☕️ US tariffs on China sent Malaysia's glove counters to the moon

1. MARKET SUMMARY 📈

2. NUMBERS AT A GLANCE 🔢

Malaysia has become a magnet for skilled foreign professionals, with expatriate numbers now exceeding pre-pandemic levels. Immigration Department data reveals a record 154,155 expatriate passes issued last year, the highest since 2018. By March this year, 38,197 passes had already been issued, up from 32,947 in the same period last year. Malaysian Employers Federation president Dr Syed Hussain Syed Husman attributes this trend to a mismatch between local skills and job requirements, forcing employers to seek foreign professionals. The stats don’t lie. The Statistics Department's Q4 2023 report revealed that only 25% of Malaysian labour falls into the skilled category. In contrast, the majority, over 62.7%, of local talents are in the semi-skilled category.

From 2014 to 2023, English Premier Clubs spent a total of GBP9.5 bil on transfer fees (i.e. buying players), the most of all global football leagues. In the 2022/23 season alone, Manchester City and Chelsea spent more than GBP1 bil each. Coming in second and third place aren’t the major leagues like La Liga or Bundesliga. It’s the Chinese Super League with GBP1.14 bil spent and Saudi Pro League with GBP1.13 bil spent. Here are 11 interesting charts breaking down key 11 financial figures of the English Premier League.

A gold pocket watch owned by Titanic's wealthiest passenger, John Jacob Astor, sold for GBP900,000 (RM5.35 mil) — six times its estimated price of GBP150,000. Including taxes and fees, the final cost to the buyer is GBP1.175 mil. This sets a new world record for the most expensive Titanic artefact, surpassing the previous record, a violin that sold for GBP900,000, which ended up costing GBP1.1 million with fees.

3. IN MALAYSIA 🇲🇾

PM Anwar hinted the King to decide on Najib Razak’s fate after the 1MDB trial ended
PM Anwar Ibrahim suggested that the Yang di-Pertuan Agong should decide on Najib Razak’s house arrest bid only after the conclusion of the 1MDB trial. In the spirit of trying not to be disrespectful of the King, PM Anwar stated that the King should follow through with the process and treat Najib’s application like any ordinary citizen filing an appeal to the Pardons Board. When asked whether the current government is on a rocky sea due to Najib’s house arrest bid, PM Anwar replied that the Unity Government won in Kuala Kubu Baharu by-election. So, turmoil what?

On trains

1. After choosing the RM7 bil elevated automated rapid transit (ART) system instead of the RM16 bil light rail transit (LRT) system, Johor Public Works, Transport, Infrastructure and Communications Committee chairman Fazli Salleh said that the ART system will have 32 stations with accumulated distance of more than 50km. There will be three lines –- the 14.8km Iskandar Puteri line, the Skudai line (18.8km) and the Tebrau line (14km). The study for the ART system in Johor Bahru will be completed in August before it will be presented to the Cabinet. As a comparison, LRT Kelana Jaya spanning from Gombak to Putra Heights has 37 stations with a total distance of 46.4km.

2. Florence Lee, one of the victims who suffered serious injuries when she was on the train when two LRT trains collided near the Kampung Baru station in Kuala Lumpur three years ago, is seeking to recover RM113,524.08 in special damages. After the tragic incident, she filed a lawsuit against the LRT system’s owner, Prasarana Malaysia Bhd, and operator, Rapid Rail Sdn Bhd. However, she has to wait until January 2028 as the trial for her case is set from Jan 10 to 13, 2028.

On airports

1. Gateway Development Alliance Consortium announced that they will acquire all the shares of Malaysia Airports Holdings Bhd (MAHB) that are not already owned by them at an offer price of RM11.00 per share. In the mouth-watering RM18.4 bil deal, the Consortium plans to delist MAHB, which will be executed in 4Q2024. The Consortium consisted of UEM Group Bhd (fully owned by Khazanah Nasional Bhd), the Employees Provident Fund (EPF), the Abu Dhabi Investment Authority (ADIA) and funds managed by Global Infrastructure Partners (GIP). Below are some interesting facts about the completion of this multi-billion deal:

   1. Khazanah’s stake in MAHB will increase from 33.2% to 40%.

   2. EPF stake to increase to a sizeable 30% from 7.9% Collectively, Malaysian investors will retain 70% of MAHB.

   3. ADIA and GIP will own the remaining 30% shares in MAHB.

   4. The Malaysian government will retain special rights in MAHB and the CEO and chairman will continue to be Malaysian citizens.

   This is the country’s largest acquisition in nearly 3 years since DiGi.com Bhd acquired Celcom Axiata Bhd for USD5.94 bil in 2021.

2. Kota Bharu’s airport got an upgrade, Penang’s airport is slated for an upgrade and now Kuching wants an entirely new international airport. Sarawak Premier Abang Johari Openg said the state is looking into whether it should develop a new international airport in Kuching. At the moment, Kuching has an existing international airport that can handle 5.3 mil passengers annually. The Kuching International Airport (KIA) was built in the 1940s by the British and also served as a Royal Malaysian Air Force (RMAF) airbase.

3. Capital A Bhd’s catering arm Santan is considering having an in-flight kitchen to serve external customers. Its CEO Catherine Goh sees an opportunity in the market as there are not a lot of players in the market (the other one we know of is Brahim). Goh stated that there are demands from different airlines mostly inbound airlines from the Middle East and Taiwan. At the moment, Santan only serves in-flight meals services to AirAsia flights.

On gloves

1. Regarding the announcement by the US to increase tariffs on Chinese rubber medical and surgical gloves from 7.5% to 25% in 2026, the Malaysian Rubber Glove Manufacturers Association (MARGMA) president Onn Kim Hung said that no immediate impact will be seen on the domestic rubber gloves industry. This is because the tariff hike will only take effect in 2026. The United States is a major export destination for our rubber gloves as 35% of our rubber gloves export goes to Uncle Sam in 2023 (RM4 bil in export value).

2. While MARGMA is toning down the impact of the tariff hike, Malaysia’s Wall Street is supremely upbeat about the development — sending shares of glove makers to two-year highs, or in crypto slang - to the moon. Shares of Top Glove Corp Bhd, the world’s largest glovemaker by capacity, hit a limit up on Wednesday, closing 30 sen or 31.25% higher to RM1.26. This is the highest since June 2022. Other glove counters, Hartalega Holdings Bhd, Supermax Corp Bhd and Kossan Rubber Industries Bhd, also saw double-digit percentage gains yesterday. It’s not without any basis, though — the US tariff hike means Malaysian glove players have the opportunity to regain market share they lost to Chinese competitors following the price war that began in 2021. On the flip side, the Chinese players can dump prices in non-US markets.

4. AROUND THE WORLD 🌎

European Affairs

1. New Caledonia riots leave three dead after Paris vote

   France will be declaring a state of emergency in the Pacific island of New Caledonia, which it rules, due to riots which have claimed three lives, all indigenous Kanak. The riots started after Paris passed a bill to allow French residents who have lived in New Caledonia for 10 years or more to vote in provincial elections. Local leaders had expressed concerns that the bill would dilute the local Kanak vote on an island where pro-independence movements are commonplace.
   France annexed New Caledonia in 1853, granting the island the status of overseas territory in 1946. This island is way nearer to Australia than it is to France — view on map here.

2. Slovak PM Robert Fico shot and wounded

   Fico was shot in the abdomen when several shots were fired after a government meeting in Handlova. According to local news agency TASR, four shots were fired, with one hitting its mark. Fico is currently in his fourth term, returning as PM of Slovakia, a small central European nation (view on map here), last year after appealing to a changing electorate. The politician has three decades of experience, having stood on both the pro-European and nationalistic sides of the country. An X user posted a video of the aftermath of the shooting, which you can watch here (NSFW).

3. Blinken promises USD2 bil in military aid to Ukraine

   US Secretary of State Antony Blinken promised a further USD2 bil in military financing to Ukraine during a press conference in Kyiv. The funds will help Ukraine procure weapons, invest in its defence industrial base, and purchase military equipment from other countries. USD1.6 bil from the total was earmarked in the supplemental funding bill signed into effect by US President Joe Biden last month, while the remainder USD400 mil comes from existing foreign military financing funds that had not yet been allocated. Where is this money coming from? Hmm.

Tech News

1. Amazon Web Services plans USD8.4 bil investment in Germany

   The tech firm will be investing the amount over the next 16 years to 2040 to build a cloud computing infrastructure specifically for Europe. The investment is expected to create an average of 2,800 full-time jobs in local German businesses per year, with several data centres launching in the state of Brandenburg by the end of 2025. 

2. Alphabet unveils new AI-bolstered Google

   Google parent firm Alphabet launched several AI offerings as its next move in the AI arms race against rival OpenAI. Seemingly in response to the launch of GPT-4o, the tech giant unveiled Gemini 1.5 AI models known as Flash, touted as being cheaper and faster, alongside a prototype called Project Astra, which can talk to users about what they capture on their smartphone cameras in real-time. However, the game-changer appears to be an AI-enhanced version of the Google search engine, which can categorise search results and summarise complex questions. The speed at which these tech companies are churning out new models is scary. The Matrix could soon be a reality. Are you The One?

Business Matters

1. Sea Ltd shares jump after exceeding Q1 expectations

   Shopee parent Sea Limited reported adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) of USD401 mil, almost double the USD222 mil expectations of analysts for the first quarter. The company also believes it is on track to reach its target of a second straight annual profit this year. E-commerce gross merchandise volume, or the value of goods sold, increased by 36% to reach USD23.6 bil, exceeding estimates. The group’s revenue also grew by 23% to USD3.7 bil.

2. Anglo American to offload diamond operation De Beers

   The UK mining giant announced the offloading as part of a strategy to centre its focus on its key areas of operations, such as copper, premium iron ore, and crop nutrients. The focus on copper is also to take advantage of the increasing demand for the metal, considering its use in renewable energy and electric vehicles. The announcement to offload its De Beers diamond operation, as well as its platinum operation, also comes after the mining firm rejected a USD42.7 bil buyout plan from rival BHP.
   A little note: De Beers is also the cause of a lot of pain and economic hardship, namely through its “A diamond is forever” campaign, which popularised the use of diamond rings in proposals. For Anglo American, it’s not forever after all, is it?
   Read: De Beers’ most famous ad campaign marked the entire diamond industry

Shorts

1. New Squid Game!
   Squid Game lead actor Lee Jung-jae has confirmed that the highly-anticipated second season will be released in December 2024, though a premiere date has not been officially released by Netflix. The first season of the show was a massive hit, with 14 Emmy nominations in 2022, of which it won six, including an Outstanding Directing Award for show creator Hwang Dong-hyuk.

2. People with HIV can now be sperm and egg donors

   Laws in the UK have changed to allow same-sex couples with non-transmissible HIV to donate eggs or sperm and become parents. Previously, the legislation only allowed a man to give sperm to a female partner. The legislative change is to keep up with advances in science and medicine while improving access to in-vitro fertilisation and ensuring equal rights. This is made possible by the use of highly effective medicine, which eliminates the risk of passing on the virus.

3. Thai political activist dies in pre-trial custody, PM orders probe
   PM Srettha Thavisin has ordered an investigation into the death of Netiporn “Bung” Sanesangkhom, 28, who died when her heart “stopped suddenly” while in pre-trial detention. She was being held on seven charges, of which two were insulting the Thai monarchy. She was on a partial hunger strike throughout her detention, which started on Jan 26, where she refused to take food and water for a month, only drinking water in late February and then eating in April after she was hospitalised for her deteriorating health.

5. FOR YOUR EYES 📺

1. If you’re looking to flex to your friends, this is the latest gadget by Dyson — the WashG1. When a mop simply doesn’t cut it. The only thing is, someone still needs to operate it. It isn’t a robot. The release date is yet to be announced.

2. Be careful while driving in Klang, especially at night. The image captured from the dashcam footage shows oil spilt on the road. NSFW.