Thursday, 4 July 2013

CIMB Malaysian Economic News - 04 July 2013

The country's household debt exposure is not at a worrying level and the non-performing loans (NPL) ratio is still under control, said Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah. "If we can control personal debt, in terms of loan applications and the ability of the borrower to repay, that is what we should focus on. What is important is the loan performance in the financial sector portfolio is of high quality," he said..

  • "We have asked Bank Negara to look into credit cards and personal loans, how to tighten the application process for such loans," he said. 
  • The household debt now stands at 83% of GDP. 
  • The biggest portion of the household debt is made up of housing loans, followed by car loans, he said.
  • He added that the collateral requirement for mortgages was high and the asset backing for these debts was high as well. (Bernama, NST)

The government has allocated RM2bn to implement 79 basic rural infrastructure projects in Sabah and Sarawak, the Dewan Rakyat was told Wednesday. Rural and Regional Development Minister, Datuk Seri Mohd Shafie Apdal said 52 of the projects, valued at RM1.3bn, were being implemented in Sarawak. (Bernama)

The next round of negotiations on the EU-Malaysia Free Trade Agreement (FTA) is expected to resume in 4Q13, said Ambassador and Head of Delegation of the European Union to Malaysia, Luc Vandebon. He said both sides are working to resume the process as soon as possible. "In the event of a round in 4Q13, it should be possible to conclude negotiations in late 2014 or early 2015,” he said. (Bernama)

Outstanding sukuk and debt securities in the Malaysian market stood at RM1tr as of May this year. Securities Commission Malaysia (SC) Deputy Chief Executive Datuk Dr Nik Ramlah Mahmood said as for the market capitalisation of Bursa Malaysia, it stood at RM1.6tr. In Malaysia, the size of the capital market has more than tripled to RM2.5tr since 2000, representing over 264% of GDP, she said. (Bernama)

The government has allocated RM2bn to implement 79 basic rural infrastructure projects in Sabah and Sarawak, the Dewan Rakyat was told Wednesday. Rural and Regional Development Minister, Datuk Seri Mohd Shafie Apdal said 52 of the projects, valued at RM1.3bn, were being implemented in Sarawak. (Bernama)

The next round of negotiations on the EU-Malaysia Free Trade Agreement (FTA) is expected to resume in 4Q13, said Ambassador and Head of Delegation of the European Union to Malaysia, Luc Vandebon. He said both sides are working to resume the process as soon as possible. "In the event of a round in 4Q13, it should be possible to conclude negotiations in late 2014 or early 2015,” he said. (Bernama)

Outstanding sukuk and debt securities in the Malaysian market stood at RM1tr as of May this year. Securities Commission Malaysia (SC) Deputy Chief Executive Datuk Dr Nik Ramlah Mahmood said as for the market capitalisation of Bursa Malaysia, it stood at RM1.6tr. In Malaysia, the size of the capital market has more than tripled to RM2.5tr since 2000, representing over 264% of GDP, she said. (Bernama)

Over 3.7m people living in rural areas have benefited from a National Key Result Area (NKRA) initiative, focusing on infrastructure. Rural and Regional Development Minister Datuk Seri Mohd Shafie Apdal said in Sarawak alone, roads measuring 911.87km were constructed, while water was supplied to 711,064 homes. He also said 18,301 houses were built and electricity supplied to 46,457 homes since the NKRA initiatives was implemented in 2010. (Financial Daily)

Malaysia wants to diversify its exports to Japan as currently, about half are made up of liquefied natural gas (LNG) and the rest are wood and wood-based products and electrical and electronic (E&E) products. International Trade and Industry Minister Datuk Seri Mustapa Mohamed said the government wants to reduce its dependency on LNG exports.

  • "Malaysia has a lot of offer to Japan other than LNG. Under the 12 National Key Economic Areas, we can export more in services, palm oil, tourism, healthcare, financial services and agriculture," he said.
  • Malaysia-Japan total bilateral trade hit US$47bn (RM149.55bn) last year.
  • Malaysia's imports from Japan include E&E products, chemicals and chemical-based products, automotive parts and minerals and mineral-based products. (BT)

Malaysian investment in UK has been on the upswing with companies, including government-linked firms, looking at investing in real estate and purchasing buildings in London. PM Datuk Seri Najib Tun Razak said Malaysia, the second major investors in London, will be the major player in the real estate development in metropolitan city.

  • He said Mara was looking at a few London properties and EPF, flushed with funds, was looking for opportunities to invest.
  • Currently, Malaysia's biggest investment in UK is the redevelopment of the £8bn (RM39.2bn) Battersea Power Station. (Bernama)

Malaysia is on the right track in its efforts to increase the country's green development credentials with 137 projects having been certified as of the 2Q13. More than 50m sq ft of building space have achieved Green Building status since Malaysia began practising certification using the fully-Malaysian Green Building Index (GBI) tools, said Project Director of Reed Exhibitions Louise Chua in a statement Wednesday. (Bernama)

Source: CIMB Daybreak - 04 July 2013

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