MALAYSIA NEWS
E-COMMERCE MARKET EYE ON 1BIL USD PROFIT ON 2016 – CHINA PRESS –
Online shopping carts are transforming the face of China’s economy, changing supply chains, and putting pricing power in the hands of its 1.37 billion consumers. This digital wave is also happening in Malaysia. With the rapidly growing technology industry, Malaysia is planning new targets for using digital technologies to drive the country’s economic growth beyond 2020. According to Mukhtar Hussain, Chief Executive Officer of HSBC Malaysia, the ASEAN Economic Community (AEC) will likely provide a larger market for the ICT industry. The ICT sector is expected to record a growth of between RM79 billion and RM81 billion or about 12 to 14 per cent next year, contributed mainly by e-commerce and big data analytics. MSC Malaysia – the national ICT initiative – which continues to attract investments from world-class and cutting-edge companies in a wide range of industries also plays a crucial role in driving Malaysia’s digital economy, having contributing RM295 billion towards the country’s revenue, RM283 billion in investment and 147,000 jobs since 1996.
64 PERCENT OF MALAYSIAN WORRY THAT THEY DO NOT HAVE MONEY WHEN SICK – SIN CHEW DAILY –
64% of Malaysians say that what they worry most about in life is their health, yet many do not have anything in place to protect it, according to the newly launched HSBC report, The Power of Protection Confidence in the future. Lim Eng Seong, Country Head of Retail Banking and Wealth Management, HSBC Malaysia said, ““People’s number one worry is that poor health could one day stop them being able to look after themselves or their family. As shown by the survey, many people unfortunately have not been able to prepare when something unforeseen were to happen. While the need for economic security is universal, each of us faces this challenge from a very different perspective”.
BLEAK CORPORATE EARNINGS AHEAD – THE STAR –
There are signs emerging that overall corporate earnings during the current results season will be weaker than last year. Despite a recent rally in shares, which was partly attributed to foreign capital inflows, analysts have said that prospects of a sustained earnings recovery remain weak due to a multitude of factors. The steep 3% decline in the FTSE Bursa Malaysia KL Composite Index (FBM KLCI) during the final week of April underscored the concerns by investors that share prices may have exceeded fundamental justifications yet again. In an April 27 note, UOBKayHian Research said external and domestic socio-economic structural challenges would persist this year. “Key challenges ahead include slowing domestic consumption growth and a steadily rising unemployment rate, which had crept up to 3.4% in February. Corporate earnings growth, which has derailed from gross domestic product (GDP) growth over the past three years, is just making a meek mid-single-digit growth recovery in 2016,” it cautioned.
ASEAN/US NEWS
OBAMA SAYS CHINESE-LED TRADE DEAL SHOWS NEED FOR TPP – WASHINGTON POST – THE STAR
U.S. President Barack Obama said on Monday that a Chinese-led regional trade deal demonstrated the urgent need for Congress to approve the 12-nation Trans-Pacific Partnership trade pact. Obama has been pushing to finalize the TPP before he leaves office on Jan. 20, but he needs to overcome strong anti-trade sentiment from both the left wing of his own Democratic Party as well as from the right flank of the Republican Party. Voter anxiety over the impact of trade deals on jobs and the environment has featured large in the campaigns of Donald Trump, the Republican front-runner for the Nov. 8 presidential election, and U.S. Senator Bernie Sanders, who is running against Hillary Clinton for the Democratic nomination. In an opinion piece published on the website of the Washington Post on Monday, Obama said he understood voter skepticism but that “building walls to isolate ourselves from the global economy” would backfire on the American economy.
CHINA NEWS
CHINA EXPECTED TO SEE US$538BIL CAPITAL EXODUS IN 2016, IIF SAYS – THE STAR
Global investors are expected to pull US$538bil (RM2.1 trillion) out of China’s slowing economy in 2016, the Institute of International Finance (IIF) estimated on Monday, although the pace of outflows has dropped. That number would be down a fifth from the US$674bil (RM2.6 trillion) pulled out last year, the industry association said, but could accelerate again if fears re-emerge of a “disorderly” drop in the yuan, or the renminbi, as the currency is also known. Capital exodus from China can influence emerging markets more generally, partly because of its sheer size and partly because sustained outflows can trigger more exchange rate volatility, which could then feed a fresh wave of outflows.
