Look at the ptoblems they have getting jobs ar home.
Look at the ptoblems they have getting jobs ar home.
Don’t play play.
These ang mohs had Thai wives and Phuket properties. Their wives cheated them.
British expat Ian Rance and Irishman Colin Vard are now living almost penniless with their children on the outskirts of Bangkok as they struggle against overwhelming odds to recover properties they bought on Phuket. Both men lost all their investments through frauds that neither of them imagined were possible.
The wives (exs?) are now in jail but that’s little consolation to their husbands and children.
Our govt has officially requested Jakarta to provide S’pore with the names of those companies that are causing the fires. This would allow S’pore to take legal action against those responsible for the haze that has covered us, M;sia and now southern Thailand.
But Indonesia’s Coordinating Minister for Politics, Law and Security Luhut Pandjaitan has given us us the finger on the issue (and in so doing tells us that the plantation cos are being protected), despite Indonesian officials regularly blaming S’pore-based (and M’sian based) cos for the fires.
Speaking to the media here after delivering a public lecture on Monday (Oct 19), he said Jakarta might consider releasing the names of the companies after they have gone though the legal process in Indonesia*.
Jakarta has said it is not yet ready to officially disclose names of plantation companies responsible for the forest fires in the country that caused the haze in the region.
Indonesia’s Coordinating Minister for Politics, Law and Security Luhut Pandjaitan said releasing the names would create uncertainty within the country.
He added that the Indonesian government also do not want to create an uncertain situation within the country because of this. “Moving forward, they know that they are going to get punished by the government. I think this is very important.
“But next year, we have already given them a clear message: We are going to revoke their licence, no question about that. That I can assure you. They understand that fully.”
So it seems that the companies are to be given yet another chance to avoid being named and shamed, and prosecuted here. Did money cdhange hands ?
Related post: Another Indon goof https://atans1.wordpress.com/2015/10/19/haze-indons-forgot-about-el-nino/
*Legal process, what legal process? He said: “Well, we are not protecting (plantation companies). Like I mentioned earlier, we have not officially submitted the names to the court. So how can we disclose them to the public? It’s unfair. We’ll wait for the court’s final decision.”
How can courts decide if the names are not officially submitted? So Kafkaesque of, relating to, or suggestive of Franz Kafka or his writings; especially : having a nightmarishly complex, bizarre, or illogical quality <Kafkaesque bureaucratic delays>
Did money change hands?
And why the Malay ultras think that they are ingrates.
BN wastes reserves defending ringgit
Remember MayBank Kim Eng says Thailand and S’pore mkts most resilient in region.
Here’s another analysis coming to the same conclusion
Idonesia is 4th after some real dogs Venezuela, Turkey and Ukraine. Yikes, it might be a another real dog.
M’sia is way down even below PinoyLand. Thailand is juz better than M’sia while Vietnam is really safe by the standards of the others. Safer than Saudi Arabia.
The following lament by the Thai PM to the feisty Thai media sounds familar?
“No one writes about what I have done,” he said, “or when they do, they write so little.”
Sounds like our PM, Khaw, ESM or any PAPpy complaining about new media (including social media)
But they can console themselves with this:”Things will be the same.”*
Sadly for the cybernuts and their heroes Meng Seng, S/o JBJ, Roy etc etc , this is not true here: “You have disrupted and brought down the whole system.”. Here the cybernuts and their heroes provide comic relief from the spin of the PAP.
This was preceded by “It doesn’t matter how many reforms or coups there are. There’s no point.”
Our economy in absolute terms is bigger than PeenoyLand. And we only slighly smaller than M’sia. Only Thailand and Indonland bigger than us in absolute terms.
Maybe the PAP should add these to its list of institutions to make sure voters make the right choices and if they don’t (think Aljunied) to protect them from the consequences of their actions, whether they reprent or not voting in the oppo (think Aljunied again). Obviously the PA system is not working in Aljunied: otherwise no need to take WP TC to court.
Ten or so other institutions will help to baby-sit the politicians, including a “National Moral Assembly” which will punish those who act unethically, a catch-all term that could be used against government critics. Three-quarters of the 120 seats in a new “National Reform Assembly” will be reserved for toadies now serving in one of the junta’s various conclaves. Their job will be to prevent any future government deviating from a legislative programme that the generals are now laying down.
Singapore – where the ratio of household debt is 75% About 75% of this household debts are mortgage loans – See more at: http://www.straitstimes.com/news/opinion/eye-the-economy/story/spore-not-headed-debt-disaster-20141125#sthash.oh3vAXO3.dpuf
The “affordable” 25 year HDB loan is responsible for S’pore’s high household debt. And remember it’s not freehold not a 99-yr lease from the govt.
S’poreans like Brits are stupid? [T]he economists calculate that homeowners discount future benefits over the very long run at a rate of 2.6% per year. This is lower than the rates used by governments to assess infrastructure projects or by pension funds to evaluate their liabilities, and suggests that the general public is more patient than the authorities give it credit for.
Switzerland has been ranked the happiest country in world.
Singapore is ranked 24th But is tops in Asean and region. Thailand is placed at 34, Taiwan (38), Japan (46), South Korea (47), Malaysia (61), Hong Kong (72), Indonesia (74) and PinoyLand (90). China and India are found lower down the scale at 84 and 117 respectively
Manila’s PSE was the top performer – with a gain of 9.8% in Q1. Thailand wa the worst, the SET pulling ahead by 0.55%. STI managed 2.4% year-to-date.
The Phi;ippines grew at an annualised pace of 6.9 per cent in the final three months of the year, far ahead of the 6 per cent expected by most analysts. The quarter-on-quarter figure of 2.5 per cent was the highest in almost two decades, according to calculations from analysts at Barclays.
TRE reader’s take on PinoyLand and Pinoys could explain why they still not going home, but prefer to stay here or come here
Peenoys overestimate themselves just because the Spore Govt gave them jobs but are in fact is using them as cheap labor. They fail to see that they are being undercut. They get cocky and boastful and are a complete discredit to themselves and their country. And they are just talk and no substance.
Why come to Spore? Because Pinoylands is built on quicksand. If your are worth your salt then go back and contribute to building your slums into a decent habitat.
After all they can discriminate against S’poreans in S’pore
Alleged discrimination based on nationality continued to top the list of complaints received last year by the Tripartite Alliance for Fair and Progressive Employment Practices (TAFEP), with the banking and information technology sectors still the most problematic.
These cases made up half of about 300 complaints in total. However, TAFEP general manager Roslyn Ten said many stem from misunderstanding and not from genuine bias, and urged companies to improve communication with job seekers or existing employees by explaining why, for example, foreigners instead of Singaporeans were hired or promoted. (CNA)
Juz wondering if getting paid less than S’porean is a legit reason for discrimination? Juz asking.
Thailand’s aviation sector is under scrutiny after an international safety audit led to a ban on new flights to China, Japan and South Korea.
Last week the International Civil Aviation Organization (ICAO) issued an alert flagging “concerns relating to air operator certification procedures”.
Last week the ICAO issued an alert which triggered increased physical inspections of aircraft operated by Thai airlines serving existing routes to countries such as Australia and Singapore, a regional air hub, as well as a ban on airlines expanding their services.
Fly SIA and associates. Don’t be cheap skate! Can die die if fly Thai. ))))
Update at 5.30am
From CNA on Thurday
The surveillance and ramp inspections of Thai carriers’ aircraft operations in the Republic have been stepped up, said the Civil Aviation Authority of Singapore (CAAS) in a news release on Thursday (Apr 2).
Its statement came after the International Civil Aviation Organisation(ICAO) reported “significant safety concerns” in Thai carriers earlier in the year. The Thai government has since said it would urgently improve airline safety in the country.
CAAS added it has not imposed any restrictions on Thai airlines. This is unlike other countries like Japan, who blocked new flights from Thailand last week – a move which affected charter services by budget carriers such as Thai AirAsia X and NokScoot.
In the release, CAAS said it has in place a Foreign Operators Surveillance Programme (FOSP), under which foreign carriers are required to have an Operations Permit from CAAS to operate in Singapore.
The release said that CAAS evaluates an application for an Operations Permit “using a risk-based methodology”, which takes into consideration factors such as the safety oversight capability of the State of Operator, the operational capability of the carrier and the safety records of the aircraft.
“In assessing a foreign carrier’s operations, CAAS takes into consideration safety information from other aviation authorities including the outcomes of the inspections or audits they conduct,” it added.
“CAAS also conducts periodic ramp inspections on the foreign carrier’s aircraft when they are in Singapore; the frequency of which is dependent on CAAS’ assessment of the carrier.”
The regulator assured that any major deficiencies found in the ramp inspections have to be addressed by the carrier for it to continue operations in Singapore.
Around the time of the Spring Festival celebrations began, the Foreign Trashes managing SGX (president and head rechie are FTs, CEO is leaving) boasted that SGX was planning to attract Chinese cos here. Remember that in Asean, the Thai exchange raises more money than this global financial centre.
Well looks like the FTs still running SGX are hoping that S ‘poreans have forgotten that they lost money in S-chips.
Here’s a reminder that the Cina have not cleaned up their act. During the Spring Feitval hols, London-based directors of Naibu Global revealed they had suspended shares in the Aim-quoted Chinese sportswear maker because executives in China had refused to update them on the co’s finances. Err maybe now that the Spring Festival is over, they’ll contact the London directors. Somehow I doubt it.
Morgan Stanley is recommending going long on the US dollar against the Singapore dollar, the Thai baht and the South Korean won and a long position in the rupee against the Singapore
Of course MS’s assumption is that US raises rates. Didn’t happen lasy yr when that was conventional wisdom.
But India looks pretty good: As Rivals Falter, India’s Economy Is Surging Ahead Long considered a laggard, India is seeing a lift in its stock market as multinational companies look to expand operations there or start new ones, The New York Times reports.
And according to Credit Suisse, India is a major bet for global EM managers these days. Funds on average hold over 15% of their portfolios in Indian companies, double the benchmark weighting. Gd for them: in USD terms, India’s up 41%
The Indian rupee, the Philippine peso, Thai baht and Taiwanese dollar have strengthened against the US dollar, making repayment of dollar debt easier in these places.
Btw, still long Ascendas India Trust.
Malaysia … have to cope with lower tax revenue from energy, minerals and other commodities. In Thailand, the central bank is hoping for a lift in public spending to revive growth; but the military-backed government is finding it hard to spend the 2015 budget.
Thailand will need monetary stimulus this year.
Relatively young countries like Indonesia, Vietnam and the Philippines drag down the average age.
[T]he private sector in Asia-Pacific now owes 1.5 times the region’s combined annual output, according to the Bank for International Settlements. As a big chunk of the borrowing is in the opaque shadow banking system, particularly in China, the debt could be even larger. Either way, servicing the loans requires incomes to increase quickly. Yet, real GDP growth is slowing almost everywhere in the region.
The threat of slowly rising consumer prices slipping into outright deflation is making things worse. Producer prices are sliding across Asia-Pacific. Falling energy costs provide a convenient excuse for margin-starved employers to skimp on pay hikes, just as they did in the late 1980s. That makes the situation harder for borrowers in Malaysia, Korea, Thailand and Singapore, all of which have high household leverage. Persistent lowflation will leave borrowers with higher debt burdens than they expected.
Demographics aren’t helping. Japan, China, South Korea, Singapore and Thailand are ageing rapidly.
(Panama sounds interesting)
And given the strong S$ and the value of property here*, we S’poreans got options to move on and yet remain nearby. Yet people like Goh Meng Seng and Andrew Loh die die want S’poreans to live and die here. They should let S’poreans decide, not insist that real s’poreans sgould stay home.
*Surely the PAP administration has shumething to do with these?
The Pinoys should go home if they really are proud of their country. Maybe coups are gd for the stock market (Egypt, Thailand)
OK it’s Thailand but given the performance of ex-genewrals like BG Yeo, NOL’s CEO and SMRT’s CEO (still can’t fix security issues, let alone get the trains to run on time), if SAF stages a coup after a freak election, we’ll be like Thailand in no time..
Six months after the military coup in Thailand
The latest GDP figures have eked out small increases, leading the government’s economic forecasting agency to predict growth of just 1% this year.
Worryingly, since the coup, tourist numbers have fallen by 20% as travel warnings issued by governments have deterred some visitors.
The Thais can blame the political problems there. Govt here blames the “deft” locals for insisting that govt cuts back on its uber liberal immigration policy? To be fair, we’ve the only developed country in Asean, so lower growth rates are par for the course. Tell that to TRE ranters and other anti-PAP paper warriors: they blame the PAP for everything that isn’t “right” here. .
In a late Sept report, FT reported that the Barings Fund mgr managing an Asean fund is cautious about topping up his exposure to Singapore and Malaysia due to fears about their economic growth prospects.
Mr Lim has large underweight positions in both countries via his $592.4m Asean Frontiers fund, which targets members of the Association of Southeast Asian Nations.
Singapore makes up almost 30 per cent of the portfolio, compared with 33.7 per cent within the benchmark MSCI South East Asia index. The manager has just over 19 per cent in Malaysia, against the index’s 26.5 per cent.
In July, data showed the Singaporean economy had contracted on a quarterly basis for the first time in two years, while Malaysia is going through a process of budget deficit reduction and may miss its 2014 target.
“Singapore and Malaysia are more developed than the rest of the Asean countries … This makes them more expensive and in the long term they don’t have as good growth potential.
“In terms of size, Malaysia is much smaller than the countries we favour, such as Indonesia, so it is less likely to expand rapidly.”
Mr Lim said he can still find selective opportunities in Malaysia, but ones which do not necessarily rely on the domestic economy. Tune Insurance, an online travel-insurance provider based in the country, is one of the latest additions to his portfolio.
“Tune allows us to access the tourism market without investing in airlines, which have to deal with a lot of regulation and are [involved] in price wars,” he said.
In general, he finds growth companies in Indonesia and the Philippines more enticing.
Baring ASEAN frontiers … holds a 3 per cent overweight position in Indonesia. He is confident 2015 will be a strong year for the country, given that the macroeconomic environment has improved.
Investors had been wary of Indonesia as they awaited the results of presidential elections in July. However, as Joko Widodo has been elected and interest rates are expected to rise next year, Mr Lim said there is now a positive outlook.
… had mixed feelings about Thailand, which makes up 15.1 per cent of his portfolio. This is in line with the benchmark.
“Thailand has a higher risk than the rest of the countries in the region, as there remains a lot of political uncertainty around the constitution,” …
In July, Thailand adopted an interim constitution ahead of the October 2015 elections. This constitution preserves the military-led government, called the National Council for Peace and Order.
When I started work in broking in the late 80s, ex-Japan, HK and S’pore were the leading stock mkts. Today, we are not even the leading exchange in SE Asia. Thailand has a bigger exchange despite its political, economic woes.
I note SGX is led by two FTs, an ang moh and and Indian Indian. any surprise if “S’poreans hate Foreign Trashes to pieces”.
Hmm maybe our anti-PAP cyber warriors should take a leaf from Thai oppo.
Thailand’s military leader and premier, Gen Prayuth Chan-ocha, has accused critics of using black magic against him, it’s reported … Prayuth addressed his critics: “If you still want to fight on and go underground, bring it on. If you resort to performing rituals, just bring it on.” … Magical symbolism has long played a role in Thai politics. During the last big wave of protests in 2010, anti-government demonstrators splattered buckets of their own blood outside the PM’s residence as priests cast a curse on the authorities. http://www.bbc.com/news/blogs-news-from-elsewhere-29075681
Maybe anti-PAP cyber-warriors need to splatter their own blood, given that their curses posted on TRE etc don’t have any effect. But then they don’t even bother to turn up at their heloos’ rallies.
Charoen’s empire (Remember he is bidding to buy OCBC group’s shares in UE).
Those who own Frasers’ reits have to take account of the increased risk profile of the reits. There is no longer cash rich, conservative F&N as the fall back, indulgent parent (it rescued FCT by injecting a valuable asset in the 2007/ 2008crisis). There is a Thai billionaire who it seems is geared to his eye-balls and more. In the 1997/ 1998 crisis, he nearly went bust.
Number of foreign visitors received in 2013
I’m surprised that Indonesia has only 8.8m visitors given the popularity of Bali.
Still Mynamar is the place to invest in the tourism biz. Opportunities there from recent BBC article.
Well the Thai jumta now has its very own version.
The army men in charge of the new dictatorship say their aim is to build a “Thai-style democracy”. Their intervention looks more interested in reviving a system of tutelary democracy, in which a bunch of royalist elites control the state, though the new regime denies it. Their alternative explanation, based on a notion of Thai uniqueness, seems to have been pulled out of a hat like a rabbit.
There is an obvious resemblance to the concept of “Asian values”, such as were espoused by Mahathir Mohamad, who ran Malaysia for 22 years. That idea tends to preclude robust democracy, and to justify itself on the back of economic development. It has proven useful to governments like Singapore’s and these days its champions tend to point approvingly to China.
Banyan (19th August 2014)
And of course, the govt here claims that China is juz following S’pore.
Chinese are number 1. lie to friends and family about the marvellous time they had,The survey didn’t give a reason for why the Chinese exaggerate the most about their holidays, but the status of being able to afford to go abroad, ensuring you keep one step ahead of the Wangses, may be a factor. Another explanation could be that the Chinese tourist is a relatively recent phenomenon who could learn a thing or two about complaining from travel-hardened European and American holiday-makers Economist
Both reasons are likely to apply to
the sheep Singaporeans too.
In Asean, Thais are ahead of us. Interestingly, Hongkies, who many locals think are BS artists don’t exaggerate that much. But then they have a reputation for being gd at complaining.
When I saw the above table, I tot of the Deaf Frog’s “Cheaper, Better, Faster”. There is always somewhere cheaper as above from FT article shows. And MNCs will move there: now moving from Jakarta and Vietnam to central Java. (Btw, $ + US$)
“Cheaper, Better, Faster’
The apologist version of what he meant by a website funded by a organisation headed by one Philip Yeo after being approached by one BG Yeo (taz the rumour). With credentials like these how not to believe meh?
In 2007, Lim coined the phrase to exhort Singaporean companies to increase their competitiveness.
Companies have to be cheaper and better than their competitors internationally, because those who used to be cheap (China) are now getting better, and those that used to be good (United States) are now getting cheaper as well. Hence, Singaporean companies have to be cheaper and better than them, and yet turnaround faster.
He obviously didn’t do an MBA: it’s accepted wisdom that one cannot have all three, only two. Attempts to have all three results in failure. This should cheer on TRE posters: Swee Say is urging a policy doomed to failure.
Especially those TRE posters (loonies?) who shout that the Oppo will win the next GE*. They ever tot that if the PAP is as bad as what they claim is the case, the PAP won’t steal the election Cambodian style?
Last yr, in a closely fought election, the governing party (the PM says LKY is a hero of his) won a majority of seats in the parliament. The Oppo alleged fraud and refused to take their seats and called for fresh elections. The govt passed laws to its satisfaction in the absence of an oppo in parly.
Now a deal has been struck. The electoral commission is at the heart of the deal. The CPP-dominated National Election Committee—widely derided as a puppet of the government—is to be overhauled, which requires that the constitution be changed. The two major parties will now have four members on the committee, with a ninth independent member to be agreed on by both sides.
The timing of the deal, so near the anniversary of the contested election, might not be a coincidence. Both sides were feeling the public pressure to reach an agreement. For the opposition, the question was how long they could keep operating as a political force with only rallies and public protests to bind them together, while laws were passed without them in the assembly. The government was faced with the prospect of having to keep defending that one-party parliament to the international community.
The violence the government employed to disperse protesters drew a steady stream of criticism throughout the year. Security forces beat and arrested demonstrators, and at least seven were shot dead.
Just as S’poreans should be watching developments in Thailand,
we should follow developments in Cambodia. There are lessons to be learner especially about the importance of the election organisers (here under PMO).
Interesting the Thais have introduced a law banning gatherings of five people or more. They learnt that from us?
*None of the Oppo parties believe this is possible. Ask SDP, NSP, People in light blue, SDA, JBJ Remebrance Party, Chiams, TJS Team and Pwee Gang.
(Or “What else can the Thais teach us about military rule”)
Further to https://atans1.wordpress.com/2014/06/15/freak-election-training-manual-for-safs-paper-generals-and-us-40-sporeans-too/ based on what is happening in Thailand, when there is a freak election result (2016 as TRE posters are predicting) and the SAF’s paper generals stage a coup to
restore the PAP protect parliamentary democracy, S’poreans will be detained for reading Orwell’s Animal Farm and 1984, and handing out food packets to passer-byes.
In Thailand, a man was detained for reading Orwell’s 1984 outside a shopping mall, while others have been detained for preparing to hand out sandwiches.For some reason, giving out sandwiches is considered a protest against the coup, not other food though.
In S’pore, the public reading of Animal Farm and 1984, will be illegal as well as sharing food. I’m also sure that bloggers who refer to Animal Farm will be prosecuted, and their blogs closed down: for defaming pigs.
But looking on the bright side, the SAF generals may do what the Thai generals are doing: spend money that Thailand may not have
IT DID not take long for Thailand’s ruling junta to discover the first lesson of building popular goodwill: when in doubt, spend. The National Council for Peace and Order (NCPO), the ruling junta led by General Prayuth Chan-ocha, has occupied itself in its first month in office airing out government coffers with a high-powered leafblower. It paid nearly 92.4 billion baht ($2.8 billion) to rice farmers under a subsidy scheme implemented by the deposed government of Yingluck Shinawatra. It is pondering ambitious transport schemes estimated to cost more than $72 billion.
It has also promised to clear a $21-billion backlog of projects awaiting approval from the Board of Investment (BOI)—of which Mr Prayuth has appointed himself chair. At the BOI’s first post-coup meeting, on June 18th, it approved 18 projects worth $4 billion.
The bad news is that investors don’t like coup as the above link tells us.
So the news may be that our paper generals may juz except a freak election result: so long as they can play with their toys.
By 2050, elderly (65 and over) almost 40% of population
Next to Japan only. But no robots here, only FTs.
Japs smarter than us in avoiding the problems that FTs bring, like pushy Pinoys, wanting to change PM from Prime Minister to Pinoy Minister and SPF to S’pore Pinoy Force. But then they have friends like William wan, Kirsten Han, AWARE and Maruah. Their only public opposition is Gilbert Goh and Goh Meng Seng.
The govt should remember that when the Pinoys burnt our flag in the 1990s and it protested, the Pinoy govt gave the S’pore govt the finger, telling it nothing wrong with burning our flag.
Remember the Hard Truth that the SAF could intervene if there is a “freak” election result?
Could what is happening in Thailand tell us what will happen here when in the near future when the PAP (even with the help of its near clones, the People in Blue) is unable to command a parly majority? And the SAF intervenes?
The paper generals could do worse than to follow the Thai generals and give us, for starters, free World cup footie? http://www.bbc.com/news/world-asia-27790396 And if its not a WC yr, then free EPL*?
Thailand’s ruling junta has ordered TV regulators to ensure that football fans will not have to pay to watch any matches at the World Cup.
This will be part of what The military said it was part of its “happiness campaign”, which has seen a number of policy gimmicks, such as free haircuts and concerts. In S’pore, S’poreans would appreciate free hawker food and no PUB bills.
As the Economist reports:
One of their priorities is a push for Gross National Happiness. The day after the coup General Prayuth told diplomats that economic revival was a big priority. Returning happiness to the people is to be counted a separate issue, apparently. A week later, and state agencies have been reported to be working on a Happiness Index. The Nation, a pro-establishment newspaper that has come to read like a Thai variation on one of Vietnam’s Party-controlled papers, reported that under the generals all of the existing economic plans have been amended—in order to boost gross national happiness. Perhaps this is all an allusion to the happiness-minded people of Bhutan, also Buddhists who adore their king? Then try picturing Bhutanese marching through Bangkok in jackboots.
On June 5th the junta organised its first “Return Happiness to the Public” event. Staged at Victory Monument, which had recently been the site of small-scale protests against the coup, it featured dancers in camouflage outfits; a spicy routine by the orchestra of the Royal Thai Army; plus free food, and haircuts. A few hundred or so fans of the army showed up, and its Thai Psychological Operation team says it was pleased with the attendance.
The generals could learn about interrupting tv programmes: Since the coup on 22 May, TV programmes have frequently been interrupted by the army listing names of people they’re summoning for questioning. Though not of course footie games.
And making, All those detained … sign an agreement which states they will not criticise the military government.
And for us S’poreans who did not PAP in GE 2011, we can do what the Thais who are unhappy about are doing
— eat sandwiches (State-run newspapers have warned people against eating sandwiches, and a senior police chief said they’re keeping a close eye on the sandwich-eaters. Eating sandwiches is not illegal per se, he said, but if sandwich-eating is being used as a front – when the real intention is to criticise the coup – then that would be.);
— give the three-finger salute
On a serious note, what the Thai coup is all about: Royalists not happy at who is the heir to the thrown http://m.afr.com/p/world/thailand_secret_story_the_battle_QcvSA6u4clBHmLTFPLFQNJ
What is not reported in the story, is that Thaksin and the crown prince are buddies.
PAP PA is showing WC and EPL matches https://atans1.wordpress.com/2014/06/12/paps-new-secret-weapons/
But this TRE poster is unhappy, he can’t bring his own food and drink:
there is a rule which says:
No outside food and drinks are allowed. Tidbits and drinks (hot/cold) are sold in the football loft.
The reader said, “I am very angry at how the PA is exploiting Singaporeans, even politicizing sports and profiteering from the World Cup!”
He said that he can understand if the place is a food court or restaurant whose primary interest is to make money and it demands that no outside food and drinks are allowed. But he cannot understand why PA disallows residents to bring their own tidbits and drinks.
“I am not allowed to bring outside food and drinks but can only buy the more expensive food and drinks directly from PA???” the reader said. “Why can’t I bring my own water from home?”
“Why this kind of small money PA also wants to make? What about the millions of dollars of budget allocated to PA every year? Not enough?” the reader wondered.
The reader was also angry that priority is not given to Singaporeans to watch the free screenings.
“It does not state if priority will be given to Singaporeans. In previous PA events in which I have attended, such as the monthly walk-a-jog sessions, a certain group of nationality will jump at every chance to hog free drinking water or other goodies after the walk-jog,” he added.
The reader then took issue with the limited seating capacity as the venue could only cater to 150 viewers.
“Is this a joke? In GE 2011, there were 27,701 voters in Hong Kah North SMC and today only 150 out of 27,701 voters can watch the matches for free???” the reader asked.
“That’s not even 1% of the residents!” he exclaimed.
He remarked sarcastically, “The PA must not underestimate that only 150 out of 27,000+ voters will go to the CC – this is not a PAP GE rally!”
“Will the PA please stop treating citizens as sheep?” he asked.
The reader concluded by saying he will not bother to write to the PA, REACH or his MP, Dr Amy Khor.
“Because I am afraid Dr Amy Khor would repeat what she has already said in parliament that ‘Singaporeans first’ policy is not good for the economy!” he said.
Gosh, he think S’pore’s his grandfather’s place is it? And he xenophobe to boot?
Singapore equities are Morgan Stanley’s Asean choice compared with those of Thailand and Indonesia, because of their attractive valuations and defensive nature.
“In a rising rate environment, we believe Singapore could be a relatively safe haven (despite its higher earnings volatility), excluding its relatively vulnerable property sector,” a report by Morgan Stanley Research said yesterday.
In a huge plug for the PAP govt (eat yr hearts out TKL, KenJ, TRE readers), S’pore’s relatively low political and policy risk and its healthy banking system, and well managed cash-generating firms are what makes S’pore its top pick in Asean..
This contrasts to the continued political uncertainty in Thailand and the fact that positive developments on the Indonesian macroeconomic front appear to have already been priced in by equity investors. Morgan Stanley report was neutral on Indonesia, and Thailand was the analysts’ least-preferred market.
The editor and publisher of The Gloom, Boom and Doom Report said that he personally favors emerging market securities that are still “cheap” …
Marc Faber underlined his belief that emerging markets provide a more suitable option for more profitable investments. He added that he has parked cash in countries such as Vietnam, Iraq, Malaysia, Thailand, and Singapore.
“I made some investments more than a year ago in Iraq, because it’s very cheap. There’s lots of problems but the market is very very inexpensive,” he said. “Russia is dirt cheap, but I don’t think there is a hurry to buy Russian stocks.”
As usual he is a super bear over the US.
This week’s Asean’s round-up is all about Temasek or its TLCs.
Singapore state investor Temasek Holdings Pvt Ltd TEM.UL is seeking to sell its $3.1 billion stake in Thai telecom company Shin Corp INTUCH.BK, according to people familiar with the matter, and has approached its SingTel (STEL.SI) unit as a possible buyer. But the troubles in Thailand have put an end to the talks.
TRE and TOC readers will be banging their balls when they learn: The Temasek stake in Shin Corp, founded by former Thailand prime minister Thaksin Shinawatra, is worth $3.1 billion by current market value.
Shin Corp’s shares now trade more than 50 percent above the price paid in 2006 by a Temasek-led consortium, that included Chinese-Thai businessman Surin Upatkoon, when it bought 96 percent of the Thai firm for a total of $3.8 billion.
As for SingTel:
“At a fair price such a deal would make sense for SingTel,” Chris Lane, senior analyst at Sanford C. Bernstein in Hong Kong who covers Asia-Pacific telecommunications. SingTel is 52 percent-owned by Temasek.
Shin Corp owns 40.5 percent of Thailand’s biggest mobile telecoms company, Advanced Info Service Pcl ADVANC.BK. SingTel already has a 23 percent stake in AIS: Adding the Shin Corp stake would cement its position in a bigger market and offset sluggish growth in mature economies where it’s also present, like Australia.
“SingTel executives are involved in the day-to-day operations of the company AIS,” said Bernstein analyst Lane. “Buying the stake from Temasek avoids the possibility of another ‘telco’ securing a significant interest in AIS.”
FPT Corp, Vietnam’s largest publicly traded telecommunications and software company, has asked Temasek to help it identify a Singapore technology company for acquisition to boost sales overseas, the Bloomberg news agency reported.
FPT will spend as much as US$20 million (S$25 million) on a Singapore acquisition, Chief Executive Officer Bui Quang Ngoc said in an interview on Wednesday. The company, which had sales of 28.6 trillion dong (S$1.7 billion) in 2013, seeks to more than triple revenue from overseas to US$400 million by the end of 2016, co-founder Mr Ngoc, who took charge in July, said in Hanoi. “Singapore is a very attractive market,” Mr Ngoc said. “If we can be successful in Singapore, it means we have enough experience to do it in other countries.”
FPT is looking to acquire a Singapore company that specialises in software services such as inventory management, order processing and employee payroll, said Mr Duong Dung Trieu, chief executive officer of FPT Information System, a unit that contributes 25 per cent of the parent’s pretax profit.
The company plans to make the acquisition in Singapore “as soon as possible,” Mr Ngoc said. Temasek holds less than 5 per cent stake in FPT, according to the Vietnamese company.
Finally airport services and catering firm SATS (a listed TLC) agreed to buy a 41.65 per cent stake in Indonesian aviation and food service provider Cardig Aero Services for 1.1 trillion rupiah (S$118 million) to grow its business in South-east Asia’s largest economy.
Indonesia is a priority market said SATS. The country’s topography and a fast-growing economy and middle-class population will continue to drive greater demand for high-quality food and travel, it said. “CAS is an attractive investment opportunity in our core business which will generate sustainable value for our customers, employees and shareholders as Indonesia continues to grow,” said Mr Alexander Hungate, President and Chief Executive Officer of SATS.
And he’s right about Indonesia: http://www.economist.com/news/finance-and-economics/21596989-how-worlds-fourth-most-populous-country-weathering-emerging-market
[S]outheast Asia has confounded the sceptics. Thailand, Indonesia and the Philippines – the “Tips” – weathering the latest storm with relative ease.
The Jakarta equity index has recorded the biggest gain of any major market – emerging or otherwise – this year, rising 5.2 per cent in dollar terms since the start of January. Financials have led the charge with Bank Rakyat jumping by more than a fifth.
The Philippine market has risen 1.5 per cent, while Thailand’s loss of 0.4 per cent looks tame compared with other EMs. For the same period, Russia’s Micex is down 7.2 per cent and Brazil’s Bovespa is 7.9 per cent lower.
A similar pattern has played out in currency markets. The Indonesian rupiah and the Thai baht are the top EM performers against the dollar this year. [EM means Emerging Markets]
Previous rallies in southeast Asia have been driven by aversion to China – the Tips are less reliant on exports to the country than are many other places in the emerging world. As concerns about economic growth and the financial system bubble up again in China, southeast Asia appears to be benefiting.
However, Bill Maldonado, chief investment officer for Asia at HSBC asset management, says more country-specific factors are at work. (Except from FT blog of 10th Feb)
— Thailand is cheap, juz as profitable as Indonesia: politics makes it cheap.
— Indonesia is growing faster than expected having taken steps earlier to fix its deficits in budget and current account and there there is an election is coming,
Both stk markets are cheap on a price to book basis, the Jakarta index is at a four-year low, while Thai stocks are trading at two-year lows.
Given Indonesia’s proximity to S’pore, we’ll benefit too. Too bad M’sia is not in better shape*. If it is, there will be a GE in 2015.
*Update at 7.30 am: M’sia could be getting better– BT reports: Analysts have revised their estimates for Malaysia’s 2014 growth upwards, with the country having reported fourth-quarter growth of 5.2 per cent, confounding the market’s estimate of 4.8 per cent.
Details released by the central bank indicate that domestic demand remains the key driver of the economy, despite concerns that this would be hit by rising living costs; private consumption remained resilient, rising 7.3 per cent from a year earlier.
In reports released on Wednesday, Bank of America-Merrill Lynch forecast this year’s growth at 5 per cent; Barclays Bank pegged its estimate at 5.4 per cent, while the Malaysian government’s own forecast was between 5 and 5.5 per cent.
If turns out to be correct, GE 2015, after National Day 2015.
Given that a senior cabinet minister and NTUC chief, and a jnr minister from NTUC is giving the PAP govt a bad name, maybe it’s time to remind S’poreans that the PAP govt is not all full of NTUC clowns. On Tueday I reported that Khaw and MoM Tan had the developers concerned, and today I’ll remind S’poreans that PM’s economic team (headed by Tharman) are keeping int’l investors onside (too bad about TOC, TRe readers, but then they can take comfort that locals like me too like a strong S$.)
(4 Feb) – Recent alarmist commentary may have stirred up concerns about Singapore’s economy, but in the midst of the emerging market rout, safe-haven seekers’ faith appeared unshaken as they scooped up its currency.
“We have noted its safe-haven status within the Asian region is getting stronger in past years. So when you have a broad risk off, in general the Singapore dollar will outperform,” said Ju Wang, senior foreign-exchange strategist at HSBC.
Earlier this week, global markets largely sold off, but the Singapore dollar strengthened, with the U.S. dollar fetching as little as 1.2666 on Tuesday, compared with around 1.2790 Friday. Against the currency of its neighbor Malaysia, the Singapore dollar has touched its highest level since 1998.
But To be sure, it isn’t clear the Sing’s climb is sustainable or would withstand a more extended market rout.
“When people want to take money off the table, the safe-haven tag may not be helpful,” Song said. “We can’t avoid spillover from contagion in Southeast Asia.”
Now that would have TOC, TRE readers happy, ’cause they can blame it on the govt.
BTW, here’s an interesting article on the flows in and out of Indonesia and the other Fragile Five. http://www.economist.com/blogs/buttonwood/2014/02/emerging-markets. Actually the rupiah has done relatively better than most other emerging markets currencies against the US$. So has the the Thai baht despite the political problems.
But the currencies of Thailand Indonesia, M’sia and the Philippines have fared worse against Japan’s yen than they have against the US dollar. This means that Japanese financial ,institutions may slow down their investments in the region: investing here could be like catching a falling knife. So, they’ll likely wait.
But before I go into what I mean here’s something on how Thailand’s woes are benefiting S’pore: Singapore Institute of Purchasing & Materials Management ‘s executive director Janice Ong said (according to BT) that there has been anecdotal evidence that the political turmoil in Thailand is diverting orders to Singapore’s manufacturers. But economists believe that the impact would be slight at best.
UOB economist Francis Tan said that the clusters in which such diversion may occur, such as hard disk drives, make up only a small proportion of Singapore’s manufacturing sector.
Divine compensation for Temasek’s purchase of Shin?
Now back to the subject matter of the title. One aspect of the crisis is the sense of entitlement by the Opposition. It was explained by this analysis
[P]olitical power and economic power no longer coincide in Thailand. The parts of the country that generate most of Thailand’s GDP do not ally with the ruling party, which commands most of the vote. That simple fact no doubt explains some of the bitterness of the country’s crisis. In the chart below, we try to quantify this simple insight.
Thailand’s redshirts back the government and most of them look forward to the election on February 2nd. They support Pheu Thai, the third incarnation of a political party founded by Thaksin Shinawatra, a tycoon and former prime minister whose sister, Yingluck, now heads the government. The protesters, on the other hand, want to derail the election and rid Thailand of the influence of the Shinawatras, whom they accuse of rapacious corruption and ruinous populism. They tend to support the opposition, led by the Democrat Party.
In the last general election in 2011, Pheu Thai won 48% of the votes cast for the national political parties*. They were the leading party in 46 of Thailand’s 76 provinces, helping the party and its allies take control of Thailand’s National Assembly. But, according to calculations by The Economist, the party’s political strongholds account for only 38% of Thailand’s GDP.
The opposition Democrats, by contrast, polled 35% of the party votes. They were the leading party in 30 of Thailand’s 76 provinces and also its capital city. Added together, these territories account for 62% of the nation’s GDP. Bangkok alone accounts for about 30%**. In Thailand, in short, domestic power and domestic product reside in different parts of the country.
… the chart illustrates the enormous gap between the Democrats’ political power and their economic clout. This gap may help explain both their feelings of alarm and their sense of entitlement. It shows the enormous scope for redistribution from Democrat-ruled provinces to those dominated by Pheu Thai. This redistribution, which has been taking place for decades, accelerated in 2001 when Thaksin first became prime minister. Back then the Thai state spent 16% of the national budget on the provinces. Today, under his sister’s government, their share has increased to a quarter.
The figures may also shed light on the opposition’s sense of entitlement. Some in the old Thai establishment no doubt feel that they make a disproportionate contribution to the country’s prosperity and development. To them a constitutional arrangement that gave them about 62% of the political power might feel about right. It would represent a realignment of domestic power with domestic product.
This situation could be replicated in M’sia. Selangor is biggest contributor in GDP terms to M’sia (as of 2013) and Penang is 5th based 0n 2010 data. Both are controlled by the Opposition. Attempts by BN to buy votes need money, and taxes can only come from the richer states. You can guess the rest …
Even in S’pore, such entitlement is not absent. I came across this comment: [O]nly 40% of the population are paying income tax to support 60% of the population. Increasing revenue from direct taxes will penalise the very people who have been contributing to the nation’s coffers. With countries in the region cutting their corporate taxes, Singapore has to rely on higher indirect taxes and reduce the proportion of revenue arising from income and corporate taxes. Otherwise, the minority tax payers can very well vote with their feet and offer their investments and skills to someone else.
Fortunately, this is rubbish. because (based on last yr’s Budget estimates only 14% (third largest) of govt revenues come from personal income tax. The largest contributor is corporate tax (17%). GST at 17% is the second largest contributor.
To herald China’s most important holiday, we [Economist] have taken a light-hearted look at the global distribution of the animals of the Chinese zodiac. The Middle Kingdom is home to some of the world’s largest herds, flocks, packs, and broods. It has the second-largest number of horses, 6.7m, after America’s 10m (although neither feature in our charts, which account for population). Instead, Mongolia, where horses are integral to its nomadic tradition, tops the ranking. Similarly, there are four times as many pigs in China as anywhere else, but Denmark’s huge pork industry means it has the highest pig-to-person ratio. Of the ten animals shown, China is among the top nations in total numbers for all but tigers, dragons (Komodo) and rats (guinea pigs in Peru and Bolivia, the only numbers available from the FAO). Snake (the departing year) and monkey are omitted for lack of data. Xin Nian Kuai Le!
Asean countries– Brunei (Rooster), M’sia and Thailand (Tiger), Indonesia (Dragon) and Laos (Tiger and Ox) — appear on several of these charts.
Click link to see all all the charts or in bigger format http://www.economist.com/blogs/graphicdetail/2014/01/daily-chart-19
But first Happy Neigh Yr .
S’pore had the second highest number of int’l tourists after HK in 2012. Distant third is Bangkok. KL is 6th. All benefit from Chinese tourists.http://www.economist.com/blogs/gulliver/2014/01/popular-cities
PAP govt must be doing shumething right, TRE , TOC readers? The casinos perhaps, Tan Jee Say?
All the Asean’s currencies are undervalued in purchase-parity terms vis-a-vis the US$. http://www.economist.com/content/big-mac-index
But the S$ is the least undervalued .i.e. its the strongest Asean currency. So if S’pore raises interest rates as TRE posters are calling, money will flood in from the other currencies. And property prices will fly and the economy tank as exports will be uncompetitive. https://atans1.wordpress.com/2013/12/19/tre-readers-are-illiterate-in-economics-and-finance/
Why Thai politics is broken: http://www.economist.com/blogs/economist-explains/2014/01/economist-explains-13
Indonesia’s most popular politician in the yr of presidential elections: http://www.economist.com/blogs/banyan/2014/01/indonesias-most-popular-politician
The problems facing the PM of Cambodia (BTW, he admires one Harry Lee): http://www.economist.com/blogs/banyan/2014/01/future-democracy-cambodia
(Or “Are S’pore & other major Asean economies are doomed?)
Even though Singapore is no longer an emerging market nation, I consider its bubble economy to be part of the overall emerging markets bubble that I have been warning about due to its strategic role and location in Southeast Asia, which is also known as ASEAN (Association of Southeast Asian Nations). My recent reports on Malaysia, Thailand, the Philippines, and Indonesia show that the entire region is caught up in a massive bubble, and Singapore is benefiting from this bubble by acting as ASEAN’s financial center.
This piece and its sequel have been well publicised, and the central babk has critiqued the first piece (It would wouldn’t it?)
Readers may recall that Donald Low is a scholar who has liberal viewers despite being the Associate Dean (Executive Education and Research) at the Lee Kuan Yew School of Public Policy. He served fifteen years in the Singapore government and I’ve been told he was one of the fathers of Workfare (a scheme I support though I think it’s too mean). He critiqued the article on Facebook as regards S’pore. I’ve paragraphed hos comments to make it easier on the eye:
Donald Low’s FC
There’s a Forbes article on an impending crash in Singapore circulating widely on FB. I won’t dignify it by posting it but here are my thoughts about it: I read the article a while ago and wasn’t at all convinced with his line of argument. It’s just far too sweeping.
Above all, if you look at the usual triggers of financial crises, they are mostly non-existent in Singapore. We don’t have a large current account deficit – on the contrary, we have a huge current account surplus. We don’t have a large fiscal deficit – we run structural budget surpluses. And we don’t have an highly leveraged/indebted household or corporate sector.
On his point about a housing bubble in Singapore fueled by low interest rates, he is partially correct. But to claim that we are on the verge of financial collapse on account of that is utter nonsense. Our leverage ratios are still healthy and I suspect a large part of the run-up in housing prices in recent years is inadequate supply – a problem which has now been largely corrected. Will we see house prices fall this year? Yes, quite possibly. My guess is 10% but even if house prices were to fall 20%, I don’t think it will impact the health of our banks or even our households. There will be households that have negative equity, but as long as they have the cash flow to service their mortgages, it will not precipitate a financial crash.
But there is one argument from the article that is worth highlighting and which I mostly agree with. And that is booms which are led by real estate development and the financial sector are mostly illusory. They create the impression of economic dynamism without creating any real productive capacity in the economy (think back to Bangkok, KL and Jakarta just before the Asian crisis). They also distort and re-direct resources away from productive activities. Real estate and finance are inherently distributive, not creative, activities – they move money and wealth around, but they don’t produce any productive capacity and technological capabilities for the economy.
So when I argue that the Singapore government should look not just at the quantity of growth, but also the quality of growth, I have in mind not just equity and distributional considerations, but also the composition of growth. Is the growth coming from manufacturing and high value-added services, or is it dominated by real estate and finance? If it’s the latter, we have a structural problem.
Finally, I would also highlight that what this article reveals is the failure of government efforts to attract high net worth individuals to Singapore, to make Singapore a wealth management hub for the rich, and to bring in more billionaires even if they increase inequality. I think the costs to the economy and society of such efforts far outweigh their benefits. What productive capacity do property speculators and HNWIs who park their monies in Singapore help to create? So yes, we get a tiny wealth management industry that employs a few thousand people and manages several billion dollars. We can easily do without these ‘benefits’. Meanwhile, their costs in terms of raising property prices, the competition they create for positional goods, and their ostentatious lifestyles undermine our egalitarian norms and values. They also reduce the trust and mutual regard citizens have for one another, undermining their willingness to contribute to more redistribution. All in, I would say that the efforts to attract rich foreigners to Singapore are incredibly misguided.
Two Saturdays ago, I blogged:
After the general election (GE) in May, Malaysia was put on notice by the international rating agencies that it had to get its fiscal discipline right. Prime Minister Najib Razak responded by first cutting fuel subsidies and raising petrol prices by 10 per cent in September.
In his October Budget, Mr Najib abolished sugar subsides and pledged to cut total subsidies by 17 per cent in the financial year. The Budget did not achieve that, so most commentators expect more fuel subsidy cuts possibly in the second half of the year. Mr Najib also promised a 6 per cent goods and services tax (GST) by next April.
Indonesia too has a problem with its fuel subsidy: it’s eating up a growing share of the budget, and meanwhile Thailand has a problem with its rice subsidy for farmers. It’s so bad that there are reports that there are farmers not receiving the subsidy. The govt doesn’t have the money.
S’pore govt doesn’t have this problem: the govt doesn’t do subsidies (except in public housing, healthcare and public tpt*: though even PAP Wormtongues** like that Jason chap cannot explain where the subsidies are in healthcare and public housing: they can only repeat parrot-like the govt’s statements about the subsidies, which is there is a subsidy).
The govt claims a more focused, targeted approach in helping the needy.
But sadly in its targeted, focused approach in helping the needy, it believes in the values of Scrooge as I blogged here. I won’t go into the details on its meanness in helping poorer or older S’poreans ’cause Uncle Leong has repeatedly provided the numbers detailing its Scrooginess. But juz to remind, here is one example: Workfare is gd in principle (better than minimum wage) in my view, but too mean.
And even when it increases welfare spending by a few pennies: Acting Culture, Community and Youth Minister Lawrence Wong has cautioned against getting Singapore into debt, even as the government ramps up social assistance.
He said state spending has to be kept sustainable to avoid passing the burden to future generations.http://www.channelnewsasia.com/news/singapore/singapore-must-be-careful/889756.html
M’sia, Indonesia and Thailand have got their finances messed up because of the use of subsidies but they understand one thing: that spending on welfare is an investment in human resources. What they got wrong is welfare by way of subsidies.
Our govt has got the right idea on subsidies: they are often wasteful, always juz grow and grow, and, often, the people who don’t need them benefit the most, example middle class people and the wealthy benefit the most from any fuel subsidy, not the poor.
But it hasn’t got it: that spending on welfare can be an investment in people. This is something that developed countries, our Asean neighbours, China, India understand. But our govt doesn’t seem not to understand: it’s a Hard Truth thatwelfare spending is a waste of resources. The money could be given to Temasek and GIC to punt the markets is another Hard truth.
If the PAP wants to reconnect with the 40% of voters who voted against the PAP in the last GE, and please its base (including the 35% that “Die, die must vote PAP” , it should rethink its Hard Truth that welfare spending is consumption, not investment. However anti-PAP paper activists should be glad that the govt is unlikely to change its thinking.
As ex-scholar Donald Low put it: “What all this points to is that we really need a more robust welfare system that gives Singaporeans much greater assurance of income when they are unemployed, old or sick. The low fertility rate and the desire of even well-to-do Singaporeans to retire somewhere else are signs that the state needs to craft a new social contract with Singaporeans, that it needs to develop more mechanisms to pool risks and give Singaporeans security.
The argument that we cannot afford all these because the population is ageing is mostly a bogeyman. It is partly because we don’t have a proper welfare system that the population is ageing as rapidly as it is. This has also been the experience in much of East Asia – where the relative absence of social security led to falling fertility rates and eventually, rapid ageing.”
But anti-govt activists should be worried that he is Associate Dean (Executive Education and Research) at the Lee Kuan Yew School of Public Policy. Maybe, juz maybe, there’ll be changes in the mentality of the PAP.
*Even the S$1.1bn spent on tpt is spare change as it’s spread out over five yrs, I think.
**Wormtongue is a minor character in The Lord of the Rings: his name describes his character.
(Or “Anti-PAP bloggers share LKY’s Hardest Truth)
Schroders plc and Baring Asset Management Ltd are avoiding Singapore stocks, the cheapest in South-east Asia, as slower economic growth in the region and cuts to Federal Reserve stimulus drive capital outflows.
The fund managers expect property to lead declines in Singapore amid a real-estate slump and the prospect of higher interest rates. The Straits Times Index was the worst-performing developed market in 2013, dropping 9.5 per cent since Fed chairman Ben Bernanke said in May that bond purchases may be reduced on signs of sustainable US recovery.
Surprised constructive nation-building (but mathematically challenged) BT reported things this way.
In US$ terms, among the bigger Asean stock mkts, only the M’sian stk mkt was better than us. Taz not saying much as only M’sia index ended in positive territory (juz) juz before hols
Got subversives in BT meh?
In the minnow Asean mkts Vietnam was +24%, while Manila was +3.4% according to the MSCI indices.
Next yr is not going to be a gd yr for Asean countries, so the fact that Schroders and Barings are “avoiding” S’pore is no big deal for anti-PAP bloggers to brag about. Don’t know about you, but I get the sense that some of them hate the PAP so much that they end up cheering and being cheerful when S’pore tanks, for whatever reason. Looks like they agree with one LKY that S’pore and the PAP are one. They may hate him but they accept his premise?
Asean round-up returns next yr, god willing.
The PAP govt is forever warning that if it loses power, or even loses one more parly seat, chaos will ensure.
Happily 40% of voters no longer believe this self-serving nonsense (hence LKY had to warn Aljunied voters that they would repent; and sneerer of the elderly poor, ACS boy is highlighting every molehill of the WP Aljunied town council), though I must point out that .70% of voters voted for two prominent ex PAPpies in the presidential election. The ex-PAP man who denounced PAP lost his deposit. Dr Chee’s man only got 25%: credible but only ’cause there were two credible ex-PAPpies challenging one another.
So all the more surprising that our constructive, nation-building media hasn’t been highlighting the dire economic situation in Thailand which can be reasonably blamed on Thailand’s more democratic system. Now that BN has closed down, time to bring back Bertha Henson to ST and make her editor? Yaacob’s sis (and Cherian George’s Mrs) isn’t doing the “right” things by the PAPpies, Spock – another bald, pointy ears: SPH’s Managing Editor elder brother?– could conclude.
So far as investors and businessmen crave certainty and predictability, the only thing certain in Thailand these days is unpredictability. The prime minister, Yingluck Shinawatra, Mr Thaksin’s sister, now seems to have only the shakiest grasp on power. It’s a fair bet the election she has called for February 2014 will never even happen. She has assembled forums to discuss vague concepts of “reform”, to appease Mr Suthep. At the same time Mr Suthep pushes for a completely new government to be run by an unelected “people’s council”. That is also known as a coup.
For Thai businessmen, this is coming at the worst possible time: the beginning of the tourist season. Tourism is vital to the national economy. Last year the country pulled in about 22m visitors. Overall, the tourism-and-travel sector contributed about $28 billion to Thailand’s economy, which would make it worth 7.3% of GDP for 2012, according to the World Travel and Tourism Council (WTTC). Including tourism-and-travel’s indirect impact on the economy would make the sector’s value rise to $64.3 billion, or 16.7% of GDP. The sector employs about 2m people directly, and far more indirectly.
There are already signs that the ongoing street protests and occasional political violence and thuggery are putting plenty of people off coming to the country—hardly surprising, as dozens of foreign governments have issued warnings against travelling to Thailand. The political situation is estimated to have reduced the number of inbound tourists in the month to mid-December by 300,000 people, or 8% of the number expected, says Yutthachai Soonthronrattanavate, president of the Association of Domestic Travel.
That is worrying, as is the thought that the current turmoil could drag on to the election in February, or even longer if that proves inconclusive—in other words, throughout the high season. Mindful of the value of the tourism industry, Mr Suthep’s mobs have promised not to occupy and close down Bangkok’s international airport, as their predecessors, the “yellow shirts”, did in 2008. That is now well understood to have hurt the tourist industry, and the wider economy.
That will not be enough to offset the difference however, as even more tourists are now attuned to Thailand’s problems and willing go elsewhere on their merry ways. Bangkok also makes a bundle as a destination for conferences and conventions, but now organisers are actively considering going to other South-East Asian venues rather than endure the road closures and traffic chaos that accompany endless rounds of street demos (to say nothing of the threat of violence).
The government’s own grandiose spending plans have been thrown up in the air too.A key part of the government’s economic strategy had been to boost domestic demand by Keynesian-style spending, the political failure to have a functioning government has effectively undermined that whole strategy. Plans to borrow as much as $68 billion for new railways and roads are to be put on the back-burner as parliamentary and constitutional approval for these bills is delayed indefinitely. Many businesses, such as construction companies, stood to benefit from those expenditures, and now their plans have been derailed as badly as any holidaymaker’s. Thailand’s growth rate for 2013 is likely to weigh in at 3% or so, relatively modest for the region. The government’s hope to achieve a rate of 7% for 2014 now looks wildly optimistic.
Merry Christmas, all, PAPpies and TRe readers, included.
No other Asean news for this week’s Asean-round-up. Lazy leh.
The Centre for Economics and Business Research (Cebr) says Asean is looking gd: Asean as a whole to grow 5.0 per cent this year, still weighed down by Thailand’s recession. And although the country is tipped to recover in the second half of this year, it may be affected by China’s soft landing, which is projected to extend into next year and dampen its demand for Asean’s goods and services.
As for individual countries (I’ve excluded S’pore as I will analyse it next week with reference to politics):
Not only is economic growth in the Philippines expected to take a hit, the report says intra-regional trade will suffer, hampering growth in other Asean countries.
Strong government spending and higher exports to China in the second half of the year were tipped to boost the Philippine GDP to 6.9 per cent this year, but Typhoon Haiyan is expected to make growth “noticeably weaker” in the final quarter of the year.
Slower government spending and a tighter US monetary policy will cap growth at 5.8 per cent next year, said the report.
Stubbornly high unemployment and extreme poverty, along with the need to lift interest rates to attract capital, will trim the country’s GDP growth to 4.8 per cent in 2015, it added.
The Cebr report’s prediction for Thailand is that its economy will grow 3.4 per cent this year. Thanks to healthier consumption and export growth, it will jump by 4.4 per cent next year; stronger exports to Western markets will nudge the Thai economy up 4.5 per cent in 2015. [Note thar report was written before the recent bout of trouble]
In Malaysia, growth will be at 4.6 per cent courtesy of a lift from China’s economy. But weakened Chinese growth will depress Malaysia’s growth to 4.2 per cent next year.
A revamped general sales tax in 2015 could further hinder growth, but a stronger global economy should ease this somewhat. Cebr forecasts that Malaysia’s GDP growth will be 4.1 per cent in 2015.
Indonesia, Asean’s biggest economy, is likely to grow 5.7 per cent this year, as a slight uptick in the Chinese economy in the second half of the year is expected to soften the effect of China’s cooling economy on Indonesian exports.
But the report said the US’ tighter monetary policy and higher interest rates will lower Indonesia’s growth to 5.6 per cent next year and the year after.
In addition to Thai meat, maybe Burmese rice (see below) will help curb food inflation prior to next GE. Remember that public tpt fares are going up soon despite lack of much improvement. This is ’cause SMRT needs $ (scholar, ex-SAF chief says biz model broken, but nothing that higher fares can’t fix) and 2014 is last possible time that fares can rise. GE must be held in 2016, and increasing fares in 2015 may be too risky for PAP. As an election may be held in 2015, January to June 2014 is the last window of opportunity for us to kanna pay and pay.
Burma plans to more than double rice shipments as the country that used to be the largest exporter embraces trade and opens its economy, challenging Thailand, Vietnam and Cambodia for sales amid a global glut.
Shipments may increase to 2.5 million tonnes in 2014-2015 from an estimated 1.8 million tonnes in the year that started on April 1, according to Toe Aung Myint, director-general of the Department of Trade Promotion at the Ministry of Commerce. Exports are targeted to increase to 4.8 million tonnes in 2019-2020, he said when Hong Kong.
Indonesian coal and property firms could find obtaining loans increasingly difficult next year as banks tighten their lending due to higher interest rates, slowing economic growth and a weakening rupiah, industry officials said. The rupiah has fallen nearly 20 per cent so far this year, hitting 12,000 per US dollar yesterday for the first time in almost five years.
The central bank this month issued guidance to banks to slow loan growth to 15-17 per cent next year, from 18-20 per cent this year, in an effort to protect the financial system from potential turbulence amid heightened global uncertainties. In response, Bank Mandiri, Bank Central Asia (BCA), Bank Tabungan Negara, and other top financial institutions are becoming more particular about companies they lend to.
“We haven’t turned cautious for any sector, but we see challenges in infrastructure, construction, coal, cement, and real estate because of several policies. We are expecting a slowdown,” said Eugene Gailbraith, a BCA director, at an investment conference. He said that the country’s biggest bank by market value plans to “take a breather” and will lend less than its expected 45 trillion rupiah (S$4.79 billion) target this year.
Loan growth at Bank Mandiri is seen slowing to 17-18 per cent in 2014 from 19-20 per cent this year, while Bank Jabar Banten eases to 22 per cent from 33 per cent, company officials said. “We will be more cautious on sectors that are sensitive to interest rates,” said Pahala Mansury, Bank Mandiri chief financial officer. Indonesia’s increased hesitation to lend to coal companies comes as no surprise with banks around the world curbing their exposure to the industry due to a sharp fall in demand and prices. For the property sector, Bank Indonesia has made the industry less attractive to banks by implementing several policy measures to curb the purchases of second homes. Financial institutions are expected to favour consumer driven industries, such as retail and food companies, as domestic consumption continues to remain strong. – Reuters. (BT report)
Indonesia’s most aggressive rate tightening in eight years has barely dented a current account deficit, prompting calls for more increases and other measures before the Federal Reserve cuts stimulus.
Bank Indonesia has raised borrowing costs by 1.75 percentage points to 7.5% since early June, the quickest since 2005.
Following data which recently showed the country recorded its second-highest current account shortfall on record in the three months through September, JPMorgan Chase & Co and Standard Chartered now see a further 50 basis points of increases in the first half of next year.
Foreign funds pulled US$3.8bn from Indonesian stocks and local currency bonds in June after the Fed said it could cut stimulus, and a lack of progress on improving the current account before the US does eventually taper leaves the country vulnerable to another sudden outflow.
In addition to ongoing political unrest in Thailand:
— Thai factory output shrank more than expected in October, adding to a string of weak data that prompted the central bank to unexpectedly cut interest rates to support the economy as mounting political tension dents confidence.
The Industry Ministry now expects output to fall 2.8 per cent this year, rather than growth of 0.5-1.0 per cent projected earlier, but predicts a rise of 2 per cent next year.
October was the seventh straight month in which output has declined, falling 4.02 per cent from a year earlier. The median forecast of a Reuters poll was for a decline of 3.3 per cent.
In September, output dropped 2.9 per cent. (BT report)
— Thailand’s central bank unexpectedly lowered the cost of credit Wednesday as escalating protests to topple the government add to pressure on the economy.
The central bank lowered its policy interest rate by a quarter percentage point to 2.25 %, hoping to stimulate lending and investment, saying in a statement that the “ongoing political situation” could compound existing weaknesses in Southeast Asia’s second-largest economy. Business confidence is fragile and government plans for $69.5 billion of spending on high speed rail and other transport infrastructure have been delayed by legal challenges.
Thailand’s third quarter economic growth was weaker than expected and a recovery in exports has not gained traction, the bank said. Earlier this month, Thailand’s economic planning agency cut its growth forecast for this year to 3% from 3.8-4.3% predicted in August.
In the space of a few days, the govt is facing or is likely to face uncomfortable questions from other govts about its activities: activities that the usual suspects, could reasonably argue, show the two-timing nature of the PAP govt that they (they the usual suspects) detest and wish it all the ill-will in the world.
Malaysia said it will summon Singapore’s high commissioner today to respond to allegations of spying which risk damaging improved political and business ties between the Southeast Asian neighbors.
Indonesia and Malaysia have been key targets for Australian and U.S. intelligence cooperation since the 1970s, facilitated in part by Singapore, the Sydney Morning Herald reported yesterday, citing documents leaked by former U.S. intelligence contractor Edward Snowden. Malaysia’s foreign ministry said it was “extremely concerned” and had already acted against earlier claims of espionage by the U.S. and Australia.
The reports could also spur friction between Singapore and Indonesia, Tan said. “The Indonesians would probably be concerned whether the information is also being shared with Singapore intelligence, besides the Australians*.”
As SingTel was singled out for mention by the Oz newspaper**, and as it has extensive mobile operations in Indonesia and Thailand, and a major stake in a major Indian telco, it could face problems in these countries.
Then there is the issue of how European and US cos are using S’pore to avoid taxes, at a time when there is growing resentment among politicians and voters that these cos are not paying their fair share of taxes. The Indian, Japanese, Taiwanese and Korean govts will also not be too happy too with S’pore’s corporate tax-regime if they read the Economist.
“Taxing times for Singapore as corporate strategy faces scrutiny” was a Reuters headline on 24 November 2013 (BT and Today carried the report too). It gave details of how Apple used S’pore as a tax-saving centre and went on, “Companies justify booking significant amounts of revenue and profits in Singapore by the fact they often run key business functions such as finance and operations, hold intellectual property rights there or base regional executives in the city.”
The chart below (via the Economist) shows a hypothetical scenario where a company moves its headquarters from Singapore (a very low-tax economy) to another country. http://www.economist.com/blogs/schumpeter/2013/11/corporate-tax-rates
S’pore very cheap place (tax wise) esp compared to Japan. Minister Zorro must be happy: juz as happy as looking as his monthly CPF statement.
The Reuters article went on: Singapore has so far largely stayed out of the debate raging in Europe and the United States about the ways multinationals try to lower their tax bills.
But revenue-hungry governments are looking to impose tougher rules on so-called transfer pricing that could make it harder for firms to trade goods, services or assets between their Singapore and overseas entities.
As a result, accountants warn that the city-state will need to review the level of transparency in its tax incentive schemes and get stronger justifications from companies on their transfer pricing arrangements to fend off challenges from other jurisdictions.
“Singapore’s challenge is to ensure that it stands ready to adequately address any kind of unilateral tax action taken by other countries,” said Abhijit Ghosh, a partner at PricewaterhouseCoopers in Singapore.
“In this brave new world of fiscal competition for the tax dollar, dispute resolution will be on the increase and Singapore will need to focus more resources on enforcing and defending its principles of value creation in international forums.”
The city-state’s government says it is against artificially contrived arrangements constructed “solely for the purpose of flouting or exploiting loopholes in tax rules”, according to a spokeswoman from the Ministry of Finance.
However Singapore is also arguing that it should not be singled out because it has low tax rates.
“We must guard against new forms of protectionism masquerading as tax harmonisation,” the spokeswoman said. “We should avoid converging on high taxes globally as this would only hurt growth and jobs.”
Looks like the owl that visited PM was a harbinger of bad news for PM.
Seriously, the “usual suspects” could reasonably argue, if they tot about it, that the “chickens are coming to roost”.and that while moralising on adultery, the PAP govt helps the ang mohs spy on our neighbours, while helping ang moh and other Asian cos avoid tax. And PritamS wants the WP to be in coalition with the PAP?
*Remember that Indonesia suspended military co-operation with Australia, after allegations emerged of Australian spies bugging the phones of the president and his inner circle.
**Access to this major international telecommunications channel***, facilitated by Singapore’s government-owned operator SingTel, has been a key element in an expansion of Australian-Singaporean intelligence and defence ties over the past 15 years.Read more: http://www.smh.com.au/technology/technology-news/new-snowden-leaks-reveal-us-australias-asian-allies-20131124-2y3mh.html#ixzz2lkSC0P8c
***SEA-ME-WE-3 cable as well as the SEA-ME-WE-4 cable that runs from Singapore to the south of France.
KL property owners, an estimated 10-16 per cent of whom are foreigners, are facing sharply higher assessment payments of up to 300 per cent following the latest move by City Hall (DBKL) to boost its coffers. http://www.businesstimes.com.sg/premium/top-stories/kl-homeowners-facing-sharp-assessment-hikes-20131119
But otherwise M’sia’s looking pretty gd
— ECONOMISTS have turned more bullish on the Malaysian economy as a result of its unexpectedly strong showing in the third quarter.
They have upgraded their forecasts, and one has even dismissed the second quarter’s sharply reduced current account surplus on the balance of payments as an “abnormal”, one-off glitch.
Malaysia’s growth accelerated to 5 per cent in the third quarter, above the street’s 4.7 per cent, and sharply higher than the 4.4 per cent posted in the second quarter. The expansion was largely driven by domestic demand and a turnaround in exports.
The figures suggest that, despite criticism from rating agencies such as Fitch and an uncertain global economy, the Malaysian economy remains resilient, and continues to maintain steady economic growth.
— THE ringgit is undervalued as it has underperformed its peers since Prime Minister Najib Razak’s Budget almost a month ago, a British bank said.
In a report yesterday, Barclays Bank said the currency’s underperformance stemmed from doubts over the country’s “fiscal credibility”. But it said any such doubt should now be “diminished” after international rating agency Moody’s raised Malaysia’s sovereign outlook to “positive” from “stable” in a report released on Wednesday.
The news should boost Mr Najib’s credibility as a finance minister; he has been flayed by critics who have accused him of going on a profligate spending spree to boost the Barisan Nasional coalition’s popularity. In the run-up to the May 5 general election, government debt had ballooned to more than 54 per cent of GDP, just a whisker away from the legally mandated debt ceiling. Although the BN won, it did so with a weaker mandate.
In July, global rating agency Fitch had affirmed Malaysia’s investment-grade sovereign rating but cut its outlook to “negative” from “stable”. That raised the level and intensity of the criticism against Mr Najib.
(Excerpts from BT)
But M’sia (like Thailand) is doing less than Indonesia to prepare for tapering: Indonesia has raised short-term interest rates and India has attracted deposits from its large diaspora. Both are now accumulating foreign-exchange reserves to help prepare them for the eventual end of quantitative easing. So are South Korea and Taiwan.
Malaysia and Thailand are not taking the same precautions. Neither country has managed to recoup the reserves it lost in August. That’s a worry, considering foreigners own 28 percent of Malaysia’s sovereign bond market. Pending the implementation of a goods and services tax from 2015, the country’s public finances remain shaky. At the peak of the summer turmoil, the cost of insuring against default on Malaysian government bonds was slightly higher than for Philippines debt, which carries a lower credit rating. The gap has widened since.
Finally, debt is soaring. In Thailand, bank loans to individuals have jumped 20 percent in the first nine months of the year, higher than last year’s 18 percent growth. Meanwhile, the Thai economy has lost momentum, the politics has become unstable, and the current account has tipped into a deficit. Instead of easing, Asia’s fear of the Fed is spreading wider.
S’pore (at 61% of debt to GDP) is third in Asean, M’sia tops the list (81%), followed by Thailand (68%) , according to a World Bank report. (http://www.economist.com/news/economic-and-financial-indicators/21588882-household-debt-asia)
A recent World Bank study identified Malaysia and Thailand as having the largest household debts, as a share of GDP, among eastern Asia’s developing economies. In Malaysia, where household debt now exceeds 80% of GDP, the government has been seeking to curb credit growth. Thailand’s government boosted access to credit following the country’s big floods in 2011. The recent slowing of growth in many Asian economies raises concerns about the sustainability of all this personal debt.
Note two weeks ago, I reported
In other Asean news
Indonesia‘s economy expanded at its weakest rate in four years in the third quarter as a result of slowing exports and subdued domestic demand.
Its economy grew 5.6% in the July-to-September period from a year earlier, down from 5.8% in the previous quarter.
Indonesia’s exports have been hurt by slowing demand from key markets and a drop in commodity prices.
Meanwhile, domestic demand has been impacted by rising fuel prices and rising interest rates.
Fuel prices in the country surged earlier this year after the government removed its subsidy programme.
Petrol prices went up by 44% while diesel prices rose by 22%, leading to higher transportation costs and electricity bills.
And as usual Indonesia is repenting the nationalistic policies it always implements when the economy is doing well. It is again, as usual, lifting restriction on foreign investments, to attract foreign capital.
Thais are in the streets, protesting a controversial amnesty bill. http://www.economist.com/blogs/banyan/2013/11/unrest-thailand
And an energy boom in the region. http://www.thefinancialist.com/an-oil-and-gas-boom-for-southeast-asia/
On 24 October, it was reported that
Singapore has lifted a ban on the import of Thai frozen chicken and is also considering allowing the sale of frozen pork from Thailand.
After banning Thai poultry from its market for nine years, Singapore has finally allowed frozen chicken from Thailand back in, reports The Nation of Thailand.
Timing of ban lighting, not coincidental, methinks
On 29th October, it was reported: Inflation in Singapore will pick up over the next few quarters before tapering towards the end of 2014.
This is according to the Monetary Authority of Singapore’s (MAS) Macroeconomic Review.
The central bank said domestic food inflation is expected to rise from around 2 per cent in 2013 to close to 3 per cent in 2014, although this is still lower than the 3.4 per cent average over the last five years.
In particular, cooked food vendors are likely to pass on the increases in labour and rental costs to consumers, as these account for a significant share of their operating expenses compared to non-cooked food establishments.
The MAS said cooked food is estimated to make up 14 per cent of average household expenditure.
Today reported: The MAS expects the core inflation rate, which strips out the cost of accommodation and private road transport, to increase from between 1.5 and 2 per cent this year to between 2 and 3 per cent next year.
Better than these non-actions:
In other Asean round-up news:
Burma is getting its first online music store, which aims to stamp out the problem of illegal downloads, according to the Eleven Myanmar news site. “The traditional distribution system has been plagued by piracy,” the man behind the website, Ko Ko Lwin, is quoted as saying. His Myanmar Music Store apparently trialled operations for a week ahead of an official launch, with home-grown star Lay Phyu’s record, Diary, selling 4,000 copies.
SingTel may still get into Burma. While it failed to get one of the two licences granted this yr, the govt has asked leading telecos (including SingTel) to offer help to the govt-owned operator as it upgrades.
Workers across Indonesia begun a two-day strike on 31 October demanding higher salaries, the latest industrial action to hit the South East Asian economy.
The workers say their cost of living has gone up amid rising inflation and a hike in fuel prices.
Thailand‘s lower house of parliament has passed a political amnesty bill that critics say could allow the return of former PM Thaksin Shinawatra.
The amnesty applies to offences committed during the political turmoil after Mr Thaksin was ousted in a coup.
The lower house passed the controversial bill in the early hours of Friday. It now goes to the Senate.
The opposition Democrat Party has warned that the passage of the bill will trigger street protests.
In other Asean round-up news:
Burma‘s Yangon had passed Singapore’s office rental rates of US$74 a square metre by the first quarter of this year according to estate agents Colliers. To give some context to this piece of info, something from yesterday’s BT: AT S$11 per square foot (psf) per month, or US$103 psf per year, the extended central business district comprising Raffles Place and Marina Bay is the eighth most expensive office area in the world, according to a Jones Lang LaSalle study.
Taking into account quoted rents from only premium office space in top sub-markets, Singapore was inched out by other Asian locations such as Hong Kong’s Central which commanded rents of HK$105 psf per month (US$162 psf per year) and Beijing’s Finance Street where corporates paid rents of 750 yuan per square metre per month (US$137 psf per year).
S’pore is sharing with Indonesia with its best practices in public-private partnership (PPP) in water and waste-water infrastructure projects.
Led by Singapore Cooperation Enterprise (SCE), an integrated arm of International Enterprise Singapore, and Temasek Foundation, the partnership programme will be delivered over a two-year period by a team of Singapore experts from both private and public sectors to 200 Indonesian government officials from various provinces and cities as well as ministries including the Ministry of Finance and Ministry of Public Works (Bappenas).
Singapore will provide knowledge in planning and procurement of water and waste-water infrastructure projects; and help cultivate a core group of officers from PT Sarana Multi Infrastruktur (Persero), a government partner promoting infrastructure development in Indonesia, who will develop public-private partnership training materials.
In the words of the Institute of Southeast Asian Studies (ISEAS), a S’pore govt-funded think tank, in its Oct Asean Monitor
Barisan Nasional’s worst-ever general election performance in May has undermined Prime MinisterNajib Razak’s promise to reform the United Malays National Organization (UMNO) after he took overits leadership in 2009. Outside UMNO, liberal reforms are stridently opposed and resisted by extremist Malay-Muslim groups such as PERKASA and by UMNO-owned media, especially the Utusan Malaysianewspaper. Within UMNO, political momentum favours former Prime Minister Mahathir and his conservative allies, who support preserving the ketuanan Melayu (“Malay ownership”) status quo.
Recognizing that UMNO needs to be further strengthened after its failure to win a convincing majority of the Malay vote, many senior party leaders and veterans will not want the president and deputy president posts, held by Najib and Deputy Prime Minister Muhyddin Yassin, respectively, to be contested duringthe upcoming October party elections. However, the party’s three vice-presidential posts are likely tobe hotly fought over by the incumbents Ahmad Zahid Hamidi, Shafie Apdal and Hishammuddin Husseinand by three challengers, namely Mohd Ali Rustam, Isa Samad and, potentially, Mukhriz Mahathir.
Recent developments have further pressured Najib to follow through with his general-election pledge totackle corruption and crime. The 2013 Global Corruption Barometer report confirms the perception thatthe level of corruption in Malaysia has increased despite the government’s claims to the contrary. Publicconfidence in the corruption-tainted police force received another huge blow from the recent spike inviolent crimes, including more than 30 murder attempts in the past five months.
Because of the country’s deteriorating public finances, a global ratings agency has downgraded Malaysia’ssovereign credit rating outlook from stable to negative. The Malaysian ringgit slid to three-yearlows against the US dollar and to 15-year lows against the Singapore dollar; these slides may generate inflationary pressures. The government announced 10.5 percent and 11 percent hikes respectively in the prices of subsidized 95 RON gasoline and diesel on 3 September, and it is likely that further measuresto strengthen the country’s fiscal position will be introduced.
Key points: The status quo will persist, with conservatives gaining control of the UMNO supremecouncil. Budget 2014 will see the introduction of a GST and the scaling back and rescheduling of publicly funded projects.
The Chinese have to live with the consequences of their vote for Anwar’s group. The Indian community (which marginally supported BN) must be sore with the Chinese.
Other Asean round-up news:
Vietnam R Sembcorp (belated)
UNDETERRED by the many challenges facing Vietnam’s economy, Sembcorp has once again upped its investment in the socialist republic – this time by building central Vietnam’s first large-scale industrial park worth US$337.8 million.
This latest of five Vietnam-Singapore Industrial Parks (VSIPs) is sited in Quang Ngai province, about 90 minutes’ flight south of Hanoi. It offers manufacturers a new and alternative investment locale that is away from Vietnam’s northern and southern regions, where labour markets are tighter and costs continue to rise.
VSIP Quang Ngai will take shape in the form of a 1,120ha industrial park and integrated township; the industrial park will take up 600ha, with the other 520ha slated for commercial and residential purposes. BT 14th August: PM was in Vietnam BTW.
Thailand is to hand over rice and rubber in part-payment for its new high-speed rail system, it’s reported.
The country’s transport minister is expected to formally agree the barter deal with Chinese premier Li Keqiang … The project to link Bangkok with Nong Khai, close to the Laos border, is part of a proposed 2m baht ($30bn, £19bn) infrastructure investment programme to part-financed with agricultural products. The railway is one day envisaged to link Thailand with the Southern Chinese province of Kunming, via the Laos capital Vientiane.
Not saying much as above chart from FT shows that its flattish unlike the other Asean mkts. Seems the big local funds are buying.
Other Asean round-up news:
According to OSK-DMG while Indonesia will be increasing its oil production over the next few years but only a few offshore marine players here can benefit from this because of an Indonesian rule that protects jobs in the industry for Indonesians.
While rig builders here could stand to gain in the near term, it appears that the cabotage law in Indonesia is being expanded to include Indonesian shipyards as well, boding well for rig builders with Indonesian-based yards. Indonesia has cabotage rules requiring all work in the oil & gas sector to be done only by Indonesian-flagged vessels.
Thailand is the third biggest buyer of gold in Asia, after China and India having overtaken Vietnam.
The Fed’s decision to delay unwinding its $85-billion-a-month money-printing programme eases the pressure on the two Asian countries with the biggest dollar addiction – India and Indonesia – to cure their habit by squeezing domestic demand. Investors reacted accordingly: the Indonesian Rupiah jumped 1.9 percent against the dollar on the morning of Sept. 19, while Jakarta stocks rose 5 percent.
… Asian countries cannot afford to relax. From just before the onset of the global financial crisis, private sector debt has swelled by 73 percentage points of GDP in Hong Kong and 45 percentage points in Singapore. While these small, open economies can arguably live with large swings in capital flows, the credit surge in Malaysia and Thailand is more worrying. The longer the global liquidity glut lasts, the more painful the hangover will be.
Burma: Lady’s still sceptical
how sceptical she was about the reform process in Myanmar …
Yet, she pointed out, Myanmar is still not a democracy, and neither at peace, nor under the “rule of law”. She and her party are campaigning to change a constitution which, besides debarring her from the presidency she hopes to assume in 2015, guarantees the army a blocking minority in parliament. She said many members of the government are betting that economic success will enable them to hold back democracy. “How quickly and reliably can mindsets change?” she asked, recalling that Myanmar has had half a century of military dictatorship and just three of tentative reform.
And although ceasefires have been signed in most of the score of ethnic conflicts that have simmered since independence in 1948, a comprehensive peace deal remains a distant dream. She identified this—“national reconciliation”—as the biggest task facing Myanmar.
UOB Vietnam has launched a unit to advise Vietnamese businesses expanding into Asia.
“Vietnam has prospered from steady economic growth over the last decade and we have seen many of our customers develop from small businesses to companies that are ready to spread their wings to the rest of Asia,” said Thng Tien Tat, executive director of UOB Vietnam.
From the first half of last year to the same period this year, UOB’s business flows between Vietnam and Asia increased 20 per cent. Trade between Vietnam and Asia grew 46.7 per cent to US$150.4 billion from 2010 to 2012, according to the International Monetary Fund.
The new FDI Advisory Unit will give UOB customers expanding in and out of Vietnam access to the bank’s full suite of corporate and personal banking products. BT
Floodwater encircled an industrial estate to the north-east of Bangkok yesterday, adding to fears that Thailand could see a repeat of the devastation caused by floods in 2011, but the estate’s director said the water will not enter the complex.
The 2011 floods killed more than 800 people around the country and caused major disruption to industry, cutting economic growth that year to just 0.1 per cent.
Since Thailand is a big supplier of electronic parts, hard disk drives and car parts, international supply lines were disrupted, too.
The government has insisted there will be no repetition, partly because rain has been less heavy this time but also because dams are nowhere near as full as they were then. BT
A Thai transgender student who protested against having to wear a male uniform could end up in court, it’s reported. BBC report
(Or “1997/ 1998 revisited”)
Earlier this week, PM said: “On balance, I would take a sanguine view. I think the Asian economies are in a stronger position than they were in 1997 when the crisis came. I think we’ve got more safeguards instituted now, over the last decades since the Asian crisis to deal with the likely consequences of big capital flows. CNA
Well, Indonesia’s central bank has raised interest rates for the second time in two weeks as it looks to stem the sharp decline in its currency, the rupiah.
It raised its key rate to 7.25%, the highest level in more than four years.
Indonesia’s currency has dipped nearly 18% against the US dollar since May this year as investors pull out of emerging markets, stoking concerns about the economic impact.
The central bank also cut its growth forecast for the current year.
On Thursday, it said that it now expects the economy to grow between 5.5% to 5.9% compared with its earlier projection of a growth between 5.8% to 6.2%.
That will be the lowest pace of growth since the global financial crisis in 2009.
But he got the haze issue wrong: he said would return “for weeks”. Hasn’t has it? And haze season is almost over. I’m glad he was wrong on this.
Here’s hoping he’s right on the Asian economies because if not
vivid memories of the 1997 crisis in Indonesia … watching in disbelief as a once stable currency slid, gently at first, from 2,400 rupiah to the US dollar in July, to 4,000 by early December, and then, dramatically to more than 16,000 in January.
The economy seized up, and within months Indonesia was in chaos.
… something else too.
The foreign fund managers, who had been cheerleaders for the investment boom before the crisis, privately admitting that the corporate data they were given by Indonesian companies was suspect.
But they continued buying into the country’s broader economic growth story, despite nagging fears about corruption and the persistent current account deficit.
Today the Thai economy is very different. Because we learned things like risk management, corporate governance, the ability to be flexible”
Jada Wattanasiritham SCB
I remember the World Bank and other respected international experts telling us, after Thailand’s economic collapse in July 1997, that Indonesia was different, its fundamentals were sound. It would not be infected by the disease, they said.
For anyone who experienced those bewildering months, and especially those who were victims of the crisis, they left a lingering mistrust of official reassurances, and an anxiety that they could be caught out again.
She seems to have forgotten:
— Fresh from leveraging up to buy a stake in insurer Ping An (he borrowed US$5.5bn), Dhanin Chearavanont is borrowing US$6 billion to finance a takeover of Siam Makro. Combining the Thai cash-and-carry group with his 7-Eleven convenience store chain makes sense. He co-founded Siam Makro with Dutch group SHV in the late 1980s, but was forced to sell out in 1998 when the Asian crisis left his empire overextended (soon to be repeated?). Sentimentality aside, the combined business should also be in a stronger position to expand into neighbouring Southeast Asian countries such as Laos and Myanmar.
The reunion is expensive. The offer price of 787 baht per share is 75% above where Siam Makro was trading at the beginning of January, and values the business at 53 times last year’s earnings. The advantage is that both Siam Makro and CP All, Mr Dhanin’s partially listed Thai retail company, currently have no debt.
— And in January another Thai tycoon, Charoen Sirivadhanabhakdi, won the battle for control of Fraser and Neave with a debt-heavy $11.2 billion offer based largely on breaking up the Singaporean conglomerate.
1997/1998 again? Both had problems then, esp the former.
This chart from Reuters shows the vulnerability of major Asian economies to Fed policy of tapering
S’pore is vulnerable
Slowing GDP: Most vulnerable
Growing Public Debt : Second most vulnerable
Uncompetitive Currency: Second most vulnerable
Growing Credit Intensity: Fourth most vulnerable. Another view: Banks with large property loan portfolios will face higher risks when interest rates start to rise — this as highly-leveraged households begin to have difficulty paying their mortgages.
Economists said this could lead to credit tightening by banks, and a hard landing for the property sector.
If that happens, DBS Bank said Singapore and Hong Kong will be hardest hit within Asia.
In other Asean round-up news
surpluses of Thailand, Hong Kong and Malaysia have narrowed even more since the second half of 2007. However, this is partly because Thailand and Malaysia have boosted domestic investment, which lifts imports.
Malaysian and Indonesian companies are grappling with a margin squeeze: The two commodity-producing economies have witnessed the biggest rise in their real cost of capital. The Philippines has the opposite problem: Falling inflation-adjusted returns for savers.
Rightly or wrongly, though, the sovereign debt issued by developed countries is perceived as safe. Malaysia is not in the same league, and it is pruning petrol and diesel subsidies to control its growing public debt problem.
Unlike in 1997, most Asian countries have relatively straightforward choices. Malaysia can introduce a goods and services tax to control the 14 percentage point increase in its sovereign-debt-to-GDP ratio since 2007. Indonesia can raise interest rates to tame 9 percent inflation. The main problem is India, with its cocktail of slumping growth, high inflation, a creaking banking system, reckless fiscal policies and political uncertainty. Other Asian nations can’t take rising U.S. interest rates lightly, but they are far from a crisis.
Indonesia’s central bank raised its benchmark interest rate 25 basis points Thursday afternoon in a move that defied market expectations and continued a swift phase of tightening efforts as the nation’s economic growth showed signs of stumbling.
The interest rate increased to 7.25 percent, the fourth hike in as many months, as Bank Indonesia moved to stabilize the increasingly volatile rupiah while controlling inflation and the widening trade deficit.
The danger of capital controls in Asean (Note this is new link and chart, not the one originally posted)
Asean trade with China (FT charts)
The govt likes to warn about the dangers of subsidies, forever quoting the deficits in the West. Well what about telling us about problems nearer home? And how come it’s ok to “subsidise” HDB flats at home? ‘Cause it not really a subsidy is what the usual suspects would argue.
Malaysia has cut fuel subsidies for the first time in more than two years as it tries to reduce its budget deficit.
The subsidy on petrol has been cut by 20 sen (6 cents; 4 pence) a litre and on diesel by 20 to 80 sen a litre.
Prime Minister Najib Razak said the cuts would result in savings of about 3.3bn ringgit ($1bn; £650m) a year.
The government spent 24bn ringgit on fuel subsidies last year, which contributed to a widening budget deficit.
Malaysia’s budget deficit was 4.5% of its gross domestic product (GDP) last year.
Some analysts said that the cut in fuel subsidies was an attempt by the government to increase investor confidence and persuade them to leave their money in the country.
Malaysia’s ratio of public debt to gross domestic product (GDP) “is approaching worrying leve according to a Bank of America Merrill Lynch (BOAML) report. It said that the country’s debt-to-GDP ratio had risen to 54.6% at the end of the second quarter, from 53.8% in the first quarter.
The figure is just short of the country’s mandated debt ceiling of 55% of GDP. In the 1960s, the limit was made law by then-finance minister Tan Siew Sin to ensure fiscal prudence.
BOAML said that it could worsen. “Rising longer-term bond yields (and hence higher debt-servicing costs) may accelerate the climb.”
Meanwhile, total debt including guarantees is piling up.
“Government guaranteed debt came in at RM147.3 billion (S$56.4 billion) in the second quarter, slightly lower than RM147.8 billion in the first quarter. Adding this to public debt brings the quasi-public debt to about 70.2 per cent of GDP at the end of the second quarter, up from 69.4 per cent during the first quarter.” [BOA report added after first publication)]
Other Asean round-up news
Thailand‘s Thaksinonmics runs into trouble
Thaksinomics has always been about two things. First, it was about establishing a secure hold over the voters, and in that it has unquestionably been successful.
But it is also supposed to be about driving the domestic economy.
The original schemes for micro-credit, affordable healthcare and local product promotion have lifted the living standards of millions of poorer Thais, as has this government’s decision to raise the minimum wage.
But the benefits of the car and rice purchase schemes are more doubtful, especially given their cost.
Thailand still remains heavily dependent on exports and on foreign direct investment for its growth.
What Viki’s US$ 200m exit says about S’pore’s, M’sia’s and Indonesia’s startup environment
And one of the reasons for the flight of money from Indonesia, is it’s failure to tackle the rising cost of its fuel subsidy. http://www.bbc.co.uk/news/world-asia-23015511
CNA Group’s Vietnam-based subsidiary, CNA-HTE Vietnam Co, has landed a $10.6 million contract to renovate, upgrade and expand the domestic terminals in Ho Chi Minh’s Tan Son Nhat International Airport.
Under this project, CNA will provide mechanical, engineering and plumbing services such as the air-conditioning, ventilation and electrical systems at the airport’s new two-storey domestic terminal. CNA will also upgrade the airport’s existing domestic terminal, which will be equipped with a new bus terminal building and a VIP lounge. Its roof will be upgraded.
The project is slated for completion in October next year and will contribute to the group’s financial performance for the fiscal year ending Dec 31, 2013. It boosted CNA’s order book to $74.2 million, from $63.6 million as at June 30.
This is CNA’s second airport-related project in South-east Asia this year; it won a contract for Laos’ Luang Prabang Airport in April for common-use terminal equipment, typically used to facilitate passenger check-ins. BT
In its latest set of results announced a few weeks ago, the profit contribution from regional associates climbed 14% to S$552 million in the quarter on higher results from Indonesia, Thailand and India, the company said.
SingTel gets 12% of its profit before tax from India and 22% from Indonesia, with those earnings in future likely to take a hit when translated back into Singapore dollars. Remember too the weakish A$, Baht, and Filipino peso will affect its earnings.
Other Asean round-up news
At an emergency meeting on Aug. 29, the monetary authority raised its benchmark and overnight deposit rates. It’s a decision Bank Indonesia should have made at its last official gathering less than two weeks ago. An obsession with economic growth stayed its hand. http://blogs.reuters.com/breakingviews/2013/08/29/currency-markets-rude-wakeup-call-stirs-indonesia/
Politics is back on the streets in Thailand, after a relative lull of more than two years, with a protest over the weekend. It underlines the persistence of divisions in Thailand and raises the prospect of a return to the political turmoil that left more than 90 people dead in Bangkok in 2010.
Thousands of demonstrators gathered in a vacant lot in Bangkok on Saturday, as speakers threatened to “overthrow” the government.
The acrimony between the Democrats and the government of Prime Minister Yingluck Shinawatra centres on a number of legislative issues, chiefly an effort by the government to pass an amnesty law for those involved in the 2010 protests.
The Democrats oppose the Bill, saying it might also apply to those who insulted the monarchy or committed serious crimes.
But the broader conflict appears to stem from their feeling of powerlessness in the face of the resurgence of Thaksin Shinawatra, Ms Yingluck’s brother, who sets the broad policy lines for the government and the Pheu Thai Party despite living abroad since 2008 in self-imposed exile to escape corruption charges.
The weekend protests followed another peaceful one earlier this month involving some 2,500 supporters of the Democrat Party and royalist groups at Bangkok’s Lumpini Park, throwing fresh light on Thaksin’s divisive influence in Thailand.
(Extract from NYT)
Malaysia‘s government is exploring the possibility of hiking the real property gains tax to rein in rising housing prices and curb speculation in the market. Bernama quoted Housing Minister Abdul Rahman Dahlan as saying that current property tax levels had failed to stabilise house prices with the house price index continuing to rise.
Malaysia’s GST will take 14 months to implement if announced in the budget in October, a ministry official said
The Philippines posted better-than-forecast economic growth, fuelled by its services sector and higher consumer and government spending. Its economy grew 7.5% in the April to June quarter, from a year earlier. It is the fourth quarter in a row its economy has expanded by more than 7% – defying a regional trend which has seen growth slow down in many countries. The Philippines’ 7.5% second-quarter growth matched that of China but is higher than Indonesia, Vietnam or Malaysia,
However, the country has been hurt in recent weeks by investors pulling out of the region’s emerging economies. This despite under emerging mkts, given the follow of remittances from workers overseas, it will not have to worry about investors’ outflows unlike other mkts.
Japan’s All Nippon Airways has said it will acquire a 49% stake in Asian Wings Airways, an airline based in Burma..
The Japanese airline will pay 2.5bn yen (US$25m) for the stake.mIt is the first time a foreign carrier has invested in a Burmese-based commercial airline. It currently operates domestic flights to all major tourist destinations in Myanmar.It t plans to “extend its wings to regional destinations through scheduled flights as well as chartered ones”.
Asean round-up: Bad news abounds
Indonesia’s benchmark Jakarta Composite Index – the biggest loser among emerging markets – has plunged over 20% in the past three months, putting it in bear market territory. Neighboring Thailand and the Philippines are not far behind, with losses amounting to over 17 and 11%
Thailand has fallen into recession after the economy shrank unexpectedly in the second quarter of the year.
The 0.3% contraction in gross domestic product between April and June followed a previous fall of 1.7% during the first quarter of 2013.
Previously, Thailand had been recording strong economic growth, outpacing other economies in the region, with expansion of more than 6% during 2012.
Many analysts had expected this performance to continue.
Sanjay Mathur, head of economics research at RBS, told the BBC that weak exports and domestic demand, plus fading business confidence, were to blame for the downturn.
I’m not only guy critical of Indon’s way of fighting inflation
— And on 19th August: Indonesia’s rupiah fell to 10,500 per US dollar for the first time since 2009, stocks dropped by the most in 22 months and government bonds plunged after the current-account deficit widened to a record last quarter.
The Jakarta Composite Index of shares has fallen 8 per cent in two days, and is now the world’s worst performer this quarter.
The yield on 10-year notes surged to the highest since March 2011 after Bank Indonesia (BI) said late on Aug 16 the current-account shortfall was US$9.8 billion, the largest in data compiled by Bloomberg going back to 1989. Inflation quickened to a four-year high and economic growth slowed to the least since 2010, figures showed last week.
As at Wednesday, the Indon market entered its bear phase after falling 20% since May http://www.bbc.co.uk/news/business-23763829
A fund manager with local investment bank Lautandhana Securindo. “The measures taken by the government and the central bank [to fix the current-account deficit] haven’t brought about the desired results.”
Indonesia’s July consumer confidence index fell to the lowest level since May last year, and follows a sharp rise in fuel prices in late June, a Bank Indonesia survey showed on Monday.
The July index was 108.4, down from 117.1 the previous month and compared to 109.0 in May last year.
The survey of 4,600 households in 18 major cities in the archipelago showed that consumers were pessimistic over the current economic environment, particularly related to jobs and wages.
Concern over fewer jobs and lower wages is expected to be a feature of coming months.
However, the survey said price pressure is expected to decrease in January 2014, as demand ease after Christmas and New Year.
The central bank according to a recent report has lost 13.6% of its central bank reserves from the end of April until the end of July defending the currency. Well August would have added to the losses. And as the chart shows, it hasn’t that much money in the first place.
Malaysia’s growth was below expectations and the central bank, lowered its forecast for the year to 4.5-5%, from 5-6%. A sharp fall in the current account surplus highlighted fears that the country could be vulnerable to market turmoil.
Gross domestic product grew 4.3% in the second quarter of 2013 from the same period a year earlier, data showed yesterday, well below economists’ expectations of 4.9 per cent in a Reuters poll.
Forecasts had ranged from 4.2 to 5.2%, following growth of 4.1% in the first three months of the year.
Still, while the Thai, Indon and S’pore equity markets were in local currency terms below their 31Dec 2012 levels, M’sia is juz ahead by about 3%. All are down in US$ terms.
Vietnam was the country that was viewed as the “next China” due to its stable transition has started to generate concerns about a looming debt crisis.
Indonesia has overtaken China as a preferred investment destination for small and medium-sized enterprises (SMEs), This was a key finding of the Singapore Chinese Chamber of Commerce and Industry (SCCCI) SME Survey 2013, which polled 516 companies in June and July.
Of the 63% SMEs which are venturing into markets abroad, 39.9% favour investing in Malaysia and 28.1% Indonesia, a hair’s breadth more than the 27.2% looking towards China.
One reason given is that as the Chinese economy develops and wages rise, Indonesia could stand to position itself as an undertapped source of low-cost labour. As I blogged here, a few days back, LKY said that SMEs would flee S’pore if FTs were not allowed in by the cattle-truck load: they want cheap labour. The survey indicates that securing cheap labour is all that SMEs care about?
Other Asean-round up news:
Express link to KL
M’sia should talk to billionaire inventor Elon Musk. He wants to build a Hyperloop that would cut travel time between SF and LA to 35 minute. 12 minutes to KL based on the 35 minutes time
THe US Commerce Department declined to set duties on shrimp imports from Thailand and Indonesia. It has imposed duties on shrimp imports from five nations.
The ruling applies to about US$2bn of shrimp imports, from India, Ecuador, China, Malaysia and Vietnam. The Commerce Department found that those nations had been subsidising their shrimp producers.
Malaysia faces the highest duties of up to 54.5%, the lowest were set for Vietnam which faces duties of up to 7.8%.
A final approval is needed by another government body, the International Trade Commission (ITC), before the duties can take effect, The ITC will consider whether US producers have been threatened by the imports and make its decision in September.
Fighting inflation the Indon way
Bit like the way they fight the haze: wayang all the way.
Indonesia’s central bank held its benchmark interest rate on Thursday and took steps to contain loan expansion to battle inflation without taking any more steam out of slowing economic growth.
Many economists do expect another rate hike later this year but the central bank faces a tricky combination of surging prices, a falling rupiah, a stubborn current account deficit and slowing economic growth.
Gd summary from FT on Japan’s reemergence in region
China’s slowdown and the prospect of less easy US money have sent a chill through southeast Asia. Benchmark indices in Jakarta, Bangkok and Manila have lost almost half of the one-fifth gains they had made this year to mid-May. The real economy is weakening, too. Last week the Bank of Thailand cut its growth forecast below 5 per cent and recent comments from Bank Indonesia suggest it accepts growth will slip below 6 per cent. Hardly a disaster then, but nor is it what these countries or their followers are used to. Enter Japan and, crucially, its direct investment. In terms of trading with the region, Japan’s significance has slipped over the past decade as its economy stagnated, but at a shade over $200bn it commands the same share as China. Its FDI of $60bn into the region over that period, however, is 10-times greater than its giant neighbour, according to HSBC. Japan is either the largest or second-largest investor in each country.
During the past two months, Japanese banks and insurers have spent almost $6bn buying stakes in their southeast Asian counterparts. More deals are expected as they try to escape a weak and ageing home market.
Meiji Yasuda Life Insurance Co is expected to acquire a 15% stake in Thai Life Insurance Co. in what would be one of the biggest investments ever in Asia by a Japanese life insurer With the planned investment worth about ¥70 bn (US%700bn), Meiji Yasuda wants to make the major Thai insurer into an equity-method affiliate and dispatch executives, the sources said.
Like other Japanese insurers, Meiji Yasuda is looking to expand overseas earnings, especially in Asia, amid sluggish business at home due to the aging of society.
Sumitomo Life Insurance Co. has made a ¥28 bn investment in Vietnam’s top insurance group, while Dai-ichi Life Insurance Co. in June announced a ¥34.3 bn investment in Indonesia. Sumitimo which lost out to Yasuda is now looking to Indonesia where Bank Negara is looking to sell up to 40% of its life business for up to $800m, according to the FT.
Japanese banks have been active too. https://atans1.wordpress.com/?s=Mitsubishi
Low labour costs and Cambodia’s proximity to key markets such as China and other emerging economies in South East Asia are attractive to foreign investors.
And with wages in countries such as Thailand and China on the rise, Cambodia is likely to become even more attractive.
Vietnam R private equity
Despite Indonesia committing to ratify the regional pact on transboundary haze pollution by early next year, at the latest, and agreeing to share digitised concession maps with other governments, Singapore’s Minister for the Environment and Water Resources Vivian Balakrishnan left yesterday’s regional meeting on the haze problem “disappointed (but) not surprised”, in his own words …
Only two of the four outcomes that Singapore had sought were fully met after the four-hour meeting: Getting the participating countries — Singapore, Malaysia, Indonesia, Brunei and Thailand — to involve high-level officials from all relevant ministries and agencies from each country in the MSC process, and getting a commitment from Indonesia to ratify the ASEAN Transboundary Haze Pollution Agreement “expeditiously”.
Singapore was unable to get an agreement from Indonesia to renew their collaboration to reduce forest fires at Jambi and other provinces if possible, with Indonesia issuing a noncommittal response to offers of bilateral collaborations from Malaysia and Singapore.
While it welcomed the offers, Indonesia is “currently identifying the areas of cooperation which will maximise and bring mutual benefits for all parties concerned”, a press released issued after the meeting said.
Singapore had also hoped to get the participating countries to submit their concession maps and agree a date for the public launch of the ASEAN Sub-Regional Haze Monitoring System (HMS) platform to enable identification errant companies engaging in slash-and-burn practices.
Maps from the Indonesian govt are the only way S’pore can establish whether S’pore-based companies are telling the truth about where the fires are burning. If the accounts of the S’porean (mostly controlled by Indonesians) are taken at their face value, the fires are almost always anywhere except on their land. Note that despite the allegations by Indon officials that S’pore companies started fires , only one co, a M’sian co,has been charged.
Meiji Yasuda Life Insurance Co is expected to acquire a 15% stake in Thai Life Insurance Co. in what would be one of the biggest investments ever in Asia by a Japanese life insurer With the planned investment worth about ¥70 bn (US%700bn), Meiji Yasuda wants to make the major Thai insurer into an equity-method affiliate and dispatch executives, the sources said.
Like other Japanese insurers, Meiji Yasuda is looking to expand overseas earnings, especially in Asia, amid sluggish business at home due to the aging of society.
Sumitomo Life Insurance Co. has made a ¥28 bn investment in Vietnam’s top insurance group, while Dai-ichi Life Insurance Co. in June announced a ¥34.3 bn investment in Indonesia.
Sumitimo which lost out to Yasuda is now looking to Indonesia where Bank Negara is looking to sell up to 40% of its life business for up to $800m, according to the FT.
Japanese banks have been active too. https://atans1.wordpress.com/?s=Mitsubishi
Japan’s Mitsubishi UFJ Financial Group (MUFG) is planning to buy a controlling stake in Thailand’s Bank of Ayudhya.Japan’s biggest lender has agreed to buy a 75% stake in the Thai bank for up to US$5.6bn.
If the deal goes through (Thai regulatory approval is needed) it would be the biggest purchase in South East Asia by a Japanese bank. The deal would also see General Electric end its investment in Ayudhya, which goes back to 2007 when it bought a 33% stake in the bank.
Attracted by bright growth prospects (more lending to its corporate clients expanding into the region, and tapping the retail market of the new middle class), Japanese financial firms have been expanding in South East Asia.In May, Sumitomo Mitsui Financial Group’s bought a US$1.5bn stake in Indonesia’s Bank Tabungan Pensiunan Nasional.
China’s Asean infrastructure fund
As these charts show, S’pore’s economy is more exposed to China than Indonesia, Philippines, Thailand, Vietnam and M’sia. (BTW, no Asean round-up this week)
And M’sia’s ports too. All are major transshipment centres.
Thailand, for instance, the second biggest investor in Myanmar after China, is forging ahead with a bigger version of Thilawa [port Japanese are building] at Dawei, on Myanmar’s Tenasserim coast. The deep-water port, associated industrial zone and roads connecting them with Bangkok 300km away will cost about $8.5 billion. Thai rulers had for centuries been toying with the idea of building a canal across the Kra Isthmus, linking the Gulf of Thailand directly to the Andaman Sea and the Indian Ocean to avoid the journey round peninsular Malaysia through the Strait of Malacca (see map). Dawei will at last give Thailand that link.
Grand plans to improve roads all the way from Bangkok to Cambodia and Vietnam are also in hand to spare those countries the tedious rounding of Malaysia and allow them to ship their goods from Dawei directly to Europe. This could profoundly alter the economic geography of South-East Asia, much reducing the importance of Singapore’s and Malaysia’s container terminals as trans-shipment points. Thilawa will also provide companies like Famoso with more direct access to European markets.
China, long the biggest investor in Myanmar, has been toiling away at its own grands projets. The most important of these are the new oil and gas pipelines that crisscross the country, starting from a new terminus at Kyaukphyu, just below Sittwe, up to Mandalay and on to the Chinese border town of Ruili and then Kunming, the capital of Yunnan province (see map above). This will save China having to funnel oil from Africa and the Middle East through the bottleneck around Singapore.
Great video on Burma’s strategic position.
Thais love debt: CP All, the Thai retailer controlled by tycoon Dhanin Chearavanont, borrowed $6 billion in May to fund a $6.6 billion takeover of Siam Makro, the Thai cash-and-carry group. Low interest rates and the hidden value in Siam Makro’s property portfolio mean the purchase can support hefty borrowing without any synergies. And in January another Thai tycoon, Charoen Sirivadhanabhakdi, won the battle for control of Fraser and Neave with a debt-heavy $11.2 billion offer based largely on breaking up the Singaporean conglomerate.
1997/1998 again? Both had problems then, esp the former.
Easy come, easy go:The main Philippines equity index has tumbled 11% and the Thai index 8.4% since May 22 when the Fed’s chairman talked of restraining QEIII. Still up on the yr, unlike S’pore.
Convert to gambling and the Philippines? Fullerton Fund Management Company (FFMC), a subsidiary of Temasek Holdings, has bought a 5.02% stake in Melco Crown Philippines Resorts Corp.
FFMC has acquired 222.2 million Melco shares, according to the company, which is listed on the Philippine Stock Exchange.
Melco is the Philippine unit of Nasdaq-listed Melco Crown Entertainment, which is backed by Lawrence Ho, a relative of Macau casino mogul Stanley Ho.
BBC discovers Burma
Warburg Pincus-Led Consortium Buys Stake in Vietnamese Retailer A consortium led by the private equity firm Warburg Pincus has agreed to buy a 20 percent stake in the Vietnamese retailer Vingroup Joint Stock Company for $200 million. REUTERS
Thai banks are warily watching for signs of a credit bubble, even as they make record profits on robust loan growth on the back of a strong economy.
Bangkok Bank, Thailand’s largest lender by assets hasraised its loan-loss reserve coverage to 203.3% of non performing loans (NPLs) in the first quarter, more than double the central bank’s minimum requirement.
The Bank of Thailand has cautioned banks on rising household debt in South-east Asia’s second biggest economy, and expressed concern that cheap home loans could cause a steep rise in prices similar to that seen in Singapore and Hong Kong.Thai banks say there are not worried about a property bubble, but concede there is a possible excess supply of condominiums along Bangkok’s mass transit routes.
Fresh from leveraging up to buy a stake in insurer Ping An (he borrowed US$5.5bn), Dhanin Chearavanont is borrowing US$6 billion to finance a takeover of Siam Makro. Combining the Thai cash-and-carry group with his 7-Eleven convenience store chain makes sense. He co-founded Siam Makro with Dutch group SHV in the late 1980s, but was forced to sell out in 1998 when the Asian crisis left his empire overextended (soon to be repeated?). Sentimentality aside, the combined business should also be in a stronger position to expand into neighbouring Southeast Asian countries such as Laos and Myanmar.
The reunion is expensive. The offer price of 787 baht per share is 75% above where Siam Makro was trading at the beginning of January, and values the business at 53 times last year’s earnings. The advantage is that both Siam Makro and CP All, Mr Dhanin’s partially listed Thai retail company, currently have no debt.
“No business as usual if opposition wins Johor: Anwar”. So too said Lim Kit Siang. This means Iskandar will be affected.
“Leaders of Indonesia & Singapore discuss ways to boost close ties” Err what about the forest fires that come round this time every yr for decades? I’m bullish on Indonesia but taz despite its dysfunctional govt.
M’sia too will suffer because of drop in PC sales juz like S’pore https://atans1.wordpress.com/2013/04/11/when-economy-slows-not-nec-its-cause-ft-supply-ltd/ because Penang too is part of the Mircosoft ecosystem. And it too is not part of the Apple or Google ecosystems.
Bangkok SkyTrain Fund Raises $2.1 Billion in I.P.O. The offering, by an infrastructure fund controlled by the rail operator BTS Group, priced at the top of its marketed range, and ranks as the biggest ever new listing by a Thai company.
Burma has shortlisted 12 international consortia, including one led by Singapore Telecommunications, for the final stage in its telecommunications licence tender, the Wires report.
Other shortlisted applicants are a consortium comprising China Mobile and Vodafone Group, India’s Bharti Airtel, MTN Dubai, Jamaica’s Digicel Group, Japan’s KDDI Corp and Sumitomo Corp, Malaysia’s Axiata Group, Norway’s Telenor, Millicom International Cellular, Qatar Telecom and Vietnam’s Viettel Group.
Seems Temasek’s telco didn’t make it.
The shortlisted applicants can now formally bid for the two licences, each with initial terms of 15 years. Bids must be submitted by June 3, and the winners will be announced by June 27.
SMEs like Iskandar http://www.todayonline.com/business/ocbc-expects-sme-loans-iskandar-triple
What happens in PK wins GE but Johor remains UMNO heartland.
Indon IPOs: Private-equity firm PT Saratoga Investama Sedaya, and Indonesia’s biggest taxi operator Blue Bird Group, have picked underwriters to prepare their initial public offerings (IPOs) as they seek to raise money ahead of a 2014 general election.
Burmese telco update: Telecoms will be among the first industries to be liberalised under Burma’s reformist government, which hopes to place mobiles into the hands of between 75% and 80% of its 60 million citizens by 2016, up from an estimated 6% today.
If take-up is high, the entire mobile market in Burma – renamed Myanmar by the ruling military junta – could be worth $10bn (£6bn) a year, with networks generating $7.3bn of those revenues, research by Ericsson found.
Foreign companies are eager to partake in what has been described as a mouthwatering opportunity, and by Thursday’s deadline 22 bids had been submitted.
SingTel and Temasek are also trying their luck. but LKY’s remarks about “stupid” generals (a few yrs ago) can’t be helpful.
Iskandar: Some issues are beginning to surface as highlighted in a recent Business Times article which said that investors are not getting assurances in black and white on issues like land zoning, mortgage loan quantums and Bumiputra employment quotas, among others.
Foreigners investing in Iskandar might do better if they can understand that most policies in Malaysia are instituted by politicians of the day. When the politician leaves, a new policy replacing the old one is to be expected. When doing business in Johor, one has to factor in such risks.
Remember that Putrajaya, the state administrative capital of Malaysia, is still struggling after more than 20 years in the making. When Iskandar was mooted in 2006, authorities were confident about getting funds from Middle Eastern investors. Obviously, that plan didn’t work out and the focus is now back to Singaporean investors.
Thailand is the “Detroit of the East”. And it is Japanese carmakers in particular that use the country as a manufacturing hub. In 2012 production reached 2.45m vehicles of which 1m were exported. This made Thailand the 7th largest car exporter globally.
Eat yr hear out Dr M. Remember, he started Project Proton because he wanted to kick-start M’sia into becoming a leading vehicle manufacturer.
Pinoys ahoy: Over 10m Filipinos, equivalent to about a quarter of the country’s labour force, live or work abroad, permanently or temporarily, legally or illegally, in over 200 countries. Their remittances are equivalent to 8.5% of GDP, helping the country to plug its trade deficit and amass over $80 billion of currency reserves. As a result, the Philippines has become a net creditor to the rest of the world … , not just a net supplier of labour.
These impregnable external finances are one reason why Fitch, a ratings agency, awarded the Philippines its first ever investment-grade credit rating on March 28th.
This chart shows all the economies that maintained 6% growth or faster over 30 years. S’pore’s run of 7ish% growthended in 1994, when GCT was PM and Lee Jnr was Deputy PM and in charge of the economy. Going by the things our PM is doing now, maybe GCT held him back? Or LHL has repented? And the changes he is initiating, is his way of saying, “Sorry”?. How about a claw-back of ministerial salaries? Esp of PM’sand DPM’s? If it happens to bankers, it can happen to ministers: after all ministers’ salaries pegged to bankers among others.
Airbus has won a record order for 234 A320 planes worth 18.4bn euros (US$24bn) from Indonesia’s Lion Air.The order trumps last year’s record order for 230 Boeing planes – also from Lion Air.
Last Saturday, Bloomberry Resorts Corp’s was opened by Philippine President Benigno Aquino.
Big casino operators will be scrutinising the Philippines’ debut as Asia’s newest top-end gambling destination this weekend to see if Manila can deliver on promises of better profit margins and lower costs than global betting capital Macau, says Reuters.
They also want to know whether Bloomberry Resorts Corp , whose shares have climbed 40% in the last six months on hopes of quick returns, can overcome national security concerns and flawed infrastructure to bring in VIPs from China to place bets at its US$1.2 billion Solaire casino resort.
Its rivals are Melco Crown Entertainment Ltd and Genting Hong Kong Ltd, with their respective local partners Belle Corp and Alliance Global Group Inc.
“There are high rollers coming in to play … I am expecting at least 1-1.5 billion pesos (US$25 million to US$37 million) to be wagered tomorrow night,” Cristino Naguiat, head of local regulator the Philippine Gaming Corp (Pagcor) told reporters.
The advantage that the Philippines has is that junket operators are welcomed, unlike in S’pore. Junket operators have a reputation for laundering money, and ties with organised crime.
Bangkok skytrain operator BTS Group Holdings Pcl has received commitments worth $850 million from 20 cornerstone investors for Thailand’s biggest initial public offering, a source with direct knowledge of the plans told Reuters on Friday.
The investors in the infrastructure fund IPO include insurer AIA Group Ltd, hedge fund Azentus Capital Management and global asset managers Fidelity and Capital Research and Management, added the source, who was not authorized to speak publicly on the matter.
BTS on Friday week filed a prospectus for the up to $2.1 billion IPO, but the document did not include the names of the cornerstones.
The fund will likely yield between 6-6.2%, Reuters reported.
PT Matahari Department Store (LPPF)’s owners raised 12.7 trillion rupiah (US$1.3 billion) selling stock in the Indonesian retailer, Bloomberg reported.
CVC and Lippo Group sold 1.167 billion shares at 10,850 rupiah. The shares were initially offered at 10,000 rupiah to 11,250 rupiiah
The sellers, seeking to capitalize on investor optimism about consumer spending in Indonesia, asked for as much as double the median valuation among department stores in emerging Asia, price-to-earnings data compiled by Bloomberg show T(he shares were offered for as much as 28 times Matahari’s forecast 2013 earnings). Jakarta’s stock benchmark is up 11.3 percent this year and hit a record high earlier this month.
Temasek GIC is a cornerstone investor despite selling some shares too.GIC also committed to buy a 1.8% stake in the share sale as a cornerstone investor at the same time as its private equity arm was one of the main selling shareholders. Temasek too was a cornerstone investor. There were 15 cornerstone investors each with less than 5%.
(Update: Last para amended and expanded on 24 March 2013.
Morgan Stanley downgraded Thailand equities to ‘underweight’ from ‘equal weight’, reflecting its expensive valuation and overbought technical indicators. It’s been up 12% in US$ terms this yr, 9% in the local currency.
The downgrade put Thailand into the broker’s list of underweight-rated countries in Southeast Asia, including the Philippines. The broker had ‘equal weight’ for Singapore, Malaysia and Indonesia.
“Thailand is expensive in terms of all the valuation measures we use in the model: P/B, Z-Score of P/E, and dividend yield,” Morgan Stanley said in its Asia/Global Emerging Markets report dated Feb 27.
“Thailand has outperformed the MSCI EM by more than 8 per cent YTD 2013, which makes its technical factors like price reversal and RSI unattractive,” it said.
The Philippine unit of Macau casino company Melco Crown Entertainment Ltd said on Tuesday it plans to sell up to 1 billion shares as it prepares to develop a $1 billion casino-resort project with local partner Belle Corp.
Melco, run by Australian billionaire James Packer and the son of Macau gambling tycoon Stanley Ho, bought a 93% in Manchester, a formerly illiquid stock with investments in pharmaceutical and real estate businesses. Melco paid Manchester shareholders 1.3 billion pesos for the backdoor listing.
Melco and Belle, controlled by the Philippines’ richest man, Henry Sy, formalized their partnership in October.
Belle plans to build an integrated entertainment resort complex called Belle Grande Manila Bay, which features a 30,000-square-metre casino in a sprawling gaming complex being developed near Manila Bay. Melco will operate the casino.
There are three other groups with casino licences in the Philippines.
Financier Nathaniel Rothschild has lost his bid to oust the current board of coal mining giant Bumi, the company he helped to found.
Chairman Samin Tan survived a vote to remove him but informed the board he was stepping down.
Mr Rothschild had wanted to rejoin the company and expel 12 of the 14 board members, including the chief executive and chairman.Allegations of financial irregularities at Bumi’s key Indonesian operating subsidiary, PT Bumi Resources – in which it owns 29% alongside the Bakrie family – first emerged in September 2012 , after Mr Rothschild received information from a whistleblower.
Thailand’s economic growth exceeded expectations in the last three months of 2012 as it continued to recover from the previous year’s devastating floods.
Gross domestic product surged 18.9% in the October-December period, from a year earlier. Most analysts had forecast a figure close to 15%.
Compared with the previous quarter, the economy grew by 3.6%. But inflation is a concern.
In Thailand – up 7.5% since the New Year – the market has been helped by a raft of initial public offerings and a boom in cross-border takeovers by Thai companies.
But the Stock Exchange of Thailand is also becoming a hub, connecting its securities trading with that of Malaysia and Singapore, and helping Laos develop its fledgling equity and bond market.
It has also signed a memorandum of understanding to help Burma do the same. FYI, the Laos market, tiny and illiquid, is up 17% in the last five weeks.
The Philippines has for decades resolutely defied the expectations that have been heaped upon it since the end of the Marcos era, and underperformed with monotonous regularity.
However, the fundamentals do look convincing now: low inflation of about 3-3.5%, growth estimated at above 6% through to 2016, strong consumption, election spending and rising foreign investor interest.
The economist Nouriel Roubini, who predicted the 2008 financial crisis (and got the recovery dead wrong by continuing to maintain a determinedly gloomy attitude to the world economy ever since), had surprising comments for the Philippines earlier this month, predicting 7% growth and praising its economic success based on fiscal and governance reforms.
He even predicted the rating agencies would grant it an investment grade rating – a stamp of approval for foreign investors. At present, the country’s rating is a notch below investment grade.
By contrast the economy in Vietnam is now in the doldrums and experts pointing to decades of economic mismanagement as the cause. Many Vietnamese are now saying their trust in the government has gone. Sounds familiar?
Another exciting year is in store for initial public offerings (IPOs) in Malaysia. A recent report by HwangDBS Vickers Research identified close to 30 companies that may be floated on the Malaysian bourse this year.
Among the biggest IPOs set for this year are Malakoff Corp Bhd, Iskandar Waterfront Holdings Sdn Bhd, the power assets of 1Malaysia Development Bhd (1MDB), AirAsia X and possibly Westports Malaysia.
Corporate bonds issuance hit nearly RM124 billion (S$49.7 billion). A record amount of nearly RM146 billion was raised through corporate bonds and IPOs, an 89% jump over the RM77.2 billion raised in 2011, going by capital market statistics released by the Securities Commission.
The corporate bond market raised 73% more than the RM71.2 billion raised in 2011; it was the highest amount raised to date, with sukuk issuances amounting to RM97.5 billion or 79% of total bond issuances.
The increase in government-guaranteed assurances boosted growth in private debt securities (PDS) and 2013 issuances are expected to be even higher.
In January, Thailand and Indonesia are the world’s best equity markets. M’sia is 4th and S’pore is 7th.
And the voters of Punggol East still vote against the PAP? Are voters deft?
“India, Indonesia and Vietnam stand to benefit most as they have large labour forces and strong domestic markets,” says HSBC on MNCs moving on from China because of rising wages and an appreciating yuan.
Almost about the telco market in Burma, but there’s more after this Burmese stuff.
Taiwanese smartphone company HTC has become the latest to enter the largely untapped Burmese market, as the country opens up to foreign firms. HTC launched its smartphones in Burma on Monday. The phones will come with a Burmese language on-screen keyboard, which the company says is the most advanced available. Burma has one of the lowest mobile phone ownership levels in the world: in 2011, only 3% of the population had a mobile phone.
HTC is not the first smartphone maker to try to tap into the Burmese market. Samsung and Huawei lead the market with their low-cost devices. However, HTC is hoping to attract consumers with what it calls one of the most advanced Burmese language keyboards in the country.
Burma is also planning licence four more telco operators: invitations have been made to tender for two. The existing is govt-owned.
The expected bidders are: Russia’s VimpelCom, among the world’s top 10 mobile network operators in terms of subscribers; Telenor of Norway, a major shareholder in VimpelCom; Vietnam’s VNPT-Fujitsu, a joint-venture between Vietnam and Japan’s Fujitsu; Malaysia’s Axiata; and Digicel, the largest mobile operator in the Caribbean.
Local listco and mobile phone distributor mDr Ltd has incorporated a subsidiary in Burma. Itholds a 51% stake in MDR Myanmar while its local partners, Be-Well (Myanmar), Be-Well Corp and Avitar Enterprises, will hold 20, 20 and 9% respectively.
The new company, with a paid-up and issued capital of US$50,000, will provide after-sales services of telecommunication devices to consumers. It will also be involved in the mobile devices and accessories distribution and retail businesses via its provision of exclusive consultancy and retail franchisee procurement services to Myanmar-based Golden Myanmar Sea Co Ltd (GMS).
Thailand: a cheong too far? http://blogs.reuters.com/breakingviews/2013/01/16/thailands-unsustainable-boom-is-piling-up-risks/
Indon private equity firm on a roll: http://www.bloomberg.com/news/2013-01-15/saratoga-seeks-consumer-deals-with-480-million-war-chest.html
Flooding caused by days of heavy rain has hit parts of the Indonesian capital, Jakarta, forcing businesses to close and blocking roads. Areas including the central business district (CBD) were inundated and traffic was grid-locked as residents struggled to move around the city.
Meanwhile there is a water shortage just south of KL.
Gd news for SE Asia. China has reported better-than-expected trade data, adding to optimism that growth in the world’s second-largest economy may be rebounding.Exports, a key driver of expansion, rose 14.1% in December from a year earlier. Most analysts had forecast a figure closer to 4%.Imports also rose, climbing 6% and indicating stronger domestic demand.
The US has filed a complaint with the World Trade Organization (WTO) against Indonesia’s restrictions on imports of horticultural and animal products. BBC report. Other agricultural exporters like Australia and Thailand have been unhappy about Indonesia’s restrictions too.
Thailand is considering measures to help companies cope with the country’s rise in the minimum wage (35% up from level of last year), but has rejected business warnings of job losses, factory closures and a shift by some manufacturers to neighbouring countries
Thailand’s central bank left its benchmark interest rate unchanged at 2.75% on Wednesday, as expected, saying the global economy continued to recover while growth this year could be higher than thought and inflation was stable.
The International Monetary Fund has warned that a credit boom in Cambodia poses a threat to economic growth. Banks have been cutting interest rates to win customers and private sector credit has increased by almost a third in the past 12 months, the fund said.
A $US200m deal with Masan Group by KKR is the largest by a private equity firm so far in Vietnam. It comes in addition to an earlier $159 million investment by KKR. Masan is Vietnam’s leading fish, soya and chilli sauce producer. As well as sauces Masan makes instant foods such as noodles, cereals and coffees. The firm estimates that 90% of local households use its products.http://www.bbc.co.uk/news/business-20954875
Japan was in talks with the Philippines on Thursday to enhance maritime co-operation amid their separate territorial rows with China.
“We talked about the challenges that we appear to be facing in view of the assertions being made by China,” Philippine Foreign Secretary Albert del Rosario told reporters after meeting with his Japanese counterpart, Fumio Kishida, in Manila.
Part of the co-operation may include 10 new patrol vessels from Japan to boost the Philippine coast guard, as well as communication equipment, Mr Del Rosario said.
Indons love their Blackberries (still): now they can transfer money to one another using their Blackberries. Maybe some rich Indon should save RIM, Blackberries’ manufacturer.
The BTS Group, a Thai elevated-railway operator, is looking to raise at least US$1.5 billion through an I.P.O. of its infrastructure fund, “which would make it the country’s largest-ever I.P.O.,” WALL STREET JOURNAL
Iskandar getting desperate: want our SMEs. One time, see our SMEs no ak. Only wanted MNCs, TLCs and Arabs.
Malaysian billionaire Quek Leng Chan, who owns 75% of the HK-listed Guoco Group, offered to take the company private for about US$1.1 billion, WALL STREET JOURNAL
Indonesia’s increased piousness has led to a demand for the services of Islamic or Sharia banks: growth is at 40% a year.
In the report*, called Emerging Trends in Real Estate Asia Pacific 2013, Singapore fell to third place in the rankings, losing the top place it held for the last two years to Jakarta. “The main issue in Singapore is a glut of new supply that’s arrived just as financial sector firms have been shedding headcount,” said Mr Colin Galloway, ULI’s Research Consultant and the author of the report.
Jakarta is seen by the 400-over industry experts surveyed for the report as the best bet, especially in the retail and office segments. Its jump to the top from its previous mid-table position has been driven by strong investor interest tied to the country’s economic growth. “It’s really boom times in Indonesia now,” said one of the surveyed developers. “The demographics look good, it’s a country as big as America in terms of headcount and corruption seems to have been at least partly reined in.”
Singapore may face further competition in attracting real estate investment as it may lose out to countries offering better yields across the region, such as emerging and frontier markets like Cambodia and Myanmar, the report said.
Thai coup coming? An analyst speculates.
S’pore minister endorses Iskandar.
*According to a report co-published by PricewaterhouseCoopers (PwC) and the Urban Land Institute (ULI).
Burma and Thailand want to build a highway linking a to-be built port in Burma to a port in Thailand. This will enable cargo to by-pass the congested Malacca Straits.
Will this remain a dream like the Kra canal, then the Kra oil pipeline? I suspect not as there are benefits for Thailand and Burma.
Might even attract TLCs: there will be a need for industrial and logistic parks.
As for the Straits of Malacca as a shipping lane? Well the development of the US inter-continental port, highway rail system to move containers from the West Coast to the East, hasn’t affected the traffic using the Panama Canal. It is being enlarged to take bigger ships.
Following violent anti-govt protests at the weekend, Thai Prime Minister Yingluck Shinawatra, on Wednesday, easily survived a no-confidence vote. She was accused her of failing to crack down on corruption.
The actions against this protest shows that the changes in Burma are still a work-in-progress. The protest also highlights China’s growing image problems amid intensifying local opposition to its extensive natural resources and infrastructure projects. In fact, one of the reasons why the generals opened up was their fear of Chinese domination.
“Najib said the 13th general election would be the decisive point for the future of the country and the people should be able to judge for themselves the advantage of choosing BN over the opposition.” (CNA). Actually what he means is that it determines his wife’s position as FLOM: First Lady of M’sia. LOL. She gets heself called FLOM, even though she is not the queen. Non-parisan analysts don’t expect Bn to lose power, but neither do they expect BN to regain its two-thirds majority in parliament, UMNO’s holy grail. If Najib can’t deliver this, there will be a new PM.
This week, shares in Universal Entertainment, a Jap co fell on reports that one of its affiliates made illegal payments to an associate of the former head of the Philippine gaming regulator.
Last Tuesday, it was reported that Thailand’s economy has slowed in the third quarter after weak global demand dented exports to the US and Europe.Gross domestic product increased by 3% in the three months to the end of September from a year earlier. That is down from 4.4% in the second quarter. Analysts expect growth to pick up in the coming months as domestic demand offsets weaker foreign sales. Thailand’s GDP increased by 1.2% when calculated on a quarter-on-quarter basis, slightly more than many analysts had forecasted.
Carrefour sell Indonesian Operations for US$672.7m. Another French biz bites the dust in region. French car makers rarely sell cars in the region, and major French banks have ceased providing US$ trade financing.
And fly AirAsia at yr own risk? The M’sian authorities have renewed its safety licence for only six months, instead of the usual one year. More probably, shaking mgt for money? Elections are coming.
And talking of elections, Indian and Chinese voters will be most “daft” to vote for PK. While Anwar’s gang and DAP are secular parties, PAS is a branch of the Muslim Brudderhood. Not only do the Brudderhood want to cut-off limbs and ban partying, but in Egypt it has just reinstated a regime based on a presidency that has the powers of a pharaoh: something that secular Egyptians died to overthrow just over a year ago.
Last week, Indonesia’s constitutional court ruled that BPMigas, its upstream oil and gas regulator should be disbanded, adding to the growing legal uncertainty that has hampered investment in its natural resources sector. BPMigas is responsible for negotiating with oil and gas contractors such as BP, Chevron and ExxonMobil.
On Sunday, Thailand’s PM announced her country’s intention to join a US-led regional trade pact after meeting the US president on Sunday. M’sia and Vietnam signed up a long time ago. Surprising, S’pore has not signed up yet.
Not all roses from the US for the Burmese govt when POTUS visited Burma on Monday: US demands that the Burmese govt makes “unconditional release of remaining political prisoners, an end to ethnic conflicts, steps to establish the rule of law, ending the use of child soldiers and ensuring the safety and welfare of the people of Rakhine state”. The Burmese government is not the only group the US will work with. The US will also work directly with opposition groups, backing demands for the rule of law and human rights. This is like saying US will work with SDP in S’pore to ensure the rule of law and human rights.
PAS still wants to chop off limbs even if it gets into power with Anwar and DAP. And the Chinese and Indians still support DAP and Anwar? Juz look at the Muslim Brotherhood in the Middle East. Sharia law rules OK when the Brudders get into power. PAS is a Brudders branch.
The World Bank has approved an US$80m grant and pledged lending for Burma for the first time in 25 years. The money will go to rural communities to build roads, bridges, schools and health clinics.
The Yingluck Shinawatra administration’s new cabinet appointees were sworn in before the King on 31 October. FT earlier in the week reported that the changes strengthened the PM’s position vis-a-vis Thaksin, her brother.
Buyout Firms Increase Focus on Southeast Asia Moves by the Carlyle Group and K.K.R. show their “increasing interest in one of the world’s most promising, but complicated, emerging markets: Indonesia.”
Indonesia attracted a record US$5.9 bn in foreign direct investment in the third quarter. It is a hot despite a bleak global outlook and worries about corruption and corporate governance http://www.reuters.com/article/2012/10/22/us-indonesia-economy-fdi-idUSBRE89L04220121022.
Note KKR has juz opened an office in S’pore.
FT says the economies of Indonesia, Malaysia and the Philippines are being driven by relatively strong corporate balance sheets, commodity exports and robust consumption amid the emergence of a rapidly urbanising middle class with purchasing power, hence the PE interest.
If Vietnam gets its act together, it could join these countries. Thailand has the corporates and the middle class but not commodities. It manufactures. So it too will be on PE radar.
And taz why the PEs have set up shop here. Convenient hub.
And its China-plus-one Asean country for MNC manufacturers: In contrast to 2005, the previous time anti-Japanese riots flared, China is not the only fast-growing, well-populated, low-cost market around. Back then, Japanese firms hedged their China risk with a “China-plus-one” strategy, implying that they would find an extra Asian supply hub, such as Thailand. Now, that has grown into a wider “China-plus” strategy, because their options these days have widened to include Indonesia, Myanmar, Vietnam, Cambodia, the Philippines and India. (From the Economist’s last but one issue).
Will Laos join the other Asean countries now that it’s in WTO? Unlikely, but its been growing fast (and under the radar) http://www.bbc.co.uk/news/business-20078312. Stag Yaw should pop across from Hanoi to check out the
gals biz prospects?
M’sia’s Westport is planning a US$500bn IPO for the first quarter of 2013 reports Reuters. Thirteen companies have raised US$6.4bn so far this year on KLSE making it the 4th biggest IPO mkt after US, China and Japan. And CEO and COO are locals, not FTs like those of SGX.
Thailand’s central bank unexpectedly cut interest rates in an effort to boost domestic demand and sustain growth: key rate to 2.75% from 3%. Analysts mutter about govt pressure on the central bank which is supposed to make independent decisions. Some analysts criticised the move, saying that lower borrowing costs might spur a rise in consumer prices, forcing the bank to reverse its decision as early as the first half of next year.
Japan (one of Asean’s biggest trading partners and source of much FDI is looking to stimulate its economy.
Burma’s president re-appointed party chief but FT and others report tensions in the party. They say this guy is the one to watch: the speaker of parliament who now has been chosen as day-to-day leader of the party: another ex-general. Parly has been causing govt some problems regarding foreign investment laws.
Vietnam’s leaders are unhappy with their PM. Makes investment scene more unstable. And Stag Yaw (remember him?) is trying to do biz there.
OCBC and CIMB have signed non-disclosure agreements as they consider bidding for General Electric’s stake in Bank of Ayudhya, Bloomberg News reports. MayBank is interested as usual, but doing nothing, as usual. I’m surprised that OCBC is interested.
Bank of Ayudhya is Thailand’s top or second-ranked provider of credit cards, car loans and personal finance, having bot businesses from HSBC, GE and AIG, among others.
Lsst yr this time, Thailand was hit by a massive flood that left the country and government floundering. This yr, it seems Thailand is prepared for another massive flood despite the prediction that the rains will not be so heavy.
Thailand’s economy grew more than forecast in the April to June period helped by domestic consumption and continued recovery in manufacturing.
Growth was 3.3% in the second quarter, compared to the previous three months. Analysts had forecast growth of 1.7%.
Thai market as of 15 August was +19.7% on the yr in US$ terms, slightly behind S’pores 20%. Explain this Dr Chee, KennethJ, EJay and other haters of all things PAP.
But Indonesia has a few things going for it:
— two major exports are recession-proof
— lower cost producer of thermal coal and closer to China (tpt costs lower) than Oz means there will still be demand for its coal; and
— palm oil cooking oil is the cheapest cooking oil;
— cheap labour attracting the likes of Foxcomm;
— last yr’s floods in Thailand are prompting MNC manufacturers to a “Thailand + one” strategy; and
— consumption now accounts for two-thirds of gross domestic product in Indonesia.
Malaysia is one of the most vulnerable Asian economies should a “perfect storm” of a disorderly debt default in Europe, a slowdown in China and the United States and rising tensions in the Middle East materialise, Roubini Global Economics said in a recent report.
The research firm, which predicted the 2008 global financial crisis, said Malaysia had the highest exposure to a pullout of capital as its euro zone and US bank claims amount to more than 25% of GDP.
The report said Malaysia was among the lowest ranked in terms of monetary and fiscal capacity to respond to a crisis, coming in ahead of only Thailand, Japan and Indonesia.
“Malaysia, Taiwan, South Korea and Vietnam appear to be the most exposed to a perfect storm through their trade and financial linkages, while South Korea, Australia, Vietnam and the Philippines … have the most policy space to offset such an external shock.”
Thailand’s Constitutional Court has rejected allegations that government plans to amend the constitution are an attempt to overthrow the monarchy. But it has made the task of changing the constitution more difficult.
The court said that parliament could only only rewrite the constitution on a piecemeal basis. A referendum was needed to decide whether the government could go ahead with the proposed changes wholesale.
The red shirts (pro govt) and the yellow shirts (anti govt) can continue rowing.
Yesterday’s alarmist post https://atans1.wordpress.com/2012/07/13/thai-market-to-collapse/