Government earmarks 33 companies for divestment
The Government has identified 33 government-linked companies (GLCs) that are ready for divestment through partial sales, outright sales or listings on the stock market. The bulk of them, or 24 companies, will be involved in these exercises between now and the end of 2012. This is part of the government’s Strategic Reform Initiatives (SRIs), or policy measures to drive its Economic Transformation Plan (ETP). (Financial Daily)
Malaysia: Unveils economic measures before planned protests
Malaysia announced plans to sell state companies, improve public finances and relax foreign ownership rules, persisting with efforts to revamp the economy ahead of protests from groups demanding fairer elections. The Government will scale back its business interests, with 33 state-linked companies identified to be listed, partially sold or divested outright, Datuk Sri Idris Jala, minister in the Prime Minister’s Department, said. Foreign equity and employment restrictions will be gradually removed in service industries including health care, education, engineering and law, he said. (Bloomberg)
Malaysia: Export growth slows as electronics sales to US ease
Malaysia’s export growth slowed in May as electronics manufacturers shipped fewer goods to the US, complicating the central bank’s job of curbing inflation while supporting an economic expansion. Overseas shipments climbed 5.4% to RM55.09bn (USD18bn) from a year earlier after gaining 11.1% in April, according to a trade ministry statement. The median estimate of 14 economists in a Bloomberg News survey was for an 11% gain. Malaysia’s industrial production unexpectedly fell in April after the March earthquake and tsunami in Japan disrupted regional trade, clouding the outlook for exporters from the Philippines to Thailand. Slowing growth in the US and the European debt crisis have also threatened demand for Asian goods. (Bloomberg)
Japan: May run out of money if bond bill isn’t passed, Noda says
Japanese Finance Minister Yoshihiko Noda said the government may run out of money as early as October unless a bill authorizing bond sales is passed in parliament. “If the bill is not passed in the current diet session, the seamless management of the budget beyond September will be difficult,” Noda said at a press conference in Tokyo. “We’ve got our backs against a wall and need to do our best to avoid that situation.”Prime Minister Naoto Kan needs parliamentary approval to issue bonds, which will pay for almost half of the annual budget this fiscal year. The premier said he won’t resign unless the bill is passed, amid concern the opposition will use its control of the upper house to hold up the release of the funds. (Bloomberg)
China: Services industries expand as new orders, jobs climb
China’s services industries expanded at the second-fastest pace this year as new orders and employment climbed, supporting growth amid the government’s campaign to cool inflation. A purchasing managers index was 54.1 in June compared with 54.3 in May, HSBC Holdings Plc and Market Economics said. A reading above 50 indicates expansion. “The continuous steady expansion of the service sector, in particular the notable improvement in employment, should lend support to economic growth,” HSBC’s chief China economist Qu Hongbin said in the statement. “This should provide room for Beijing to keep the current tightening measures for another two to three months to slow inflation meaningfully into the fourth quarter.”(Bloomberg)
Australia: Trade surplus in may widens to seven-month high
Australia’s trade surplus in May was the widest in seven months as the mining industry fueled a recovery from the economy’s worst quarterly contraction in two decades. Exports exceeded imports by AUD2.33bn (USD2.5bn), from a revised AUD1.62bn surplus in April, the Bureau of Statistics said in a report in Sydney. The median estimate in a Bloomberg News survey of 25 economists was for a surplus of AUD1.9bn. Reserve Bank of Australia Governor Glenn Stevens is forecast to hold interest rates at 4.75% for a seventh meeting to help the economy recover from natural disasters at home and abroad. (Bloomberg)
U.S: Orders to factories rose 0.8% MoM in May on capital goods, after a revised 0.9% MoM decline in April. Demand for durable goods that are meant to last at least three years increased 2.1% MoM, while unfilled orders climbed the most since September. (Source: Bloomberg)
Portugal: Ratings cut to junk by Moody's on financing risk. The long-term government bond ratings were lowered to Ba2, or junk, from Baa1, and the outlook is negative. Discussions to involve private investors in a new rescue plan for Greece make it more likely that the European Union will require the same pre-conditions in the case of Portugal, Moody's said in a statement. (Source: Bloomberg)
China: Services industries in June expanded at the second-fastest pace this year as new orders and employment climbed. A purchasing managers index was 54.1 in June compared with 54.3 in May, HSBC Holdings Plc and Markit Economics said in a statement. A reading above 50 indicates expansion. (Source: Bloomberg)
India: Services industry growth accelerated in June, increasing pressure on the central bank to boost interest rates further to damp inflation. The Purchasing Managers' Index rose to 56.1 from 55 in May, HSBC Holdings Plc and Markit Economics said in an emailed statement. A reading above 50 indicates an expansion. (Source: Bloomberg)
Philippines: June inflation accelerated to the fastest pace in 26 months after utility and transport costs rose. Consumer prices increased 5.2% YoY in June, the biggest gain since April 2009, according to data released by the National Statistics Office in Manila using 2006 as a base year. Inflation was 4.6% YoY using 2000 as a base year. (Source: Bloomberg)
Vietnam: Central Bank cuts repurchase rate- Vietnam's central bank cut its repurchase rate by one percentage point even after inflation accelerated to one of the fastest paces in the world. The State Bank of Vietnam said it lowered the rate to 14% from 15%, the first reduction since October 2010, according to an emailed statement. (Source: Bloomberg)
Greece: Banks ready to take part in rollover, Venizelos says
Greek banks are willing to roll over their government bonds as part of a European Union rescue plan that will keep the country out of financial markets for three years, Finance Minister Evangelos Venizelos said. “The Greek banks are ready to participate,” he said in an interview with Bloomberg Television in Athens. Greece will meet its goal of achieving a primary surplus next year and in following years, and is targeting EUR1.7bn in revenue from state-asset sales by the end of September, the minister said. He added that he will appoint a new head of the country’s privatization fund by 11 July. (Bloomberg)
Portugal: Ratings cut to junk by Moody’s on financing risk
Portugal’s credit rating was cut to below investment grade by Moody’s Investors Service on concern the country will need to follow Greece in seeking a second bailout. The euro dropped for the first time in seven days. The long-term government bond ratings were lowered to Ba2, or junk, from Baa1, and the outlook is negative. Discussions to involve private investors in a new rescue plan for Greece make it more likely that the European Union will require the same pre-conditions in the case of Portugal, Moody’s said in a statement. (Bloomberg)
US: Orders rose 0.8% in May on capital goods
Orders placed with US factories increased in May, indicating manufacturing may rebound from a slowdown in economic growth in the first half of 2011. Bookings for manufacturers’ goods rose 0.8%, less than forecast, after a revised 0.9% decline in April that was smaller than previously estimated, figures from the Commerce Department showed today in Washington. Demand for durable goods that are meant to last at least three years increased 2.1%, while unfilled orders climbed the most since September. Manufacturing is showing signs of recovering from parts shortages linked to the earthquake and tsunami in Japan, at the same time commodity costs ebb and growing economies overseas fuel exports. (Bloomberg)
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