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Tag: Economy

  • Visa and The Mall Group collaborate to drive the future of retail in Thailand

    Visa and The Mall Group collaborate to drive the future of retail in Thailand

    Visa, the world’s leader in digital payments, and The Mall Group, Thailand’s leading retail and entertainment complex developer, last week announced a new long-term partnership set to drive the future of retail in Thailand.

    Building on their existing relationship, this partnership will see The Mall Group and Visa develop personalised shopping experiences for consumers, using Visa’s capabilities and exploring new technologies such as the Internet of Things (IoT), Artificial Intelligence (AI), Augmented Reality (AR), Virtual Reality (VR), biometrics, as well as data analytics to understand changing consumer behaviours.

    Chris Clark, Visa’s Regional President for Asia Pacific, said: “We believe payment technology can be a key differentiator for The Mall Group helping it to deliver a faster, more convenient and more personalised shopping experience for consumers. We’re looking forward to working together to drive payments innovation at The Mall Group’s expansive locations across Thailand.”

    Supaluck Umpujh, Chairwoman of The Mall Group, said: “The partnership with Visa represents a significant step into a new era of retail where customer experience is at the heart of everything we do. Our goal is to explore and leverage the latest innovations that will add value to our business. This will consequently benefit our shoppers and help strengthen our position as a world-class shopping destination among both local and international visitors.”

    Studies have shown that by 2020 AI will be responsible for managing 85 percent of retail customer interactions and as many as 100 million consumers will use AR to create a more novel shopping experience.

    For decades, Visa, together with its merchant partners, has consistently invested in growing electronic payments in Thailand. This has included educating consumers and merchants on the benefits of electronic payments, expanding the acceptance of electronic payments, and introducing new technologies to enhance the payment experience and make it more secure, such as EMV, contactless payment technology, tokenisation, and Visa QR payments.

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  • Supporting industry should be a major priority: PM Vietnam

    Supporting industry should be a major priority: PM Vietnam

    Vietnam needs to make its supporting industry a production base for the global manufacturing chain, PM Nguyen Xuan Phuc says. “Vietnam should become a production base for multinational companies. This is what the Ministry of Industry and Trade and other government bodies should think about in their development strategy,” Prime Minister Nguyen Xuan Phuc said Wednesday.

    He was speaking at the conference on “Solutions for Promoting the Development of Supporting Industry in Vietnam,” held in Hanoi.

    He said that Vietnam should strive to compete in regional and global markets, manufacturing parts for cars, motorbikes and even airplanes.

    The government has always been prioritizing land access for the supporting industry, and has never said no to any such request, Phuc said.

    Supporting businesses should speed up and start operations earlier, Phuc said, adding that there were firms in the industry that could finish clearance and lay their foundations in just three months, while some have left things hanging for as long as three years.

    The supporting industry in Vietnam remains weak, having to import nearly 90 percent of raw materials, spare parts and components needed for production, according to the Ministry of Industry and Trade.

    This means a low localization rate, even in industries with great supporting industry potential, like automobiles and textiles and garments, it said.

    Minister of Industry and Trade Tran Tuan Anh said at the conference that only 300 supporting firms were currently part of the supply chain for multinational companies. As of last year, Vietnam had 75,000 manufacturing firms.

    The number of new businesses in this sector has barely increased in recent years, even though this is a key foundation for industrialization, Anh said.

    Therefore, those making finished products in the country are having to import accessories and parts from other countries or produce them on their own, he added.

    He cited Japan as a good example of a strong supporting industry. Even though the majority of Japanese supporting businesses are medium, small and micro sized, they are integrated deeply in the global manufacturing chain with high added value. They provide accessories and parts to the aviation industry, he noted.

    The trade minister added that Vietnam’s policy for attracting foreign direct investment (FDI) does not create favorable opportunities for local supporting businesses to develop and join the global manufacturing chain.

    There are over 3,000 supporting industry businesses in Vietnam, accounting for 4.5 percent of the manufacturing and processing sector, creating jobs for over 550,000 employees, according to the Ministry of Industry and Trade.

    From January to November this year, Vietnam imported $30.66 billion worth of machines, accessories and parts, and exported $15.13 billion worth of products, according to Vietnam Customs, marking a trade deficit of $15.53 billion.

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  • Securing Raw Materials Key to Competitiveness of Indonesia’s Textile Industry

    Securing Raw Materials Key to Competitiveness of Indonesia’s Textile Industry

    Indonesia is set to become one of the top five textile and textile product producers in the world by 2030, and the Ministry of Trade is forging ahead with its Making Indonesia 4.0 roadmap, which prioritizes the development of a number of industries, including the textile sector.

    Muhdori, the trade ministry’s director tasked with the textile, leather, footwear and various other industries, said the implementation of the roadmap would strengthen the textile sector’s global competitiveness, as it improves efficiencies and product quality.

    “Being highly integrated from upstream to downstream, this sector is competitive and is supported by a large amount of human resources for its production activities,” he said.

    The challenge for the textile industry was to become more efficient, while continuing to improve human resource competencies, in accordance with technological development, he said.

    “Being both an export-oriented and labor-intensive sector, the textile industry has thus far contributed significantly to Indonesia’s economic growth,” Muhdori said.

    According to the Ministry of Industry, textile and textile product exports have continued to increase in recent years. The textile and textile product sector’s contribution to Indonesia’s gross domestic product amounted to a record $10.46 billion last year, while exports were valued at $12.58 billion, up 6 percent from 2016.

    Increased Exports

    The Ministry of Industry pegged textile exports at $13.5 billion this year, along with the creation of 2.95 million new jobs in the industry, while exports are projected to increase further to $15 billion next year, with the creation of up to 3.11 million jobs. This will increase the sector’s share of Indonesia’s total exports to 1.6 percent.

    The ministry is optimistic that this year’s growth target of between 4 percent and 6 percent can be achieved. The textile industry grew 3.45 percent last year, having nearly doubled from 2016.

    However, this growth target also calls for an increased supply of raw materials, which currently consist of 51 percent synthetic fiber, such as polyester and nylon, 37 percent cotton fiber, and 12 percent rayon.

    But the industry still faces obstacles in reaching its full competitive potential, as nearly all cotton must be imported. In contrast, 80 percent of synthetic fiber and 85 percent of rayon are domestically produced, with these numbers expected to increase further.

    Rayon is a cellulose material extracted from soluble wood pulp. It offers better absorption and breathability than cotton. Rayon fiber has various uses, including in clothing, bedding, towels, baby wipes, masks and personal hygiene products.

    According to Redma Gita Wirawasta, secretary general of the Indonesian Synthetic Fiber Producers Association (APSyFI), rayon is most in demand in the fashion industry due to several advantages, such as comfort and disposability, which make it environmentally friendly.

    “Indonesia has the potential to become one of the largest rayon industry players in the world, supported by extensive land availability and a suitable climate. This makes Indonesia comparatively superior to other rayon-producing countries,” he said.

    Raw Materials

    Redma Gita said the growth of the rayon fiber industry requires sustainable raw material supply through industrial plantations.

    “Rayon plants supported by industrial plants not only strengthen the structure of the textile industry, but also reduce its dependence on imported raw materials, which has been an issue for national textile competitiveness,” he said.

    “This upstream industry could even generate foreign exchange as some of its production is exported,” he added.

    The Ministry of Industry noted that the production capacity of the rayon fiber industry has risen substantially over the past three years. Production is expected to increase to about 700,000 metric tons this year, compared with 565,000 tons last year and 470,000 tons in 2016.

    Production capacity growth is expected to continue until 2021, when it is expected to reach 1.2 million tons.

    However, the industry faces challenges from environmental activists. Redma Gita refuted allegations from Canopy, an international nonprofit focused on forest conservation, which stated that raw materials for rayon fiber comes from ancient and endangered forests in Sumatra and Kalimantan.

    “Those accusations are baseless. They have provided no proof of this whatsoever,” he said. He also highlighted the importance of the government in supporting the development of the national textile industry.

    Machmud Thohari, a forestry expert, meanwhile also questioned the Canopy report’s use of terms such as ‘ancient’ and ‘endangered’ to categorize forests.

    “As far as I know, the terms ‘ancient’ and ‘endangered’ aren’t commonly used in the scientific classification of forests,” he said.

    Thohari said the term ‘ancient forest’ may have been used to refer to an old-age forest or one that is many, many years (i.e.: centuries) old.

    On a similar note, Riau Governor Wan Thamrin Hasyim also condemned the Canopy allegations, as he sought to highlight the strategic industrial potential of the province.

    “The accusation must be clarified, as it can deter investors and [negatively impact] Riau’s economic growth,” he said.

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  • Indonesia’s November Trade Deficit Widest Since July 2013

    Indonesia’s November Trade Deficit Widest Since July 2013

    Indonesia posted its widest monthly trade deficit in over five years in November as exports, especially that of palm oil and pulp, slumped, data from the statistics bureau showed on Monday. The deficit in November was $2.05 billion, compared with October’s revised deficit of $1.77 billion and the biggest trade gap since July 2013, according to Refinitiv data. A Reuters poll had expected a deficit of $830 million.

    The rupiah weakened slightly after the trade data to 14,620 a dollar at 12.45 p.m. from 14,600 before the announcement.

    Exports surprisingly fell 3.28 percent in November from a year earlier to $14.83 billion, the worst monthly performance since June 2017. The poll’s median was for a 3.95 percent increase for exports.

    A decline in overseas sales of a range of products, such as palm oil, jewelry, pulp and paper, and crude oil, was the main reason for the drop, Central Statistics Agency (BPS) head Suhariyanto said at a news conference.

    Export revenues from vegetable oils, including palm and coconut oil, fell nearly 19 percent in November from a year earlier due to weak prices, he said.

    November imports stood at $16.88 billion, up 11.68 percent from a year earlier, topping the poll’s 10.50 percent estimate, but down from the nearly 24 percent growth in October.

    Southeast Asia’s largest economy has been struggling to contain imports in recent months. Some measures, including higher tariffs, have been imposed to curb imports.

    Authorities have also sped up negotiations for free trade deals to gain better access for exports, in a bid to reduce the trade gap and support the rupiah.

    Bank Indonesia has also hiked interest rates six times since May to try to attract portfolio investment needed to fund the widening current-account deficit.

    Fakhrul Fulvian, an economist at Trimegah Sekuritas, said the worse-than-expected trade deficit would “lower the expectation of improving current-account balance” in the fourth quarter. But he argued that the central bank would not have to raise rates again because it already did in November.

    Maybank Indonesia economist Myrdal Gunarto agreed.

    “The movement of the exchange rate in domestic market remains manageable and the trade deficit was supported by returning foreign inflows,” Gunarto said. “With that, we project Bank Indonesia will still maintain its policy interest rate at the current level.”

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  • Vietnamese consumers among the most optimistic in the world

    Vietnamese consumers among the most optimistic in the world

    Vietnamese consumer confidence has reached a global high thanks to optimism over jobs and personal finances. The Vietnam Consumer Confidence Index has risen by nine points from the second quarter to reach an all-time high at 129 points in the third quarter of 2018, according to the Global Consumer Confidence Survey.

    The survey results have been released by research association The Conference Board in collaboration with global market research company Nielsen.

    The survey ranks the country in second place in the world in terms of consumer confidence, behind India at 130 points.

    While most Asian economies are vulnerable to the ongoing trade dispute between China and the U.S., Vietnam is a possible exception, as it may attract parts of the global value chain that currently run through China, the report said.

    The rise in the confidence index is also due to greater optimism about employment prospects, personal finances and the level of willingness to spend.

    Eight out of ten Vietnamese surveyed said that they were positive about their job prospects, up nine percentage points from the second quarter.

    Eighty-two percent of respondents expected their personal finances will be good or excellent over the next 12 months, up 6 percentage points from the second quarter.

    The majority of them, 63 percent, said that the next 12 months are a good time for them to buy the things that they want and need, 8 percentage points higher than the second quarter.

    Concerns about having a stable job and health (both at 40 percent) remained the top concerns among Vietnamese consumers. The national economy came in third at 27 percent, 5 percentage points higher than the previous quarter.

    Vietnamese consumers continue to take the lead globally when it comes to saving, the survey found. Seventy-two percent of respondents said that they would save their spare cash, up two percent from the second quarter.

    But Vietnamese people are also more willing to spend on big-ticket items. The percentage of people who would spend their spare cash on home improvements increased 10 percent from the second quarter to 48 percent.

    Over half of them, 53 percent, want to spend the money on new clothes, up 7 percentage points from the second quarter.

    Nguyen Huong Quynh, managing director of Nielsen Vietnam, said that when consumers faced multiple concerns, their purchasing decisions will be affected and businesses should always keep a close track on changes in the spending habits of consumers.

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  • Vietnamese carriers get busy with early holiday plans

    Vietnamese carriers get busy with early holiday plans

    With six weeks to go for Tet, the Lunar New Year festival, Vietnamese carriers are bracing for the upsurge in demand. Jetstar Pacific, the low-cost arm of flag carrier Vietnam Airlines, announced Tuesday that it would increase the number seats on local routes by 80,000.

    It has also opened a new route from Hanoi to the southern city of Can Tho to meet travel demand between the two destinations before and after the Tet holiday, which falls February 2-10 next year.

    Earlier, the carrier had announced plans to operate 3,210 flights, or 600,000 seats, to serve customers for the Tet holiday.

    Vietnamese people traditionally move from the cities to their hometowns and villages all over the country to reunite with their families before the Lunar Near Year begins.

    State-owned Vietnam Airlines has also raised its number of seats from January 20 to February 19 to 1.4 million, 100,000 higher than the same period last year. This involves an addition of 566 more flights, to serve customers in Tet.

    The flag carrier has also announced that it will open a new route from Ho Chi Minh City to the new Van Don International Airport near Ha Long Bay in Quang Ninh Province. It will start operating one flight a day between the two destinations starting December 30.

    About 90 percent of flights between Ho Chi Minh City and Hanoi, central cities of Vinh and Da Nang have already been booked, a Vietnam Airlines representative said.

    As there are signs of the demand increasing further, the largest airline in the country by passengers carried plans to open another 56,000 seats in the next few days.

    Many VietJet Air agents have confirmed that VietJet has opened ticket sales from Ho Chi Minh City to Van Don Airport in Quang Ninh Province starting January 20. The Van Don International Airport, the first private airport in the country, is set to open for business on December 25, 2018.

    Dinh Viet Thang, head of the Civil Aviation Administration of Vietnam (CAAV), said at a conference last month that the number of airplanes will increase by 32 to 180 to meet the high travel demand around Tet time. This means that the transport capability of the Vietnamese aviation sector will increase by 20 percent, he added.

    The number of air passengers for the upcoming New Year’s Eve and Tet holidays is expected to increase by 11 percent year-on-year, according to the Civil Aviation Administration of Vietnam (CAAV).

    It also says that local airlines have registered to increase the number of flights by 2,611 to 19 airports for Tet. The number of passengers during the holiday is expected to increase by around 280,000 over normal days.

    The highest holiday surge in the number of passengers will be seen on the HCMC-Hanoi route, which will have 519 additional flights, or 20 percent of the total increase. The corresponding numbers for the HCMC-Da Nang route will be 354 flights and 14 percent; HCMC-Vinh, 306 flights and 12 percent; and Hanoi-Phu Quoc, 24 flights and one percent.

    Vietnamese carriers have served almost 45.1 million passengers in the country in the first 11 months of this year, up 11.9 percent from a year ago, according to the General Statistics Office.

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  • Vietnam’s car imports down 20 pct in 2018

    Vietnam’s car imports down 20 pct in 2018

    Vietnam imported 72,650 cars this year, down nearly 20 percent over 2017, according to the Vietnam Customs. The import value of cars exceeded $1.64 billion this year, up 21 percent year-on-year, the agency said. Thailand and Indonesia remain major suppliers of Vietnam’s imported cars. From Thailand alone, Vietnam has imported more than 52,170 vehicles worth a combined $1.04 billion since the beginning of the year.

    According to customs data, from December 7-13, car imports slowed down by 701 units from the previous week, totaling 2,833 vehicles. Total import value is reported to be $67 million.

    Vietnam’s population is around 93 million, larger than South Korea, but car consumption is only around 300,000 units a year, Mike Dunne, an independent industry analyst who has spent more than three decades in Asia, told U.S. television channel CNBC recently.

    Most cars sold in Vietnam are foreign brands assembled in the country from kits. But a series of free trade agreements have reduced import duties and are opening up the market. A 30 percent import tax on cars from other Association of Southeast Asian Nations (ASEAN) countries was scrapped this year.

    There are only 358 businesses in the auto industry in Vietnam compared to 2,500 in Thailand, according to the Ministry of Industry and Trade. The ministry also said that Vietnam imports over 90 percent of auto parts.

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  • LG sets up lab to conduct appliance technology research

    LG sets up lab to conduct appliance technology research

    LG has established a new research laboratory committed to advances in fridge, oven and other home-appliance technologies. LG Electronics opened the 6,760-square-foot Food Research Institute on Monday at Changwon, South Gyeongsang. At the center, researchers will develop technologies that can be applied to the company’s home appliances, such as refrigerators, kimchi and other specialty food fridges, ovens and electric stove tops.

    Food preservation, the fermentation of kimchi and food preparation will be some of the focuses.

    The company said researchers will work closely with academics from Seoul National University and Konkuk University, as well as experts from government and private agencies, such as the Rural Development Administration, the Korea Food Research Institute and the World Institute of Kimchi.

    LG Electronics often mentions advanced technologies in its marketing materials, using the technology to set itself apart from competitors.

    According to the company, LG refrigerators run on inverter linear compressors, which are 18 percent more energy efficient and create less noise than comparable gas compressors. Its kimchi refrigerators maintain temperatures of 6.5 degrees Celsius (43.7 degrees Fahrenheit), the optimal level for kimchi. At that temperature, the growth of a lactic-acid bacteria that creates a sour taste is suppressed. LG’s electric stove tops can cook food up to 2.3 times faster than gas ranges, the company boasts.

    The facility at Changwon is not the first research lab established by the company to further develop its home appliances. In February, LG Electronics opened a water research lab committed to the making of better water purifiers. In October, it opened a center dedicated to air science to advance its air purification technologies.

    “We will continue investing in research and development related to food, water and air technologies,” said Song Dae-hyun, head of LG Electronics’ Home Appliance & Air Solutions.

  • Malaysia’s CIMB to gain RM200m from stockbroking business transfer

    Malaysia’s CIMB to gain RM200m from stockbroking business transfer

    CIMB Group Holdings Bhd is expected to record a gain of disposal of approximately RM200 million from the process of transferring the group’s stockbroking business to its joint venture company with China Galaxy Securities Co Ltd.

    This comes after taking into account the premium on the disposal of approximately RM433 million and goodwill attributable to the business.

    CIMB said the consideration in connection with the proposed business transfer will be satisfied in cash and it was determined based on the future prospects and net asset value of the in-scope business as at Dec 31, 2015, which amounted to RM565.6 million.

    The consideration is subject to closing audit adjustments, if any.

    Jupiter Securities, the subsidiary of China Galaxy Securities Co Ltd (CGS)-CIMB Holdings Sdn Bhd, which is the Malaysian joint venture entity, will operate the stockbroking business.

    CIMB said in a stock exchange filing that its wholly owned subsidiary CIMB Group Sdn Bhd (CIMBG), China Galaxy’s wholly owned unit China Galaxy International Financial Holdings Ltd (CGI), and CGS-CIMB Holdings Sdn Bhd has inked a share subscription agreement for the subscription of new shares in CGS-CIMB Holdings Sdn Bhd.

    The proposed business transfer entails the sale of CIMB Investment Bank Bhd’s cash equities business and 100% equity interest in CIMB Futures Sdn Bhd as well as CIMB Bank Bhd’s equity financing services business and share margin financing granted in connection with the cash equities to Jupiter Securities.

    After the completion of the exercise, CIMBG and CGI will hold 50% stake each in the Malaysian JV entity.

    The exercises are expected to be completed in the first half of 2019.

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  • BTS adds 4 trillion won to the Korean economy

    BTS adds 4 trillion won to the Korean economy

    Popular boy band BTS’s annual economic value is estimated at over 4 trillion won ($3.5 billion), making it more lucrative than a medium-sized company. The group’s annual production inducement effect, which refers to the value generated in related industries, is estimated at around 4.1 trillion won, according to a report by Hyundai Research Institute (HRI) released Monday.

    “BTS was the first Korean artist to place at No. 10 on the Billboard Hot 100 and reach No. 1 on the Billboard 200,” read the report. “The group’s rising fame and popularity can be observed in the explosively growing number of Google searches and YouTube video counts after 2017.”

    “Expecting such growth in popularity to have a positive effect on the Korean economy, we wanted to estimate the impact of BTS’s popularity on the domestic economy by assessing foreign tourists and consumer exports.”

    Research findings revealed that the HRI’s assumptions were correct. According to the report, BTS is responsible for attracting at least 796,000 foreign tourists annually to Korea since their debut in 2013. The report also credits the group for increasing sales of related exports by $1.1 billion every year, including $233.98 million worth of clothing, $426.64 million worth of cosmetics and $456.49 million worth of foodstuffs.

    BTS’s estimated annual economic value of 4.1 trillion won is 26 times larger than the average medium-sized company in Korea, which earned just 159 billion won in 2016 according to the report.

    The HRI report also discussed the factors believed to be behind the success of the group.

    “All BTS members participate in the songwriting and composing, often writing from their own perspective the concerns of young adults in their teens and twenties, and listeners are able to sympathize with them regardless of their nationality,“ read the report. “BTS’s albums and concerts are also structured in a way that has a narrative, which helps attract the attention of fans and raise their expectations for upcoming albums and concerts as well.”

    Other factors mentioned include active communication with BTS fans – known as ARMY – through social media and the fans’ strong support.

    BTS is expected to produce an accumulated total of 41.8 trillion won in economic value between 2014 and 2023 if it maintains its average popularity level of the last five years.

    “In order to maximize the economic impact of Hallyu [Korean wave], it’s necessary to develop and promote domestic tourism through dramas, movies and videos and raise demand from foreign tourists,” the report concluded.

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  • World Bank cuts Malaysia’s 2018 GDP growth forecast again

    World Bank cuts Malaysia’s 2018 GDP growth forecast again

    The World Bank has again revised downward its projection for Malaysia’s 2018 gross domestic product (GDP) growth to 4.7% from 4.9% after taking into account factors such the rigorous rationalisation of expenditure by the government and slowdown in private and public investment. It last cut the country’s GDP growth forecast in October, to 4.9% from 5.4%.

    Malaysia’s third quarter GDP growth moderated to 4.4%, bringing about a nine-month expansion of 4.7%.

    Despite a moderation in growth, the World Bank believes that the Malaysian economy remains resilient and continues to be anchored by private consumption, although it has been cooling down after the reintroduction of the sales and service tax.

    The key drivers for private consumption are stable labour market conditions, cost of living aid and tax refunds payment.

    Private investment in the manufacturing and commodity sectors are also expected to be sustained.

    Speaking at the launch of the World Bank’s Malaysia Economic Monitor on Realising Human Potential Report, World Bank Group economist Shakira Teh Sharifuddin said Malaysia’s economic growth is projected to remain flat at 4.7% in 2019, with external factors such as current trade tensions and increased volatility in the financial and commodity markets expected to weigh on the overall economy.

    In addition to the escalating trade tensions, monetary normalisation in advanced economies, high dependency on oil revenue and high level of public debt are seen as potential risk for the government.

    The percentage of the federal government’s revenue to GDP has seen a steep decline between 2012 and 2018, falling from 21.4% to 16.2%. In 2019, the share of revenue to GDP is expected to be reduced further to 15.1%.

    This, Shakira said, leaves the government with limited space to respond to economic shocks.

    In the near term, the government is expected to rigorously embark on fiscal consolidation measures with expenditure expected to decline to 18.1% of GDP from the 2018 estimate of 20.3%.

    Shakira said that while the introduction of new taxes in the budget is welcomed, the government should relook the incentive mechanisms.

    On another note, the World Bank stressed on the need for Malaysia to accelerate the development of its human capital if it wishes to join the ranks of a high-income nation.

    While Malaysia, which ranked 55th out of 157 countries in the Human Capital Index, fared well in some areas, there is room for improvement in certain areas, noted the report.

    It also states the prevalence of stunting among Malaysian children which affect more than one in five Malaysian children, a key indicator of malnutrition. In the absence of renewed efforts to develop human capital, a child born today in Malaysia will only reach a productivity level of 62%.

    In terms of education, the 12.2 years spent by Malaysians in school only equates to the 9.1 years learning outcome of school goers in the highest performing system.

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  • November inflation seen easing to 0.5%

    November inflation seen easing to 0.5%

    Malaysia’s consumer price index (CPI) is expected to rise 0.5% in November from a year earlier, a Reuters poll showed, marginally slower than the previous month amid lower transport prices. Inflation has been mild since the government removed an unpopular consumption tax in June and reinstated a narrower sales and services tax (SST) three months later.

    The annual inflation rate was 0.6% in October. It has been rising after hitting a three-and-a-half year low of 0.2% in August.

    Economists expect any pickup in inflation due to the reintroduction of SST to be muted, softened further by the government’s decision to fix pump prices for premium RON95 petrol for the rest of the year.

    Last month, Malaysia’s central bank said inflation had been largely benign in the third quarter, but was expected to edge upwards the rest of the year and into 2019.

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  • Flood of new passengers to stoke demand for jet fuel in Vietnam

    Flood of new passengers to stoke demand for jet fuel in Vietnam

    Vietnam’s jet fuel demand will surge to a record this year as its tourism booms and the country’s airlines are rapidly expanding. The country is on track to have 38 million international passengers and 16 million visitors this year, according to data from CAPA Centre for Aviation. That is up from 18 million passengers and 8 million visitors in 2015, according to the data.

    “Aviation demand in Vietnam is booming… Fuel consumption in Vietnam will reach a record high this year and will keep rising for the years to come,” said Tran Hoai Nam, vice president of Vietjet, Vietnam’s biggest private airline.

    He added Vietnam’s growth in foreign arrivals was the highest in Southeast Asia, rising 8.7 percent annually.

    The surge in traffic has translated into a rush of jet fuel demand in Vietnam. Through November, the country has imported 1.87 million tonnes of the fuel, according to customs data, equal to 14.8 million barrels, and up 18 percent from the same period last year.

    “For 2018, jet fuel demand in Vietnam is estimated to be increased by about 20 to 25 percent in comparison with 2017, mostly due to the increase in consumption of the international flights,” said a Hanoi-based trader at one of country’s jet fuel suppliers, who asked to remain unidentified due to company policy.

    Vietnam currently consumes about 18 million barrels of jet fuel per year, according to data from Petrolimex Aviation.

    By 2035, Vietnam will have 150 million airline passengers per year, nearly four times what it was in 2015, according to a 20-year forecast from the International Air Transport Association (IATA).

    Over the same period, India will have 442 million passengers, 3.6 times what it was in 2015, while China will have 1.3 billion passengers, 2.7 times what it was in 2015, IATA said.

    In November, Vietnam issued an aviation licence to Bamboo Airways, which would be the country’s fifth airline after Vietnam Airlines, Jetstar Pacific Airlines, Vietjet Aviation VJC.HM and Vietnam Air Services Co.

    Bamboo is expected to launch its first flights within weeks. It signed a provisional deal in July to buy 20 of the wide-body 787-9 jets from U.S. manufacturer Boeing and agreed a memorandum of understanding with Europe’s Airbus for up to 24 of the narrow-body A320neo jets in March.

    VietJet, which currently operates 60 Airbus jets, has signed a $6.5 billion (5.2 billion pounds) agreement to buy 50 new jets.

    Vietnam’s jet fuel imports will continue to surge as the country only has two refineries, Dung Quat in the central province of Quang Ngai and Nghi Son in Thanh Hoa Province, near to the capital Hanoi, which only started operations this year.

    “Both Dung Quat and Nghi Son refineries are primarily catered towards the production of gasoline and diesel, and thus, jet fuel yield is relatively low at 5 percent,” said Peter Lee, an analyst at Fitch Solutions Macro Research.

    Nghi Son, once fully operational, will produce about 4.6 million barrels of jet fuel per year, said a source at the refinery. Dung Quat can produce as much as 2.3 million barrels per year, according to the company website.

    “Vietnam will be reliant on imports to meet most of its jet fuel demand going forward,” Lee added.

    Vietnam imports most its jet fuel from refineries in Singapore, Thailand and China, trade data showed.

    Despite the steep growth outlook for Vietnam’s aviation sector, passenger growth might may be uneven as the country grapples with capacity constraints at its airports.

    Vietnam’s biggest airport Tan Son Nhat, serving Ho Chi Minh city in the south, receives about 10 million more passengers per year than it is designed to serve.

    The government is planning a second international airport at Long Thanh, 40 km (24 miles) east of Ho Chi Minh City, that will serve 25 million passengers a year starting in 2025.

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  • ICONSIAM to launch event to boost Thai’s tourism

    ICONSIAM to launch event to boost Thai’s tourism

    Amazing Thailand Countdown 2019 at ICONSIAM is a truly amazing event of the country with a great collaboration of entities from the public and private sectors and surrounding communities to organize a New Year Celebration in a scale never before seen along the Chao Phraya riverside, the place that has become the NATIONAL ICONIC LANDMARK and ICON of Eternal Prosperity.

    Amazing Thailand Countdown 2019 under the theme of “The River of Prosperity” will make the New Year Celebration sensational on Monday, December 31, 2018, from 18:00 hrs. This New Year Celebration is jointly organized by the Tourism Authority of Thailand and ICONSIAM in collaboration with The ICONSIAM Superlux Residence Corporation Limited, The ICONSIAM Residences Corporation Limited. In addition, our partners both from the public and private sectors are also actively involved—including Association of Chao Phraya Commerce, Marine Department, Siam Commercial Bank, TRUE Corporation Public Company Limited, Kasikorn Bank, Thai Shipping Association, Bangkok River Partners, and Chao Phraya Riverside Communities.

    According to Yuthasak Supasorn, Governor of Tourism Authority of Thailand (TAT), said that “Amazing Thailand Countdown 2019 is a major event that TAT has consistently organized over the years at various destinations throughout the country. The purpose is to promote Thailand as the ultimate destination for Thai and overseas tourists alike. It’s also an effective way to help stimulate the economy and distribute income to people in every region in the country. More importantly, it supplements our effort to make tourism sustainable. This year we’ll organize the event in 5 different regions: Bangkok, NakornPanom, Chiangrai, Rajburi, and Satul.

    In Bangkok, TAT and ICONSIAM plus other partners have mapped out a plan to make the upcoming event a grand New Year Celebration by the Chao Phraya River on December 31, where the venue will be at the River Park of ICONSIAM. This very venue is characterized by diversity comprising, for example, a unique way of life and local culture that would satisfy all tourists alike. Furthermore, local business entrepreneurs and hotels on both sides of the River will take part in this celebration in various forms such as lighting and colouring their premises, and overnight Buddhist praying. Another spectacular event is a fireworks display along the Chao Phraya River which will brighten the water current and create a favourable image of Thailand as an attractive tourist destination for all people throughout the world.

    Tourism is a major income earner for the Thai economy. As such, TAT’s mission is to promote tourism in Thailand and, as a result, engaged in an extensive public relations activities both at home and overseas. It is anticipated that over one million people shall attend the New Year Celebration that will transmit to the world a favourable image of Thailand as a vibrant and dynamic country. Equally important is that substantial spending will keep the money flowing into our economy.”

    Moreover, Narong Chearavanont, Chairman of the Board of The ICONSIAM Superlux Residence Corporation Ltd., added that “we are proud to have organized the “Amazing Thailand Countdown 2019” with TAT and other partners. It is an effective way to present the beautiful image of the Chao Phraya River to the world and ICONSIAM as a riverside destination on the Chao Phraya River. We are honored to have been selected by TAT to organize the event. We are grateful for the active involvement of our partners who are committed to making the New Year Celebration event grand, impressive, and memorable for all tourists.” Here are major highlights of the upcoming Amazing Thailand Countdown 2019.

    A display of fireworks made from Thai sticker rice. These fireworks are an innovation that is      eco-friendly. This fireworks display is based on the concept of “The River of Prosperity.” It demonstrates the history of the Chao Phraya River pertaining to our way of life, tradition, and legends of Siam as a country. This 5-minute fireworks display is composed of 5 Acts.

    Act 1 – “The River of Prosperity” is a fireworks display in silver, gold, and bronze colours held together consecutively. Based on the beliefs of people, the three elements symbolize prosperity. As such, the first second of the New Year is to make the Chao Phraya River bright, beautiful, peaceful and prosperous as it has been over the years.

    Act 2 – “The Siam Treasure” is a fireworks display of multiple shapes and colours that reflect a close interconnection between our tradition, a way of life and the Chao Phraya River. Not only that the River was essential in daily human activities, it was also what people utilized for transportation, a naval route for diplomatic corps coming in to establish diplomatic relations with Siam, a way to transport products and conduct trade since Ayutthaya to present, a way to perform religious rites, and an attractive scenes that capture imagination of overseas tourists and generate income for our country.

    Act 3 – “The Blossom of Joy” is a fireworks display that creates excitement in more ways than one. The display is accompanied by Thai folk songs that reflect our uniqueness as fun-loving, friendly, and smiling people. Any overseas tourist visiting Thailand will become impressed with, for example, reciprocity of Thai people. Such an impression is enough to start a happy New Year by the Chao Phraya River-a bloodline of Thailand.

    Act 4 – “One World” is a fireworks display that highlights the flags of all countries. It also represents their connectivity through tourism, trade, education, cultural exchange based on equality that will flourish from the start of the New Year and in the years to come.

    Act 5 – “Thailand” is a fireworks display of the tricolours of the Thai flag along the Chao Phraya River. The tricolours of red, white and blue collectively represent our national identity as an independent country shielded by our solidarity and unity.

    The upcoming display of 5-Act fireworks will take place along the Chao Phraya River from                    5 different locations. The brightness of the fireworks can be seen within the vicinity of 1,400 meters, which is the longest and grandest display of fireworks ever on the Chao Phraya River.    The vicinity encompasses Peninsula Hotel, Millennium Hilton Hotel, Shangri-La Hotel, Mandarin Oriental Hotel, and Royal Orchid Sheraton Hotel. It is expected that over one million people will watch this display of fireworks within the 2-km vicinity.

    Furthermore, there will be a “Khon” performance (a type of Thai drama) at the event in honour of it being recognized by UNESCO as a World Heritage. The Khon performance will be a New Year present for visitors.  It will be magnificent owing to the great number of performers, composition, details relating to Thai classical dance, warrior costumes and weapons. All of these protocols are truly our cultural treasures that are worth watching.

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  • Korea’s auto exports on the rise, but local industry still struggling

    Korea’s auto exports on the rise, but local industry still struggling

    Attractive prices and returns have seen the number of Chinese customers buying high-end apartments in HCMC soar this year. Duong Thuy Dung, senior director of real estate market research firm CBRE Vietnam, said at a recent forum that 31 percent of high-end apartment buyers in HCMC in the first nine months were Chinese. This figure increased from only 2 percent in 2016 and 4 percent last year.

    In the last two years, Chinese were sixth among all buyers, but this year, they have surpassed Vietnamese to rank first.

    Only 24 percent of high-end home buyers are Vietnamese, CBRE data shows.

    Stephen Wyatt, country head of property service firm JLL Vietnam, said the number of Chinese buyers has been increasing because Vietnam has an attractive price compared to other markets like Hong Kong, Japan, Singapore, South Korea and Taiwan.

    Chinese people often compare prices in Vietnam with Shanghai when they buy properties, he said, adding that they hope to gain profit from higher property prices in Vietnam in the future.

    A high-end apartment in the city costs around $5,000 per square meter, but the same one in Hong Kong could cost four times, said Nguyen Khanh Duy, director of residential sales at real estate service provider Savills HCMC.

    Nguyen Hoang, director of research and development at real estate firm DKRA, said that the number of Chinese and South Korean buyers in HCMC started to increase last year.

    Chinese from Shanghai and Hong Kong are buying properties as investments (not to stay in). “Most projects that foreigners bought in the last two years are under construction,” he said.

    Other industry insiders said that the high returns that HCMC high-end apartments offer is attracting many foreign buyers.

    The rate of return is 5-6.5 percent in Thao Dien ward and Thu Thiem Peninsula in District 2, while in other Asian countries, this rate is only 3.7-5.2 percent, Duy said.

    CBRE senior director Dung added that it was not just Chinese, but foreign buyers in general who are showing an increasing interest in HCMC real estate.

    Dung said that each foreigner group has a different preference for high-end apartments. Customers from mainland China, Hong Kong and Taiwan prefer large-scale projects near the downtown HCMC.

    South Koreans like to buy apartments in the southern District 7 that hosts a large community of South Koreans, while Western buyers often look for a quieter lifestyle in eastern District 2.

    Dung said HCMC is estimated to receive 40,000 new apartments in the 2018-2020 period, 60-70 percent of these in the high-end segment.

    In the last three years 35,000 luxury apartments have come into the market, CBRE said.

    This is a major increase from 2012-2014 when fewer than 10,000 units were on offer, CBRE said.