- Forest City SFZ is up and running soon
- India is turning away from our palm oil
- China is limiting its exports so that the United States tak marah
IN Malaysia
Taxpayers will be funding the soon-to-be-running Forest City Special Financial Zone
Finance Minister II Amir Hamzah Azizan announced that Forest City will be the first test bed for the 0% tax rate for family offices, or private asset management firms that serve wealthy individuals and their families. This initiative is expected to be operational by the first quarter of 2025. Another initiative announced by Amir Hamzah is the special 5% tax rate for financial technology and foreign payment system operators.
What is mentioned above is among the menu of ‘temptations’ to revive the USD100 bil Forest City development project, a joint venture between Country Garden and a private Malaysian company backed by the country’s king, Sultan Ibrahim. While the ultra T10s live tax-free in places such as Forest City SFZ, the M40s and B40s are taxed at every turn, even our annual bonuses. Perhaps, wouldn’t it be lovely if PMX could give us a little love by waiving the taxes on bonuses?
On a related matter, Juwai IQI co-founder and group CEO Kashif Ansari stated that the set of incentives announced for Forest City is set to increase home sales by 20%. At the moment, Forest City which is developed to house 700,000 inhabitants, can only attract about 2,000 residents, a measly 0.3% occupancy rate.
Source: https://www.nst.com.my/property/2024/09/1108511/forest-city-sfz-set-boost-home-sales-20pct
Ringgit is at its best in 50 years
The Malaysian Ringgit is enjoying its day under the Sun, the best quarter since 1973 and it is expected to extend its rally. At the moment, the Ringgit has performed 12% better than the United States greenback this quarter. Narrowing rate differentials with the US, improving trade performance and attractive asset valuations may help the ringgit strengthen further, analysts said.
Perhaps it is time for Google to reintroduce the Ringgit – US Dollar currency conversion tool as Malaysians will not be too sensitive to the current exchange rate, even if Google does make a mistake.
Source: https://theedgemalaysia.com/node/727542
However, not trying to be a party popper but an appreciating Ringgit is not good for an export-oriented country like Malaysia as it will make our goods and services relatively more expensive in the international market. According to the Ministry of Investment, Trade and Industry (MITI), Malaysia’s trade numbers in 2023 are RM2.637 tril, with RM1.426 tril in exports and RM1.212 tril in imports. Malaysia’s exports in 2023 were dominated by E&E products which accounted for a 40.4% share of total exports.
Our neighbour Thailand is also experiencing the same problem. The drastic rate cut by the US Federal Reserve led to the Thai Baht being the second top-performing currency in the region, just behind the Ringgit. However, this is the title that Thailand does not want to attain. Local manufacturing players even urged the central bank to make rate cuts, shadowing the US Federal Reserve’s move. Tourism players are also worried as the strong baht and global economic uncertainty mean foreign tourists have less to spend in Thailand. The Thai tourism sector is key in the country as it contributed 12% to the GDP and over 20% of the total employment in 2023.
All news on palm oil
- Commodity Minister Johari Abdul Ghani stated that his ministry has presented a proposal to the Ministry of Finance to revise the windfall profit levy (WPL) on palm oil in the country. Johari added that WPL is no longer relevant in the face of rising production costs in the palm oil industry. Currently, a WPL rate of 3% is imposed on palm oil prices exceeding RM3,000 per tonne in Peninsular Malaysia and RM3,500 per tonne in Sabah and Sarawak.
- The Bollywood romance affair between Malaysia and India may be nearing its end as Indian refiners have cancelled 100,000 metric tons of palm oil purchases for delivery between October and December with suppliers including from Malaysia. The cancellation is prompted by increased import duty on crude palm oil (CPO) (from 5.5% to 27.5%) and the rising price of Malaysian CPO. India, the world’s largest importer of edible oils, previously increased the import duty to protect its local oilseed farmers. Indian refiners do not want to buy the expensive CPO for the winter months, which is traded at a premium compared to soy oil and rather enjoy a decent profit by cancelling old orders.
Sarawak will soon have its own bank
After receiving the ‘blessing’ from Bank Negara Malaysia (BNM), Sarawak will soon formalise the acquisition of shares in Affin Bank Bhd from its existing shareholders – Lembaga Tabung Angkatan Tentera (LTAT) and Boustead Holdings Bhd, raising its stake in the bank to about 30%. The acquisition of the shares that is slated to be announced on Friday will skyrocket the state government as the largest shareholder of Affin Bank. The bank which is traded publicly on Bursa Malaysia has a market capitalisation of about RM7.2 bil. Comparatively, Malayan Banking Bhd (Maybank), the country’s largest bank has a market cap of RM129.12 bil.
Around the S.E.A.
Not-so-encouraging news coming out from China
- Steel mills bankrupting – According to Bloomberg Intelligence, steel mills in China are facing a steel crisis where each of them is facing bankruptcies, one by one like domino. In the first half of the year, almost 75% of the country’s steelmakers suffered losses due to the not-as-expected economic growth and the ongoing property crisis. So, when the local market does not need their steel, they look elsewhere but the international market does not want their steel also as other countries are accusing the Chinese metal is being dumped at below cost. Bagaikan keluar mulut buaya, masuk mulut harimau, China steelmakers is now pishang. That is why the Chinese government is calling for consolidation in the local steel industry – where the top five companies to control 40% of the market by 2025 and the top 10 to account for 60%.
- China to limit export of certain products – In the name of national security, the Chinese Government has implemented stricter controls on items with both military and civilian applications such as nuclear technology, missiles, biotech, and chemicals. The new regulation supplements the existing export control law announced in 2020. The enhanced restrictions on dual-use exports is timely to reduce the tension with the United States as Uncle Sam already accused China of supplying dual-use products to Russia, fueling the Ukraine invasion. So, kiranya China still takut to the US rupanya.
Big deals incoming in the semiconductor industry
- Apollo-Intel – Apollo Global Management Inc has extended a lifeline to the struggling chipmaker Intel by offering a multibillion-dollar investment, to the tune of USD5 bil. Apollo had worked before with Intel, where the latter sold a USD11 bil stake in a chip plant in Ireland to the former. Other than Apollo, previously, another US-based company, Qualcomm also mulling over the possibility of taking over Intel. The sharks are circling the wounded Intel, waiting to pounce on the prey.
- TSMC-Samsung – Taiwan-based TSMC and South Korea-based Samsung Electronics are set to kindle an East Asian romance in the Middle East, having discussed building huge factory complexes in the United Arab Emirates that could transform the chip industry in the coming years. The project between the duo in the UAE could be worth north of USD100 bil.
For your EYES only
We are not undermining the severity of GISB Holdings’ alleged child abuse claims at its welfare homes, whereas it stands, that nearly 500 kids have been rescued by the authorities. While the police are doing the good work, the netizens are also doing their part by basically reducing the importance of GISB down to a laughable meme. One thing we can agree on is that GISB does know how to create a catchy song.
Kalau dah masuk hari ke-7 tapi tapi masih terngiang-ngiang lagu GISB, maksudnya kau dah log in sebagai ahli.
Kau tinggal pegi cawangan berhampiran ambik kad keahlian dengan ketayap je. Lusa dah boleh start buat roti.
— Amran Fans (@_AmranFans) September 20, 2024
