☕️ Witness: RM3 mil cash in suitcase delivered to former DPM Zahid Hamidi's official residence

1. MARKET SUMMARY

2. NUMBERS AT A GLANCE

100 countries back China’s Global Development Initiative (GDI), in what China’s state media says is China’s “golden prescription for global challenges”. The GDI focuses more on Sustainable Development Goals (i.e. ESG) as compared to the Belt Road’s Initiative focus on infrastructure. The West is wary of the GDI.

9,696 students scored straight As last year’s Sijil Pelajaran Malaysia (SPM) candidates.

Talking about cars, the Sales & Service Tax exemption that started back in June 2020 the government granted for the purchase of new vehicles cost the government RM4.8 bil lost in revenue. Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz said if the exemption (ending on June 30) is extended for another three months, it would cost the government RM1.2 billion in revenue.

3. IN MALAYSIA 🇲🇾

1. In a bid to solve the congestion people have been complaining about, Prime Minister Ismail Sabri Yaakob has announced free rides for all public transport services operated by RapidKL for 30 days since yesterday. The same goes for our beloved KTM. The government will bear the cost of RM155 mil lost in ticket sales. Technically, it’s the rakyat that bears the cost through taxes. The rakyat is not seeking free transportation — we want efficient public transit systems. The RM155 mil could have gone to fix broken lifts and escalators and add more buses.

2. Johor ruler Sultan Ibrahim Sultan Iskandar said the state could be more developed if it stood on its own feet. The state ruler wants the federal government to give more allocation to the state, which contributes almost RM13 bil in federal revenue annually. Will we see a #Johor-xit?

3. The Human Resource Minister M. Saravanan called the idea of legalising undocumented migrants for the workforce “stupid” as it would encourage more illegal immigrants to enter the country. Well, we mustn’t forget the country needs 1.2 mil workers across multiple industries. As stupid as the idea sound, there is also an opportunity cost here — loss of productivity due to the lack of workforce.

4. Wedani Senen, a manager with the SWIFT unit at AmBank, might have put the nail in the coffin during the hearing of the 1MDB-Tanore trial. Wedani, whose primary role is to oversee bank transactions, confirmed Najib Razak’s private bank accounts with AmBank had received about USD670 mil (the infamous RM2.6 bil) between 2011 and 2013. Najib Razak had previously testified the funds were donated by Saudi Arabia’s late monarch, King Abdullah Abdulaziz Al-Saud. Where’s the nail? Wedani verified the transfer of a USD620 million into Najib’s “694” account from Tanore Finance via its Falcon Private Bank Ltd account in Singapore.

5. David Tan Siong Sun, a former staff of Ultra Kirana Sdn Bhd (UKSB), said Ahmad Zahid Hamidi was referred to as “monster”, “young boy”, and “yb” in the company’s ledger. Why monster? Because David was snacking on the Mamee Monster snack when he entered the ledger. Not kidding. I personally thought it was Money Monster. David also testified he had delivered RM3 mil in cold, hard cash in a suitcase to Ahmad Zahid Hamidi’s official residence.

Shorts

1. PN17 company Sapura Energy Bhd managed to secure six major contract wins in the Asia-Pacific and Atlantic region, with a combined value of RM2.7 billion, through its wholly-owned subsidiaries and joint-venture.

2. The world’s largest sovereign wealth fund, Norway’s Government Pension Fund Global, has placed Supermax Corp Bhd under observation for two years due to allegations of serious human rights violations involving the company’s foreign workers. The decision came after a recommendation from the fund’s Council of Ethics, which recommended excluding Supermax.

4. AROUND THE WORLD 🌎

1. The relationship between China and the US is more intertwined than we see and goes beyond trade. China is the second-largest holder of US Treasuries behind Japan. Put it another way, China is the second-largest lender to the US. However, in April, China has reduced its holdings to the lowest since May 2010 to USD1.003 tril, down USD36.2 bil from the previous month. Japan’s holdings also fell to USD1.218 tril in April from USD1.232 tril in March. In total, foreign holdings of US Treasuries stood at USD7.455 tril - meaning the rest of the world bought up this much of US loans so the US could continue their spending spree. See the list here of foreign holders of US Treasuries - even Singapore owns USD183.1 bil.

2. The European Union (EU) will soon force tech companies to police “manipulative behaviours” on their services, which include deepfakes and fake accounts. This will be enforced through a co-regulation scheme, where both regulators and signatories to this EU code of conduct will share the responsibility for it. Companies that fail to adhere to the code will face a fine of up to 6% of global revenue - Meta and Google posted revenue of USD118 bil and USD258 bil in 2021, respectively - this would translate to multibillion-dollar fines.

3. Danish toymaker Lego will invest USD1 bil in its first factory in the US that will run on renewable energy and will employ 1,760 people. This would be its seventh factory worldwide after announcing a new factory in Vietnam last year (>USD1 bil investment creating 4,000 jobs in the next 15 years). Big bucks in making coloured bricks - the company reported revenue of USD7.8 bil, up 27%. Lego is thriving now, but in the early 2000s, the company was struggling. Its revival is said to be one of the most remarkable turnarounds in corporate history and is frequently adopted in case studies. Read its turnaround story here.

4. “Lightyear”, Pixar’s 26th animated film telling the origin story of Buzz Lightyear, has been banned in 14 countries, mostly in the Middle East and China, the world’s largest movie market. This includes Malaysia as well. This came after Walt Disney Co refused to remove depictions of a same-sex relationship, including a kiss between 2 female characters.

5. Melbourne won the bid to host the Australian F1 Grand Prix, beating out Sydney and the Gold Coast in a new 10-year agreement to host until 2035. The F1’s popularity has hit new heights thanks to the Netflix series “Drive to Survive”, attracting a younger audience and turning drivers into superstars.

6. Elon Musk is in the news again:

   1. A Dogecoin investor who accused him of running a pyramid scheme to support the cryptocurrency is suing Musk for USD259 bil.

   2. A group of SpaceX employees called Musk a “distraction and embarrassment” in an internal letter to executives. The letter, sighted by Reuters, does not single out any controversy in particular.

5. FOR YOUR EYES 👁👁

1. Air Asia X CEO Benyamin Ismail explains why AAX could not provide cash refunds — the law under a restructuring process would not allow it to.

2. The first Gordon Ramsay Bar & Grill outside London in Sunway Resort will open its doors on June 18, 2022. Here’s what its menu is like in the UK. The restaurant is not halal-certified but does not serve pork dishes (unlike the UK) and all its suppliers are halal-certified, as confirmed by HaveHalalWillTravel.com.

3. How do you pronounce Tealive? Tea-live or Tea-leave? Once and for all, the video below solves this by the founder, Bryan Loo. The brand was voted “Malaysia’s Most Trusted Brand” by Reader’s Digest.