☕️ Malaysia to jointly develop resource-rich, disputed Ambalat sea block with Indonesia

1. MARKET SUMMARY 📈

2. NUMBERS AT A GLANCE 🔢

Malaysians are in financial distress — but is it a chicken or an egg situation? Do we have bad spending habits, or is it because of easy access to “cheap” credit?

A rising number of Malaysian youths are facing severe financial distress, a trend that Youth and Sports Minister Hannah Yeoh calls for urgent action to address. In 2024, 877 bankruptcy cases were recorded involving individuals aged 18 to 40, marking an increase from 727 cases in 2023. Yeoh attributes this worrying rise to a combination of factors, including unchecked consumerism, prevalent digital spending habits, and the increasing popularity of "buy now, pay later" (BNPL) schemes. These modern financial tools appear to be outpacing the financial literacy levels among young people, leading them into debt and eventual bankruptcy.

Deputy Bank Negara Malaysia (BNM) governor Adnan Zaylani, who co-chairs the Financial Education Network (FEN), highlighted a persistent knowledge gap among young Malaysians. Survey data consistently shows that Malaysians aged 19 to 30 score below the national average in the Malaysia Financial Literacy and Capability Index. This index is a crucial metric used by BNM to assess financial knowledge, attitude, and behaviour. Adnan stressed that youth are particularly vulnerable to making poor financial decisions, especially with the surge in online spending. He noted that this demographic is more prone to relying on flexible, yet high-risk, payment options such as "buy now, pay later" (BNPL) schemes.

A recent survey by SPayLater, Shopee’s "buy now, pay later" (BNPL) arm, involving over 40,000 users, revealed that 81% of respondents utilise BNPL services to manage financial shocks rather than for discretionary spending. The survey further indicated that 57% use BNPL to manage monthly cash flow, while 46% leverage it to bridge finances until payday. Significantly, 32% reported turning to BNPL during emergencies, citing needs such as baby formula, medical bills, home repairs, and insurance. While these findings suggest a practical use of BNPL as a financial buffer, both Yeoh and Zaylani issued a warning — they cautioned that users, particularly younger individuals, risk falling into long-term financial hardship if they do not possess a clear understanding of compounding debt and their full repayment obligations.

3. IN MALAYSIA 🇲🇾

Sabah, apa khabar bah?
Malaysia, Indonesia mark Ambalat truce with joint development promises
Malaysia and Indonesia took the diplomatic path as both countries have agreed to jointly develop the resource-rich Ambalat sea block, an area that has been contested by both countries for decades. The agreement was announced during PM Anwar Ibrahim’s short visit to Indonesia last week. According to Aristyo Darmawan, an expert on international law at the University of Indonesia, the joint development plan over Ambalat abides by Article 83 of the United Nations Convention on the Law of the Sea (Unclos), which says ‘states may enter into provisional arrangements to manage the area’ while they seek final delimitation in the disputed area. The Ambalat sea block, spanning 15,000 sq km off the coast of Sabah, is believed to have a production potential of between 30,000 - 40,000 barrels per day and to have oil reserves of between 100 mil and 1 bil barrels of oil with the potential to be exploited for 30 years. Even Madani Government critic, former Economy Minister Rafizi Ramli, supports the joint development proposal, saying that this is great news for Petronas. Especially after the whole Petros fiasco. However, former PM Muhyiddin Yassin opposed the agreement, arguing that the joint development plan would negatively affect the country’s sovereignty claim over Ambalat.

STAR to quit GRS?
According to a viral video clip, Sabah Deputy Chief Minister I and STAR President, Jeffrey Kitingan, was allegedly threatening to exclude his party from the ruling coalition in Sabah, the Gabungan Rakyat Sabah (GRS). Kitingan is also the latest figure to be implicated in the Sabah mining license scandal. However, Sabah STAR communications director Jalumin Bayogoh clarified that the video clip was selectively edited and misrepresented Kitingan’s actual stance.

Airbus bonanza
In conjunction with PM Anwar Ibrahim's official visit to France, AirAsia is expected to announce the purchase of dozens more of French-based Airbus SE’s single-aisle aircraft. The Southeast Asian low-cost carrier is working on an expanded aircraft purchase with the European planemaker, which supplies all of its aircraft. AirAsia has 240 mostly single-aisle aircraft in its fleet, and a backlog of more than 350 orders for the top-selling A320 family of jets. At the end of May, AirAsia reported a net profit of RM50.2 mil for its 1Q2025, on revenue of RM940.1 mil.

National carrier Malaysia Airlines is also set to ink a deal to acquire more Airbus A330neo long-haul jets. In 2022, Malaysia Airlines placed an order for 20 A330neos and secured options for another 20. The airline is considering exercising options for the 20 additional A330neos, as announced last month. The airline reported a net profit after interest and tax of RM54 mil for FY2024 in April, marking a third consecutive year of operating profit.

In related news, it’s not only France that has been getting Malaysia’s attention. Malaysia has agreed to finalise a government-to-government (G2G) defence procurement agreement with Italy, in addition to exploring a new agreement for joint logistics services, which will pave the way for knowledge-sharing in several critical areas. Recently, Malaysia acquired two ATR-72 maritime patrol aircraft, built by Italian defence firm Leonardo, for the use of the Royal Malaysian Air Force.

Shorts

1. MACC probe into MyKiosk project
   The Malaysian Anti-Corruption Commission (MACC) has launched a probe into allegations of corruption and misconduct in the award of tenders for the MyKiosk project. The complaint came from Selangor MCA Youth in May, with a claim that, despite RM250 mil being allocated for the MyKiosk project, only slightly more than half of the kiosks were occupied. Pahang MCA Youth claimed that the Government paid between RM25,000 to RM34,000 per kiosk, when each unit at market price only cost RM12,800. The MyKiosk initiative aims to provide the B40 group and micro, small, and medium-sized enterprises with standardised, safe, and affordable trading spaces for rent. As of December 2024, a total of 7,243 MyKiosk units had been approved.

2. Hasnah to be interim CJ
   When former Chief Justice (CJ) Tengku Maimun Tuan Mat retired earlier this month, the Chief Judge of Malaya (CJM), Hasnah Mohammed Hashim, has taken up performing the Chief Justice’s duties temporarily until a new one is appointed. However, Hasnah herself will retire soon in November, ceteris paribus, potentially leaving three out of the top four justice positions in the country vacant. Under the Federal Constitution’s Article 125, Federal Court judges’ tenures shall be until 66 years old, but their tenures can be extended by six months if the King approves it. “Ceteris paribus” means “all things being equal” or “if everything else remains the same”.

4. AROUND THE WORLD 🌎

Tariff headache: Vietnam, China and Indonesia
Lopsided-sounding deal between US and Vietnam
Ahead of the July 9 deadline for tariff negotiations, Trump on Wednesday announced that a “deal” has been reached between the US and Vietnam, in which the US will charge a 20% tariff on Vietnamese exports, and a 40% tariff on transshipments from third countries passing through Vietnam. He also added that Vietnam would accept US products with a 0% tariff. However, Vietnam did not confirm the specific tariff levels mentioned by Trump, though a state-run news outlet reported that Trump did speak to General Secretary Tô Lâm to “patch up” the terms of the deal, which they refer to as a “trade framework”. Note that Hanoi has long sought for the US to recognise it as a market economy and remove restrictions on the exports of high-tech products to the country, but has seen these requests dismissed by Washington.

Vietnam was the sixth-largest source of goods the US imported last year, shipping USD137 bil worth of goods. The two countries’ growing economic, diplomatic and military ties are seen as a hedge by Washington against China, though Vietnam has worked to retain close relations with both superpowers. Meanwhile, China said it is examining the US-Vietnam deal and would retaliate if its interests were hurt. Washington has previously complained that Chinese goods have been dodging higher US tariffs by transshipping through Vietnam — so the 40% transhipment tariff is out to get China? 

US said China can now buy their chip design software and ethane again
On the China front, the US has apparently lifted restrictions on exports to China for chip design software developers and ethane producers. Software firms like Synopsys, Cadence, and Siemens said they will now sell their chip design tools to Chinese customers again. The US also removed limits on ethane exports to China that it had set just weeks ago. Last week, China's commerce ministry said that the talks with the US have them confirming a framework under which China will review export applications for controlled items while the U.S. will cancel corresponding restrictive measures.

Indonesia scrambles as deadline looms
Indonesia, which faces a 32% tariff by the US, has agreed to sign a pact worth USD34 bil with business partners next week to boost purchases from the US in an effort to have a trade deal signed before the tariff deadline. It is also believed that flag carrier Garuda Indonesia is in talks to buy up to 75 jets from Boeing, although it is unclear if this is part of the tariff negotiations. Indonesia agreed under the pact to increase imports of fuels and investment by Indonesian companies in the energy and agriculture sectors in the US. Minister Airlangga Hartarto said the memorandum of understanding, due to be signed on July 7, will deploy the USD34 bil for new Indonesian investments and purchases in the US. Indonesia “enjoyed” a goods trade surplus of USD17.9 bil with the US in 2024.

The US is always “sus” of China
Two Chinese nationals identified as Yuance Chen, 38, and Liren “Ryan” Lai, 39, were arrested on Friday in the US and are now charged with acting as illegal agents of the Chinese government. Prosecutors accuse the duo of attempting to obtain classified US military information, gather US Navy intelligence, and recruit active-duty military personnel to assist Chinese intelligence efforts on behalf of China’s Ministry of State Security (MSS), the country's primary civilian intelligence agency. The Attorney General described the case as part of a broader strategy by Beijing to compromise American defence from within, while the FBI Director emphasised their department’s commitment in ongoing efforts to disrupt foreign intelligence threats targeting the US. Nothing but cricket noises from the Chinese Embassy in Washington so far regarding the issue.

Shorts:

1. Another ferry disaster in Indonesia
   A ferry carrying 65 passengers sank on its way from Java to the holiday island of Bali, leaving at least 4 people dead, with dozens still unaccounted for at the time of writing. The ferry sank before midnight on Wednesday, and was said to be carrying 22 vehicles on board in addition to the 65 passengers. However, it is common in Indonesia for the actual number of passengers on a boat to differ from the manifest, leaving questions about the real number of victims. Marine accidents are a regular occurrence in Indonesia, an archipelago of around 17,000 islands, in part due to lax safety standards and sometimes due to bad weather.

2. Farewell, Diogo Jota
   The Portuguese football community and Liverpool FC lost gifted winger Diogo José Teixeira da Silva, alias Diogo Jota, 28, when he died yesterday in a road accident after his Lamborghini veered off the road and caught on fire. In the car was his brother, footballer André Silva, who also lost his life in the crash. Jota is known for his lightning-fast pace and clinical finishing on the field. He arrived at Liverpool FC in 2020 after a stint at Wolverhampton Wanderers, whom he helped gain promotion to the Premier League in 2017-18. He registered six goals and three assists in 26 appearances in the Premier League in 2024-25 with Liverpool, celebrating the club's 20th league title in May.

3. Your hair can actually help plants grow
   Chile found an ingenious way to tackle soil hydration in crops — using mats of human hair on the base of plants to help lock in moisture. The hair, sourced from 350 salons and 10 pet groomers around Chile, is turned into sheets and discs of compostable mulch through mechanical weaving. It is said to reduce direct evaporation by 71% and save up to 48% of irrigation water. Hair contains nutrients, nitrogen, calcium, sulfur, and organic matter that is added to the soil, improving it and enhancing plant growth and agricultural production by at least 30%. Pretty smart way to handle pesky hair waste.

5. FOR YOUR EYES 📺

Beautiful Malaysia

1. The Pinnacles of Kampar, Perak- opening soon.

2. Air Terjun Padang Batu, Pahang.

thegreatoutdoorsmalaysia

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4. When sunrise meets Penang bridge.

zairulpuad

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