Malaysian PM: Environment should be priority

‘Environment protection cooperation’

Yab Dato' Sri Mohd Najib Tun Abdul Razak

Prime Minister of Malaysia

The opening ceremony of 8th China-ASEAN Expo October 21, 2011, Nanning, China

Your Excellency Wen Jiabao; Premier of the People’s Republic of China,
Your Excellencies, Leaders of ASEAN Countries,
Your Excellency Governor of Guangxi Zhuang Autonomous Region,
Distinguished Guests,
Ladies and Gentlemen,
I am delighted to be here with all of you today at the 8th China-ASEAN Expo – an event that continues to go from strength to strength, bringing together business communities from China, ASEAN and all over the world and the increasing regional cooperation and global ties.
This year I am especially proud because Malaysia has been named Country of Honour. I would like to thank the organizers both personally and on behalf of the more than 100 Malaysian companies taking part in this event for what is indeed a privilege.
This year’s event is particularly significant because it marks the 20th anniversary of the establishment of formal links between ASEAN and China. Over this period the ASEAN-China relationship has grown significantly, buoyed by a common commitment to our mutual development. Through close co-operation we have worked to improve public health, including the establishment of the Risk Communication Resource Centre here in Malaysia to manage infectious diseases outbreaks. We have worked to build the fabric of our societies by controlling and combating drug use. And we have worked to integrate our economies and boost our sources of growth by implementing the China-ASEAN Free Trade Agreement – an agreement that means companies from Kuala Lumpur to Beijing and from Bangkok to Shanghai can reap greater rewards from trade, expand their opportunities to invest and step up their regional and global presence.
But as our economies continue to integrate and expand, we must not allow them to do so in a way that will consign future generations to wealth without the wonders of the natural world. We can build an ice rink or put a roof on a football stadium, but we cannot yet do the same with glaciers or the ozone layer.
What we can do is change our ways and, by promoting cleaner technology and reducing fossil fuel emissions, start to reverse the damage that has already be done. But this will take not just thought for tomorrow but action today, which is why it is so important that this Expo addresses critically important issues like environmental protection and sustainable development.
The background to this development comes of course from the 11th ASEAN-China Summit in 2007, where those nations present agreed that “environment” should be added to the list of priority areas for cooperation. In subsequent years the China-ASEAN Strategy on Environmental Protection Cooperation 2009-2015 went on to pave the way for the establishment of the China-ASEAN Environmental Protection Centre in China.
Ladies and gentlemen,
The breadth and bearing of the Centre is not hard to see and, in leading plans for environmental projects, environmental strategies and promoting environmental industries in China and throughout ASEAN, I have high hopes that it will become a hugely significant institution. One of the projects it has already announced is the China-ASEAN Green Envoys Plan, which aims to increase the use of no-harm-to-the-environment technology, environmental labeling and clean production.
But the weight of the work to be done is formidable and the responsibility could never be borne by just one institution. That is why Governments the world over need to do more to raise public awareness of environmental issues, promote environmental education and develop environmentally sound technologies.
Only in this way we can help to reverse a tide that is coming rapidly further inland and ensure that our children inherit a clean, safe and healthy planet – a planet that harvests enough crops to feed our global population and provides water that is safe to drink.
But our economic and environmental development are of course closely entwined, and as we gather here today we should be mindful of economic challenges that Europe and the US are facing and the impact these will have on us in Asia – for export growth in that part of the world is likely to be muted for some time to come and we will need to look for alternative sources to support our growth.
If we cannot do more business with the West, we can certainly do more business amongst ourselves. Trade between China and ASEAN has grown considerably over the last 20 years, from US$8 billion in 1991 to US$231.2 billion in 2010. China is now ASEAN’s largest trading partner, accounting for 11 per cent of trade last year, while ASEAN is China’s 4th largest trading partner accounting for 10 per cent of trade.
That is not to say there isn’t room to increase this on both sides – quite the opposite in fact, and I welcome China’s pledge to increase bilateral trade to US$500 billion by 2015.
Reaching this target will not be easy. All effective cooperation means working to improve our understanding of each other’s wants and needs, and we must continue to do this at the same time as improving market access for goods and services.
The convening of the first ASEAN-China Ministerial Meeting on Technical Barriers to Trade in Nanning is an important step in this direction, but I hope that we can build on our momentum, increase our ties and continue to progress for the benefit of all.
On that note, I would once again like to thank the organisers for giving me this opportunity to speak to all of you today and, on behalf of all ASEAN countries, I hope that you all enjoy the 8th China-ASEAN Expo.
Thank you.

Rising trade strains Malaysia's top ports

MALAYSIA'S growing international trade is putting a strain on main ports, with delays in cargo handling being reported despite an increase in throughput volume, according to a business report on Malaysia. 

Publisher and consultancy Oxford Business Group (OBG) said as majority of Malaysia's foreign trade as well as its domestic cargo transfer is moved by sea, delays in clearing the ports can have a direct impact on the economy. 

"Bottlenecks add to the costs of both shipping firms and their clients, especially those with perishable freight or cargoes being transported on a tight deadline. 

"Though there has been an increase in the number of 20-footer container units being handled by Malaysia's ports this year, some of the main cargo facilities are being stretched, with complaints coming from ... 


Read the full story at www.btimes.com.my

Malaysia investors to see ‘Goldilocks’ economy in 2011

KUCHING: In the near term, Malaysia’s growth trajectory will hinge on two major factors – namely the global economic development and the strength of private consumption in supporting domestic demand.

STRONG BEARING: On the external front, the US’ economic strength will have a strong bearing on Malaysia’s economic performance through direct and indirect trades. – Photo from mir.com.my

According to Malaysian Rating Corporation Bhd (MARC), Malaysia’s gross domestic product (GDP) growth in 2011 is anticipated to normalise but remain higher than its long term trend of 4.5 per cent to five per cent.

“The moderation in growth in the next one to two quarters is expected to continue, judging by high frequency statistics and leading indicators such as equity market movements and the Organisation for Economic Co-operation and Development (OECD) composite leading indicators (CLI) which are currently moving downward,” said the economics team in MARC.

In its report, MARC further pointed out that the benchmark equity market, the FBM KLCI which leads the economy by approximately four months had now turned downward, portended slower growth over the next few quarters.

Similarly, the sharp decline in the OECD CLI and a more moderate outlook for the manufacturing sector suggested a softer growth in the near term.

On the external front, the US’ economic strength would have a strong bearing on Malaysia’s economic performance through direct and indirect trades. Although the proportion of Malaysian exports to the US shrank to 9.7 per cent in the first 10 months of 2010, US still remained as an important final destination for a major chunk of Asean exports.

Therefore, it was not surprising that the overall correlation between Malaysia’s and the US’ economies remained high over the years, said the economics team. With the US economy expected to continue being saddled with high unemployment, growth would be slightly lower than its long term trend.

However, the lag effect of huge liquidity injections would likely provide some support to the economy that would otherwise grow at a minuscule rate.

“Going forward, we opine that the external sector will exert downward pressure on the domestic economy, especially in the first half of 2011, as demand for major products such as electrical and electronic (E&E) manufactures by advanced economies soften.

“The offsetting effect, however, will come from the commodities side, where prices of crude palm oil (CPO) and crude oil are expected to remain relatively firm,” it revealed.

On the domestic front, the demand would largely be supported by private consumption which had primarily been responsible for the country’s growth since the Asian Financial Crisis (AFC). Major factors that supported private consumption remained favourable, suggesting that consumers would likely be driving domestic demand.

The unemployment rate had declined to 3.1 per cent in the third quarter of  2010 (3Q2010), below its long term average of 3.4 per cent, providing an important catalyst for private consumption. Similarly, consumer sentiment which is another indicator of private consumption had also remained upbeat, suggesting a sustainable growth in private consumption throughout 2011.

Based on the given factors, the rating agency foresaw Malaysia’s GDP growth to moderate to 5.3 per cent in 2011, from the estimated growth of 7.2 per cent in 2010.

MARC economic report also showed that inflation was expected to creep up in 2011, but it would stay below the three per cent mark. That was due to the lack of demand driven factors that offset the rising food and fuel prices arising from the government’s subsidy rationalisation efforts to reduce the burden on its coffers.

As for food prices, it foresaw continuous upward pressure following the sustainably strong commodity

prices attributed to the uncertainty in weather conditions. In this light, Malaysia, being a net food importer, was expected to bear the brunt of strong commodity prices due to low self-sufficiency in food production.

As for fuel, it anticipated further adjustments in petrol prices by 10-20 sen in view of steady and strong prices of crude oil. Sustainable economic growth above its long term potential means that Malaysia would likely take the opportunity to reduce the burden on the government’s financial position.

On the other hand, on the demand side, the small output gap for 2011 of minus 0.6 per cent suggested that demand driven factors that were normally responsible for higher inflation were less visible.

“Against such a backdrop, we project the consumer price index (CPI) to post a moderate increase of 2.6 per cent in 2011, up from an estimated 1.9 per cent in 2010, with core inflation edging up to 2.1 per cent,” said MARC economic team.

In terms of implicit deflators, the divergence between the private consumption and GDP deflators was worth noting. While the implicit deflator for private consumption was in line with the CPI, the implicit deflator for GDP was suggesting stronger price pressures, having grown by 4.1 per cent in 3Q2010 after peaking at 6.1 per cent in 1Q2010.

However, the moderation in its growth suggested that inflation might not be a pressing issue in the nearterm.
In terms of debt sustainability, the Malaysian government’s ability to meet its obligations had been demonstrated by the decline in its debt-service charge ratio to 10.2 per cent in the first nine months of 2010 alone, with the ratio now well below the historical average of 15.6 per cent.

Additionally, analysis of the debt maturity profile revealed that the bulk of the government’s debt would mature after three years, suggesting that the risk of an asset-liability mismatch was fairly low for the Malaysian government.

On interest rates, MARC believed that demand-led inflation, if it happened, would not be a major trigger for future rate increases, as Bank Negara Malaysia (BNM) would likely resort to administrative measures instead. Furthermore, the need to sustain the growth momentum could mean that the policy rate would remained status quo in 1H2011.

In the medium term, however, Malaysia’s stable economic growth above its long term trend, coupled with the need to address financial imbalances, could lead to further normalisation, which was expected to happen in 2H2011.

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Palm Oil Drops as Rally to 34-Month High Lifts Soyoil Appeal

Palm oil fell the most in more than three weeks after a rally to the highest level in 34 months narrowed the discount to soybean oil, increasing the appeal of the rival oil for use in food and fuels.

The March-delivery contract declined 2.7 percent to 3,761 ringgit ($1,226) a metric ton, the most since Dec. 17, on the Malaysia Derivatives Exchange. Futures also had the first weekly drop in three weeks. Prices climbed to a 34-month high on Jan. 4.

Soybean oil’s premium over palm oil contracted to $10.09 a ton yesterday, compared with the 12-month average of $84.7 a ton, according to Bloomberg data. Soybean oil traded at a discount of $14.30 on Jan. 4, the first time since June 2007 that the edible oil has been cheaper than palm.

“The rally has prompted profit-booking among investors and with palm oil at parity with soybean oil, there will be less buying,” said Krishna Reddy, an analyst at Way2Wealth Commodities Ltd. in Mumbai.

Palm oil has rallied 67 percent in the past six months on concern that cooking-oil supplies may tighten as dry weather in Argentina weakened the crop in the largest soybean-oil producer and rains damaged oil-palm harvests in Indonesia and Malaysia.

March-delivery soybean oil shed as much as 1.2 percent to 56.70 cents a pound. Futures jumped 43 percent in 2010 for a second straight annual gain.

“Concerns over the Argentine soybean crops are alive and that should support a rally in prices,” Reddy said.

India Plantations

India, the biggest buyer of palm oil, plans to increase its oil-palm area more than sevenfold as it seeks ways to lower its cooking-fat import bill of $8.4 billion, Farm Secretary P.K. Basu said in an interview yesterday in New Delhi. Plantations may cover 1 million hectares (2.47 million acres) in the next five years, from 130,000 hectares now, he said.

Palm oil for September delivery on the Dalian Commodity Exchange tumbled 2.3 percent to 9,852 yuan ($1,486) a ton and soybean oil for delivery in the same month declined 2 percent to 10,586 yuan a ton.

CME Group Inc.’s March palm oil contract, pegged to the Malaysian benchmark price, declined as much as 0.9 percent to $1,226.75 a ton and traded at $1,228.75 at 4:43 p.m. in Singapore.

Top Malaysia panel to probe government agency's interrogation of opposition aide who died

KUALA LUMPUR, Malaysia - Malaysia's leader pledged Friday to form a rare high-level panel to investigate the official anti-graft watchdog's interrogation of an opposition party aide who later died mysteriously.

Teoh Beng Hock was found dead on a building roof next to the office of the Malaysian Anti-Corruption Commission in July 2009, hours after agency officials questioned him over suspected misuse of state funds by his boss.

The case has pressured Prime Minister Najib Razak to address allegations that police and other authorities use excessive force against suspects during interrogation.

Teoh, 30, was the aide of an opposition state legislator. An inquest into Teoh's death left it unresolved, with the coroner saying Wednesday that there was inadequate proof of suicide or murder.

Najib said a Royal Commission would soon look into the anti-corruption agency's investigation procedures and determine whether there was "any violation of human rights" during the questioning of Teoh.

It would be only the fourth time Malaysia's government has established a Royal Commission in the past 20 years. The commissions are meant to probe issues of great public interest and have wide powers to compel witnesses to provide testimony and to seize documents for evidence.

Opposition leaders nevertheless voiced frustration that the panel would not specifically investigate whether anti-graft officials were responsible for Teoh's death.

Najib said the attorney general would file a court application for the inquest's coroner to revise his ruling, but it was not immediately clear whether that could lead to a new investigation or criminal charges against anyone.

"What is important for us is to know the truth, and the government wants to know the truth. We will do our utmost to find out the truth," Najib told a news conference.

The Royal Commission will comprise "eminent and respected" members, Najib said, promising more details soon.

The anti-graft agency has denied having any direct role in Teoh's death. A reputed Thai forensic expert told the inquest last year that Teoh's death was almost certainly a homicide. Two Malaysian government pathologists, however, testified that he most likely committed suicide.

ISHARES MSCI MALAYSIA INDEX FUND: THE WINNING STREAK CONTINUES (EWM)

(SmarTrend(R) News Watch via COMTEX) -- Shares of iShares MSCI Malaysia Index Fund (NYSE:EWM) traded at a new 52-week high today of $14.71. Approximately 1 million shares have traded hands today vs. average 30-day volume of 1.9 million shares.

iShares MSCI Malaysia Index Fund is currently trading at $14.63, approximately 4.2% above its 50-day moving average of $14.03. SmarTrend will be monitoring shares of EWM to see if this bullish momentum will continue.

In the last five trading sessions, the 50-day MA has climbed 0.24% while the 200-day MA has risen 0.37%.

In the past 52 weeks, shares of iShares MSCI Malaysia Index Fund have traded between a low of $10.18 and a high of $14.59 and are now at $14.63, which is 44% above that low price.

SmarTrend currently has shares of iShares MSCI Malaysia Index Fund in an Uptrend and issued the Uptrend alert on June 21, 2010 at $11.96. The stock has risen 21.6% since the Uptrend alert was issued.

Write to Chip Brian at cbrian@tradethetrend.com

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As of Friday, 12-31-2010 23:59, the latest Comtex SmarTrendA? Alert,
an automated pattern recognition system, indicated an UPTREND on
06-21-2010 for EWM @ $11.97.

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Malaysia seen as good market for 'Sandy Bridge'

MALAYSIA, which has surpassed its 50 per cent broadband pene-tration target earlier than projected, is expected to provide a good end-user market for the soon-to-be launched Intel's next-generation family of microprocessors codenamed Sandy Bridge.

Intel Semiconductor Ltd vice-president and general manager (Asia Pacific) Navin Shenoy said Sandy Bridge will transform computers and make them faster with various capabilities.

"We will launch in Malaysia at the same time as in the US. The whole eco-system is ready," he said, adding that Sandy Bridge will be officially unveiled at the Consumer Electronics Show in the US on Wednesday.

Sandy Bridge, Intel's second-generation core processor family, will power the latest desktop computers, laptops and ...

Shoppers to pay 20 sen for each plastic bag on Saturdays

PETALING JAYA: Shoppers throughout the country will now have to pay 20 sen for each plastic bag when they shop at hypermarkets, supermarkets and Petronas service stations on Saturdays.

The move, which is already in force in Selangor and introduced to reduce the eight billion plastic bags used each year in Malaysia, caught many shoppers by surprise.

Other developments:

> The sum charged will go to a special fund which will benefit the environment and community;

> Shoppers in Penang will have to pay for their bags in these outlets every day; and

> Plastic industry players in Penang have expressed unhappiness, vowing to distribute 30,000 free bags in defiance of the move.