Factories suffer worst dip in over three years

KUALA LUMPUR, June 1 — Manufacturing output declined in the last quarter at a rate not seen since 2013, raising questions about the sector's ability to keep the economy growing at targeted rates.

According to the latest release of Nikkei Malaysia's Manufacturing Purchasing Managers Index (PMI), conditions in the already-struggling sector deteriorated further in the current quarter, with sharp declines in both orders and production.

“Production at Malaysian goods producers contracted for the fourteenth successive month in May. In fact, the rate of decline was the sharpest in over three-and-a-half years,” Nikkei Malaysia said.

“Similarly, new orders decreased for the fifteenth month running, with the latest decline the fastest since December last year.”

The PMI remained stagnant at 47.2 last month, extending the five-year low registered in April. Any number greater than 50 in the index represents an improvement in the sector.

Factories have also scaled back their purchases of raw material for 12 consecutive months, prompted by rising prices as well as declining orders.

Nikkei Malaysia said both the weak ringgit and high sales tax made it more expensive for manufacturers to operate.

“Moreover, the rate of inflation was the sharpest since February. As a result, manufacturers raised their charges to the greatest extent since December last year,” it added.

Despite the decline in output and orders, however, factories increased their hiring in May, although Nikkei Malaysia described the improvement as “slight”.

Malaysia is banking on exports to achieve its targeted gross domestic product growth of between 4 and 4.5 per cent this year, as high household debt and rising inflation weigh on consumer spending.

Household debt here has reached 89.1 per cent as a ratio of GDP or over RM1 trillion.

Slowing global demand also negated the export advantages of the weak ringgit, which is currently trading at 4.14 versus the US dollar.

Malaysia's trade balance fell to RM6.8 billion in the last quarter, down from RM11.4 billion in the final three months of 2015.

Old Johore money was in Tamil language too

National Debt At RM582.8 Billion, Says Najib

KUALA LUMPUR, March 11 (Bernama) -- The federal government's external debt at end-December 2014 stood at RM582.8 billion (or 54.5 per cent of GDP), of which RM566.1 billion (97.1 per cent) was domestic debt while the remaining RM16.8 billion (2.9 per cent) was in offshore loans, said Datuk Seri Najib Tun Razak.

"The federal government's debt position remains manageable and puts the country in the moderately-indebted category.

"The government is committed to ensuring the federal government's debt level does not exceed 55 per cent of GDP," the premier, who is also Finance Minister, said in his written reply to William Leong Jee Keen (PKR-Selayang) today.

Leong had wanted to know the reasons for the dramatic rise in the country's external debt to RM740 billion in the third quarter of 2014 from RM43 billion in 1990, and its effects on the government's finances and economy.

Najib said to ensure the federal government's debt remains low and manageable, fiscal consolidation measures would continue to be taken to lower the deficit in stages, reducing the need for the government to borrow and thus reducing the debt level.

"Strict adherence to fiscal discipline and good debt management should be given emphasis to ensure a strong fiscal position and macroeconomy as well as to withstand any crisis," he said.

Najib said Malaysia's external debt was RM740.7 billion in the third quarter of 2014, compared to RM41.5 billion in 1990 and RM196 billion at end-2013.

He attributed the drastic increase to the redefinition of external debt in use since 2014, in line with international reporting requirements, which now put the country's external debt as comprising offshore borrowings by the federal government, public enterprises and the private sector as well as holdings of debt securities, deposits and trade credits denominated in ringgit by non-residents.

Najib said the higher external debt under the new definition reflects the high level of non-residents' holdings of ringgit-denominated debt securities, constituting nearly two-thirds of the rise in the country's external debt.

"This is due to the wider depth, openness and attractiveness of the Malaysian financial market.

"At the same time, the new definition allows the government to better assess the risk exposure to non-residents," he said.

At end-2014, Malaysia's external debt stood at RM744.7 billion or 69.96 per cent of GDP, he added.

1MDB sudah langsai hutang, kata Arul

 

Syarikat pelaburan strategik negara 1Malaysia Development Berhad (1MDB) mengesahkan sudah melangsaikan pinjaman RM2 bilion sepenuhnya kepada bank Malaysia, kata Arul Kanda.

Presiden dan Pengarah Eksekutif Kumpulan 1MDB itu mengesahkan laporan The Malaysian Insider pagi ini yang melaporkan pinjaman itu dilangsaikan sebelum tarikh akhir ditetapkan, mengikut terma perjanjian pinjaman.

“Dengan penyelesaian pinjaman ini, saya ingin menegaskan komitmen 1MDB menyelesaikan semua kewajipan hutang kami mengikut tarikh yang ditetapkan,” kata Arul dalam satu kenyataan hari ini. – 13 Februari, 2015.

Controversial Malaysia Fund Misses Payment

Struggling state investment vehicle spells bad news for PM

Asia Sentinel

The failure of Malaysia’s ill-starred state run investment fund 1Malaysia Development Bhd to meet a RMB 2 billion (US$563 million) repayment to domestic banks spells bad news for Prime Minister Najib Tun Razak, the chief advisor to and ostensible brains behind the fund.

Reuters reported on Jan. 6 that 1MDB, as the fund is known, had missed a Dec. 31 payment and is exploring ways to settle with lenders, primarily RHB and Maybank, two of the country’s biggest banks, by the end of January. It is the second time 1MDB has missed a payment. It previously asked Bank Negara, the country’s central bank, for a three-month extension on its loan obligations.

The performance of the fund, which has borrowings of RM42.2 billion, has become intricately bound up with the attempt to bring down Najib that is being waged by forces allied with former Prime Minister Mahathir Mohamad. In recent days the campaign to force out the prime minister has sprung into the open, partly over the fact that he was invited to play golf in Hawaii with President Barack Obama at a time when the east coast of the country was inundated with some of the worst floods in decades.

“It is a watershed and an ominous one when the rakyat (the people), through the blogs, the independent news portal and the social media outlets, discovered that the PM was golfing in Hawaii while a quarter million people were flooded out of their homes,” wrote A. Kadir Jasin, the former editor of the Straits Times and Mahathir’s chief spear carrier, on his blog. “They asked, ‘does the PM care?’”

When Najib belatedly rushed home to visit the flooded area, he caught an infection from e.coli bacteria in the polluted waters, opening him to ridicule from his critics. He also left behind in the United States Perdana 2, the luxurious government-owned Airbus ACJ320 executive jet. Blogs, especially those aligned with Mahathir, erupted in criticism, saying the plane had been left behind to make stops in Los Angeles, Indianapolis, Los Angeles, New York, London, Dubai and back to South East Asia, carrying the prime minister’s wife, Rosmah Mansor, whose taste for extravagant shopping and overseas travel have made her a lightning rod for criticism.

Muhyiddin Yassin, the current deputy prime minister, has in recent weeks stepped up his oblique criticism of the way the government is run, saying the ruling Barisan Nasional could lose the next election, due in 2018, if changes are not made. Criticism has been growing among the rank and file as well, with one UMNO member filing a complaint with the Malaysian Anti-Corruption Commission in December over the operation of 1MDB before he was told to knock it off.

The disastrous performance of the fund has been complicated by the circumstances of its 2009 inception. It was proposed to Najib by Jho Low Taek, then a 27-year-old investment advisor with a lot of Middle Eastern friends and a reputation as a playboy who made the papers of New York tabloids, partying with the likes of Nicole Ritchie and Paris Hilton as well as the prime minister’s wife, Rosmah Mansor.

Arul Kanda Kandasamy, formerly executive vice-president, head of Investment Banking Group and head of Corporate Finance for the Abu Dhabi Commercial Bank, was brought in last week to take over from former COO Mohamad Hazem Abdul Raman, who quit suddenly. Kandasamy told reporters he is confident the problems the fund faces can be overcome.

“I genuinely believe that the majority of the allegations that have been directed at the company have more to do with a misunderstanding of the business, or are raised for purposes that aren’t necessarily business related, as compared to any real issues that exist within 1MDB,” he said

Nonetheless, 1MDB has been struggling vainly for months to get away a US$3 billion IPO of its power assets, which critics contend were purchased at vastly inflated prices in an attempt to generate cash flow after much of its initial funding disappeared into a middle eastern oil exploration company called PetroSaudi.

Instead of repaying the RMB7 billion loan, PetroSaudi converted the money into an 11 year loan, to be repaid at 8.5 percent annual interest. The money was invested through the Cayman Islands, a notoriously unregulated banking haven. To criticism, 1MB replied that the fund is regulated by authorities in the Caymans, Switzerland and Hong Kong, which critics said means almost no regulation at all.

It was Jho Low, as he is known, who steered the RMB7 billion loan to PetroSaudi. According to records in London, he also used a letter from the fund to back a failed bid to take over three prestigious London hotels and there is considerable suspicion that he also used the fund’s credit standing to help guarantee funding for the production of The Wolf of Wall Street, a phenomenally successful movie co-produced by Reza Aziz, Rosmah’s son.

In recent months, the government, in an attempt to build up 1MDB so that its power assets can be listed, has strong-armed at least three no-bid contracts to build coal-fired and solar power plants to supplement the fund’s assets. One of those power plants, in Port Dickson near Malacca, was awarded to 1MDB despite a lower bid from a joint venture of YTL International Bhd and SIPP, partly owned by the Sultan of Johor, who is said to have been enraged by the snub and is demanding privately that SIPP be given its own no-bid contract for another plant. The government has also given another plant a 10-year extension to its production agreement, which was supposed to end in 2016 but has been extended to 2026.

Powertek, 1MDB’s fund’s wholly owned subsidiary, also has operations in five emerging markets in addition to Malaysia. They are Egypt, Bangladesh, the United Arab Republic, Sri Lanka and Pakistan.

"1MDB has invested the proceeds with regulated and licensed international fund managers, the fund said in a prepared statement early last year. “These fund managers adopt an absolute return strategy of which the primary investment objective is to achieve long-term capital appreciation and/or steady income through investments in listed and/or unlisted companies.”

The opposition has been cudgeling Najib for months on the fund, which appears to be in growing jeopardy to the point where major defaults could send a serious shock through the domestic banking system. The fund has twice missed deadlines for filing its annual reports and its auditors have quit twice. But when Mahathir unlimbered his criticism, the allegations picked up serious steam. In particular, they have been percolating through the UMNO rank and file, probably Najib’s most dangerous trouble spot, given that the opposition is regarded as disorganized an toothless.

One ominous harbinger, according to well-informed sources in Kuala Lumpur, is that Khairy Jamaluddin, the son-in-law of former Prime Minister Abdullah Ahmad Badawi, is said to have moved into Mahathir’s camp. Khairy abandoned the Badawi wing of the party after Mahathir and Muhyiddin pushed Badawi aside and joined Mahathir’s van.

Calls for strict audit that government had spent RM800 million on flood victims as Kelantan entitled to ask where the money had gone as it should get RM500 – RM600 million as the worst flood-stricken state

By Lim Kit Siang Blog

Today, accompanied by the former Bersih co-chairman and patron of Negara-Ku, Datuk Ambiga Sreenevasan, DAP MPs Anthony Loke (Seremban), Liew Chin Tong (Kluang), DAP State Assembly members Lee Chin Chen (Ketari- Pahang), Wong May Ing (Pantai Remis) and DAP and social activists in four FWDs, with a container of essential supplies for Manek Urai, I made my third flood victims relief mission to Kelantan.

We left Kuala Lumpur at 5 am, first stop at Bentong for breakfast, arriving in Gua Musang before 10 am, where we were given a briefing by DAP and PAS Gua Musang leaders on the floods devastation in Gua Musang beginning on Winter Solstice (Dongzhi festival) on Dec. 22, 2014.

Gua Musang, which literally means “Cave of the Civet”, is the largest of the 10 districts in Kelantan and Gua Musang town had never experienced serious flooding before.

It therefore took the people in Gua Musang by complete surprise when Gua Musang, together with Kuala Krai (another district which had never suffered serious flooding before) became the two worst flood-stricken areas in the December 2014 floods catastrophe.

When we visited Gua Musang town, the people were busy valiantly trying to clean up their houses, shops and inns – a puny effort compared to the enormous ravages caused by the floods.

It was two weeks since Gua Musang had been stricken by the unprecedented floods catastrophe, with water as high as 10 to 12 ft, submerging the whole town but Gua Musang still looked forlorn and desolate.

From the slow pace of recovery that I saw in Gua Musang, the Kelantan Mentri Besar Datuk Ahmad Yaakob may be right when he said that Kelantan will need at least six months to fully recover from the devastation of the worst floods that hit the state in the past few weeks.

But six months to recover from the devastation of the floods catastrophe is too long and will impose great problems and grave burdens on the flood victims in Kelantan.

This is why there must be a total change of mindset of the Federal, state and local authorities to ensure that this recovery period is slashed from “at least six months” to two months, and why a declaration of state of emergency to centralize and mobilise all available resources to help the floods victims in Gua Musang and other parts of Kelantan to start life anew after the devastation of the floods is urgent and imperative.

During the worst of the floods catastrophe, an emergency is needed to save lives. In the post-flood scenario, an emergency is needed to restore living and ensure livelihood – to help the flood victims rebuild life and business anew in the shortest possible time.

From Gua Musang, we left for Manek Urai where the container of essential supplies was down-loaded at the PAS Manek Urai Relief Centre, and we met up with the PAS MP for Kuala Krai, Dr. Mohd Hatta Ramli, PAS Vice President and Kelantan State Assemblyman for Salor Datuk Husam Musa and former Kelantan Assembly Speaker and Kota Bharu MP, Dato’ Wan Abdul Rahim Wan Abdullah.

It is Ground Zero in Manek Urai, where the devastation of the floods catastrophe was most bleak and desolate as if there had been a tsunami or the aftermath of a war zone.

We visited Kg Manjor, where only 15 out of 220 houses survived the floods catastrophe, and a living testimony of the power and might of Mother Nature when it expressed its fury at the despoliation of the environment.

Everywhere we saw houses destroyed after being flung about like toys by angry floods, with a chair left on a roof as evidence of the height of the waters, and vehicles thrown around, some atop another vehicle while others somersaulted.

The villagers of Kg Manjor were lucky to be able to flee to higher ground, where they spent five nights and days until the floods subsided – without water, food, power or contact for the first two days!

There were other Ground Zero devastating damages from the floods catastrophe, like Manek Urai Lama, Kg Karangan, Kg Laloh, Kg Dabong, Kg Kemubu.

I am not aware that any Cabinet Ministers, including the Prime Minister or Deputy Prime Minister, had visited any of these Ground Zero zones of the floods catastrophe in Kuala Krai.

My visit to Ground Zero zones has reinforced my view that an emergency must be declared to help the flood-stricken victims to rebuild and start life anew, that the 150,000 in the armed forces should be mobilized to help a million flood victims to start life anew, not only to provide security and prevent the outbreak of diseases post-floods, but to help restore essential utilities like safe water and electricity, erect temporary shelter for the flood victims and to allow them to start life anew in shortest possible time.

I am shocked that the Deputy Finance Minister, Datuk Ahmad Maslan announced yesterday that the government had so far spent about RM800 million through the National Security Council to help victims in states affected by floods in the provision of food supply, logistics and cleaning houses of victims.

As Kelantan is the worst flood-stricken state in the floods catastrophe, the bulk of the expenditure, say RM 500 million – RM600 million, should have been spent in the state.

But where has this vast sum of money gone to as no one in Kelantan would feel that the Federal Government had spent RM500 million to RM600 million in Kelantan in the past two weeks of the floods catastrophe to help flood victims.

I have visited Kota Bharu three times, been in Kuala Krai twice, even in the Ground Zero zones of Manek Urai as well as Gua Musang, and I definitely do not feel or sense that RM500 million to RM600 million had been spent in Kelantan in relief efforts for the flood victims.

Let Maslan reveal out of this RM800 million, how much had been spent in Kelantan, Terengganu, Pahang and Perak – so far the worst flood-hit states.

There should be strict audit of the so-called RM800 million already spent to help flood victims, and the other expenditures still to be made, to ensure that there is no hanky-panky whatsoever.

No money should be spared to help the flood victims, but not a sen should be wasted.

All government expenditures spent in the floods catastrophe must directly benefit the flood victims and not the “floods” barons, entrepreneurs or cronies.

For a start, let the Deputy Prime Minister and Education Minister, Tan Sri Muhyiddin announce that every student affected by the floods catastrophe will be provided free two sets of school uniforms, text books, exercise books, and all other necessary school supplies, which will be evidence of such expenditures directly benefitting the flood victims and not some chimerical figure of RM800 million said to be spent on flood victims but without them being the direct beneficiaries.

There should be no rigid requirement for student to wear school uniform at least for the first month of school for the flood-stricken areas, until every student have been supplied with two sets of free school uniforms.

On Sunday night, I sent an email to the Prime Minister Datuk Seri Najib Razak on my five-point action plan on the floods catastrophe which have caused 23 dead, evacuation of a quarter of million people, with a million people adversely affected by the floods, and losses running into billions of ringgit.

I also asked for an urgent meeting with the Prime Minister before the Cabinet meeting on Wednesday, as Malaysians expect the Cabinet to make important decisions on the floods catastrophe especially with Ministers on vacation abroad and the Cabinet had not met for 20 days – including during the worst periods of the December 2014 floods catastrophe.

As the Prime Minister is suffering from E Coli after floods visits, I am not pressing for a meeting with Najib before the Cabinet meeting tomorrow.

I wish him speedy recovery to be able to chair the Cabinet meeting tomorrow to ensure that the Ministers can take collective decisions on the five-point action plan which I had outlined to him in my email, namely:

(1) the declaration of a state of emergency for the flood-stricken states;

(2) the formation of a BN-PR Joint Action Council on Floods Catastrophe;

(3) Convening of a Special Parliament this month on the Floods Catastrophe which can also discuss the deferment of the implementation of GST so as not to add further burdens on the flood victims;

(4) Doubling of the RM500 million allocation for relief of flood victims to RM1 billion to enable every flood victim whose livelihood/business had been wiped out by the floods catastrophe to apply for interest free loans, ranging from RM1,000 to RM250,l000 to start life and business anew, and

(5) Establishment of a Royal Commission of Inquiry into the weaknesses and failures of the Floods Disaster Preparations Plans to provide relief and help to the flood victims of the current floods catastrophe.

I hope the Cabinet tomorrow will have good news for the million flood victims, especially those in the worst-hit areas like Gua Musang and Kuala Krai in Kelantan and Temerloh and Mentakab in Pahang.

In fact, it would be a good idea if the Cabinet tomrrow makes it compulsory for every Minister, including the Prime Minister and Deputy Prime Minister, to visit Ground Zero areas in Manek Urai, in particular “devastation” areas like Kg Manjor and Kg Maneki Urai Lama, for such visits will make Ministers not only more knowledgeable but more humble and committed to ensure that mega flood relief expenditures directly benefit the flood victims and not the “flood” barons, entrepreneurs cronies.

(Media Conference Statement at Pengkalan Chepa Airport, Kota Bharu on Tuesday, January 6, 2014 at 5 pm)

110 Percent Loan For PR1MA House Buyers - PM Najib

KUALA LUMPUR, Nov 22 (Bernama) -- Datuk Seri Najib Tun Razak said loan offers of as high as 110 percent will be extended to 1Malaysia Housing Project (PR1MA) house buyers by selected financial institutions.

The prime minister said this was a continuance of the government's effort to help the people pertaining to the housing project.

"This financial is to enable all house buyers to own houses while the extra 10 percent is to pay additional costs such as legal fee and insurance.

"The rent-to-own scheme is also offered as an assistance to the middle income group to own houses," he said in his latest entry in his blog Najib.razak.com tonight.

Najib, when tabling the 2015 Budget themed 'People Economy' in Parliament last October, had announced the government would address the issue of house ownership with reasonable prices through the construction of 80,000 units of houses under PR1MA with an allocation of RM1.3 billion.

The move, he said, was to enable more people to own houses, with the criteria of household income raised from RM8,000 to RM10,000.

Meanwhile the prime minister said the government aimed to build 500,000 units of PR1MA houses in five years' time and the PR1MA programme currently had covered all the states except Labuan.

He said among the PR1MA communities at present in the planning were in the southern and northern regions, Sabah and Sarawak with houses priced from RM118,000 to RM335,000.

Among the areas are in Bukit Bintang, Kuala Lumpur (RM275,000), Tebraru, Johor (RM180,000), Kuala Ketil (RM215,000), Sandakan, Sabah (RM280,000) and Kuching, Sarawak (RM235,000).

Najib said steps to apply for PR1MA houses were very easy and urged those who met the criteria to register for application and surf the official website at www.pr1ma.my.

Any applicant can obtain further details on the eligibility requirements or easy steps to apply via the attached infographic in the blog.

Soalan jet NR1: Putarajaya tutup kemas mulut

As rich get richer, Mokhzani breaks into billionaires’ top 10

KUALA LUMPUR, Feb 20 — Datuk Mokhzani Mahathir, the son of former prime minister Tun Dr Mahathir Mohamad, has finally joined the ranks of the country’s top 10 richest people as the nation’s magnates continue to widen the gap with the rest of Malaysia.

According to a new list of Malaysia’s 40 richest tycoons released by the Malaysian Business magazine, the SapuraKencana Petroleum mogul added another RM1.59 billion to his coffers over the last year to raise his estimated wealth to RM4.22 billion — good enough for ninth place on the list.

In 2012, Mokhzani had emerged with about 15 per cent of SapuraKencana after his Kencana Petroluem Bhd merged with SapuraCrest Petroleum Bhd. He later disposed of 90 million shares at for an estimated RM387 million.

Mokhzani relinquished his executive positions in SapuraKencana late last year and instead remains only as a non-executive director.

The two richest Malaysians remain “sugar king” Tan Sri Robert Kuok (RM54 billion) and T. Ananda Krishnan (RM33 billion) by a wide margin, with the telecommunications and entertainment tycoon nearly twice as rich as third-placed Tan Sri Teh Hong Pow of Public Bank fame.

Tan Sri Syed Mokhtar al-Bukhary was fifth richest with RM11 billion, while AmBank chairman Tan Sri Azman Hashim capped off the top 10.

Berjaya’s Tan Sri Vincent Tan foray into the English Premier League with Cardiff City also appears to be taking a toll on his bank balance, with the gaming magnate managing only 20th spot with his RM1.9 billion.

“One interesting fact is that since 2002, 81 tycoons have joined the 40 Richest Malaysians list and out of that, 15 have managed to remain on it continuously,” the magazine said in an accompanying release.

It added that there were now two more local billionaires, bringing the number to 33, while the combined wealth of the top 40 richest Malaysians weighed in at RM217.8 billion or some 11 per cent better than they had been in the previous year.

According to a previous list released by Forbes last year, Mokhzani was the 15th wealthiest person in Malaysia. Forbes also differed on Vincent Tan’s net worth, listing him as the tenth richest man in the country.

Forbes is due to release an updated list next month.

Malaysian Business began tracking the worth of Malaysia’s wealthiest people in 2002.

AG Report: Milk project gone sour

The Auditor General points out, among other, that milk cartons were not stored according to specifications, risking damage and contamination.

PETALING JAYA: The 1Malaysia Milk Project (PS1M) failed to meet its objective in providing quality milk to school students despite millions spent on it, said the Auditor-General’s Report 2012 .

In the report, the AG said that the Education Ministry had appointed four contractors, via direct negotiations, for the project which is worth RM188.33 million.

“But after the Education Ministry studied the details of the contract, it was revised to RM170. 93 million,” said the AG.

The companies awarded the contacts were Hybrid Allied Sdn Bhd, Dutch Lady Milk Industries Bhd, Konsuma Sdn Bhd and Sabah International Dairies Sdn Bhd.

The project was initially intended to provide milk, twice a week, to 3.1 million primary school students all over Malaysia.

But an audit done between June 2012 and September last year found that the contractors failed to produce the quantity needed to match the demand.

Contractors slacking

And due to the limitation, the milk cartons were instead, only channelled to those in rural areas and those from low income families.

“As for Sabah, milk was supplied only to students studying between Year 4 and Year 6 as the rest were provided milk by the Sabah Foundation,” said the report.

Among other glitches found in the PS1M project were that the milk were not distributed on schedule and the milk cartons were not kept in proper storage, risking damage and contamination.

The AG report found that instead of the contractors preparing temporary storage facility to store the milk cartons, the products were stored in school libraries, suraus or even storerooms under the stairs.

“And the milk were not kept 15 centimetres above the floor and 15 centimetres away from the wall as per the guideline, which puts the milk cartons at risk of being damaged or contaminated.

“When we spoke to the teachers, they said there were not aware of the procedures and claimed that the contractors did not inform them of the guidelines,” said the report.

The report added that the several contractors did not send a representative to the schools when the milk cartons were distributed to students, as per the agreement, in order to test the milk before being given away.

“And the teachers were not also not aware that a representative from the contractor was required to be present,” said the report.

The truth? Ministry did pay RM1.6 million for K-pop concert

The Youth and Sports Ministry spent RM1.6 million to bring in three South Korean pop groups for
The National Youth Day was celebrated in May 2012 in Putrajaya. The Malaysian Insider pic, October 2, 2013.the National Youth Day celebrations last year, in contrast to the claim that the cost had been covered by sponsors.

The Auditor-General's Report revealed yesterday that the money came from the government’s coffers.

The three K-pop groups - U-Kiss, Teen-Top and Dal Shabet - were brought in by Stadium First Sdn Bhd.

A ministry official had reportedly said then that the bill was paid by sponsors.

The report also found the ministry overspending RM1.11 million on promotion and publicity for the event.

The department reprimanded the ministry for spending RM48,300 on a “working visit” to Institut Kemahiran Belia Negara in Jitra, as well as to Songkhla, Phuket and Krabi in Thailand, for 21 people on the National Youth Day secretariat as well as senior officers.

It was also reported that the ministry spent RM75,966 on a promotional dinner, hi-tea and lodging for journalists at hotels.

The report classified several costs as “very high”, including RM50,000 paid to 50 bloggers and company management, and another RM50,000 for promotion and publicity.

Three bloggers were paid a total of RM7,500 in daily allowance for five days’ of coverage.

The ministry also spent RM3.32 million for one million Rakan Muda membership cards, and yet the programme was discontinued in July last year. – October 2, 2013.

Government debt soars – and that excludes contingent liabilities

Update: So with this in mind, the Malaysian government wants to send a second ankasawan on a junket to space (which would cost hundreds of millions of ringgit) – if funds permit. Well, do you think the state of our funds will ‘permit’ this?
Malaysian government debt has been steadily rising in recent years and is expected to touch RM502bn this year or 53.7 percent of GDP on the back of a rapid rise in issues of quasi-government bonds and securities. (The legal threshhold is 55 percent.) But this does not include sizeable contingent liabilities or off-balance sheet items.
Click to enlarge the following general government gross debt data from the International Monetary Fund:

At the onset of East Asian economic crisis, general government gross debt compared to GDP had sunk to a a low of 32.3 percent, according to IMF figures. By 2000, it had risen to 35.3 percent and by 2008, it had touched 41.2 percent. And now it is has soared to over 53 percent. (The increase in government borrowings is largely due to the rise in government investment issues and government securities, which reached RM412bn by end-June 2012, up 71 percent from five years ago.)
IMF staff expect general government gross debt to surge past RM700bn to top 55 percent in 2016-2017 based on present policies.
Which means whoever is elected to government in the coming general election has a real job to do to keep a lid on, if not reduce, the debt.
But even this government debt figure of RM502bn in 2012 tells only three quarters of the story. It does not include off-balance sheet debt or contingent liabilities (i.e. debts that COULD be incurred if something goes wrong or in the worst-case scenario as in the PKFZ scandal). Off-balance sheet debts include state government borrowings raised by bond issues.
Such off-balance sheet debt and contingent liabilites have doubled over the last four years from RM53bn to RM100bn now. Apart from matters related to Khazanah and Cagamas, contingent liabilities could include stuff related to 1MDB, Prasarana and Johor Corp, The Edge (22 October) quotes bond analysts as saying. 1MDB, for instance, has been issuing bonds to raise money to buy electricity power producer assets.
Also, as the KL MRT is not part of the government’s development budget, bonds issued by Prasarana to raise billions of ringgit for the MRT project will be regarded as off-balance sheet items – and not included as central government debt.
I moderated a forum yesterday on the coming general election. One of the participants from the floor wondered aloud if Malaysians would be fearful of voting for change in the coming general election given the uncertainty over whether there would be a smooth handover of power if the ruling coalition loses after 55 years in power.
But then another participant said people now are even more fearful of the country’s growing level of indebtedness and the massive corruption and this fear alone would trump all other considerations when they go out to vote. We saw an early indication of this overriding concern in the phenomenal turnout at the Bersih 3.0 rally, when people put aside their fears despite knowing there could be heavy-handed police action.

Deeper Debt

Costs for faulty military quarters soared to RM3.2b, audit shows

An image in the Auditor-General’s Report depicts raw sewage flowing from leaking pipes at a military housing unit.

KUALA LUMPUR, Oct 15 ― Military family quarters built by the Defence Ministry saw costs nearly double to RM3.2 billion amid a litany of defects including collapsed ceilings and leaking sewer pipes, according to revelations in the Auditor-General’s Report 2011.

Among others, the report found that the majority of the military quarters projects audited were awarded by direct negotiation and that the government waived penalties worth RM87.12 million for failure to meet contractual obligations.

“The waiver that was approved by the Ministry of Finance to the respective contractors caused losses and compromised the interests of the government,” said the report.

The audit team said that the financial performance of the military quarters projects was “unsatisfactory” as costs has shot up 84.1 per cent from the original allocation of RM1.74 billion.

Quarters examined by the audit showed that costs per unit ranged from RM260,000 at TUDM Subang and RM287,000 at Kinabatangan camp, to RM391,000 at Kementah camp and as much as RM1 million at TUDM Butterworth.

Explicit photos provided in the report showed sewage flowing on the floor due to leaky pipes at the Kementah camp quarters, a collapsed ceiling at the Subang TUDM quarters, and cupboard doors that cannot fully open due to a faulty design at Kementah camp.

One photo also showed quarters in the Kinabatangan camp in Sandakan being used by foreign workers and their families.

The report also said that stricter monitoring was required and contractors that failed to deliver should be blacklisted.

“In the audit’s opinion, the Defence Ministry should not accept family quarters that have defects and damaged construction that is so high that it causes members of the armed forces to live in premises that are not of quality,” said the report.

The audit also found that contractors failed to meet construction deadlines and were given extensions ranging from 94-1240 days.

According to the report, family quarters that were completed also had high levels of defects and contractors failed to rectify the defects within the warranty period.

Banks Urged To Go Easy On CTOS, CCRIS Flagging To Help The Young Buy Houses

KUALA LUMPUR, Oct 8 (Bernama) -- Banking institutions were today urged to be flexible to the young whose names are listed on Credit Tip-Off Sdn Bhd (CTOS) and Central Credit Reference Information System (CCRIS) to enable them to get housing loans.

Datuk Idris Haron (BN-Tangga Batu) suggested that the CTOS and CCRIS conditions should not be imposed on them.

"They might have made a wrong move in managing their finances at the outset, as a result their names are listed in CTOS and CCRIS and they are facing problems to secure housing loans. So, I propose the Finance Ministry and banks be flexible with them," he said.

Idris, who is also Syarikat Perumahan Negara Berhad (SPNB) chairman, said in this manner it would not affect the opportunity of the young to invest in a home.

"A house is an immobile property, not mobile property like a car or a motorcycle. It can also be used as collateral. So, if the applicant runs away, the bank can auction the house to recover the amount it lost," he said when debating the 2013 Supply Bill in the Dewan Rakyat.

Furthermore, Idris also suggested that the government introduce a ceiling price to high end housing projects specifically in urban areas to control house prices and prevent speculation on property.

Idris also suggested that the real property gains tax period imposed be raised to 10 years from five to avoid resale of property in a short period of time.

The Dewan sits again Tuesday.

Malaysia could still face bankruptcy, Idris Jala warns

KUALA LUMPUR, Nov 1 — Datuk Seri Idris Jala said today that Malaysia could still become bankrupt
within a decade if it spends borrowed money on operational expenditure such as subsidies instead of investing the cash.

“If our economy grows less than four per cent... and we don’t cut our operating expenditure, if we borrow at 12.5 per cent, if our annual debt rises to 12.5 per cent and our revenue does not grow, then it will happen,” Idris (picture) said today after announcing the latest investment updates for the government’s economic transformation programme (ETP).

The performance management minister triggered alarm bells with his controversial bankruptcy forecast last year.

Malaysia’s national debt rose by 12.3 per cent to over RM407 billion last year, according to the Auditor-General’s latest report released last week.

Although the economy grew by 7.2 per cent in 2010, last year’s fiscal deficit maintained public debt at over 50 per cent of GDP for the second year running.

The Auditor-General said in the report that the government owed 53.1 per cent of GDP, slightly down from 53.7 per cent last year.

Economists have also said the country’s economic growth could slow to just 3.6 per cent next year from a projected 4.3 per cent this year due to the increasing risk of a double dip global recession.

Idris said today that Malaysia will not go through a recession but will suffer an economic slowdown as a result of the ongoing financial crisis in Europe spreading.

“It’s not as rosy as we would like,” the Sarawakian minister admitted during a public question-and-answer session.

He noted that the GDP this year was only at 4.4 per cent.

But he assured Malaysians “our government will not allow that to happen”.

He also said his forecast did not mean Putrajaya should stop borrowing.
“We should borrow money provided the money is spent as investment rather than as operating expenditure,” he said.

“We must make sure our borrowing is in proportion to investment,” he added.

Subsidies are among the government’s biggest operating expenses.

The CEO of the government’s Peformance Management and Delivery Unit (Pemandu) said bankruptcy could be avoided even if the GDP falls below the targeted six per cent a year as long as it can increase its revenue collection.

Idris said that the country’s population has grown to 28 million but highlighted that only one per cent was currently paying income tax.

He said one of the ways to raise revenue was to implement the goods and services tax (GST).

He added that the GST would also help make the country globally competitive, noting that 140 other nations have already done so.

“If we do that, it propels competition. Sooner or later, we’ve got to implement GST,” he said.

He said the government has proposed the consumption tax but was unable to carry it out due to objections from the opposition Pakatan Rakyat pact.

AK’s overseas media expansion hits snag on Tindle buy

KUALA LUMPUR, Aug 28 — Malaysian mogul Ananda Krishnan’s plans to expand his media presence in Britain took a hit this week after Tindle Newspapers increased its existing stake in troubled Johnston Press, which is majority owned by the reclusive tycoon.

Tindle Newspapers, owner of more than 200 weekly newspapers in the United Kingdom, increased its share in rival Johnston Press to 4.36 per cent to become the fourth largest shareholder after seizing on the troubled newspaper publisher’s low share price.

Johnston Press on Thursday reported a 47.5 per cent year-on-year drop in pre-tax profit to GBP13.8 million (RM67.4 million) in the first half, with the publisher cutting 179 staff as advertising revenue fell by 10 per cent, according to The Guardian newspaper.

“Clearly, Tindle think that the share price is low and could bounce back but it is unlikely that the majority shareholder would allow a takeover because its shares were bought at a much higher level,” the British national daily quoted a City source as saying.

“And whoever takes over Johnston would have to take over quite a substantial debt so it is questionable whether this would be a sensible move anyway.”

Ananda (picture) became the largest shareholder in Edinburgh-based Johnston Press in 2008 after spending almost GBP86 million buying 20 per cent of the company, whose stable of titles includes The Scotsman and the Yorkshire Post.

He had spent GBP43 million buying new shares after the publisher announced a GBP212 million emergency rights issue to shore up its battered balance sheet and another GBP43 million buying over half of the Johnston family’s 19.5 per cent stake.

British newspapers reported then that Ananda was planning to bulk up Johnston Press’s online presence to cope with the loss in revenue after advertisers shifted to the Internet away from regional titles.

“Ananda believes local audiences, both in print and online, have considerable value in the current climate,” Johnston Press chief executive Tim Bowdler told The Daily Mail in 2008.

But the world’s 89th richest man, whose interests span telecommunications, media, gaming, property and power, has been unable to turn around the company.

Since he acquired a majority stake in Johnston Press three years ago, its share price has plummeted from GBP1.35 per share to only 5p now.

Ananda had earlier tried to buy Virgin Radio in what appeared to have been a bid to assemble a global media empire but lost out to India’s The Times Group, in what was then the largest Asian media acquisition in Europe.

Profusion of Ah Longs a sign of economic woes

All so-called anti-poverty actions are just ad-hoc programs. Solve this and this, and wait for the next one to surface! The government is confused because it doesn’t have the financial capability to solve the problem and it doesn’t understand all the factors affecting the economy.
 
By Daniel John Jambun  

The decision by the Government Employees Co-operative Society Berhad (Kopeks) recently to settle debts owed by its members to Ah Longs to the hefty tune of RM500,000 made one wonder if Kopeks is not actually encouraging its members to go into debt, because it could easily bail them out anytime when the situation becomes critical. The bailout was a precedent that set a bad example of co-operative fund management.

It also reminded us how bad the economic situation in the Sabah is right now. If government servants can go into serious debt in spite of earning salaries, imagine the situation for those without jobs, and those in the rural areas who have to live off the land just to keep body and soul together. In this period of high inflation even those with salaries are in fact living below the poverty line.

If we still need to be convinced about the dire situation the people are facing, just let’s note that the recent job fair organized by the BN got a surprising response of 30,000! And these only involved those who could afford to come. Many didn’t even bother to come because they knew it was not worth the effort and cost to go.

Part of the reasons for the state’s poverty is the high unemployment rate among young school leavers and graduates. Many graduates actually survive by opening and operating kueh stalls, even taking on odd jobs. So the repeated advice to youths not to be choosy with jobs is actually a lot of nonsense knowing these young people, out of sheer desperation, are even going by the tens of thousands to Kuala Lumpur, Johore and Singapore to earn money.

High unemployment in Sabah has also caused the existence of sandwich families, which the government has admitted to be very high in number. The term “sandwich family” can be defined, from my own observation, as the case of parents who have to house and feed their children who are already married and have their own children because of joblessness. Many families are not even having any celebration when their children get married because they are so cash-strapped!

There is an ongoing, hidden depression going on in Sabah. They have suffered so long but have partly resigned to their fate knowing they is nothing they can do. The government has simply failed them. A fifty-ringgit note doesn’t last very long, doesn’t buy a lot these days. People have very little savings and for those who struggle to make ends meet, the money runs out long before payday.

What is more depressing is that we all know the government has not an iota of a  plan to solve the problem; all so-called anti-poverty actions are just ad-hoc programs. Solve this and this, and wait for the next one to surface! The government is confused because it doesn’t have the financial capability to solve the problem and it doesn’t understand all the factors affecting the economy - globally or locally. So they have become experts in coming up with lame explanations and playing the blame game, like they blame youths for being unemployed because “they are choosy”. What a load of nonsense!

So in desperation, the people who need to settle their financial problems have to resort to Ah Longs, or loan sharks. And loan sharks come to fill up the market because there is a huge need for their service. A profusion of loan sharks, the rise of MLMs, get-rich-quick schemes and gambling businesses are a clear indication of serious economic problems in any country. People need a way out to escape financial pitfalls and hope to fulfill their dreams by buying lottery tickets as a way to comfort their troubled souls.

The latest way to become rich overnight today is to find the tokek lizard and make millions overnight!
I would challenge the BN government to undertake a statistical survey of the situation and give us the accurate figures for unemployed secondary school leavers and graduates, the number of sandwich families and the grand total of amounts they spend from their parents’ income, the number of Sabahans who are working in the Peninsular and Singapore, and most importantly to give an economic blueprint for Sabah to solve unemployment and poverty in the short term.

Or is the government itself too cash-strapped to undertake these surveys?

How much does it cost to pay IDS to do them compared to providing for some road buildings in which the cost are doubled of tripled for the benefit of some political bosses? How much money has been stashed overseas, robbing us of economic trickle-down effects? We can only imagine the terrible losses we have suffered and our children will suffer in the future because of our government’s corruption and mismanagement!

Status Of Country Will Not Guarantee Continued Success - Najib

PUTRAJAYA, April 21 (Bernama) -- Prime Minister Datuk Seri Najib Tun Razak said that a country's status is no guarantee that it will continue to succeed if its financial and economic policies were not managed properly.

"Although a particular nation has been recognised as a developed country, there is no guarantee that the country will not become a 'failed state' in terms of managing its economy and financial policies properly," he said.

Najib, who is also the Finance Minister, said this at the Special Assembly of the Finance Ministry, here Thursday.

He said when a nation is categorised as a failed state, it would then lose its integrity and would have to seek financial aid from international financial institutions.

"This would lead to uncertainties in terms of domestic policies which would in turn result in the people of that country carrying a heavy burden," he said.

Citing Greece, Ireland, Spain and Portugal as countries facing problems due to their failure in managing their financial and economic policies properly, the Prime Minister said their failure had posed difficulties for them in tackling the problems arising.

"As a result, there is a feeling of uneasiness among the people when they are 'bound' by the conditions imposed by the international organisations," he said.

As such, Najib said the government had set the road map and clear platform based on the concept of '1Malaysia: People First, Performance Now' to ensure that Malaysia did not face similar problems.

He said various policies, programmes and projects, including those under the Government Transformation Programme (GTP), National Key Result Areas (NKRA), Economic Transformation Programme (ETP) had been drawn up so that Malaysia could continue to succeed and realise the aspiration to turn Malaysia into a developed nation with a high income by the year 2020.

"We have long fought for what we consider to be most important in maintaining and preserving the interest of the people and national integrity," he said.

The Prime Minister said that last year Malaysia succeeded in registering an economic growth of 7.2 per cent and the challenge currently was to ensure that the growth rate was not less than six per cent each year.

He said the challenge thereafter was to control inflation in the country to the lowest rate possible, otherwise the people would face difficulties and a heavier burden.

"In addition, we also have other primary objectives where the national wealth and strong growth could be could be distributed in a balanced manner," he said.

At the assembly, the Prime Minister also announced the award of the MS ISO 9001:2008 certification by Sirim to the Malaysian Treasury and launched the "Treasury's Smile Culture".

On the MS ISO 9001:2008 certification, Najib said it involved seven divisions namely the Remuneration Policy, Public Money and Management Service Division; Tax Analysis Division; Economic Analysis and International Division.

Loans Management, Financial Market and Actuary Division, Government Procurement Division, Strategic Financial Management Division; Information Technology Management Division; and Corporate Communications Unit.

For the "Treasury's Smile Culture", Najib said the campaign with the slogan "Always With A Smile" would last two months.

He said the campaign was most suited to the aspiration to raise the effectiveness of the public service delivery system to ensure that the services provided satisfied the needs of the people and clients generally.

Don’t be buoyant about economy, Bank Negara warned

Natural disasters will impact our economy as Japan cut backs on investments and prioritise reconstruction of the nation.

KUALA LUMPUR: Economists are expecting fiscal aftershocks to affect the Malaysian economy following the earthquake and tsunami which hit Japan in last month.

“Bank Negara’s annual report is very optimistic,” said Ramon Navaratnam, former deputy secretary-general of the Finance Ministry.

“Firstly, the natural disasters will lead to a lower demand for imports on Japan’s end. It will also lead to an impact on the world economy, slowing progress globally.”

The well-known economist also said that Japanese investments here would suffer setbacks as their priority would be to reconstruct Japan.

He warned Bank Negara against erring on the side of optimism, advising them to be cautiously neutral.

AmResearch senior economist Manokaran Mottain echoed this, saying that exports would be affected, dropping between 5% and 10%.

Because of this, Malaysia’s GDP growth will be reduced by at least 0.3 percentage points.

“In this regard, we are now projecting the real GDP to be a weak 4% in the second quarter,” he said.

Manokaran, however, said he was confidence that projects such as the ETP (Economic Transformation Programme) and 10th Malaysia Plan would stabilise growth momentum to approximately 6% by the final quarter.

Japan is Malaysia’s third largest export destination, accounting for 10.4% of total exports.

A Bank Negara official concurred that the annual report had not taken into account the earthquake because it had been prepared last year.

“Our forecast is optimistic, but it must be noted that Japan contributes only 8% of global growth.”