☕️ MACC confirms it is investigating Daim Zainuddin for alleged corruption, money laundering

We kickstart the last week of the year with the remarkable achievement of comic artist Datuk Lat (Mohd Nor Khalid). The Royal Artist was the proud recipient of the Cai Zhizhong Comic Prize at the 3rd Cai Zhizhong Comic Prize award ceremony in Guangzhou, China, last Friday. Lat was chosen by an awards committee comprising renowned artists from numerous branches of art in China. He is the only sole foreign participant at the award ceremony and was also invited to be on the next selection committee. Cai Zhizhong is an internationally renowned cartoonist known for his graphical works on Chinese philosophy and history — view his auctioned artworks here.

1. MARKET SUMMARY 📈

2. NUMBERS AT A GLANCE 🔢

Penang’s next greatest export — medical tourism. 287,379 foreign tourists travelled to Penang in the first 9 months of 2023, compared to 127,920 in the same period last year (borders reopened on 1 Apr 2022), generating about RM356 mil in medical revenue (an average spending of RM1.24k per tourist). Penang alone accounted for 33.8% of 850,000 foreign tourists to Malaysia and 27.4% of the total RM1.3 bil of medical revenue brought in by foreign tourists recorded in 2022. Penang can thank Indonesians for its primary source of inbound medical tourists, which contributed 54% of international medical arrivals in Penang. The arrival of Indonesians for medical tourism in Penang is partly due to the partnership struck in January between the state and Indonesian low-cost airline Citilink on a medical tourism collaboration.

8.49 mi akiya or unoccupied homes were recorded in Japan in 2018, according to the government’s Housing and Land survey in 2018, which is conducted every five years. Many of these houses become abandoned as Japan’s population shrinks and ages and are typically located in rural areas. It’s estimated at least 30% of homes in Japan will be abandoned by 2023. Airbnb is eyeing this as an opportunity, hoping to convince owners to remodel their vacant homes into tourist attractions and is looking to partner with local businesses and governments. One particular attraction is kominka, or traditional wooden houses, which Airbnb thinks will attract foreign tourists interested in Japan’s rich history and culture.

533 underage married couples were recorded in the past four years in Kelantan. The state government retained the age of marriage without amendment at 18 for boys, and 16 for girls. 13 applications for underage marriage were earlier rejected — underage marriage application approvals require the consent of the Syariah Court.

3. IN MALAYSIA 🇲🇾

Amanah elects leadership for 2024-2026 term, Mat Sabu retains the presidencyParti Amanah Negara concluded its National Convention 2023, electing leaders for the 2024-2026 term. Mohamad Sabu (aka Mat Sabu) retains the presidency, while Mujahid Yusof Rawa becomes the deputy president, succeeding the late Salahuddin Ayub. Health Minister Dr Dzulkefly Ahmad secured the highest vote among the 27-member committee, followed closely by Khalid Samad. The election, conducted by 1,003 delegates, saw 97 candidates vying for committee positions. The new top office bearers will be announced after a special meeting among the elected committee members.

Electricity tariff hike to affect mid-range consumers starting JanuaryThe Energy Commission announced increased electricity tariffs from Jan 1 to June 30, 2024, impacting consumers paying bills between RM230 and RM738 per month. Approximately 15% or 1.2 mil users of Peninsular Malaysia's domestic consumers will face higher charges, with bills expected to rise by RM12 to RM32 per month, with the remaining 7 mil domestic users unaffected.

The affected users consuming between 601kWh and 1,500kWh will lose the rebate, leading to the increase. However, those using less than 600kWh and over 1,501kWh won't see changes, maintaining a rebate or surcharge respectively. National Resources Minister Nik Nazmi Nik Ahmad previously mentioned a RM5.2 bil allocation for electricity subsidies, in line with the tariff adjustment.

MyCC imposes RM415.5 mil in fines on feed millers for 'chicken feed cartel'The Malaysia Competition Commission (MyCC) has fined five feedmillers, including Bursa Malaysia-listed companies Leong Hup International Bhd’s wholly-owned subsidiary Leong Hup Feedmill Malaysia Sdn Bhd, Malayan Flour Mills Bhd's partially-owned Dindings Poultry Development Centre Sdn Bhd and PPB Group Bhd's 80%-owned FFM Bhd, a record total of RM415.5 mil for colluding in a "chicken feed cartel." This marks the largest fine in MyCC's history.

The penalty stems from anti-competitive agreements among these entities, causing price increases in poultry feed. The investigation revealed simultaneous price hikes despite raw material cost decreases, indicating collusive behaviour. The companies have 30 days to appeal the decision to an independent tribunal. The others involved are Gold Coin Feedmills (M) Sdn Bhd under Gold Coin Group and PK Agro-Industrial Products (M) Sdn Bhd under Charoen Pokphand Holdings (M) Sdn Bhd, which in turn is a subsidiary of Thai conglomerate Charoen Pokphand Group Co Ltd.

MACC investigates Daim Zainuddin for alleged corruption and money launderingMalaysian Anti-Corruption Commission (MACC) Chief Azam Baki confirmed the investigation of former Finance Minister Daim Zainuddin for alleged corruption and money laundering. The probe follows the recent seizure of Ilham Tower, a 60-storey skyscraper reportedly linked to Daim and his family. Azam stated that the seizure aimed to prevent asset sales during the ongoing investigation and assured that it wouldn't disrupt the tower's operations. Additionally, reports suggest more assets tied to Daim may face confiscation due to a failure to clarify the funding sources for their acquisition. Prime Minister Anwar Ibrahim emphasised that the agency's actions demonstrate impartial investigations, dismissing any hidden agendas behind the building's seizure.

Government considers 'Anti-Ali Baba' lawEconomy Minister Rafizi Ramli revealed plans for an "Anti-Ali Baba" law aimed at addressing the unlawful renting of licenses to foreign workers by Malaysians without meeting specified conditions. He highlighted the role of illegal licensing by locals for foreign workers as a contributing factor to this problem. Rafizi mentioned ongoing labour market reforms focusing on progressive wages and initiatives like the Academy in Industry programs. These reforms are aimed at phasing down foreign workers through multi-tiered levies by 2030, as outlined in the upcoming Malaysia Plan.

Business

1. BR Capital launches innovative debt fundraising platform for small-mid companies in MalaysiaBursa Malaysia Bhd and RAM Holdings Bhd have unveiled their joint venture, BR Capital (formerly BM RAM Capital Sdn Bhd), introducing an avant-garde debt fundraising platform. This initiative, endorsed by the Securities Commission, aims to cater to both listed and unlisted small to mid-sized companies with fundraising needs of at least RM5 mil and a minimum tenure of one year. The platform enables these enterprises to issue credit-rated investment notes, diversifying their funding sources beyond conventional markets.

2. Fusionex Group ceases operations after court order; impact on over 500 employeesFusionex Group, a prominent Malaysian data technology company that was acquired by Hitachi Ltd. in 2020, is winding up operations following a court order, a development anticipated to affect more than 500 employees. CEO Hiroyuki Kumazaki cited the inadequate handover of records and information by the previous management as the primary reason for the closure of Fusiotech Holdings Sdn Bhd and its 12 wholly-owned subsidiaries.  The decision to liquidate the organisation follows an investigation initiated by Hitachi, the details of which remain undisclosed pending a court hearing. This move comes after Fusionex withdrew its shares from the London Stock Exchange AIM in 2017, transitioning to a private company within five years of its IPO. Fusionex specialises in data analytics, big data, machine learning, and artificial intelligence.View: Fusiotech Holdings financials and the chronology of its rise and fall

4. AROUND THE WORLD 🌎

Israel-Hamas - ambitious ceasefire plan proposed by EgyptEgypt, together with Qatar, has presented an ambitious plan for a complete ceasefire in Gaza to Israel, Hamas, the US and European governments that would see Israel fully withdraw from the Gaza Strip, all captives held by Hamas, and Palestinian prisoners freed and a united technocratic Palestinian government installed in the enclave. Egypt would lead talks to reunite Palestinian factions Hamas and the Palestinian Authority, who would then jointly appoint a government of experts to run the West Bank and Gaza ahead of future elections.

The plan appears to be preliminary and is already seen to be struggling to gain traction on both sides. On Israel’s side, they are seeking a truce, a pause instead of a ceasefire and the Israeli Prime Minister is hellbent on eradicating Hamas. The Israeli government, however, is facing increasing pressure to bring home the remaining captives. Hamas meanwhile rejected the proposal to relinquish power in the Gaza Strip. Everyone wants to have their cake and eat it too. 

The future of planes

• A plane without pilot onboardReliable Robotics, an automation systems company based in California successfully flew a cargo plane, a Cessna 208B, 50 miles (80.5 km) with no pilot on board for 12 minutes and was remote control operated by a pilot from the ground. Instead of piloting the plane, instructions were sent to the plane to manoeuvre in a pre-determined set of ways, marking a major milestone in automated aviation. The system, developed since 2019, will not entirely replace pilots but address the shortage of qualified pilots as it still requires real-life pilots to operate. Watch the pilotless flight here.

• Planes flying without fossil fuelJapan Airlines, one of Asia’s largest airlines, announced a series of deals with global manufacturers of hydrogen-electric aircraft and engines to explore the feasibility of flying emission-free passenger planes, namely Germany’s H2Fly, California’s Universal Hydrogen and British-American ZeroAvia (backed by Bill Gates, Amazon and Shell). All three companies have successfully flown hydrogen-powered planes this year.

Deals

• In one the region’s largest insurance deals, Japanese insurer Sumitomo Life Insurance is offering to fully acquire local insurer Singapore Life Holdings (SingLife), which it already partly owned, valuing it at SGD4.6 bil. Sumitomo will acquire private equity giant TPG’s 35% stake for SGD1.6 bil and other minority investors as well. SingLife, founded in 2014, is one of the top 6 insurers in Singapore based on total assets of SGD14.4 bil as at end-2022. 

• The drawn-out sale process of Manchester United has now come to an end as British billionaire Jim Ratcliffe will acquire a 25% stake from the Glazer family, valuing the club at around USD5.4 bil, falling below the initial asking price of USD6 bil. Ratcliffe will also invest USD300 mil into the club. A member of the Qatari royal family was also in the run in this deal. United is off to its worst start of the season not seen since 1930 - some interesting (disappointing) stats here. 

• ChatGPT creator OpenAi is back in the market to raise a new round of funding at or above a valuation of USD100 bil, potentially making it the second-most valuable startup behind Elon Musk’s SpaceX. The company is also in discussion to raise funding of between USD8-10 bil for a new chip venture with Abu Dhabi-based G42 to produce semiconductors that compete with those from Nvidia. It’s unclear if the chip funding and wider company funding efforts are related. 

Daihatsu scandal updates

• Toyota Motor Co, the owner of Daihatsu, halted shipments of six car models including Veloz and Avanza,  in some Southeast Asian countries as Daihatsu faces a widening safety scandal involving 64 models, including almost 2 dozen sold under Toyota’s brand. The affected shipments make up about 5% of Toyota’s production in Asia and are not expected to have a material impact. 

• Daihatsu will compensate 423  domestic suppliers with which it has direct business relations as its plants in Japan will remain shut until the end of next month. The company’s spokesperson also said that it has resumed production of Perodua brand cars in Malaysia after obtaining regulatory clearance. 

South Korea’s new generation of organised crimeSouth Korean police have been cracking down on organised crime and found that the majority of those who have been arrested are Gen Z or millennials. Of the 1,183 members of organised crime rings arrested recently, 888 or 75.1% of them were “MZ gangsters” younger than 30. The crimes committed by this younger gen have also kept up with the times, involving online gambling, scams and frauds as compared to older generations. It’s also found that MZ gangsters were more aligned economically and profit-driven rather than based on factions like before — it seems like the younger gen is more practical in their thinking than ideological.

5. FOR YOUR EYES 📺

1. Ex-PNB CEO shares his investment tips on The FAQ Show.

2. TIME’s 2023 in review.