☕️ Flying taxis coming soon - Malaysia eyes low-altitude economy boom

1. MARKET SUMMARY 📈

2. NUMBERS AT A GLANCE 🔢

Five-fold – Japan has implemented a five-fold increase in visa fees for all foreigners starting Jul 1. Single-entry visa fees will be raised from the current JPY3,000 (RM76.86) to JPY15,000 (RM384.31), while multi-entry visas will now cost JPY30,000, up from JPY6,000. The last time Japan revised its visa fees was in 1978, 48 years ago. Foreign Minister Toshimitsu Motegi said the increase was to “reflect inflation and exchange rate fluctuations”, adding that the government does not expect an immediate impact on inbound tourism. So it’s now more expensive to Cuti-Cuti Jepun.

JPY561.28 tril (USD3.5 tril or RM14 tril) – That was the amount Japan held in net external assets at the end of 2025, marking an all-time high for the nation. However, despite the increase, this total was surpassed by China, whose net external assets climbed at a faster pace to JPY636.3 tril, pushing Japan down to become the world’s third-largest creditor nation. This comes a year after Japan lost its position as the world’s largest creditor nation to Germany for the first time in 34 years. In 2025, Germany remained at the top of the list with JPY675.5 tril. A creditor nation is a country with a positive net international investment position, meaning it lends more to the world than it borrows over time.
Learn: What is a creditor nation?

25.92 basis points – Aka 0.2592%. Near the end of 2025, the cost of insuring exposure to Japanese government bonds touched a two-year high, following news about the spending plans of Prime Minister Sanae Takaichi’s new government. As a result, spreads on credit default swaps for five-year Japanese government bonds, one of the more traded maturities, reached 25.92 basis points, a level last seen in Nov 2023. Credit default swaps act as insurance on bonds, with the buyer paying a premium to the seller in exchange for protection against potential losses. These spreads go up in times of greater uncertainty. 
Learn: What is bond insurance?

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3. IN MALAYSIA 🇲🇾

Guan Eng graft trial to proceed
Former Penang chief minister Lim Guan Eng, his wife Betty Chew and businesswoman Phang Li Koon will have to stand trial over a corruption case linked to an RM11.6 mil migrant workers’ hostel project after the Court of Appeal upheld an earlier High Court decision. The court ruled that the case should proceed to trial as the charges are separate from an earlier case involving Lim, even though both matters came from the same MACC investigation. The defence had argued that Lim should not be tried again for related matters after his earlier acquittal in a separate bungalow case in 2018. However, the court said the current charges involve different acts and legal elements that the prosecution must prove, meaning they are not the same offence. It also confirmed that the constitutional protection against being tried twice for the same offence does not apply in this situation.

Lim, who was charged in 2020, is accused of using his position as the chairman of Penang Development Corporation's procurement board to secure RM372,009 in benefits for his wife through a consultancy firm linked to the RM11.6 mil project. Phang is accused of abetting the offence, while Chew faces three money laundering charges involving RM87,009, RM180,000 and RM105,000. The case will now return to the Penang High Court on Jul 3, while Lim’s legal team has confirmed they will appeal the decision.

Flying taxis soon - Malaysia eyes low-altitude economy boom
Malaysia is aiming to position itself as a key player in the emerging low-altitude economy sector, which includes drones, unmanned aerial vehicles, air taxis and electric vertical take-off and landing aircraft. Transport Minister Anthony Loke said the sector could become a new growth engine if developed strategically, with opportunities spanning logistics, tourism, agriculture and advanced technologies. He said Malaysia already has a strong aviation and aerospace base but has yet to fully tap into maintenance, repair and overhaul activities as well as manufacturing potential in the low-altitude space. Loke added that global standards for the sector are still being developed, giving Malaysia an opportunity to help shape frameworks rather than simply follow existing ones.

Business updates:
Petronas strikes major gas find: Petroliam Nasional Bhd (Petronas) has confirmed another gas discovery at offshore Block 52 in Suriname, bringing the total number of discoveries in the area to eight. Combined resources are estimated at more than one bil barrels of oil equivalent. Suriname President Jennifer Simons said the development supports long-term oil and gas growth as the country (view map here) seeks to replicate neighbouring Guyana’s rapid offshore-driven expansion.

Petronas is expected to make a final investment decision this year after declaring its Sloanea discovery commercially viable. The block lies within the Golden Lane corridor, a highly prospective offshore region. First production from Suriname’s offshore fields, led by a TotalEnergies consortium, is targeted for 2028, while state firm Staatsolie continues opening large offshore areas for further exploration and partnerships.

AirAsia X hit by payment delays: AirAsia X Bhd is facing financial pressure after falling behind on supplier payments and seeking delivery deferrals on at least a dozen aircraft due to rising fuel costs. The airline has also reportedly missed payments under its engine maintenance agreement with Rolls-Royce Holdings plc, which supports part of its fleet of about 250 aircraft. It has also asked lessors to delay payments on more than 16 planes, with fuel price increases linked to geopolitical tensions adding further strain.

Management said some aircraft leasing companies have agreed to extend timelines, describing the situation as manageable and consistent with industry conditions. Across the low-cost sector, airlines are under pressure as limited pricing power makes it harder to pass on higher costs. AirAsia, which leases about 98% of its fleet and does not hedge fuel, recently posted its largest quarterly loss in three years, although it continues with expansion plans and maintains financing access.

Shorts:

1. New MyKad to cost RM40 each
   Malaysia will introduce the new-generation MyKad under a pay-per-issue model, with each card costing RM40 and an estimated RM120 mil annual rollout based on three mil cards. The government said replacement will be phased in and limited to new applicants and older cardholders, while the RM10 processing fee remains unchanged and existing MyKad will remain valid.

2. NPE 2 to go barrier-free
   The NPE 2 extension will adopt a barrier-free Multi-Lane Free Flow (MLFF) toll system when completed in 2029. The RM1.7 bil project is about 6% complete and will link key Klang Valley highways, supported by traffic monitoring and phased construction to reduce disruption.

3. Severe haze risk flagged for region
   A think tank has warned that Malaysia, Singapore, Indonesia and Brunei face a high risk of severe haze in 2026 due to hot dry weather, rising biofuel demand and economic pressures. The Singapore Institute of International Affairs said El Niño conditions could intensify the dry season between Aug and Sept, while higher global costs may increase land clearing through burning.

4. AROUND THE WORLD 🌎

Alibaba sues the US
Remember when the US released a blacklist a couple of weeks back and Alibaba was on it? Well, Alibaba is now suing the US Department of Defense (DoD) for identifying it as a supporter of the Chinese military without substantial evidence.

In Feb, Alibaba was momentarily included in the list before it was removed immediately. Earlier this month, DoD again accused several of China’s biggest companies of aiding the PLA, including Alibaba, Baidu Inc and BYD Co. Alibaba said that it has been in talks with the US regarding this blacklist since the Feb incident. While being on the list doesn’t carry significant legal repercussions, it does bring reputational risks to Alibaba, which is pivoting hard into an AI-first company.

A 1260H designation is essentially a warning to US investors to stay away and is considered a prelude to punitive trade restrictions. This could be problematic, given Alibaba’s reliance on overseas suppliers for AI chips. Most importantly, it also prevents Alibaba from retaining certain lobbyists who have represented the company for years.

‘Blasphemy!’ - Masayoshi Son on AI bubble
SoftBank CEO Masayoshi Son has described any talk of an AI bubble as ‘an insult to AI’ and doubled down by saying, ‘I think it's blasphemy against AI if you say it's ‌a bubble.’ at Softbank’s annual general meeting. But it’s hard not to see why he’s trying to fend off these talks, considering that he’s a heavy investor in the AI sector.

OpenAI comes to mind, while Arm, a chip-design company, is becoming a key company in SoftBank’s portfolio. Softbank is also building data centres in the US and Japan to further expand computing capacity and is planning for initial public offerings of SB Energy, an energy and infrastructure developer and Roze, an autonomous robotics company, which could be worth USD100 bil (RM413.8 bil) combined.

Son has complained about how he has to constantly convince people that ‘SoftBank Group is the factory that lays the eggs’ and is a ‘golden-egg-laying goose’. Son also scrapped plans to retire in his sixties to transform SoftBank into the world’s preeminent AI-powered robotics company. Seems like a man of faith.

Throwback to the funny moment when Jensen Huang retold the story of SoftBank once being the largest shareholder of Nvidia with a 4.9% but famously sold it. The stake today would be worth close to USD250 bil.

Outbreak
France reports first Ebola case
France has officially reported its first case of Ebola. A doctor who recently returned from a humanitarian mission in the Democratic Republic of the Congo has tested positive. He or she has been isolated, and the authorities are now tracing contacts. They assess the risk to the wider European population as low.

So far, about 1,000 Ebola cases have been confirmed, with 267 deaths, according to the World Health Organisation. Meanwhile, a US citizen who had been receiving treatment for Ebola in Germany was discharged earlier this month after no virus had been detected in the patient since May 30.

Meanwhile, bird flu in Australia
In the land down under, bird flu is starting to make its mark. Australia has now confirmed the third case of bird flu, which was found in South Australia. The first two cases were found in Western Australia. The authorities are now stepping up surveillance and testing of wildlife and livestock for the highly pathogenic H5N1 bird flu strain. This prompted Papua New Guinea to ban imports of poultry meat from Australia briefly. Those restrictions have been lifted with some caveats. Papua New Guinea is Australia’s largest export market, buying up USD30.4 mil (RM125.8 mil) in 2023. Currently, the Australian government says there are no threats to humans. Human infections are rare, but bird flu outbreaks can devastate poultry populations, disrupting the poultry markets and prices.

Shorts:

1. ‘Omega’ heatwave rips through Europe
   If a heatwave is named ‘Omega’, you know it’s going to be a big one. The record-setting heatwave is ripping through Western Europe, hitting temperatures as high as 44.3 degrees Celsius in the southwestern town of Pissos in France. France notched its hottest day on Tuesday since modern records began 80 years ago. At least 48 people have drowned as they sought to escape the heat by swimming. Two children died in cars due to the heat. Meanwhile, in Spain, two elderly people died of heatstroke. A rare weather pattern known as an Omega block was driving temperatures across parts of Europe to as much as 18°C (32°F) above seasonal norms, according to the Reuters Climate Monitor. Authorities in Europe are closing schools early or shutting them down as these high temperatures could even endanger healthy people.

2. SK Hynix to raise USD29 bil in the US
   After surpassing Samsung briefly in market capitalisation to become South Korea’s most valuable company, SK Hynix is now trying to raise USD29.4 bil (RM121.66 bil) in a secondary listing in the US via the American Depositary Receipts. This is higher than Alibaba’s USD25 bil IPO in 2014. The proceeds will be used to build chip factories in South Korea and purchase chipmaking equipment from ASML, a Dutch equipment maker. ASML is the only company in the world that can make extreme ultraviolet (EUV) lithography machines used to produce the most advanced semiconductors. This will enable SK Hynix to get exposure to a wider range of investors in the US. SK Hynix produces high-bandwidth memory (HBM) chips and commands about 61% of the global market.

   Learn: What is ADR?

5. FOR YOUR EYES 📺

The Beautiful Game

1. The Norwegian World Cup team performing the viking row together with fans after qualifying for the Round of 32.

2. The brilliant ‘scam’ goal contributed by Ronaldo - watch here.

3. The history of football.