☕️ Civil servants: With greater income, comes greater indebtedness

1. MARKET SUMMARY 📈

2. NUMBERS AT A GLANCE 🔢

248,207 cancer cases in seven years – Nearly 250,000 Malaysians were diagnosed with cancer between 2017 and 2023, with cancer-related deaths rising from 12.6% in 2022 to 13.8% in 2023, according to Health Minister Datuk Dzulkefly Ahmad. The five most common types of cancer in Malaysia are breast, colorectal, lung, lymphoma, and liver cancer. Cancer is now the third leading cause of premature deaths in the country, trailing only pneumonia and heart failure. These alarming statistics highlight the urgent need for enhanced cancer prevention, early detection, and treatment initiatives to address the growing burden of the disease.

99% plunge in FDI over three years – Foreign direct investment (FDI) in China has plummeted by 99% since 2021, reaching a 33-year low of USD4.5 bil in net inflows in 2024, according to Chinese government data. This marks a 90% drop from 2023, as economic slowdowns and concerns over an anti-spying campaign deter foreign companies. FDI peaked at USD344 bil in 2021 but began declining sharply after Shanghai’s 2022 lockdown under China’s zero-COVID policy.

31 of Southeast Asia’s 55 unicorns are based in Singapore, more than half of Southeast Asia’s total, according to an October 2024 report by Founders Forum Group and the Economic Development Board. However, the global start-up ecosystem faces a prolonged funding winter, with high interest rates and geopolitical uncertainty driving investors toward safer assets. A November report by Enterprise Singapore and PitchBook revealed that Singapore-based companies raised USD4.05 bil across 369 deals in the first nine months of 2024, a significant drop from the USD8.2 bil raised in the same period in 2021. This decline underscores the challenges start-ups face in securing funding amid economic headwinds.

3. IN MALAYSIA 🇲🇾

Outdated laws to be reviewed to keep up to date with social changes, tech advancements
Federal Court judge Harmindar Singh Dhaliwal, recently appointed to a 25-member-strong committee, is to head said committee in studies and discussions that aim to identify and produce reforms within the Penal Code, the Criminal Procedure Code, and the Evidence Act that are considered no longer suitable, or outdated for the current society.

The reforms intend to improve the efficiency of the criminal judicial system, as well as improve the fairness and lack of bias in trials. The study and proposal for the reforms that follow it entail an 18-month-long process. The proposals submitted will be crucial to enhancing and reinforcing the rule of law, as well as safeguarding the individuals within the criminal justice system.

The PM’s Department’s legal affairs division was reported stating in a letter that the strategic move of the committee’s establishment was to ensure the relevancy, effectiveness, and justice-grounded framework, particularly for cases and individuals related to technological advancements and social changes now outdated in the current judicial laws in criminal court. It followed up with quoting the Madani government, in that they believed in holistic and comprehensive reforms to assist the country’s criminal justice system in being more responsive, fair, and effective in meeting the ever-evolving needs of a growing society.

Medical meets Money

• MOH to review regulations to improve price transparency and curb medical inflation for private hospitals
  According to BNM’s Annual Report 2024, the Ministry of Health (MOH) will proceed to review the regulations and regulatory oversight of private hospitals in a bid to curb the rising medical inflation within the nation, alongside the promotion of greater price transparency in medical costs.

  Part of five strategic movements, and the first of nine initiatives within the first movement, MOH aims to curb the projection inflation of 15% in 2025, which is reported to be significantly higher than the averages within the Asia-Pacific and global areas. The cost of medical health insurance and takaful claims had risen by a whopping 73% in the span of two years leading up to 2023, whereas the growth in takaful premiums collected was surpassed, resting at a 21% growth.

  The ratio of claims in 2018 averaged to 11 claims per 100 people, but by 2023, this figure had more than doubled to 25, partially due to a myriad of reasons, such as higher treatment costs inflated by a lack of regulations, higher usage of medical services as shown by the increase in claims, and costs of hospital supplies and services, which make up anywhere between 59% to 70% of private hospital bills.

• Prudential Malaysia to increase medical health premiums following 19.6% increase in 2024 claims, to start in April
  Prudential Malaysia has informed its policyholders that the company is forced to increase the premiums pertaining to medical health, starting from April, due to the increasing number of average claims, specifically 19.6% as compared to the previous year. According to an insurance manager tied to Prudential Malaysia, the increase would be tied to the policyholder’s claim record, the lowest increase at 4% for those who made no claims.

  Within the same notice, the insurer informed their policyholders that annual reviews of medical plans and insurance charges may be warranted to ensure the protection of said policyholders. The CEO stated in the notice that under the PRUHealth plan alone, 74 out of 1000 policyholders made claims, as compared to 62 out of 1000 a year ago, claims even saw an average increase of 3.9%, or rather, from RM14,113 to RM14,664.

Civil servants: With greater income, comes greater indebtedness
Post the salary increase for civil servants implemented in Dec 2024, Bank Negara Malaysia (BNM) reported a sharp hike in personal financing disbursed to civil servant borrowers. Compared to the monthly average from 2023 to 2024, which was RM3.6 bil, BNM’s Financial Stability Review, released this Monday, reported the average in Dec 2024 and Jan 2025 to be RM6.4 bil — a staggering 77.8% hike.

Alongside this fact, BNM also flagged the rising occurrence of fraudsters targeting borrowers who were reported to have repayment arrears, a majority of these victims being civil servants, with lures of lucrative rewards and returns in less than honourable investment schemes.

Shorts

1. Digital bank champion goes to - GXBank
   GX Bank Bhd, the first digital bank in Malaysia, now reportedly commands the largest share of customer deposits, which stands at RM2.16 bil deposits, compared to its two and only competitors in the operational digital bank field: AEON Bank (Nov 2024: RM339 mil) and Boost Bank (Sep 2024: RM204 mil).

   GXBank now reports the largest asset size amongst its competitors as well, at RM2.4 bil in Sept 2024, whilst AEON Bank reported RM711 mil, and Boost Bank at RM399 mil, despite being only 3 months into their operations. Despite that, all three banks have yet to break even (massive losses btw, if you are curious - see table below), a condition set by the government. Despite their growth, all 3 banks’ assets combined are well below 1% of the total banking sector’s assets.
   View table: Selected key financials of the 3 operational digital banks

2. China’s Panda Loan to Malaysia extended
   Fu Wa and Feng Yi, the two giant pandas in Zoo Negara, are to stay for at least 2 more years in the country, following the extended loan agreement between China and Malaysia for the endangered and publicly-loved animals. The decision to extend the stay of the pandas, a symbol of China and Malaysia’s close relationship, was highly supported by the government, despite the rising costs. In 2018 alone, the government allocated RM4.65 mil to maintain the pandas. Maintaining them pandas ain’t cheap as it was estimated in 2016 that the bill will exceed RM151 mil by 2024. 

4. AROUND THE WORLD 🌎

Politics

• Canada’s snap election
  Canada’s new PM, Mark Carney, has called a snap election for April 28, just weeks after succeeding Justin Trudeau. Citing threats from U.S. President Donald Trump, Carney is seeking a strong mandate to counter trade tariffs and defend Canadian sovereignty. The Liberals, in power since 2015, have seen a surge in support after Trudeau’s resignation, closing the gap with the opposition Conservatives. Polls show the Liberals and Conservatives in a near tie, with 37.5% and 37.1% support, respectively. The election will decide who is best suited to manage Canada-U.S. tensions: Carney, a seasoned economist, or Conservative leader Pierre Poilievre, known for his hardline rhetoric. With Trump openly musing about Canada as the "51st state," this election is shaping up to be less about domestic issues and more about defending national identity. If nothing else, it’s a reminder that in politics, timing is everything.

• South Africa diplomatic fallout with US of A
  South Africa’s former ambassador to the US, Ebrahim Rasool, returned home to a hero’s welcome after being expelled by the Trump administration. Greeted by cheering crowds at Cape Town International Airport, Rasool called his persona non grata status a “badge of dignity” and said he had no regrets. His expulsion followed Trump’s executive order cutting US funding to South Africa, citing its alleged support for Hamas and Iran and so-called “anti-white policies.” US Secretary of State Marco Rubio accused Rasool of being a “race-baiting politician” who despises the U.S. and Trump, pointing to a speech Rasool gave criticising the administration’s stance on diversity and immigration. Despite the diplomatic fallout, Rasool emphasised the need to mend ties with the U.S. But let’s be real, this is more than just a political spat. It’s a high-stakes clash of ideologies, and Rasool seems to be wearing his expulsion like a medal.

ChatGPT and loneliness
A joint study by OpenAI and the Massachusetts Institute of Technology (MIT) Media Lab suggests that frequent users of ChatGPT may experience increased loneliness. Researchers analysed millions of conversations and surveyed over 4,000 users, finding that those who formed emotional bonds with the AI were more likely to feel lonely and dependent on it. A separate four-week trial with 1,000 participants reinforced these findings, showing a clear link between high usage and reduced socialisation. The study also examined ChatGPT’s Advanced Voice Mode, revealing that while voice interactions initially helped mitigate loneliness, the benefits faded with excessive use. Researchers say this is just the start of understanding AI’s long-term effects on mental health. It’s a reminder that even the most advanced AI can’t replace real human connection, no matter how good the conversation might be. Have you been feeling lonely since the launch of ChatGPT in late-2022?

Closer to home - what’s happening ASEAN?

• Indonesia lifts migrant worker ban on Saudi
  Indonesia will lift its decade-long ban on sending migrant workers to Saudi Arabia, citing improved labour protections despite ongoing concerns over mistreatment. A memorandum of understanding is set to be signed in Jeddah later this month, with plans to send 600,000 workers, including 400,000 domestic helpers by June. Officials project USD1.89 bil in annual foreign exchange earnings, with minimum wages set at 1,500 riyals (USD399), higher than Jakarta’s minimum wage. The ban, imposed in 2015, followed widespread reports of abuse, wage theft, and exploitation under the kafala system. However, around 25,000 workers still entered Saudi Arabia illegally each year. Rights groups warn that critical safeguards remain weak, with 186 complaints filed by Indonesian workers in Saudi Arabia last year. Activists urge stronger bilateral agreements to prevent human rights violations, emphasising that economic gains must not come at the cost of worker safety.

  Whilst we are still on Indonesia, Danantara Indonesia, a new USD900 billion sovereign wealth fund, has named a high-profile advisory team, including Joko Widodo, Susilo Bambang Yudhoyono, Ray Dalio, Jeffrey Sachs, and Thaksin Shinawatra. While positioned as Indonesia’s Temasek, its launch rattled markets, causing a 7% stock drop amid concerns over political influence.

• Thai PM faces No-Confidence vote amid economic and political scrutiny
  This is like another Monday for our Thai neighbours. Thai Prime Minister Paetongtarn Shinawatra faces a no-confidence motion in parliament, with the opposition targeting economic struggles and her father Thaksin Shinawatra’s perceived influence. Despite criticism, her ruling coalition holds a majority, making her removal unlikely when the vote takes place this coming Wednesday. Thaksin, a divisive ex-premier, returned from exile in 2023, served six months in detention, and was later released on parole. While he denies interference, he has publicly supported policies like legalising gambling, promoting cryptocurrency, and a USD14 bil stimulus scheme, all pursued by Paetongtarn’s government. Thailand’s economy grew only 2.5% last year, lagging behind regional peers, with household debt at 89% of GDP. The opposition argues the government is failing to tackle these issues. However, parliamentary rules bar direct mention of Thaksin, limiting the opposition’s strategy. Paetongtarn, Thailand’s fourth Shinawatra prime minister, remains politically secure, for now, but economic concerns could test her leadership far more than political attacks.

• Singapore’s retail shake-up
  Malaysia’s Macrovalue (owns Cold Storage and Giant Malaysia) is set to acquire all Cold Storage and Giant supermarket outlets in Singapore for an initial price of SGD125 million (RM413.6 mil). The deal, expected to be finalized in the second half of 2025, includes 48 Cold Storage stores (under CS Fresh, CS Gold, and Jason’s Deli), 41 Giant outlets, and two distribution centres. DFI Retail Group, the current owner, will shift its focus to Guardian Pharmacy and 7-Eleven operations in the region. Despite turning profitable in 2024, DFI sees stronger growth potential in convenience retail rather than supermarkets.

5. FOR YOUR EYES 📺

1. Pro-tip for those of you looking to get married soon or are already in a marriage.

2. Switzerland’s next-gen passport is a work of art. Learn more about it here.