☕️ 71% of active EPF contributors below 55 do not have enough to retire above poverty line - PM Anwar
Giant operator Dairy Farm exits the Malaysian grocery business. Apple’s next frontier - diabetic health tech. K-pop agency corporate war, hostile takeover - Hybe vs SM.
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1. MARKET SUMMARY 📈
2. NUMBERS AT A GLANCE 🔢
The chaos in the world — geopolitical tensions, climate change, labour crunch — costs the Malaysian economy RM8.7 bil a year, according to business transformation consultancy TMX Global. The firm estimates that supply chain issues cost companies an average of 0.47% in lost revenue globally. Based on Malaysia’s GDP of RM1.85 tril, RM8.7 bil is lost due to supply chain woes.
Although the Japanese have the world’s most powerful passport (visa-free or visa-on-demand to 193 destinations), fewer than 20% of them actually have passports, according to Japan’s Ministry of Foreign Affairs. Japanese are not huge fans of travelling. According to a survey done last year by global intelligence company Morning Consult, 35% of Japanese respondents said they were unwilling to travel again, the highest number of any country.
USD200 mil — the most expensive house currently listed for sale in the Carribean. It is also one of the priciest homes for sale in the entire world. What’s so special about this property? Located on the small private island of Mustique, The Terraces, as the estate is called, spans 17 acres and nine structures. There is an 80-foot-long swimming pool (The Olympic pool’s 164 ft), and the house hosts panoramic views across the Caribbean and Atlantic Coasts.
3. IN MALAYSIA 🇲🇾
Almost two-thirds of EPF members need more savings to retire
PM Anwar Ibrahim told the Parliament that only 29% of the Employees Provident Fund (EPF) contributors had enough savings (RM240,000 by age 55) in 2022, down from 36% in 2020. This situation was the direct result of the massive RM145 bil voluntary withdrawals during the pandemic and PM Anwar said that any further withdrawal would hurt the EPF’s bottom line. An estimated 4 to 6 years is needed to rebuild the savings withdrawn during the pandemic.
It needs to be highlighted that the RM240,000 figure is the basic savings necessary to retire and live above the poverty line (the national poverty line is RM2,208 per month). However, according to the Department of Statistics Malaysia (DOSM), an individual needs at least RM600,000 to retire comfortably.
Court cases updates:
In Syed Saddiq’s trial of criminal breach of trust (CBT) of RM1.12mil Bersatu funds, Syed Saddiq told the court that he was being prosecuted just because he did not support his then party’s president Muhyiddin Yassin. On top of that, he said that this whole case started when he lodged a police report over the alleged missing funds from his home. At this rate, every politician with court cases dangling over their heads is crying foul that they are victims of political witch-hunts, either by the current or former governments. Now is the right time for Putrajaya to start separating the Public Prosecutor’s Office from the Attorney General’s Chambers so the government can be seen as impartial in the future.
In Siti Bainun’s children abuse case, Siti Bainun told the court that she never abused Bella on her own or instructed someone to do that. She denied all of the prosecution witness Yasmin Nahar’s testimony that she instructed Yasmin to tie Bella all the time and give Bella chilli and faeces to eat. To top things off, Siti Bainun even said to the court that Yasmin, a former resident of the welfare home, was the problematic one. Typical gas-lighting.
Three years required to create the country’s climate change Bill
Environment minister Nik Nazmi told the Parliament that his ministry needed at least two to three years to complete the development of the climate change Bill. At this moment, the Bill is still in its infancy and his ministry will nudge the development of the Bill to adopt the whole nation approach.
Hopefully, it is not too late for Malaysia to adopt a climate change bill in three years, as a study stated that parts of Malaysia will be underwater in 2050 if we do nothing. According to the study, in 2050, Melaka will be no more and a large part of Klang will be gone.
MACC is probing UiTM accounts
While still hot on the heels of Bersatu, the Malaysian Anti-Corruption Commission (MACC) has started investigating the accounts of Universiti Teknologi Mara (UiTM) Holdings. MACC is conducting a forensic investigation for any wrongdoings following a significant accumulated pre-tax loss of up to RM157.04mil for four consecutive years (2017, 2018, 2019 and 2021). MACC chief commissioner Azam Baki said the investigation started two years ago based on complaints received and the university had fully cooperated in the probe.
MITI to speed up EV production via talks with local automakers
International trade minister Tengku Zafrul Abdul Aziz said that his ministry has been discussing with local automakers, Proton and Perusahaan Otomobil Kedua Sdn Bhd (Perodua), on matters such as the introduction of affordable national electric vehicles (EV). With the increased obsession with EVs by the current government, I guess it is safe to say that the worsening traffic condition in the Klang Valley will not be improving anytime soon.
Bintang Capital Partners Bhd, the private equity arm of AHAM Asset Management Bhd, had led an investment round of USD10mil into Involve Asia Technologies Sdn Bhd, a Malaysian-based marketing technology company. Involve Asia will use the investment to expand across Southeast Asia and Australasia and for product development. The company currently operates in 6 countries, catering to over 500 brands and has driven over USD1.5 bil transactions since it was founded in 2014. If you are seeing Shopee links around social media promoted by your friends or influencers, it’s likely powered by Involve Asia. Learn more about the company here.
Hong Kong’s Dairy Farm International Ltd (DFI) has exited the Malaysian grocery industry after 24 years by selling its 70% stake in GCH Retail (Malaysia) Sdn Bhd to a group of Malaysians led by Datuk Andrew Lim Tatt Keong, the group deputy chairman of SOGO Department Store Sdn Bhd, in a rumoured multi-billion deal. GCH Retail operates a chain of hypermarkets and supermarkets under the Giant, Mercato and Giant Mini brands. The deal is expected to be completed in early March 2023.
Pharmaniaga Bhd, the pharmaceutical arm of Boustead Group, has appointed Izaddeen Daud as its new non-independent non-executive chairman. Izaddeen currently holds multiple high-ranking positions within the Boustead Group and sits on various boards of the Group’s subsidiaries.
The Ministry of Human Resources (MoHR) is pending a reply from Indonesia regarding the proposal to reduce the cost of hiring Indonesian domestic workers. The current ceiling cost per worker is RM15,000. The ministry is looking to reduce it to RM9,000.
4. AROUND THE WORLD 🌎
Apple’s next frontier - diabetic health tech
Bloomberg reported that Apple has made a big breakthrough in non-invasive blood glucose monitoring — good news for diabetic patients. The current method of monitoring requires patients to prick their skin. Apple’s approach relies on optical absorption spectroscopy, a measurement process that relies on light wavelengths to determine glucose levels.
Codenamed E5, the innovation, already more than 12 years in the making, is part of the company’s Exploratory Design Group (XDG), which is reportedly one of the most secretive initiatives at the company. The project is at a proof-of-concept stage, with its technology being viable but it needs to be shrunk down to a practical size. Adding the monitoring system to Apple Watch would be the ultimate goal, making it an essential item for millions of diabetic patients around the world. There’s an estimated 537 mil diabetics around the world in 2021, according to Statista.
The share prices of some diabetes technology companies took a hit upon this news. With billions of dollars up for grabs, the big healthcare boys are working hard as well to introduce similar, non-intrusive technology — an Abbott representative responded to this development that the company is continuously developing new glucose monitoring products.
K-pop agency corporate war, hostile takeover - Hybe vs SM
An internal feud in K-pop agency SM Entertainment has led to rival Hybe, the agency behind BTS, becoming the largest shareholder in the former. SM was founded by Lee Soo-man, who is affectionately referred to as “the godfather of K-pop” and credited for producing stars like BoA and Girls’ Generation. Lee turned to Hybe for its backing after an internal power struggle that saw him getting sidelined.
Hybe has acquired 14.8% of the 18.5% stake of SM’s founder Lee Sung-soo for 422.8 bil won (USD330 mil). Hybe also extended an offer to purchase 25% from other shareholders as it intends to acquire management rights over SM - a move criticised by SM’s co-CEOs as a “hostile takeover”. SM execs argued this move would monopolise the industry and put fans and SM’s artists at a disadvantage - SM and Hybe combined account for 70% of revenues from albums and digital music of the K-pop industry. SM roped in South Korea’s internet giant Kakao Corp to acquire a 9% stake in a defensive move against Hybe.
The LA Times summarised this corporate saga in a Q&A format, breaking down further the feud between Lee and SM’s management - it seems like Lee was up to funny business.
This whole episode is perfect for a K-drama series.
Ukraine’s 2023 economic support, India on the conflict’s semantics
The Group of Seven (G7) nations announced ahead of the meeting of finance chiefs from the G20 nations that it has increased its economic support to Ukraine to USD39 bil for 2023. The G7 has also urged the International Monetary Fund (IMF) to approve the USD15 bil loan programme for Ukraine by the end of March to cover immediate financial assistance for Ukraine. The G7 nations comprise Britain, Canada, France, Germany, Italy, Japan and the US.
Branding matters even during a war. India, the host of the G20 meeting, tried to convince G20 members to stop calling the Russia-Ukraine conflict as “war” and instead called it a “crisis” or a “challenge” but failed to achieve a consensus amongst delegates. Russia labels it a “special military operation” and China calls it a “crisis”. India has not explicitly sided with Russia but has economically supported it by refusing to impose sanctions and scooping up cheap Russian oil and gas.
Portugal announced the suspension of new licenses for Airbnb within its borders, forming just one part of its housing reforms designed to make buying and renting homes more affordable for locals over growing concerns locals have been priced out. Data shows rents in Lisbon have climbed more than 36% in the past year.
Bill Gates goes yam seng as he acquired a 3.76% stake in Heineken Holding NV worth USD902 mil through the Bill and Melinda Gates Foundation Trust. The Microsoft cofounder previously said he was not that into beer on Reddit’s “Ask Me Anything” thread in 2018.
A mysterious metal sphere washed up on the shore in Japan; police and even a bomb squad were sent to check on the object and X-ray exams confirmed the object was safe. It’s still unknown what the object is as authorities have not said anything leaving the internet to speculate that it was a “Godzilla egg”. To Dragon Ball fans, it could be Kakarot’s (aka Son Goku) capsule.
Weekend read: The new Gulf sovereign wealth fund boom
The oil and gas boom has showered the Middle East region with capital. It has also seen busts in the sector, teaching the Gulf nations to diversify its economy to reduce reliance on commodities. This has given rise to sovereign wealth funds from the regions entrusted to invest the Gulf nations’ oil wealth, with so much of it that they are making waves worldwide from buying football clubs to western banks and Japanese gaming companies.
5. FOR YOUR EYES 📺
An SJKC student’s happy birthday dance to a classmate. He’s got the moves. I want my friends to do this for my birthday.
How retractable seats work in auditoriums, halls, theatres etc.