Discover more from The Coffee Break
☕️ MACC to summon 4 Bersatu MPs who pledged support for PMX
MY ranks #1 in SEA for highest rate of diabetic cases. Salutica Bhd vs Apple in patent infringement lawsuit. Saudi Arabia vs UAE - the battle to become the Middle East superpower.
1. MARKET SUMMARY 📈
2. NUMBERS AT A GLANCE 🔢
RM350 mil — the amount allocated by the Social Security Organisation (Perkeso) annually to cover the treatment costs of contributors with kidney disease. Human Resources Minister V. Sivakumar mentioned that this is a substantial amount, and in an effort to reduce costs, Perkeso is working towards establishing more dialysis centres across the country.
16th — Malaysia’s ranking among 226 countries and territories in the world for the prevalence of diabetes among its people. The country has the highest rate of cases in Southeast Asia. In 2021, approximately 19% of the population was diabetic, reflecting an increase from 12.1% in 2011. This means that one in five individuals in the population has diabetes. This is despite the tax on sugary drinks imposed by the government since July 2019. Not all hope is lost.
According to the Ministry of Health, the tax on sugary drinks is helping Malaysians make healthier choices. It has been estimated there has been a 9.25% reduction in consumption of sugary drinks after the imposition of the excise duty of 40 sen per litre, which is 8.33% of the retail price of such beverages. Under Budget 2024, the tax will be increased by 25% to 50 sen per litre.
How to reduce your sweet tooth? Just cut back on sugar, and your body will adjust, palate changes and sweet things won’t taste as good by then. Check out the video below. #notmedicaladvice
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3. IN MALAYSIA 🇲🇾
Punctuality takes flight: MAVCOM introduces KPIs amid fixed fares assurance
Transport Minister Anthony Loke announced that the Malaysian Aviation Commission (MAVCOM) is developing key performance indicators (KPIs) to monitor airline punctuality, which are expected to be finalised by Q1 2024. The KPIs will assess criteria such as flight cancellations, with Q3 2023 data revealing a 79% on-time performance for domestic airlines. Malaysia Airlines and AirAsia reported the lowest punctuality at 74%, while SKS Airways recorded the highest at 95%.
Mavcom plans to take action against operators failing to meet service standards outlined in the Malaysian Aviation Consumer Protection Code 2016. Loke also assures the continuation of fixed fares for festive seasons, encouraging airlines to increase flight frequency to meet travel demand. The journey from intent to policy implementation poses challenges. Will the path to seamless air travel be smooth, or are unexpected hurdles on the horizon? 🛫🤨
MACC to Summon MPs over alleged corruption in support switch
The Malaysian Anti-Corruption Commission (MACC) is set to summon the 4 Perikatan Nasional (PN) Members of Parliament (MPs) who pledged support for Prime Minister Anwar Ibrahim. MACC Chief Commissioner Azam Baki revealed that an open investigation will be conducted soon following a police report lodged against the MPs, indicating elements of corruption in their support switch. The investigation aims to probe allegations of enticement, bribes, and threats related to the MPs' backing of Anwar. Meanwhile, MACC will release an interim report on the investigation into alleged irregularities in Aman Palestin Bhd's fundraising activities for the Palestinian people next week.
Constitutional Clash: Hannah Yeoh challenges GEG as unconstitutional
Malaysia's Youth and Sports Minister, Hannah Yeoh, openly declares the proposed tobacco and vape generational end game (GEG) as unconstitutional, sparking a clash with former Health Minister Khairy Jamaluddin. The dispute intensified as Federal Tourism Minister Tiong King Sing challenges Khairy's accusations, highlighting concerns about the GEG's readiness and enforceability. The controversy raises questions about the government's unified stance on smoking regulations, signalling a constitutional debate with implications for public health policies.🚭
Tiong said Khairy should prove that cancer cases in Malaysia are a direct consequence of smoking. The “Lung Cancer in Malaysia” paper, published in the Journal of Thoracic Oncology in 2020, revealed that more than 90% of male lung cancer patients had a significant smoking history. While correlation is not equivalent to causation, in this case — it’s pretty telling. If only the minister would read our newsletter.
Salutica broadens legal battle with Apple, files patent infringement suit in Singapore
Salutica Bhd, currently engaged in a patent infringement lawsuit against Apple's Malaysian unit, has extended its legal action to Apple South Asia Pte Ltd, filing a suit in Singapore's High Court. The subsidiary, Salutica Allied Solutions Sdn Bhd, seeks a declaration of patent validity and infringement, along with an injunction against Apple South Asia. The dispute involves Bluetooth technologies used in SAS's FOBO Tag and FOBO Tire products. While the legal action is unlikely to impact Salutica's business significantly, the company pursues claims for damages or an account of profits arising from the alleged infringement.
Enovix Corp, an advanced silicon battery company listed on Nasdaq, plans to invest RM5.8 bil in Malaysia over 15 years, including a previously announced RM315 mil manufacturing line in Penang. Enovix's decision to establish its first high-volume manufacturing facility in Malaysia reflects the country's appeal as a preferred investment destination in Southeast Asia for advanced technology companies.
TikTok outlined plans to invest an additional USD2.8 bil in data centre facilities in Malaysia, intending to establish the country as its Asian hub.
Google announced a strategic collaboration with Malaysia to enhance digital competitiveness through skilling programs, infrastructure investment, responsible AI innovation, and cloud-first policies.
Microsoft shared its intentions to expand its data centre region in Malaysia, making the country a focal point for cloud computing and frontier technologies in the region.
Carsome group slashes hundreds of jobs across Southeast Asia amidst profitability drive
Carsome Group, the Southeast Asian used-car online marketplace, is reportedly cutting hundreds of jobs across the region, particularly in Indonesia and Thailand, as part of a cost-cutting measure to achieve profitability. The unicorn company, valued at USD1.7 bil, is working towards breaking even this year and aims for its first full year of profitability in 2024. The job cuts come as Carsome adjusts its operations in certain markets, preparing for a potential stock-market listing when market conditions are favourable.
The Majlis Ulama Ikatan Muslimin (Isma) and PAS Dewan Pemuda vice-chairman Muhammad Hanif Jamaluddin urge the cancellation of the Coldplay concert in Kuala Lumpur, citing insensitivity during the ongoing humanitarian crisis in Gaza, Palestine. Both religious groups express concern about the timing of the concert, emphasising the need for solidarity with Palestinians facing attacks.
We sympathise with the struggles of Palestinians in Gaza, but life has to move on. This is an economic activity that had been planned even before this latest conflict erupted and sudden cancellation will have a significant economic impact, not just to Coldplay but across the value chain — before we care for others, we have to care for ourselves first. Besides, has PAS forgotten about the humanitarian crisis faced by Rohingyas and elsewhere? No show of solidarity for them? Consistency lacking.
Teresa Kok of PH-Seputeh sent a letter of demand on November 10 to Kepala Batas MP Siti Mastura Muhammad seeking an apology and retraction for defamatory statements, as the latter allegedly made defamatory remarks during an election campaign. As no responses have been received, Teresa initiated legal action.
4. AROUND THE WORLD 🌎
Xi-Biden meeting key takeaways
US President Joe Biden met Chinese President Xi Jinping at the sidelines of the Asia-Pacific Economic Conference (APEC) Summit in San Francisco for a four-hour meeting. Here are some highlights of their discussion:
High-level, direct military-to-military communications have been restored, which would allow both presidents to be in contact directly via call and prevent miscalculations between both countries. China severed military communications last year with the US following the then-US House Speak Nancy Pelosi’s visit to Taiwan.
The topic of Taiwan can never be avoided - President XI said Taiwan is the most dangerous issue in US-China ties. According to US officials, Xi indicated that China is not preparing for a massive invasion of Taiwan. China’s preference would be through “peaceful unification”, but Xi then laid out conditions for the potential use of force. Biden reiterated that the US’ One China policy will remain.
Read: What is the US “One China” policy, and why does it matter?
China pledged to tackle the flow of fentanyl into the US, causing one of the worst drug problems the US had faced and contributing to the rise in overdose deaths in the country. Chinese manufacturing companies are a source of not only synthetic opioids but also precursor chemicals which can be combined to make them. Senior US officials described this as the most important agreement of the summit.
On the Israel-Palestine front, the US pressed China to discuss the conflict with Iran, which financially supports Hamas, a group categorised as a terrorist organisation by the US and the EU. Not much discussion on this as far as we have read.
Biden had a solo press conference after the talks with Xi. He called Xi a “dictator” when asked whether he still held the view that Xi is a dictator (watch it here). Fortunately, it did not reverse the slight progress in reconciliation between both countries.
Exxon Mobil eyes USD15 bil investment in Indonesia
The US oil and gas giant plans to invest USD15 bil in a petrochemical project and carbon capture and storage (CCS) facilities in Indonesia, President Joko Widodo announced. The planned CCS facilities will be the biggest in Southeast Asia. Exxon has agreed to evaluate CCS projects worth USD2 bil with state energy company Pertamina, which could potentially store three gigatons of CO2 emitted by industries in Indonesia and the rest of the region in depleted oil and gas reservoirs.
Toyota Prius finds new purpose as it comes to the end of its useful life
About 20 years ago, when Toyota’s hybrid car Prius came to market, it took the automotive world by storm. Most of these cars are reaching the end of their useful lives soon. Instead of going to waste, Redwood Materials unveiled a partnership with Toyota to recycle batteries from these old Priuses and salvage EV components for Toyota’s new batteries that will go into its future EVs. Redwood is a battery recycling startup founded by Tesla’s cofounder — no, it isn’t Elon Musk — but JB Straubel. In total, Toyota expects to recycle, remanufacture and repurpose almost 5 mil units of Priuses. Redwood did not disclose the value of the deal, though a similar deal with Panasonic in late 2022 was worth billions of dollars.
FMCG in the news
Giant FMCG manufacturer Mars is acquiring 30-year-old luxury British chocolate maker Hotel Chocolat for USD673 mil. Hotel Chocolat has been listed on the London Stock Exchange since 2016 and Mar’s offer of GBP3.75 (USD4.66) is a huge 170% premium to its Wednesday closing price. Hotel Chocolat has 131 stores and a further 21 in Japan. The company generated GBP201.8 mil in revenue and GBP0.3 mil in profit before tax for the 2023 financial year.
PepsiCo is getting sued by the New York state for plastic pollution along the Buffalo River, allegedly contaminating the water and harming wildlife. PepsiCo is the single largest identifiable contributor to the problem — of the 1,916 pieces of plastic trash collected with identifiable brands, over 17% were produced by PepsiCo.
Alibaba’s major group restructuring hits a wall. The Chinese e-commerce giant earlier unveiled a radical corporate overhaul in its history to spin off and list 6 main business units. Alibaba has called off the spinoff of its giant cloud business, blaming US restrictions on the sale of advanced chips to China. It also announced that it will suspend the IPO of its grocery arm business, Freshippo. These news sent its stock diving 8%.
Thailand’s crypto market is booming. The world’s largest crypto exchange Binance is partnering with one of Thailand’s largest businesses, Gulf Energy, to form a 49:51 joint venture to roll out a crypto exchange. Gulf Energy is controlled by Thailand’s second-richest person, Sarath Ratanavadi, with a net worth of about USD10.6 bil. Couple of weeks back, Thai bank Kasikorn Bank announced its acquisition of a majority stake in crypto exchange Satang in a deal worth USD102.8 mil.
Weekend read: Saudi Arabia and the UAE are battling to become the Middle East's economic superpower
The battle for Gulf supremacy is heating up, with both nations experiencing growing economic might thanks to the abundance of black gold and their attempts to diversify away from a post-fossil fuel future.
5. FOR YOUR EYES 📺
One simple hormone — dopamine — can control your day. Don’t let it control you, take control. Listen to what Andrew Huberman has to advise.
KL is 0.66x the size of the world’s largest open-air prison, Gaza Strip. Check out here for more comparisons with other cities.
Love advice for the brokenhearted. Set them free (again and again).