Monday, July 23, 2012

20120723 1218 Local & Global Economy Related News.

Malaysian companies must adapt to new ways of doing business and be ready for a new era of competition which extends globally. Malaysian Competition Commission (MyCC) Chief Executive Officer Shila Dorai Raj saud under the Competition Act 2010, business chambers must make their members understand the implications of breaking the law. The Act does not condone anti-competitive behaviour among businesses, including price fixing, cartel-like activities, market sharing, and controlling of supply or pricing. (NST)

The Finance Ministry is studying, with a view to restructuring all forms of subsidies, especially oil and gas, to ensure that they meet the target groups and help to reduce the burden of low-income earners. Towards this end, Deputy Finance Minister Datuk Dr Awang Adek Hussin, said he welcome suggestions from any quarters to be included for tabling of Budget 2013. He said the Government had placed the price of RON97 under “managed float” and maintained the subsidy for RON95, which was used mostly by low-income earners. (The Star)

The international reserves of Bank Negara Malaysia amounted to RM429.4bn (equivalent to USD134.4bn) as at 13 July 2012. The reserves position is sufficient to finance 9.4 months of retained imports and is 4.3 times the short-term external debt. (Bank Negara Malaysia)

Malaysian banks plan to tighten rules for the local interbank lending market amid a global probe into manipulation of benchmark borrowing costs that led to record fine for Barclays Plc last month. The 12 bank whose estimates were used to compile the Kuala Lumpur interbank offered rate, or Klibor, would be required to lend funds to other banks at that day’s rate during a five-minute period from 11 am every day, said Finance Markets Association of Malaysia president Dato’ Lee Kok Kwan. A limit would be set for the amount of money, he said. The rules were being drafted in consultation with Malaysia’s central bank and would be announced next week, said Lee, who is also deputy CEO of CIMB Group Holdings Bhd. The new rules would also stipulate a spread between Klibor and the rate that the 12 participating banks must pay for deposits during that five-minute window, Lee said. (StarBizweek)

China’s expansion may cool to 7.4% this quarter, whilst a decline in producer prices in tandem with consumer inflation may hurt investment returns of industrial companies, damping their desire to expand, warned People’s Bank of China monetary policy committee adviser Song Guoqing. (Bloomberg)

China’s MNI flash business sentiment indicator fell to 49.63 in Jul from 53.21 the final Jun survey, indicating a contraction in business during the month. (Bloomberg)

Greece and the European Investment Bank reached an agreement today for the lender to resume lending to Greek firms and for infrastructure projects to the tune of €1.44bn by the end of 2015. (Bloomberg)

Russian President Vladimir Putin signed the bill ratifying Russia's entry to the World Trade Organisation after 18 years of often acrimonious negotiations. (AFP)

Sri Lanka announced the completion of a US$2.6bn IMF bailout, but it was seeking fresh loans to support an economy emerging from decades of ethnic war. (AFP)

Bank Indonesia says it will prepare Rp89.4tr (US$9.5bn) of hard cash to anticipate demand for money and the traditionally higher number of transactions during Ramadhan. (The Jakarta Post)

Indonesia is targeting a 42% increase in fund inflows next year as economic growth accelerates, according to estimates by Bank Indonesia deputy governor Halim Alamsyah, who announced plans to attract capital and foreign direct investment inflows of US$12.2bn this year and US$17.3bn in 2013. The central bank forecasts GDP will expand in the range of 6.3-6.7% next year, from a range of 6.1-6.5% in 2012. (The Jakarta Globe)

Bank Indonesia has identified 10 commercial banks that could be at risk of being acquired or merged with another, based on its new guidelines, according to governor Darmin Nasution who said that the new rule would “by natural selection” force a degree of consolidation to the country’s banking system. (The Jakarta Globe)

Fitch Ratings says the Bank Indonesia’s new rule on bank ownership will likely expedite banking consolidations but will pose challenges for smaller lenders “notably because of a concentrated shareholding structure, especially family-owned, which has been cited as one factor behind bank failures in Indonesia in the past.” (The Jakarta Globe)

Cambodia, Myanmar, Laos and Indonesia vowed that rules and regulations are being improved to embrace an investment flow in light of the activation of the ASEAN Economic Community in 2015. (Asia News Network)

No comments: