☕️ EPF's highest payout in 7 years, but don't get carried away, EPF chief warns

1. MARKET SUMMARY 📈

2. NUMBERS AT A GLANCE 🔢

The FY2024 dividends declared by the Employees Provident Fund (EPF) beat market forecasts for the rates to come in at 5.8% to 6.2% for conventional savings, and between 5.4% and 5.6% for shariah savings, on strong investment performance. Last year dividends were the highest since 2017, when the fund declared a 6.9% dividend, and also 6.3% for shariah savings. Comically, EPF used graphics of two humans in the press release photo, instead of actual humans. Jokes aside, EPF is actually the 13th largest pension fund in the world and 5th largest in Asia, with total assets of RM1.25 tril as of Dec 31, 2024.
View table: EPF dividend rate 2010 - 2024

Here’s a breakdown of the fund’s assets performance:

3. IN MALAYSIA 🇲🇾

More on EPF: Don’t get carried away 
The Employee Provident Fund (EPF) CEO Ahmad Zulqarnain Onn told the public that although the pension fund announced the 6.3% dividend payout for both its conventional and shariah accounts, the highest since 2017, however, he stated that we should not rest on our laurels. Zulqarnain added that it was easy to leverage strong market growth, as what happened last year. But, the public needs to acknowledge that markets have their ups and downs. That is why EPF is focusing on long-term investment strategies such as the diversification of portfolios to handle fluctuations in the market.

While we are on the topic of EPF, Zulqarnain also revealed that the amendments to the Employees Provident Fund (EPF) Act 1991 to make foreign worker contributions compulsory are expected to be tabled in Parliament before the current Dewan Rakyat sitting ends on Thursday. Based on EPF estimates, there will be up to 2.5 mil foreign workers that will benefit from this new policy.

P.S.A. - Recently, there has been a rumour that EPF announced a withdrawal of up to RM10,000, in conjunction with the month of Ramadhan. However, after checking with EPF itself, the so-called withdrawal bonanza is fake.

Please, no more EPF withdrawals.

Move away black gold, now silicon wants to take centre stage
PM Anwar Ibrahim announced that a leading upstream semiconductor player, UK-based ARM Holdings PLC (majority owned by SoftBank) is expected to sign an agreement anytime this week to set up shop in Malaysia. Malaysia has been a well-known player in the downstream semiconductor space and is itching to enter the chip design space. ARM Holdings' imminent entry is a major boost to prop up Malaysia as a major name in the global semiconductor race. FYI, ARM offers the most popular CPU architecture in the world with 250 bil chips shipped since inception. It is most dominant in mobile CPUs with 99% market share and 40.8% in automotive. This dominant market share is achieved through its developer ecosystem.

Malaysia is the leading investment destination for any semiconductor play in the market. But, how do we ensure the flow of investments is sustainable and consistent in the long run? The answer is to ensure the resources are available. Rare earth elements (REEs) are used in chips because of their unique properties that improve the performance of semiconductors and Malaysia has an abundance of REEs. According to Putrajaya’s estimates, we have a REE reserve worth RM747 bil but unfortunately, there are still gaps in the regulatory aspects on how to unlock our REE potential from beneath the surface - without destroying the environment. 

Another way to ensure the sustainability of the semiconductor industry is to boost the domestic direct investment (DDI) towards our semiconductor industry, which is still heavily reliant on foreign investments (FDI). Recently, US-based Intel announced an indefinite hold on the USD9 bil project to build a new chip packaging and testing facility in Penang due to the USD18.8 bil losses incurred by Intel in FY2024. The pause or permanent hold on Intel’s Penang project could slow down Malaysia’s wafer fabrication and advance packaging industries for several decades, or possibly be unrecoverable.

Why did Zulfarhan’s killers escape death row?
Recently, the Federal Court (the nation’s apex court) decided that six former Universiti Pertahanan Nasional Malaysia (UPNM) students who were previously convicted of murdering Navy Cadet Officer Zulfarhan Osman Zulkarnain in 2017 will no longer meet the hangman.

Here are the reasons:

• No proof beyond a reasonable doubt - the court found out that there was not enough evidence to convict the six of murdering Zulfarhan, as according to Section 300(c) of the Penal Code, where culpable homicide is murder ‘if it is done with the intention of causing bodily injury to any person, and the bodily injury intended to be inflicted is sufficient in the ordinary cause of nature to cause death’. The keyword here is intent.

• Additionally, the statements by key witnesses such as medical forensic expert Dr Salmah Arshad (burns covering 30% to 50% of a victim’s body can cause death but also may not necessarily result in death) and forensic expert Dr Rohayu Shahar Adnan (element of injury on the victim that ordinarily causes death cannot be proven beyond reasonable doubt and the victim died 10 days after the incident) are enough to clarify whether the action of the six is intended murder or otherwise.

Instead of facing the rope, the six will go through an 18-year jail term since the date of their arrest in June 2017. However, if the six displayed good behaviour, they can be released as early as 2029.

Shorts

1. Pos Malaysia, led by CEO Charles Brewer since 2021, has suffered six-year straight losses, suffering a net loss of RM202.7 mil in FY2024, almost a 30% increase in net loss compared to the previous year. The huge loss is due to the postal segment that recorded a net loss of RM196 mil. Since Charles took the helm in 2021, the share price of Pos Malaysia has slipped by more than 70%, from RM0.78 per share to its current price of RM0.20 per share. With ballooning losses and collapsing share price, it's curious why he still gets to keep his job. View the ‘bonfire’ here.

2. The journalist from Malaysiakini who allegedly demanded a bribe as payment for taking down an article related to a foreign workers smuggling syndicate is still being detained by the Malaysian Anti-Corruption Commission (MACC) for six days already. The journalist was suspected of receiving RM20,000 in cash at a hotel in Shah Alam on Friday. As for the one giving the bribe, no news whether any actions were taken against them. 

3. English Premier League used-to-be giants and now relegation fighter (ranked 14th on the table), Manchester United is set to return to Malaysia for the first time in 16 years to participate in a pre-season match against an ASEAN All-Star team in Bukit Jalil. A source revealed that the former Premier League champions will make two stops in Asia, including Hong Kong. The pre-season match will be held on May 28, just merely days after its final EPL match against Aston Villa on May 25.

4. AROUND THE WORLD 🌎

Israel: New weapons and ceasefire extension drama

US to expedite delivery of USD 5.4 bil in US military aid to Israel
The US has declared to expedite delivery of approximately USD 4 bil in military assistance to Israel, with Trump’s office using the emergency authority as a means to do so, effectively bypassing any feedback or review by Congress. This one marked the second time in recent weeks that Trump’s administration has declared an emergency to quickly approve weapons sales to Israel. Meanwhile, the Pentagon said on Feb 28 that the State Department had approved the potential sale of nearly USD3 bil worth of bombs, demolition kits and other weaponry to Israel. Since taking office, Trump’s administration has approved nearly USD 12 bil in major foreign military sales to Israel. Note that the Biden administration also used emergency authority to approve the sale of arms to Israel without any congressional review. Pretty much nothing’s changed.

Israel blocks entry of all humanitarian aid into Gaza
The first phase of the Gaza ceasefire expired on Saturday, but in its effort to extend the phase, Israel has blocked the entry of all humanitarian aid into Gaza as it demands Hamas agree to a US plan for temporary extension. Israel is yet to move ahead with the second phase, which would have ultimately led to a permanent end to the war, but it is quite obvious that they are stalling it. Hamas wants phase two of the deal to go ahead as originally negotiated, with the release of hostages and Palestinian prisoners and the withdrawal of Israeli forces from Gaza. They would not agree to any extension of phase one without guarantees from the US, Qatari and Egyptian mediators that phase two would eventually take place. For that, Israel has decided to block all humanitarian aid into Gaza until Hamas says yes.

US-Ukraine souring ties
It was yet another bad day for Ukrainian President Volodymyr Zelensky at the Oval Office on Friday, as what was supposed to be an opportunity to convince the US to not side with Russian President Vladimir Putin backfired and he was told to leave the office instead. It began in a calm manner but quickly became heated as President Trump and Vice President JD Vance started to raise their voices towards Zelensky, saying that he showed disrespect and making a point that Zelensky is not ready for making “peace” and accept the US proposal, and does not have a “card to play”. Trump even deemed him “gambling with the lives of millions of people, and gambling with World War Three”. The falling out meant that Ukraine and the US failed to sign the minerals deal that Kyiv hoped would spur Trump to back Ukraine's war effort, and potentially win support from Republicans in Congress for a new round of aid. Watch the heated exchange here.

Meanwhile, a day after, Zelenskyy was warmly welcomed with a hug by British PM Keir Starmer at Downing Street, in which he gave his words of unwavering support to Ukraine. The UK and Ukraine signed a loan agreement worth GBP 2.26 bil on Saturday to support Ukraine’s defence capabilities, which London called a sign of “our unwavering and ongoing support for the Ukrainian people”. If the US stops their aid to Ukraine, the burden now lies on Europe to help defend Ukraine on their own - something that many analysts believe would be a very tall order and a big challenge for Europe.

Space Stories

• Private company makes first US Moon landing in more than 50 years
  Firefly Aerospace’s Blue Ghost Mission 1, a US private spacecraft, has successfully landed on the Moon on Sunday, marking the second private mission to do so and the first one to land upright. Nicknamed “Ghost Riders in the Sky,” the mission is part of a NASA-industry partnership aimed at reducing costs and supporting Artemis, the program designed to return astronauts to the Moon. Blue Ghost will be doing various experiments and sampling, and is expected to capture high-definition imagery of a total eclipse on March 14, when Earth blocks the Sun from the Moon’s horizon. On March 16, it will record a lunar sunset, offering insights into how dust levitates above the surface under solar influence. The US is now working to make private lunar missions routine through NASA’s USD 2.6 bil Commercial Lunar Payload Services (CLPS) programme.

• Pakistan x China sign deal for astronaut’s Tiangong Space Station mission
  The China Manned Space Engineering Office (CMSEO) and the Pakistan Space and Upper Atmosphere Research Commission (SUPARCO) have signed an agreement formalising their cooperation that will enable a Pakistani astronaut to fly to the Chinese space station. It means that the Pakistani astronaut will become the first foreign national to visit Beijing’s space station, named Tiangong which was completed between 2021 and 2022. The Pakistani astronaut will be chosen from a group who trained in the Chinese space program, in which he or she will undergo further rigorous training in China.

Shorts

1. TikTok will invest USD 8.8bil into Thailand’s digital sector

   ByteDance TikTok has announced that they will be investing USD 8.8bil in Thailand’s digital sector, focusing on digital infrastructure, workforce development and online safety initiatives. This comes as the latest in a string of major spending by tech giants, namely Amazon, Google and Microsoft, who will also have projects in the kingdom. Thailand, South-east Asia’s second biggest economy, has more than 50 mil TikTok users and three mil businesses on TikTok Shop.

2. Microsoft announces Skype will close in May

   Prepare to bid adieu to Skype - owner Microsoft has announced that it will be shut down for good in May. Many are feeling melancholic over the announcement, attributing happy memories with the voice call app that allowed people to make computer-to-computer voice calls to connect with loved ones globally. First released in 2003, Skype was bought by Microsoft in 2011 for USD8.5bil - its biggest-ever acquisition at the time. However, Skype began to wane as WhatsApp and Facebook Messenger took over its popularity.

5. FOR YOUR EYES 📺

1. Indonesia has its own Corruption League. About time Malaysia has one too.

2. New safety equipment needed

To Malaysia and fellow Muslims, wishing you a Merry Ramadhan*, kuatkan iman dan jangan ponteng!
* A heartwarming video of a man wishing his neighbour Merry Ramadhan, first time we have heard of such greeting

kini.viral.my

View more on Instagram