- Domestic steel industry collapse is imminent
- Thailand is being advised not to legalise casinos
- Vietnam to build a cross-border railway with China
IN Malaysia
Uncertain future for the steel sector
US President Donald Trump’s recent announcement to impose a 25% tariff on all imported steel products will not be good for the Malaysian steel industry as global steel producers will divert steel trade towards the region where they can sell their products at lower prices than domestic producers, i.e. the Southeast Asia region. This could spell the end for local steel producers as at the moment they are already grappling with surging exports of Chinese steel material caused by the Chinese and Vietnamese overcapacity, overproduction and domestic economic slowdown. The new Trump tariffs will only exacerbate an already challenging environment. Currently, the domestic price of steel billets and bars has reached a four-year low and domestic producers are forced to sell below cost just to compete with Chinese prices.
Not enough water to sustain data centres?
Malaysia National Water Service Commission has revealed that three states in Malaysia – Selangor, Negeri Sembilan and Johor – do not have enough water to feed their resource-hungry data centres. Data showed that water infrastructure in the three states could only provide a total of 142 million litres a day (MLD) to data centres, far short from the 808 MLD required in total. The largest demand came from Johor, which sits across the Causeway from Singapore, with 72 data centres requiring 673 MLD of water. Data centres need water to be utilised in two main ways – indirectly, to generate the electricity that the data centers need to operate, and directly, as a liquid coolant to dissipate the heat generated by the servers and other data center equipment. Hopefully, these three states including Johor do not become the bane for Malaysia to become Asia’s data centre hub. To investors, there are other states to explore also such as the Great North – Penang, Kedah and Perlis and we do not have water issues.
All things military
- When will they learn, when will they learn, when will they learn??? After the case of the stealth littoral combat ship and the invisible Blackhawk helicopter, now it is the case of counting errors in building offshore patrol vessels. Home Minister Saifuddin Nasution said that both Putrajaya and THHE Destini have mutually agreed to terminate the agreement for the latter to supply three Offshore Patrol Vessels (OPV) for the Malaysian Maritime Enforcement Agency (MMEA). The value of the initial contract signed in 2017 is RM738.9 mil to supply, deliver, test and commission three OPVs within 3.5 years. Unfortunately, after spending more than RM750 mil, Putrajaya only received one ship dubbed KM Tun Fatimah, which was also behind schedule. I think by this time, any Tom, Dick or Harry knows that the Government should not trust local shipyards to build military-grade ships. They just cannot deliver.
Fortunately for MMEA, Putrajaya has chosen Turkiye’s Desan Shipyard to build the agency’s multi-purpose mission ship (MPMS). The MPMS ship is expected to be operational by 1Q2027 and will significantly boost MMEA’s operational capabilities as the ship can operate non-stop for 30 days. As per the Budget 2025, Putrajaya has allocated RM350 mil for the MPMS acquisition.
With a MYR 350 million budget, the MMEA Multi-Purpose Mission Ship will be built by Turkiye’s Desan Shipyard. The Malaysians are planning for three MPMS.
It is 99m with 30 day endurance, 4 fast interceptor boats, 2 UAVs and 70 crew members. See CONOPS image below.
📸 MMEA https://t.co/i4lDyj0ivX pic.twitter.com/JljxBkCzCq
— Herbie (@Herbie_atX) February 12, 2025
Source: https://www.bernama.com/misc/rss/news.php/news.php?id=2391646
- In answering the public’s queries, Law Minister Azalina Othman provided three main reasons why Putrajaya is spending RM16 bil to lease 28 military helicopters instead of outright purchasing them. The three reasons are –
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To quickly replace ageing assets. According to Azalina, many helicopters used by government agencies, including the Malaysian Armed Forces, were between 12 and 32 years old.
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To significantly increase the readiness levels. Azalina cited a 2017 Universiti Teknologi Malaysia study titled Aircraft Acquisition Conceptual Framework, which found that the Royal Malaysian Air Force’s (RMAF) aircraft readiness was at just 43% between 2011 and 2015 compared to the minimum 70% mark.
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Fiscal considerations. Azalina stated that leasing the helicopters allows the government to optimise spending by distributing costs more sustainably over 15 years. This includes maintenance, insurance coverage, and training for more than 1,300 personnel.
Okay, let’s do a comparison. The cost of a military-grade Airbus H225M, the most used helicopter in RMAF is about RM300 mil per unit, with all the bells and whistles. The total outright purchase cost for 28 Airbus H225M would amount to RM8.4 bil. Mind you that the hypothetical RM8.4 bil cost does not include the 15-year maintenance cost. So, do you think Putrajaya made a good decision to lease the helis instead of purchasing them?
Around the S.E.A.
All things Thailand
- China President Xi Jinping advises Thailand against legalising casinos as it would create social problems, stemming from its experience operating Macau – a special administrative region where casinos are legal. However, some speculated that Xi gave the comment only because he did not want the legalisation of casinos in Thailand to jeopardise the inflow of Chinese tourists into the Land of Smile and lose the soft power. In 2024, China tops the ranking for most foreign tourists visiting Thailand, amounting to more than 6 mil tourists. In response to Xi’s comments, Thailand PM Paetongtarn Shinawatra defended her government’s stance to halalkan casino by stating that the casino project would involve an integrated complex with hotels, restaurants, and entertainment, with a casino taking up less than 10% of the space. Apart from that, taxes collected from the project could be used for scholarships.
- Japanese car manufacturer Mazda Motor Corp is planning to invest USD150 mil to set up a manufacturing facility that can produce electric compact sport utility vehicles. The investment will support sales in Japan and other Southeast Asian markets, with the aim of producing 100,000 units per year. Thailand is Southeast Asia’s biggest auto production centre and an export base for some of the world’s top carmakers, including Toyota and Honda.
Vietnam to build a cross-border railway line linking China
Vietnam intends to construct a 391km railway from the border city of Lao Cai to the Haiphong which houses the largest seaport in northern Vietnam. To assist in this project, Vietnam will ask Daddy China to partly fund the USD8.3 bil project via a loan. This new railway project is on top of the approved USD67 bil, 1,541km high-speed rail that would link Hanoi with business hub Ho Chi Minh City. However, for the high-speed rail project, Vietnam will internally source the funds, via government bonds and low-interest loans. This funding strategy represents a departure from Vietnam’s traditional economic hedging strategy — its calculations of the risks and rewards of accepting investment from larger powers.
Source: https://eastasiaforum.org/2025/01/09/vietnams-high-speed-rail-hits-the-brakes-on-foreign-funding/
For your EYES only
Siapa kata brand Malaysia tak popular overseas? Recently, Perodua chairman Asmat Kamaludin revealed that EPL club Manchester United approached them for a sponsorship deal, specifically to put the Perodua logo on one of their shirts and sponsor them. I guessed Man Utd is so shit now until no one wants to sponsor them anymore. And to Perodua, it makes no business sense for you to sponsor an overseas club as you do not have any export presence and let’s be honest, you can be dubbed as a Toyota subsidiary already. Do you know Daihatsu owns 25% of Perodua, where in return, Daihatsu is a wholly-owned subsidiary of Toyota.
Manchester United have approached Perodua to be their sponsor, said the carmaker’s chairman Asmat Kamaludin.
He also said that Perodua is assessing its involvement in Malaysian football to avoid potential market divisions.
— BFM News (@NewsBFM) February 13, 2025
