- No job cuts in Malaysia Airlines
- MoF grants three-year extension for CGC to manage TPUB-i
- Penang gets approval for man-made islands with 72 conditions
- Lazada sees surge in traffic during inaugural mega Mid-Year Festival
- Breakneck growth in China’s credit-card debt raises worries about a potential bust
- Calls for boycott of Japan grow in South Korea
No job cuts in Malaysia Airlines
Datuk Pahamin Rajab and his five partners who are keen to take over Malaysia Airlines Bhd have given their assurance that there will be no job cuts should their plan to turn the ailing airline around be accepted by the government. The offer through their vehicle, Najah Air Sdn Bhd, has proof of funding and they will need to conduct a three-month due diligence before unveiling their full turnaround plan for the airline. “We are looking at taking a 49% stake in the airline and Khazanah Nasional Bhd 51%,’’ Pahamin told StarBiz when contacted yesterday. He added that “we have assured the Prime Minister that we will not sack anybody at Malaysia Airlines. We will also not ask for financial support from Khazanah or the government. We will (ask to) have the rights to manage without interference from the government. “The airline will have the same national branding and will not change name. It will remain as Malaysia Airlines and it will be an international airline,’’ he said. The Pahamin-led group met the Prime Minister this week to express interest to help turn the airline around. The Prime Minister is the chairman of Khazanah, the sole shareholder of Malaysia Airlines.
MoF grants three-year extension for CGC to manage TPUB-i
The Ministry of Finance (MoF) has approved a three-year extension for Credit Guarantee Corporation Malaysia Bhd (CGC) to manage the Bumiputera Entrepreneur Project Fund (TPUB-i). CGC is expected to manage the TPUB-i contract financing scheme up to June 30, 2022, MoF said in a statement. Finance minister Lim Guan Eng said this is in line with the government’s commitment in ensuring that the country’s economic growth also creates opportunities that allow entrepreneurs and small medium enterprises (SMEs) to flourish. TPUB-i, a contract financing scheme funded by Bank Negara Malaysia (BNM), provides working capital financing to Bumiputera entrepreneurs who have been awarded contracts or projects by the government or its agencies, statutory bodies, and reputable companies. Under this scheme, CGC has an allocation of RM300 million to facilitate Bumiputera entrepreneurs who face challenges in obtaining access to financing from financial institutions. The scheme offers a profit rate of up to five per cent per annum to first time applicants, for funding up to RM3 million. Since the inception of the scheme in July 2009, CGC has approved and disbursed total financing of RM1.58 billion to more than 1,900 Bumiputera entrepreneurs. In 2018, the amount stood at RM330 million, an all-time high in terms of loan approval value in a year.
Penang gets official nod for man-made islands… with 72 conditions
The Penang state government today confirmed it has obtained approval from the Department of Environment (DOE) to create three man-made islands under its proposed south reclamation project. Chief Minister Chow Kon Yeow said, “It comes with 72 conditions and we will work hard to comply with these conditions imposed by the authority.” He said the state government needs to study the lengthy conditions for approval of the environmental impact assessment (EIA) but promised to disclose the details next week. However, he said the conditions were not new as these were imposed by the various technical committees even during the process of application for the EIA. The EIA for the Penang South Reclamation (PSR) project has been displayed publicly twice, the first time in 2017. The second display, between April 29 and May 28 this year, featured revisions after it was rejected by the DOE last year. The PSR is the funding module for the state’s mega infrastructure project — the RM46 billion Penang Transport Master Plan (PTMP). It will cost SRS about RM11 billion to reclaim the three islands which will make available a total 4,500 acres of lands.
Lazada sees surge in traffic during its inaugural mega Mid-Year Festival
Lazada is expecting an increase in traffic during its first-ever mid-year mega sale festival, to be held on July 12, 2019 across six markets in South-east Asia. Lazada Malaysia chief marketing officer Diana Boo said it will be offering discounts of up to 50 per cent during the 24-hour sale, as well as free shipping and vouchers. She said the leading e-commerce platform has also introduced new features such as “Chup Dulu”, a deal which started on June 29 which allows buyers to reserve their products ahead of the sales. The features also include the “Lower Price Guarantee”, where Lazada will pay buyers who find an identical, in-stock, non-promotional product being sold at a lower price on another online store twice the price difference.
Breakneck growth in China’s credit-card debt raises worries about a potential bust
Credit-card debt has grown more than six-fold in China since 2012, mirroring booms in other Asian markets that ended badly and raising concerns about the potential risks to Chinese banks, according to a new report from S&P Global Ratings. The credit rating agency said that unsecured consumer lending in the mainland is expected to increase at a rate of 20 per cent annually for the next two years, a slight slowdown, but reminiscent of problematic booms in Hong Kong, South Korea and Taiwan. At the same time, the credit-score and credit-behaviour models used by banks in China have not been fully tested by a consumer downcycle, S&P said. “We also anticipate that marginal players and latecomers to unsecured consumer lending are likely to compete aggressively, tapping into riskier customer segments,” Liang Yu, an S&P credit analyst, said in a research note. “Increasing business partnerships between banks and some types of fintech firms can also multiply asset-quality risk for some banks; in particular, banks with limited experience in unsecured consumer lending and/or inadequate capability in managing risks associated with a rapid increase in such exposures,” Yu said. The heightened concern about household debt comes as domestic consumption in China has become a major driver of gross domestic product growth. Household debt as a percentage of GDP in China has grown from 29.9 per cent in 2012 to 53.2 per cent last year, according to figures from CEIC, a financial data provider. Household debt stood at US$7.4 trillion in China at the end of March, according to CEIC.
Calls for boycott of Japan grow in South Korea
Calls in South Korea for a boycott of Japanese goods in response to Japanese restrictions on the export of high-tech material to South Korea has picked up as a dispute over compensation for forced wartime labour roiled ties between the US allies. The dispute is the latest flashpoint in a relationship long over-shadowed by South Korean resentment of Japan’s 1910 to 1945 occupation of the Korean peninsula. The latest bitterness over forced labour could disrupt global supplies of memory chips and smartphones. Samsung Electronics and SK Hynix – the world’s top memory chipmakers, and suppliers to Apple and China’s Huawei Technologies – could face delays. The row over forced labour exploded last year when a South Korean court ordered Japan’s Nippon Steel & Sumitomo Metal Corp and Mitsubishi Heavy Industries to pay hundreds of thousands of dollars to South Korean plaintiffs. Japan maintains that the issue of forced labour was fully settled in 1965 when the two countries restored diplomatic ties, and has denounced the ruling as “unthinkable”. Japan said on Monday it would tighten restrictions on the export of high-tech materials used in smartphone displays and chips to South Korea in connection with the dispute. The restrictions came into effect on Thursday, fuelling calls for retaliation in South Korea.