NTT Ltd, the world-leading global technology services provider, announces Dimension Data, NTT Communications and Training Partners join 28 companies and brands from over 70 countries worldwide, rebranding as NTT, the global USD11 billion technology services company.
NTT Ltd Malaysia will be led by Henrick Choo as CEO and he will be responsible in ensuring the country meets the ambitious objectives of NTT Ltd and its clients. He reports to Kim-Meng Png, CEO for ASEAN NTT Ltd.
Choo added, “It’s an honor to be leading NTT Ltd. in Malaysia into this exciting new era. NTT is such a great, well-respected brand – and is doing amazing things for its clients and society in general. We owe the brand’s success to the outstanding talents and team that make up the foundation of the brand. Our people are indeed our best assets as they carry with them the experience, knowledge and refined skills needed to take NTT to new heights. We are pleased to announce that as of today, we can offer local clients with access to the NTT brand, and its wealth and breadth of capabilities. Together we do great things.”
Png, who is based in Singapore, will be responsible for the company’s strategic development and operations across Singapore, Malaysia, Indonesia, Thailand, Vietnam, Cambodia, Laos, Myanmar and the Philippines. He reports to John Lombard, Asia Pacific CEO for NTT Ltd.
NTT Ltd will partner over 10,000 clients around the world, including leading organisations across financial services, pharmaceuticals, telecommunications, energy & utilities, manufacturing, automotive and technology sectors.
In rebranding to NTT, NTT Ltd. in Malaysia will be able to offer its clients an unparalleled range of skills and capabilities across many technologies and will also benefit from NTT’s innovation center in Japan as well as being able to make use of its full partnership network.
John Lombard, Asia Pacific CEO for NTT Ltd. commented, “We’re delighted to launch the NTT brand in Asia Pacific, as various companies including Dimension Data, DTSI, Emerio, NTT Communications, NTT Security and Training Partners join the NTT Ltd. family.”
“I’m also pleased to announce the appointment of Henrick Choo as CEO. He has been chosen to lead NTT Ltd. in Malaysia based on his exceptional background and proven track records in the organisation. I’m confident that under his capable leadership, we will become a leading services provider that can deliver intelligent, innovative solutions that address any of our clients’ digital challenges worldwide.”
AirAsia sees no necessity to respond to the Malaysian Aviation Commission (Mavcom) to produce documented details of congestion at klia2 immigration counters. The onus is clearly on the commission, which is funded by the rakyat, to get on the ground to inspect and investigate the highlighted issue.
AirAsia Berhad CEO Riad Asmat said: “Why do we need to provide evidence when the issue has been highlighted publicly in the news and on social media platforms? It only further proves Mavcom’s inaction, indolence and blatant disregard of its responsibility in protecting the rights of aviation consumers.
“It only takes Mavcom officials a few hours off from their KL Sentral office for a quick visit to klia2 to see for themselves how severe the situation is at immigration counters during peak hours. They can come on any day, as it is a daily occurrence and not an isolated incident as alleged.
“No one from Mavcom for that matter, including its Executive Chairman, has ever visited AirAsia’s head office RedQ which is just right next to klia2, when we have streams of visitors including foreign regulators and policymakers visiting us to better understand the low cost carrier (LCC) model of AirAsia. And mind you, we are talking about AirAsia here, the main LCC from Malaysia that is now the 13th largest airline group in the world. Are we not important to Mavcom, and Malaysia?”
Mavcom has, since May 2018, collected RM1 from each air passenger flying out of airports in Malaysia. It is estimated that Mavcom has earned as much as RM30 million, if not more, from the regulatory service charge. To date, Mavcom has yet to publish its annual report for 2018.
Former Deputy Transport Minister Datuk Aziz Kaprawi, in announcing the collection of the RM1 regulatory fee by airlines on behalf of Mavcom in 2017, was quoted as saying: “The regulatory charge is only justified to be imposed on passengers, owing to the services rendered by Mavcom to them, which includes complaints management and consumer awareness activities which need to be conducted from time to time.”
AirAsia X Berhad CEO Benyamin Ismail said: “All Malaysians need to hold Mavcom accountable for their blatant disregard in upholding and protecting the rights of aviation consumers who, without fail, contribute to their coffers to pay the extraordinary salaries for Mavcom commissioners and executives. In the meantime, the immigration congestion at klia2 worsened by the day, badly affecting our guests. Out of frustration, we wrote to Mavcom asking that they step in and help resolve the impasse.”
“This is not the first instance of Mavcom’s reluctance to act on complaints and issues, and I am sure it won’t be the last. The RM480 million lawsuit that AirAsia filed against MAHB for operational losses at klia2 two weeks ago was a result of Mavcom’s refusal to decide on the dispute as requested in our earlier notification to them. Mavcom also refused to mediate in the klia2 passenger service charge (PSC) dispute between AirAsia and MAHB, and it took the Cabinet to decide on a lower PSC for klia2 and other airports. All this clearly goes contrary to Section 75 of its own Mavcom Act 2015.
“Mavcom will go down in Malaysia’s history as the one commission that needs to be spoon fed despite its members and employees being paid handsome salaries. Mavcom must remember that it is highly funded by the rakyat but unfortunately, chose to fail them – big time.”
Pizza Hut and Universal Music Malaysia come together once again to bring pizza and music enthusiasts an enthralling night of musical wonders during the exclusive star-studded “The Singing Pizza Concert” held at Bentley Music Auditorium, Petaling Jaya.
After a series of passion-driven experiences as part of “The Singing Pizza” campaign, the concert marks a cross-industry collaboration between Pizza Hut and Universal Music Malaysia to connect and inspire Malaysians’ passion for life with richer pizza experience elevated through music.
The specially curated line-up of the night comprises diverse styles and genres, perfectly embody the Malaysian diversity and the variety of selections and dining experience that Pizza Hut Malaysia has to offer.
“The Singing Pizza Concert marks the culmination of “The Singing Pizza” experience that has been connecting Malaysians through the same love for pizza and music. Having innovation as part of our DNA, the campaign integrates digital technology to transform and take the pizza experience up a notch, underpinning our commitment to deliver easy and better pizza experience to Malaysians every single time,” said Loi Liang Tok, Head of Pizza Hut Malaysia.
“Living up to the momentum of “The Singing Pizza”, we’d like to celebrate passionate Malaysians with an immersive experience through The Singing Pizza Concert, featuring a taste of local acts as unique and diverse as what Pizza Hut has to offer,” Loi added.
Kenny Ong, Managing Director of Universal Music Malaysia/Singapore/Indo-China said, “We are grateful to have the opportunity to work on another creative marketing collaboration together so that the brand can stand out and be distinctive in the market. Not many F&B brands have the opportunity to organise something like this.”
“Universal Music Group (UMG) is very proud to be associated with a global and powerful brand such as Pizza Hut Malaysia to introduce great food and great music to our customers. The campaign has been a truly collaborative and creative partnership between Pizza Hut Malaysia, UMG and TBWA. We believe music will always be a key cultural driver regardless of nationality, ethnicity or age. UMG, together with Pizza Hut Malaysia are confident that we will continue to find new and innovative ways to connect and engage our customers”, he added.
Conceptually turning a regular pizza box into a music box, “The Singing Pizza” comes with vinyl-themed pizza boxes featuring illustrations of Fazura, Fattah Amin and Alvin Chong with a QR Code to access 200 exclusive tracks, including top trending and unreleased tracks that are updated biweekly on ‘The Singing Pizza’ App.
The app, which has more than 20,000 downloads to date, is the first platform to release new tracks such as Fattah Amin & Fazura’s “Paling Sempurna”, Fattah Amin’s “Isterimewa (Acoustic Version)”, Alvin Chong’s “Bei Ni Chong Ai” and Fazura’s “Can’t Forget Me (BATE Remix)”.
“The Singing Pizza” campaign was recognised with the “Excellence in Marketing Innovation” award at the recent Marketing Excellence Awards 2019 organised by Advertising+Marketing Magazine.
Allianz Group was named the No.1 insurer on the 2019 Interbrand Best Global Brand Rankings last week.
Across all brands measured, Allianz’s brand value increased from USD10.8bn in 2018 to USD12.1bn this year and climbed six places from No.49 to No.43 across all industries.
Allianz Malaysia Berhad Chief Executive Officer Zakri Khir said: “It is a feather in our cap and Allianz Malaysia is proud to have contributed to the brand’s success in becoming the global brand leader in insurance. Like our counterparts all over the world we have always been focused on winning people over through service and trust. This milestone is proof that we have got our strategy down pat, with
everyone from our employees, agents and brokers focused on being important and relevant partners in the lives of our customers and invertors.”
The Allianz Group is one of the world’s leading insurers and asset managers, operating in more than 80 countries with more than 92 million retail and corporate customers. Allianz customers benefit from a broad range of personal and corporate insurance services, ranging from property, life and health insurance to assistance services to credit insurance and global business insurance.
In 2018, the Group achieved total revenues of 131 billion euros and an operating profit of 11.5 billion euros.
Travellers are always looking for unique, fresh experiences when hitting the road. Whether you’re journeying alone or with loved ones, forays into unknown lands often entail new experiences. But travel preparation can often be tedious, given the range of options and adventures available.
According to the President of Malaysian Association of Tour and Travel Agents (MATTA) Datuk Tan Kok Liang, the number of Malaysians travelling has been increasing steadily, due to a better quality of life. This year, MATTA expects Malaysians to make at least 13.2 million trips abroad.
A study by Expedia has reported that 72 percent of Malaysians spend a lot of their time researching things to do on their travels while 66 percent admitted that they spent their time reading travel reviews.
Established in 2018, Zouba is the first-ever meta-book travel marketplace, the platform currently home to over 280,000 different tours and activities across 3,300 destinations. It is a platform for discovering and instantly booking tours and activities worldwide which make travel planning easier, faster and more convenient. There is always something for everyone to enjoy.
Recognising the immense growth of outbound travel in Malaysia and the amount of time Malaysians spend on putting together a travel to-do list, Zouba is looking to make travel planning easy, convenient and fast.
“Travelling can begin even before arriving at your destination. Planning a trip in a foreign city – especially if you do not speak the native language – is one of the most challenging aspects of travelling. With the vast amounts of information available online, many find themselves lost and frustrated when trying to come up with a travel to-do list. As avid travellers ourselves, the Zouba team wants to help other travellers simplify the planning process by providing an all-inclusive platform that lets you book all kinds of experiences,” said Mr. Prasanna Vee, Chief Product Officer of Zouba.
“We want to give users a highly personalised discovery and booking experience. So instead of browsing through the endless list of tours and activities online, our system understands your choices and suggests travel options which we think you might like from our ever-expanding database. Essentially, we want to help you discover things you will love based on your interests and passions, in the most convenient way,” adds Prasanna Vee.
From wine tasting tours in Barcelona to nighttime excursions to Al-Khazneh in Petra, whether you’re on a shoestring budget or you’re looking to treat yourself, there is something for everyone on Zouba. Customers can choose their activities from Zouba’s trusted partners and instantly make their bookings, all on one platform.
With predictions that 2020 will be the year of travel discovery unlike any other, Zouba aims to continue forging trusted partnerships worldwide to satisfy every traveller’s wanderlust.
Local universities could help the country improve its economic performance if they adopted some of the best practices of certain universities in Asia.
Among countries that could serve as good role models for Malaysia include China, South Korea and Japan. These countries have universities with sound fundamentals with translational research and development endeavours.
Decades ago, the Chinese economy and Chinese universities were underdeveloped. Fast forward to the present day and the Chinese economy is the world’s second-largest and its universities ranked as some of the best globally.
“Over the last two decades, China developed a strategy to strengthen the research capabilities of its universities and to promote collaboration with industry and community organisations. This enabled China to leapfrog to a higher stage of development to become a forerunner in technological innovations,” said Professor Mahendhiran Nair, Vice President (R&D) at Monash University Malaysia and CEO of Monash Malaysia R&D (pic).
He explained that China has successfully created an ecosystem that served as an enabler for the development of key technologies to enhance the competitiveness of its local industries and for the world to buy the country’s products at affordable prices.
“Clearly, they had a strategy with their ‘Buy China 2025’ and the ‘One Belt One Road’ policies, and Chinese universities are playing a pivotal role in helping the country achieve these goals,” he said.
“The country is now making waves with their 5G technology which is challenging traditional innovation-driven developed nations,” added Professor Nair at the launch of Trailblazing Research, an exhibition highlighting Monash University Malaysia’s high impact research and innovation.
He believes that Malaysian universities already have strong foundations but need to integrate cutting-edge technology in the face of competition from neighbouring countries.
The research and development strategy of Malaysian universities can be better integrated with the national economic sectors and priority areas, he added.
Professor Nair states that Malaysia has regional and global strengths in the services sectors such as financial services, tourism, education, medical tourism and aerospace. These sectors are increasingly becoming more knowledge- and technology-driven.
“We are currently a major player in the region for the maintenance, repair and overhaul (MRO) in the aerospace industry,” said Professor Nair, adding that the MRO sector has significant spill-over impact onto universities.
He added that universities should undertake research and innovation for local industries to improve their process improvement and product development.
Professor Nair explained that China identified priority technologies, strengthened their university research ecosystems to work on these technologies, built robust research infrastructure in the universities and recruited brilliant people to ensure that they are globally competitive.
“China sent its best students to leading American and European universities and then attracted them back to develop the local innovation ecosystem to enhance the competitiveness of local industries. They also collaborated with other top foreign universities and multinational companies that enable them to spur knowledge transfer to local firms and institutions.”
He added that the Chinese government transformed state-owned enterprises by linking them to new talent, technologies and universities.
“This made their enterprises more competitive. As a result, they became part of other countries’ supply network and moved up the global innovation value chain.
“We need our government, private sector and educational institutions to work together to build a resilient and agile innovation ecosystem that will enable all stakeholders to become more competitive.”
He said that, by aligning our goals, Malaysia could become more competitive to meet the challenges of the future and lead several innovative technology and economic sectors for the region.
“We need to realise that universities are not just ivory towers but are centres for knowledge development and knowledge exchange.”
The Trailblazing Research exhibition is currently being held at Building 9 (level 3) of Monash University Malaysia until 1 November 2019.
It showcases a collection of high impact research output (monographs, journal articles and innovation awards) by Monash University Malaysia researchers. These works have impacted local communities and contributed to nation-building in Malaysia, in the region and throughout the developing world.
Visitors are invited to explore the pioneering research led by the university, which has contributed to nation-building in the region.
As leaders, sometimes managing our egos is one of the toughest challenges we face. It’s something that, when not checked, is most likely to get us into trouble as well.
One of my favorite lessons about leadership comes from the Tao Te Ching:
“When the Master governs, the people are hardly aware that he exists… When his work is done, the people say, “Amazing: we did it, all by ourselves!”
But does this mean that as the leader of your team, you should make yourself inessential? Well, not quite.
I recently spoke to a friend who was the CEO of a well-respected charitable organisation doing vital work in a remote rural county of the U.K. Budget cuts at the local authority, on whom they relied for most of their funding, reduced their contribution by 50 percent. By some miracle, this CEO was able to keep the doors open, providing a bare-bones service to the people who needed it most. One of the ways she was able to do this was by making herself redundant.
She confided that although she was glad that her work was kept alive, she was struggling with accepting that they were able to get along without her. She felt this conflict because she had worked so incredibly hard to prepare her team for this very day.
She accepted that it was good to see her team succeed autonomously, but of course emotionally it was still hard for her to feel unnecessary. Even knowing the service would otherwise have had to shut down only went so far in soothing her bruised ego.
Feeling needed, feeling essential, is a powerful potion for most of us. When your job involves making sure people in need get the services they rely on, or driving the function that makes your stakeholders happy with big dividends, it’s easy to believe you are the lynchpin that makes it all possible.
In fact, a good leader makes herself essential by being the force that creates a team of people who can get the day-to-day work done without her. A leader who can be fearlessly vulnerable can create effective and capable teams without resorting to heavy-handed, labor-intensive micro-management. This in turn produces a level of self-belief and self-confidence that comes from knowing you can humbly rely on others.
These aren’t some elusive, magical skills or characteristics that only some fortunate people are born with, though. This kind of leader exists in all of us. This kind of leader is realised by bravely bringing the most human parts of ourselves to the table every day, having checked our egos at the door.
You succeed as a leader by reminding yourself that the work is not about you — it’s about what you achieve as a team for the people in need that you serve, or for the bottom line that you take pride in growing, or the reviews of the stellar product that you produce.You lead with humanity and integrity, remembering that every person who comes in to work each day also wants to feel like they are valued and essential and that they are doing a good job. You are in the fortunate position to help each of your team members feel this way.
Letting people get on with their jobs, giving plenty of scope for autonomy and innovation, being open to alternative ways of getting things done, and acknowledging good work — simple things we all want — is part of being an essential leader.
And though the work will have gotten done because of your leadership, your team will have the confidence and satisfaction of having done the work all by themselves.This makes a strong and resilient team that will keep on excelling, even in the toughest of times.
John Collison, president and co-founder of Stripe and YB Ong Kian Ming, Deputy Minister of International Trade and Industry during the launch of Stripe at the Glassdoor, Kuala Lumpur.
Stripe, a global technology company that builds economic infrastructure for the Internet, recently launched in Malaysia. Valued at USD35 billion, Stripe also announced a partnership with Payments Network Malaysia Sdn Bhd (PayNet) to make FPX available to businesses in the country.
Malaysia is home to one of the world’s most connected populations – not only are smartphones nearly ubiquitous at 88 percent penetration, Malaysia’s Internet users are also among the top 10 most engaged globally. However, despite this, the Internet only represents around 3 percent of the country’s GDP.
“Even today, less than eight percent of commerce is online, largely because moving money on the Internet remains complicated, cumbersome and slow,” said John Collison, co-founder and president, Stripe. “At Stripe, our goal is to remove these barriers and build the kind of infrastructure ambitious businesses need to run at Internet speed and scale.”
With the launch in Malaysia, any online company in the country can now gain access to Stripe’s entire product stack, to launch, run and scale their business globally from day one – including Stripe Connect for running multi-sided marketplaces, Billing for subscriptions and recurring payments, Radar for fraud detection and prevention, Sigma for analytics, and more. From today, Stripe is also making FPX available in beta, allowing businesses on Stripe to accept payments via online bank transfers, along with major credit cards like Visa and Mastercard.
“We are extremely excited by the energy and determination of the Malaysian entrepreneurs we’ve been working with daily. Technology should not be holding them back,” said Piruze Sabuncu, head of Southeast Asia and Hong Kong, Stripe. “Stripe aims to empower more businesses in Malaysia to export their creativity to the rest of the world.”
Stripe has been testing its service in Malaysia since January this year, and already works with some of the country’s most innovative companies including: e-commerce solutions platform EasyStore, food delivery service dahmakan, and fashion and retail platform FashionValet.
What Stripe does:
Allows businesses to set up and run instantly. Stripe enables businesses to receive payments in over 135 currencies and through payment methods like FPX and credit cards. Set up is fast, and merchants can get started in as little as 10 minutes.
Equips online businesses with a full stack to launch, run and scale. In addition to accepting payments, companies can use Stripe to build new business models like marketplaces, crowdfunding and subscriptions, handle accounting and optimise checkout experiences for mobile devices – all from one centralised dashboard. Plus, there are hundreds of third-party services that are integrated with Stripe – everything from invoicing to email marketing and customer relationship management.
Fights fraud. Stripe Radar, the technology company’s fraud detection and prevention tool leverages advanced algorithms and machine learning to actively protect businesses from fraud. This is especially useful for businesses operating internationally, since fraud patterns and threats can vary significantly from one country to the next.
Delivers seamless security. Stripe is certified to PCI Service Provider Level 1, the most stringent level of certification. Stripe also provides 3D-Secure (3DS) support, creating one-time-use codes for businesses to charge their customers; these codes cannot be stolen and re-used.
“Stripe’s speedy, seamless integration was only a precursor to the impact it has had on our business. Thanks to its high credit card acceptance rates, Stripe’s payments infrastructure has boosted our sales significantly – our mobile checkout conversion rates have gone up by nearly 40% since we integrated,” said Max Lotz, co-founder & CEO of Flower Chimp. “We’re looking forward to using Stripe as our premier payments partner across all the markets we operate in.”
Despite sentiments pointing to a bleak economic outlook for next couple of years beginning
2018 across the globe, coupled with the transition period of government in Malaysia, Selangor Menteri Besar Yang Amat Berhormat Tuan Amirudin Bin Shari remains
upbeat of the State’s economic performance.
“Selangor is still the engine of Malaysian economy. Year after year, it has never failed to contribute the biggest slice of cake to the nation’s GDP compared to other states,” he says enthusiastically.
In 2018 Selangor contributed around 23.7 percent to the GDP, one percent higher than the previous year. The achievement of RM18.9 million of investment last year – both foreign direct investment (FDI) and domestic investments – the highest in 25 years, shows that
Selangor is one of the attractive locations for investment in Malaysia.
“This of course, is due to Selangor’s strategic geographic location, logistics and infrastructure. Geographically, the State is located close to the country’s capital city Kuala Lumpur and in terms of logistics, it boasts two international airports and one of the busiest seaports in Southeast Asia.
“The State’s road network and Internet connectivity is another factor for the success,”
he says proudly, adding that to date Selangor has 95 percent Internet coverage. “With the latest technology for industrialisation and best road network as well as infrastructure which helps to boost traditional trade activities in place, Selangor isthe economic powerhouse of Malaysia,” he explains.
Reiterating his confidence in the State’s economy, the Menteri Besar hopes Selangor can be one of the main economic players in the region by 2025. “We have set an investment target of RM10 billion for this year and up till July we have already attracted RM6 billion investment. This shows we are on the right track to hit the RM10 billion conservative target.”
BECOMING GLOBAL TRADING HUB
On Selangor’s aspiration of becoming a global trading hub, Amirudin says Selangor is ready. “We have already met the most important criteria which is infrastructure. Two of Malaysia’s seaports are in Selangor and we are planning to have one more in the future. We also have 95 percent Internet coverage in the State and what is needed now is the increase of bandwidth.”
The elated Menteri Besar says that even the most remote area in Selangor such as Hulu Selangor enjoyed good Internet connection with business owners adopting epayment for business transactions.
He went on to say that Selangor is also ready in terms of culture, mindset and intellectual
capacity to become an attraction of the world.
“Being a moderate state that provides a conducive environment for people to live harmoniously and with 160 institutes of higher learning and universities producing 40,000 graduates every year, Selangor is the perfect place for trading and economic activities. On top of this, we also have technical and vocational institutes which produce skilled workers, making us ready in terms of human resource. To be more ready, thus far we have allocated RM75 million technical and vocational budget to train existing workers to become skilled workers and the sum is expected to be increased to RM100 million in 2020. Therefore, we have chosen ‘Gateway To ASEAN’ as the tagline for the Selangor International Business Summit (SIBS) which was held from 10th to 13th October this year.”
Amirudin proudly says, although year 2025 is the official target to fully become a global trading hub, Selangor is already attracting global investors. However, beginning 2016, Selangor has been focusing on certain niche areas – the five pillars that forms the clusters for SIBS – electrical & electronics, machinery equipment, transport equipment, food and beverages manufacturing and life sciences.
EXPECTATION FOR SIBS
SIBS started with the Selangor International Expo in 2015. According to the Menteri Besar, the event was launched to introduce Selangor to the eyes of global investors and the business community. “Although we are the economic powerhouse for Malaysia, people often relate Malaysia to Kuala Lumpur and other states, through SIBS we want to establish the identity of Selangor as a representative of Malaysia in the global business community.
“I think this is the best platform for Selangor to introduce herself as who it is. We had a humble start to introduce ourself as a trading hub and a centre for investment in Malaysia. We want to assure investors that everything (all kind of business activities) can be started in Selangor. We want to show our readiness to become a big player or challenger in the global market. For example, in 2018, SIBS occupied one floor in MITEC and now have grown to three floors this year. The number business transactions and participants
have also grown year to year. This shows that the event is a good initiative by Invest Selangor Berhad.”
Adding on he said, this year’s event is very special as for the first time, SIBS has managed to engage few federal ministers to participate.
To put in a nutshell, he says this is a good sign that Selangor is recognised by the federal government and the business community locally and globally. “The SIBS is not just about economic activity but cultural and a presentation of Malaysia to the global eyes.”
In September, Tricor Malaysia, the leading provider of share registration services launched a digital platform for the subscription of and payment for rights issues.
As a Share Registrar who carries out the distribution and collection of corporate exercise application forms, Tricor Malaysia operates TIIH Online to digitalize the management of submission of documents and payment of subscriptions to share entitlements.
The new electronic rights issues subscription service was successfully used by one of Tricor’s clients to complete their recent rights issue exercise in September 2019. TIIH Online which became operational in 2017 is a proprietary application designed to help meet corporations’ investor services needs through digitisation and in support of the government’s vision envisaged in the Fourth Industrial Revolution.
TIIH Online is essentially a one-stop digital platform for participation of corporate exercise online and submissions of all time critical public-listed company documents such as rights subscription forms (RSF), dividend reinvestment forms, proxy forms and remote participation forms.
The platform also electronically facilitates services such as participation in dividend reinvestment plans, application for Initial Public Offerings (IPO), lodgement of proxy forms for general meetings as well as exercising for conversion rights of non-equity securities such as warrants and irredeemable convertible unsecured loan stocks. Public listed companies who engage TIIH Online can also offer its shareholders the chance to remotely participate in general meetings in adherence with the Malaysian Code of Corporate Governance (MCCG).
Approximately 10,000 users are currently registered on the TIIH Online platform. To date, 60 Tricor’s clients have already used the digital platform.
According to Tricor Group CEO Lennard Yong, the company’s latest innovation, the electronic rights subscription service, is a pioneering move in Malaysia which enhances client experience and improves efficiencies by phasing out the traditional methods of submitting hard copies of rights subscription forms and cheques.
“Our electronic rights subscription service is a game changer for the industry as it offers tremendous cost and time savings. Shareholders will benefit from instant updates via email from anywhere in the world which means they won’t lose investment opportunities through late or non-receipt of RSF through mail, instant acknowledgment and delivery as well as secure payment gateway allowing shareholders the flexibility to use their own internet banking facility to execute all payments,” said Yeap Kok Leong Tricor Malaysia CEO and Managing Director.
Tricor Malaysia Executive Director – Head of Investor Services Saw Wai Chuan also commented: The TIIH Online platform was designed and built by an in-house team which is deeply knowledgeable about Malaysia’s share registration industry, practices and regulators’ stringent requirements.
TIIH Online is also regularly subjected to external security audits to ensure security and functionality 24/7 to assure shareholders of a seamless, safe and convenient conduit designed for their convenience.
You’d be forgiven for thinking that pizzas are only for parties, gatherings or when you’re home alone binging on your favourite Netflix series. And you’re not wrong, but this year, Pizza Hut is back with its year-end surprise! Expect a dramatic twist to your year-end celebrations with Pizza Hut’s brand-new explosive pizza you won’t want to miss out on!
For over 37 years, Pizza Hut has engaged with Malaysian consumers so closely that they enjoy great moments with great pizza. Notably this year, Pizza Hut takes it a notch higher with several breakthrough innovations, a key enabler in its turnaround strategy of making it easier for all Malaysians to enjoy a better pizza. The new revamped mobile application signifies the continuous focus around digital innovations in making pizza more accessible. Aiming to continue elevating Pizza Hut’s experience, the innovative “Singing Pizza” was launched in Q2 this year, to transform Malaysians’ overall pizza experience with entertainment at every bite – an innovative use of the pizza box as a music box. The launched of its 400th store then further cemented Pizza Hut’s position as the No. 1 pizza brand in Malaysia.
Staying ahead of the game in this competitive landscape means keeping up with trends and tastes through innovative product offerings. Pizza Hut delighted customers with an unexpected twist to a familiar favourite – Durian Cheese Pizza – launched during the National month. And now with the year-end celebrations just around the corner, Pizza Hut’s multi-sensory Black Volcano Pizza will be unlike any pizzas you’ve ever tasted.
Year-end holiday period will have Malaysians coming together to reconnect and celebrate, in which Pizza Hut sees the opportunity to bring about greater meaning during these occasions. The innovative Black Volcano Pizza will do just that, designed especially for maximum fun and excitement with its dramatic black crusted pizza and fun bite-size volcano crust – an invitation for Malaysians to have an explosive great time with friends and loved ones this year-end.
From the 1st of October to the 31st of December, the Black Volcano Pizza is available nationwide tantalising Malaysians taste buds with its delicious cheese filled volcano crusts baked with charcoal infused pizza dough and topped with crispy chicken pops. Dressed in a classy all-black crust – a first for pizza in Malaysia, this majestic volcano themed pizza is a sight to behold and will instantly turn a dull meal time to a wow experience with friends.
Thsi new limited-edition Black Volcano Pizza can be purchased via ala carte orders at RM44.50 for a regular size while combo options are available through delivery, take-away or dine-in.
As the representative of the tech industry in Malaysia, PIKOM is supportive of the Government’s various incentives outlined in Budget 2020 recently. It stands to put various short-term, medium-term and long-term goals in more realistic perspectives, leading up to Shared Prosperity Vision 2030.
PIKOM Chairman, Ganesh Kumar Bangah said, “We are pleased to see that there will be special incentives for start-ups to penetrate the world market. IR4 received the boost needed in the form of upskilling and training development via HRDF. The RM 20 million will be a start in our quest to remain competitive. For larger companies, the matching grant up to RM 2 million would put them in good stead and allow them to make investments in technology. Infrastructure for 5G is the key backbone for the digital age but without applications, the ‘highway’ built would not be of relevant use. PIKOM continues to call for a dedicated Tech Ministry to oversee the overall growth of this industry as well as manage various incentive policies and growth of SMEs.”
It was positive to note that the start-up scene was also not left behind. Recognising the importance, Cradle and MDEC received funding to adopt technology in continuous development of start-ups and micro enterprises. Even though RM5K for each SME may not be much, it would be able to kickstart their journey as they subscribe to cloud services such as accounting, HR. POS, inventory management, and many other services.
Ganesh also noted that the biggest allocation was for education and rightly so since the lifeblood of the country is always its people. He continued, “Focus on STEM and TVET will help position Malaysia well in preparing the future workforce. To cap it off, setting up of the Digital Enablement Centres will help SMEs and other businesses to refer as a one-stop shop for all their digital questions.”
PIKOM also appreciated the budget allocation for content development to encourage more content developers to join this field and make Malaysia a centre for creative content including e-sports.
The proposal for e-wallet incentive is a boon and will have a transformative effect in creating the cashless society.
Export promotion also received a shot in the arm by increasing the allocation for the Market Development Grant, which will greatly help in increasing global market penetration for the local tech players.
PIKOM looks forward to continuously work closely with the government in addressing the withholding tax and the digital service tax grey areas prior to its implementation on 1st January 2020.
Malaysia announced its Budget 2020 on 11th October 2019, focusing more on the digital economy growth compared to previous budgets in recent years. In the Budget, there are three key initiatives that stand out according to IDC; attracting foreign investment in the digital industry, increasing digital connectivity within the country and bridging the talent gap that exist in Science, Technology, Engineering and Mathematics (STEM) fields.
“It is heartening to know that the Government is taking these concepts seriously, as IDC anticipates that 66% of Malaysia’s GDP will be digitalised by 2022. IT Spending in Malaysia is anticipated to achieve USD82 billion from 2019 to 2022 – a far cry from where Malaysia was 15 years ago where the country could barely muster USD4 billion of spending from both enterprises and consumers (sans communications spending),” says Sudev Bangah, Managing Director for IDC ASEAN.
As Malaysia focusses on growing its Digital Economy, IT spending on 3rd platform technologies (Cloud, Big Data/Analytics, Mobility and Social) along with innovation accelerators such as Cognitive Systems, Internet of Things, Robotics and Next-Gen Security will grow to have an overall positive impact on the economy as their adoption and utilisation will create new business models and revenue streams.
While these discussions have become dominant, it is worthy to note that the intent is stronger than its actions. Only one in two CEOs in Malaysia are under pressure to successfully execute its Digital Transformation (DX) strategy in the face of Industry 4.0, and those who are pressured, are doing so for customer services and operational excellence.
The Budget 2020 had several interesting initiatives; three that caught the eye of IDC were;
The availability of up to RM1 billion worth of customised packaged investment incentives annually over 5 years, as part of the strategic push to attract targeted Fortune 500 companies and global unicorns to Malaysia.
The creation of the necessary infrastructure to construct a Digital Malaysia by implementing the National Ferberisation and Connectivity Plan (NFCP) over the next 5 years which will provide comprehensive coverage of high speed and quality digital connectivity nationwide, including rural areas.
The allocation of RM11 million towards initiatives by the Ministry of Education in collaboration with Ministry of Environment, Science, Technology and Climate Change to inculcate the Science, Technology and Innovation (STI) culture, encouraging more students into the fields of Science, Technology, Engineering and Mathematics
IDC specifically applauds the three initiatives listed above as it directly resonates with the needs of the industry. With the budget allocation for each of this initiative, it will enhance investment in Artificial Intelligence, Smart Cities, Automation and Talent as businesses move towards hyper personalisation and customer centricity, which would ultimately create an innovative and sustainable digital economy.
While most of the initiatives were encouraging, there were also a few that left more challenges than solutions. For example, the announcement to build 14 one-stop Digital Enhancement Centres in all states was rather ambiguous, and the notion that a provision of a “digital stimulus” will encourage and heighten the use of eWallets. What would be interesting to see as a follow up is how the government will address core issues on adoption and utilisation at large.
“While it is encouraging to see the attention and emphasis placed on driving towards the Digital Economy, it does seem that we are only thinking a year at a time – and many of these initiatives will most likely lose momentum going into 2020,” says Sudev Bangah, Managing Director of IDC ASEAN.
He continues “With more than 87% of organisations in Malaysia lamenting the lack of “ready talent” to face the digital economy, and only half of these organisations are pressured to digitally transform – the fundamental issues go beyond funding, incentives or allocations. What it truly boils down to, is the need for re-invigoration, innovation and follow-through to take us to the next level”.
Nonetheless, overall it is an impressive budget given the circumstances with much needed attention and stimulus for talent development and adoption of emerging technologies by the enterprises. IDC predicts that by 2022, 70% of all IT spending will be on 3rd Platform technologies, as over 50% of all enterprises build ‘digital-native’ IT environments to thrive in the digital economy. Government has shown its intent and announced what best they could now it’s upon other stakeholders to up their game and leverage on the initiatives to propel Malaysian economy to reach greater heights with shared prosperity.
Knight Frank Malaysia applauds the Government’s approach in making Malaysia a preferred investment destination. The recently unveiled National Budget 2020, themed “Driving Growth and Equitable Outcomes Towards Shared Prosperity” focuses on driving the country’s economic growth by spurring more investments.
Infrastructure and Connectivity
The Government intends to make Port Klang a regional maritime centre and cargo logistics hub combining manufacturing, distribution, cargo consolidation, bunkering as well as ship repair. In the National Budget 2020, the Federal Government announced a RM50 million allocation for the repair and maintenance of roads leading to Port Klang.
Allan Sim, Executive Director of Capital Markets, Knight Frank Malaysia welcomes such initiative and accentuates the importance of infrastructure and connectivity in stimulating the logistics and manufacturing industry. Allan Sim comments, “On-going mega projects such as the East Coast Rail Link (ECRL), connecting Port Klang on the Straits of Melaka to Kota Bahru on the South China Sea, would be a boon for the logistics sector as freight and shipping time will be reduced significantly. Time efficiency plays a big role in logistics and supply chain management, as such key infrastructure investments will continue to draw the attention of investors.”
Proactive steps have also been announced to further accelerate the adoption of smart technologies among manufacturers and industrial players in the country. Besides the allocation of RM550 million to provide smart automation matching grants to 1,000 manufacturing and 1,000 services companies to automate their business processes, the government has also extended the year of assessment for the Accelerated Capital Allowance and automation equipment capital allowance for the manufacturing sector on the first RM2 million and RM4 million incurred on qualifying capital expenditure to 2023.
Allan Sim says, “These measures will further spur investments in the manufacturing industry and potentially improve Malaysia’s economy moving into 2020, in line with the recently unveiled Shared Prosperity Vision 2030 (SPV 2030).”
Office Market
Teh Young Khean, Executive Director of Corporate Services, Knight Frank Malaysia, says, “Up to RM1 billion a year worth of customised packaged investment incentives have been pledged to encourage inbound investment from Fortune 500 companies and “global Unicorns” in the high technology, manufacturing, creative and new economic sectors over the next five years. By generating more economic activities and creating more job opportunities, this measure will drive higher demand for commercial real estate as more companies set up new businesses / expand existing businesses. This augurs well for the current tenant-led office market.”
Stimulate the Housing Market – Lowering Threshold for Foreigners & Real Property Gain Tax (RPGT)
On the housing front, the Government continues to address the overhang situation in the nation. Sarkunan Subramaniam, Managing Director of Knight Frank Malaysia, says, “Now that we have more clarity on the RM600,000 threshold where it only applies to existing unsold units of condominiums and apartments in urban areas, this may be an effective remedy for the overhang situation, especially for units within the RM600,000 to RM700,000 price range.
“However, the property overhang is attributed to various factors such as mismatch of products, location, expected yield rather than pricing alone. Some units have remained unsold due to other factors such less favourable location in terms of accessibilities, distance and lack of amenities as well as product type.
“In addition, land is a state issue, therefore the decision by the Housing and Local Government Minister to allow state government to set their own thresholds for foreign property purchasers could be a right move.”
The Government has also pledged to enhance the Real Property Gain Tax (RPGT) treatment by revising the base year for asset acquisition to 1 January 2013 as compared to the previous base year of 1 January 2000. Potentially reducing tax liabilities upon capital gains.
Sarkunan Subramaniam comments, “Shifting the base year for asset acquisition is likely to spur more activity in the secondary market. The revision of the base year may reduce taxable gain, thus translating into lower tax burden for sellers. From 2000 to 2010, the national house price index was higher by 40.7% and for the subsequent period up to 2013, it increased by another 40%.
The current RPGT for individual Malaysians is 5%, and 10% for foreigners if the property is sold after the fifth year. The initial intention of imposing the RPGT for disposal of a property from the sixth year onwards, effective 1 January 2019, was to curb speculative purchase.”
This handout photo taken and released by the Malaysia's Department of Information on November 2, 2018 shows Malaysia's Prime Minister Mahathir Mohamad (C) together with Finance Minister Lim Guan Eng (L) and Deputy Prime Minister Wan Azizah Wan Ismail (R) arriving for the 2019 budget presentation at the Parliament House in Kuala Lumpur. (Photo by Fandy AZLAN / DEPARTMENT OF INFORMATION / AFP) / RESTRICTED TO EDITORIAL USE - MANDATORY CREDIT "AFP PHOTO / DEPARTMENT OF INFORMATION/ FANDY AZLAN " - NO MARKETING NO ADVERTISING CAMPAIGNS - DISTRIBUTED AS A SERVICE TO CLIENTS
Budget 2020, which was tabled by Minister of Finance YB Lim Guan Eng last Friday, reflects the Government’s commitment to enhance connectivity across the country in preparing Malaysia for Digital Transformation.
In line with the government’s aspiration, the National Fiberisation and Connectivity Plan (NFCP) will bring together the people and businesses in pursuit of stimulating the Malaysian digital economy in the Fourth Industrial Revolution (IR 4.0), engender technological innovations across different industries, narrow the digital gap and generate a constructive
environment for new technologies such as 5G.
MCMC also welcomes the myriad of incentives aimed at spurring the development of 5G ecosystem and adoption, which solidifies the government’s vision to establish a strong use for viable 5G applications that will transform various industries, as well as positively impact the living standards of Malaysians. This bodes well with our goal of commercialising some of the 5G use cases beginning third quarter of 2020.
The Chairman of Malaysian Communications and Multimedia Commission (MCMC) Al-Ishsal Ishak said, “MCMC lauds the government’s commitment to accelerate economic growth through digital transformation and at the same time cognisant on the importance of
driving inclusivity and equitable growth. Striking the balance is key as digital connectivity today holds the power to promote growth in every corner of the country and prepare our workforce with the right skills for the future.
“As the regulator of the multimedia and communications industry, MCMC will continue to spearhead the development of the nation’s digital infrastructure through the NFCP to ensure that both businesses and the people will be able to reap the benefits of the digital economy as we move towards the era of 5G and Fourth Industrial Revolution. This will support Prime Minister Tun Dr. Mahathir Mohamad’s vision for Malaysia to become Southeast Asia’s Industry 4.0 hub in an effort to regain its status as an Asian Tiger.”
In conjunction with World Sight Day 2019, Hilton Kuala Lumpur donated RM9,000 to the Malaysian Foundation for the Blind (MFB) as an act of hospitality towards the global awareness on blindness and vision impairment. This is an extension of Hilton’s centennial celebrations in Southeast Asia this year.
For 100 years, Hilton has seen a world that can be made better through genuine hospitality. Hilton Kuala Lumpur’s efforts are a part of its weeklong celebration, recognising the company’s year-round commitment to serving and enriching the communities where team members live, work, and travel.
A reflection of its corporate social responsibility (CSR) commitment to the community, the generous contribution was a concerted effort between the 5-star hotel and its team members. The funds garnered resulted in the purchase of 200 white walking canes for the visually impaired.
“Over the last century, being the most hospitable company in the world has been a core focus for us here at Hilton, and it is this part of our DNA that has inspired us to perform these ‘Acts of Hospitality’ throughout our communities during our milestone centennial year. Malaysia represents a significant part of our presence in Southeast Asia and as a company of our scale and heritage, we have a responsibility to do our part for the communities we operate in,” said Mr. Jamie Mead, Regional General Manager, Malaysia, Philippines and Vietnam, Hilton.
MFB, a national nonprofit foundation, is a local champion whose mission lies in making life better for blind and partially sighted people in Malaysia, as well raising awareness, and creating skills and vocational training programs.
Large transnational corporations (TNCs) are widely believed to be paying little tax. The ease with which they avoid tax and the declining corporate tax rates over the decades have deprived developing countries of much needed revenues besides undermining public faith in
the tax system.
The rise of digital giants is an additional concern for all countries. Digitalisation makes it hard to establish where ‘production’ takes place. Hence, digital tech TNCs’ revenues
typically bear little relation to reported profits and tax bills.
CORPORATE TAX RULES FAVOUR RICH COUNTRIES
Through the Organisation for Economic Co-operation and Development (OECD), developed economies have long set corporate tax rules, without much consideration for the effects
on developing countries’ revenues.
UN initiatives on profit shifting and tax avoidance have been largely resisted by developed countries. At the Third UN Financing for Development Conference in Addis Ababa in mid-2015, developing countries failed to ‘elevate’ the UN Tax Committee into an inter-governmental body. Even more modest efforts to strengthen it failed, due to opposition fromvdeveloped countries.
On-going efforts — under the OECD’s Base Erosion and Profit Shifting (BEPS) project to reform international corporate tax rules, mandated by the G20 — suffer from legitimacy deficits, as developing countries continue to be marginalised, with only consultative roles.
The so-called BEPS Inclusive Framework (IF) tries to ensure that OECD-set standards are enforced in developing countries even though their legitimate concerns remain unresolved, while unilateral actions by developed countries continue to harm them.
The OECD designed BEPS still allows companies to move their profits anywhere legally via ‘transfer pricing’ to take advantage of low-tax jurisdictions which some OECD countries
provide. This favours developed countries which can bettera fford lower corporate tax rates.
Therefore, the latest report of the Independent Commission for the Reform of international Corporate Taxation (ICRICT) argues that BEPS has achieved all it can.
Instead, it proposes new tasks, dubbed ‘BEPS 2.0’, urging the OECD to reject transfer pricing.
DIGITAL ECONOMY CHALLENGE
Recent, highly profitable, ‘highly digitised’, ‘technology-driven’ business models — which rely heavily on intangible assets, such as patents or software — are another reason for rethinking international corporate taxation.
Current tax systems are unable to prevent egregious tax avoidance by digital TNCs. With their marginal cost of production at zero, all revenue can be taxed effectively without
negatively affecting the supply of digital services.
The OECD has been addressing this issue within the BEPS Framework over the past half-decade without reaching consensus. “With no consensus on taxation of the digital economy, some countries have resorted to unilateral measures”, notes the UN Committee of Experts on International Cooperation in Tax Matters.
The recent unilateral action by France to tax tech giants invoked the US threat of new tariffs on French exports. Clearly, the overriding priority now is to establish an international
corporate tax system for the digital economy benefiting both developing and developed countries.
UNITARY TAXATION
The ICRICT has proposed that the international taxation system should move toward unitary taxation of multinationals, which would deter their abuse of transfer pricing as global income would need to be consolidated.
Global profits and taxes could then be allocated geographically according to objective criteria such as sales, employment, resources, even digital users in each country. A global minimum effective corporate tax rate of 20-25 percent of all profits earned
by TNCs would be an advance.
The ICRCT also recommended four measures to tackle harmful international tax competition, namely putting a floor under tax competition, eliminating all tax breaks on profits, establishing a level playing field and ensuring participation.
Recent IMF research has proposed various options and three criteria for consideration: better addressing profit-shifting and tax competition; overcoming legal and administrative obstacles to reform; and fully recognising the interests of emerging and developing countries.
However, as the UN Committee of Experts emphasised, “the solution should be simple to administer … and easy to comply with” as “developing countries often neither have the capacity to administer complex solutions nor are they equipped to handle costly international dispute settlement processes.”
IMF AND UN ROLES
The IMF claims near-universal membership, which enables better understanding of developing countries’ problems. It also provides technical support on tax issues to over a
hundred countries yearly. But as Fund governance is stacked against developing countries, only the UN can better ensure that developing country interests receive due recognition.
The Platform for Collaboration on Tax (PCT), has tried to enhance co-operation on tax issues. As the PCT is not a political body, there is need to recognise the UN Tax
Committee as the principal PCT decision-making body to ensure its decisions fairly serve both developed and developing countries.
Countries must work together so that more inclusive, equitable and progressive multilateral coordination can accelerate progress. Clearly, a new approach to international
corporate taxation is urgently needed.
This article was originally published in the Inter Press Service (IPS) opinion column
Buyouts engineered by optimistic CEOs and pessimistic CFOs have the best odds of success
As the US-China trade war drags on, sirens are going off on sales, earnings and growth forecasts around the world. But one aspect of corporate activity is bucking the gloom: mergers and acquisitions (M&As). Global appetite for M&As is at a 10-year peak, fuelled by years of sustained economic growth and low cost of debt. Announced transaction volumes surged to USD4.1 trillion in 2018, the third highest ever. In Singapore, 14 companies were bought out or privatised in the first half of 2019, more than the 2018 full-year tally.
The froth belies the fact that M&As, which can pave a fast track to future growth if done right, are risky propositions with a failure rate of 80 percent. Nonetheless, investors and analysts need not rely on guesswork to identify successful deals. Our research points to an optimal combination in the C-suite that increases the odds of M&A success: optimistic CEOs tempered by pessimistic CFO.
Optimism and pessimism have been shown to be aligned with the roles of CEO and CFO respectively. CEOs are expected to be upbeat and open to taking risks in order to engineer or sustain an upward trajectory for their company. Satya Nadella, Jack Ma and Mary Barra are just a few of the flag-bearers.
THE A-TEAM FOR SHOPPING
However, optimistic vision does not automatically translate into healthy post-M&A return on assets (ROA). This is where CFOs come in. They scrutinise target firms, conduct in-depth due diligence and pinpoint potential risks of any M&A. They are expected to be cautious and attuned to adverse conditions – in other words, pessimistic gatekeepers.
Hear it from former Facebook CFO David Ebersman in a 2015 interview, “One of the things I felt responsible for doing was to be a bit of a pessimist: to think about what could go wrong with the investments we were making, and to make sure someone was challenging every dollar we were spending in the business.
We studied the level of optimism and pessimism of CEO-CFO pairs at 2,356 US firms, the pairs’ influence on 4,529 M&As and, in turn, firm performance. We culled transcripts of conference calls between 2002 and 2013 involving both the CEOs and CFOs and, measured the executives’ optimism and pessimism by analysing their use of positive and negative words. Positive words included “achieve”, “assure” and “successful”; negative ones covered “flaw”, “penalise” and “unavoidable”. CEO optimism was calculated as the difference between a CEO’s use of positive words and negative words, and CFO pessimism was calculated as the difference between a CFO’s use of negative words and positive words.
Our data showed that CEOs generally used more positive words and were more optimistic than CFOs. CFOs used more negative words and were more pessimistic than CEOs. We then used the ratio of CEO optimism to CFO pessimism to derive what we call the CEO-CFO relative optimism. This value is then matched with the firm’s number of M&As and operating performance, assessed in our study as return on assets (ROA) a year later.
We found that the more optimistic a firm’s CEO-CFO pair was (high-optimism CEO with low pessimism CFO), the more M&As it undertook. High CEO-CFO optimism also correlated with lower ROA a year after M&As. Conversely, low CEO-CFO relative optimism was associated with fewer M&As but higher ROA.
At Spectrum Pharmaceuticals, for example, where relative optimism of the CEO (Rajesh Shrotriya) and CFO (Brett Scott) was in the top 5 percentile, ROA was a disappointing -3.4 percent after the firm made an acquisition in 2012. At the other end of our data set were Gilead Sciences’ CEO (John Martin) and CFO (Robin Washington), whose relative optimism ranked in the bottom 5 percentile. The biotechnology company reported a ROA of 36 percent a year after making a major acquisition in 2009.
We conclude that in the presence of pessimistic CFOs, optimistic CEOs not only undertake fewer acquisitions, they are less likely to undertake dud acquisitions. This points to an optimal pairing of an optimistic CEO who has a large risk appetite for M&As, and a pessimistic CFO who is sufficiently prudent to alert him or her to potential pitfalls
OPTIMISM IN TURBULENCE
Our findings may have even more relevance in these turbulent times of trade sanctions and de-globalisation. In our study, companies with high CEO-CFO relative optimism carried out more M&As in a dynamic environment of volatile total industry sales. This suggests that CEOs are more likely to consult CFOs on M&As in times of uncertainty, and when a highly sanguine CEO works with a low-pessimism CFO, the result is likely to be more M&As.
In other words, uncertainty about the operating environment enhances the positive relationship between CEO-CFO optimism and the number of M&As. How optimistic the CEO is, and how pessimistic the CFO is in parallel, will under the circumstances weigh on firms’ M&A decisions and their future performance.
This article is republished courtesy of INSEAD Knowledge.
Below is a Standard Chartered Global Research team’s report on the recently announced Budget 2020.
Step by step
Finance Minister Lim Guan Eng presented his second budget on 11 October. As expected, the 2020 fiscal deficit target was reduced to 3.2 p% of GDP, slightly higher than what was projected in the 2019 budget for 2020. The finance minister had earlier alluded to a more gradual pace of fiscal consolidation, which is justified by the challenging growth environment. Notably, the government is sticking to its medium-term consolidation objective.
According to the Medium-Term Fiscal Framework (MTFF), the government is targeting an average fiscal deficit of 2.8% of GDP for 2020-22. This may be a challenging target, and implies an average fiscal deficit target of 2.6% of GDP during 2021-22. The means to reaching the deficit target appears to be expenditure rationalisation over the medium term.
The government is projecting a steady growth rate of 4.7% in 2019 and 4.8% in 2020. Malaysia’s growth so far has proven to be relatively resilient. Strong private consumption and the resumption of mega-infrastructure projects should help. That said, downside risks to growth remains amid external challenges.
We maintain a Neutral near-term duration outlook on MYR debt. The budget announcement is in line with market expectations and supply pressure is manageable. Based on the 2020 fiscal deficit target of 3.2% of GDP, we estimate a similar supply outlook to 2019. In 2020, we expect gross borrowing in MGS and GII to be RM121billion – new funding needs of RM50 billion, and MGS and GII redemptions of
RM71 billion.
Revenue outlook remains constrained
Excluding special dividends from Petronas, total revenue is budgeted to increase by 4.8% in 2020. Corporate income taxes are projected to rise 6.7%, while individual income taxes are expected to increase 6.1%, supported by a proposed new tax band for top income earners. Indirect taxes are expected to rise 6.5%, with the sales and
services tax (SST) projected to bring in MYR 28.3bn.
Previously introduced measures such as air departure levies and digital service taxes (effective in 2020) should support revenue. However, even though tax revenue is expected to grow 5.5%, it will likely ease to 15.1% of GDP, continuing a steady decline since 2012. In particular, non-petroleum-related revenue as a percentage of GDP remains low. Any downside risks to growth projections may also affect near-term revenue projections.
Operating expenditure is budgeted to increase 7% (excluding the effects of RM37 billion of tax refunds in 2019). The bulk of the increase is due to a 28% rise in supplies and services as the government allocates more funds for repair and maintenance of
public assets. Development expenditure was allocated more funds in 2020 to accelerate programme implementation.
As a share of GDP, development expenditure was maintained at 3.5% in 2020.
Relying on expenditure rationalisation
Despite a more gradual pace of fiscal consolidation for 2020, the government remains committed to fiscal prudence over the next few years. According to its MTFF (Figure 4), the government is projecting an average fiscal deficit of 2.6% of GDP over 2021-22. This assumes nominal GDP growth of 6% over 2021-22, which appears reasonable, in our view. The fiscal deficit target appears challenging. Assuming a
uniform reduction in the fiscal deficit, the government may have to target a deficit of 2.8% and 2.6% of GDP for 2021 and 2022, respectively.
Raising revenue remains a key challenge. According to the MTFF, total revenue to GDP is targeted at 15% of GDP. Our estimate for 2020 revenue is 15.2% of GDP.
From a growth perspective, the MTFF implies revenue growth of 4.2% per annum in 2021 and 2022, higher than the average 2.3% growth during 2016-20. That said, any upside surprise, such as more efficient tax collection or new taxes over the new few years, should relieve pressure on expenditure rationalisation.
Given the lack of revenue space (the government did not introduce any major revenue measures for 2020), the focus may remain on expenditure rationalisation. Total expenditure is 18.4% of GDP. According to the MTFF, the government projects average total expenditure of 17.8% of GDP for 2020-22. Based on our estimates, this may imply an average 3.9% per annum growth in operating expenditure in 2021 and 2022 and a -5.5% per annum fall in gross development expenditure in 2021 and 2022.
Revenue components
Expenditure components
Rates strategy
• Gross supply of MGS and GII remains stable at RM121 billion in 2020
• 2020 net MGS supply has increased to RM22 billion vs RM14 billion in 2019
• Supply risk is manageable due to light GG supply and flush liquidity
Fiscal consolidation and light GG supply support local demand
We maintain a Neutral near-term duration outlook on Ringgit debt. The budget announcement is in line with market expectations and supply pressure is manageable. Based on the 2020 fiscal deficit target of 3.2% of GDP, we estimate a similar supply outlook to 2019. In 2020, we expect gross borrowing in MGS and GII to be RM121 billion – new funding needs of RM50 billion, and MGS and GII redemptions of RM71 billion.
We expect a 44:56 ratio between gross issuance of MGS and GIIs in 2020. Total planned 2020 gross issuance increases to RM121 billion from RM115 billion in 2019, with slightly higher redemptions. However, redemption is skewed more toward GII (RM40 billion) and less toward MGS (RM31bilion). As a result, net supply in MGS for 2020 is set to increase to RM22 billion from only RM14 billion in 2019. The redemption profile for MGS and GII suggests light reinvestment demand for MYR debt in January and February, but this is likely to increase significantly as most redemptions will be in Q2.
We believe flush onshore liquidity and a lower supply of government-guaranteed (GGs) bonds are likely to support local demand for MGS. As of end-June 2019, total GGs was around RM273bn which is around 18% of GDP. This is a significant amount, but net GG supply in 2019 YTD has declined to RM9.3 billion from RM18 billion
in 2018 and RM30 billion in 2017. We do not expect any significant expansion of GG supply as the government has been cautious about any off-balance-sheet liabilities.
We expect slightly higher net GG supply RM15 billion in 2020. The addition GGs bonds are likely to be well-received by onshore investors. Onshore demand on MGS is likely to exceed supply, in our view. Local pension fund’s (EPF’s) allocation to MGS and equivalent bonds increased by RM30 billion to RM 269 billion in H1-2019, compared with RM32 billion in 2018.
The three and a half month Top E-Commerce Merchant competition came to a grand close at the awards ceremony held on 13 October at the Malaysia International Trade and Exhibition Centre (MITEC).
Part of the three-day Selangor Smart City and Digital Economy Convention 2019 co-organised by the Selangor Information Technology & E-Commerce Council (SITEC), and Invest Selangor Berhad, the event sought to reward and recognise well-performing online merchants in Malaysia.
Officiated by YB Dato’ Teng Chang Khim, executive councillor with the Selangor State Government, the event saw a variety of performances from an Acapella group and LED drums performance.
“As it stands, Selangor is one of the first states in Malaysia to set up initiatives and supportive infrastructure for the e-Commerce community. With E- Commerce gaining such importance and omnipresence in our lives, this event serves to not only recognise the e-merchants that are pushing the boundaries, but also to help the public recognise the faces, the people, behind their favourite online stores,” said Teng.
Participating e-merchants were required to sell their products in an online sales period during the competition, as part of the requirements needed to participate in this competition.
“In the short span of 14 days, participants achieved RM 12.9 million sales over 117,155 orders, a testament to the quality and ability of our local e-merchants,” Teng added.
The champion, Hermo Creative Sdn Bhd, went home with RM 10,000 in cash sponsored by DHL eCommerce solutions, a trophy and an official certificate from SITEC and RM46,000 Second CRM voucher with one year access.
Hermo is Malaysia’s leading online beauty retailer dedicated to providing a wide selection of high-quality and affordable beauty products sourced from Korea, Taiwan, Japan, Europe, USA, as well as other internationally renowned beauty brands.
Grabbing RM 5,000 in cash, a trophy, an official certificate from SITEC, and a RM46,000 Second CRM voucher with one year access, is first runner up, Cloudhax Sdn Bhd. Cloudhax runs ticket2u.com.my, an online ticketing and event management platform that helps you buy and sell, manage and check-in tickets for your event with ease.
The second runner up, Kenjo Baby House Sdn Bhd, received RM 3,000 in cash, a trophy, an official certificate from SITEC and SITEC and RM46,000 Second CRM voucher with one year access. Kenjo Baby House online store Momo House sells baby and maternal products on all famous e-commerce platforms in Malaysia, namely Lazada, Shopee and others, since 2016 and is considered one of the top 3 online baby product merchants in the country.
The other seven finalists went home with RM 1,000 in cash, a trophy, an official certificate from SITEC and SITEC and RM36,000 Second CRM voucher with 6 months access.
On top of the best E-Commerce Merchant awards handed out, the best E-commerce Startup award category this year went to Hello1010 Sdn Bhd, Malaysia’s largest travel SIM cards store that allows the purchase of overseas SIM cards. The company walked away with a trophy, an official certificate from SITEC and RM1000 domestic shipping voucher from DHL eCommerce Solutions.
The event also saw 14 awardees from industries such as logistics, payment gateways, digital marketing and even AI being appreciated with the Top E- Commerce Service Provider awards.
Below is a full list of winners.
Winner: Hermo Creative (M) Sdn Bhd
1st Runner-Up: Cloudhax Sdn Bhd
2nd Runner-Up: Kenjo Baby House Sdn. Bhd
Finalist:
Black Dots Marketing Sdn Bhd
E-Transact Technology Sdn Bhd
Doublewoot Enterprise
SNF Online
Siti Khadijah Apparel Sdn Bhd
Tailored Jewel Sdn Bhd
PTT Outdoor (MY) Sdn Bhd
Best E-Commerce Startup Award
Hello1010 Sdn Bhd
Top E-Commerce Service Providers
Category: Financial Services
1. Affin Bank Group
2. Payments Network Malaysia Sdn Bhd
Category: E-Wallet
1. TNG Digital
2. Boost (Axiata Digtial Ecode Sdn Bhd)
3. WavPay Systems Sdn Bhd
Category: Payment Gateway
1. kiplePay Sdn Bhd
2. iPay88 (M) Sdn Bhd
3. Razer Merchant Services
Category: E-Commerce Marketplace
1. Shopee Malaysia
Category: Cloud Service
1. Exabytes Network Sdn Bhd
Category: Logistics
1. DHL eCommerce Solutions, Malaysia
Category: CRM Service
1. Second CRM
Category: Digital Marketing
1. Digital Optimist
Category: Artificial Intelligence
1. MYTHEO by GAX MD
