). The next day, British opposition Labour leader Jeremy Corbyn will meet Barnier.

Amid trade talks, China urges US to respect its right to develop, prosper

BEIJING, Feb 20 — The United States should respect China's right to develop and become prosperous, the Chinese government's top diplomat told a visiting US delegation, reiterating that the country's doors to the outside world would open wider. The…

China to expand agriculture reforms to bolster rural economy

BEIJING, Feb 19 — China will deepen reforms of its agriculture sector to promote its rural economy, the government said in its first policy statement of 2019, as it seeks to bolster growth and offset trade challenges. Beijing’s statement,…