Malaysia's healthcare system is one of the best in the world

 Country is third best and practioners 'equal to or better than most Western countries'

PETALING JAYA: The country’s achievement at being rated third best in the world for healthcare services is something to be proud of, said Health Minister Datuk Seri Dr S. Subramaniam.

He also gave credit to the boom in the country’s medical tourism sector through strategic investments on good medical facilities and competitive rates compared to other parts of the world.

“Medical tourism has benefited the Government in terms of foreign direct investments and also spin-off effects in the hotel and shopping sectors,” he said yesterday.

The Star Online reported yesterday that a study by the American publication International Living rated Malaysia’s healthcare system as the third best out of 24 countries in its 2014 Global Retirement Index, beating Spain, Italy, Ireland and New Zealand, among other countries.

The index, which was recently released by the Baltimore-based magazine, praised Malaysia’s healthcare, which scored 95 out of a possible 100 points, as the medical expertise of Malaysian healthcare practitioners is “equal to or better than what it is in most Western countries”, according to InternationalLiving.com’s Asia correspondent Keith Hockton.

The top two countries, France and Uruguay, scored 97 and 96 points, respectively.

On the methodology of the index’s ratings, the magazine said both the cost and quality of healthcare were evaluated.

Another report in International Medical Travel Journal News reported that medical tourism receipts in Malaysia from foreign patients totalled RM509.77mil in 2011 involving 578,403 patients.

Dr Subramaniam added that Malaysia remained competitive with players like Singapore and Thailand and the focus was to consolidate the country’s position.

He said the key towards improving the overall healthcare sector would be to focus on the preventive and primary healthcare divisions.

Malaysia Medical Association (MMA) president Datuk Dr N.K.S Tharmaseelan also acknowledged the findings, saying that the country has one of the best healthcare systems in the world.

“The Health Ministry has become a massive seamless service provider in healthcare that has produced magnificent results over the years. Our statistics prove it,” he said, adding that this was despite general practitioners being the lowest paid in the world with their fees being regulated.

He added that impressive figures such as life expectancy for women reaching 80 years and about 72 years for men were reflective of the excellent healthcare provided by the ministry and the private sector.

By G. Surach The Star/Asia News Network

Malaysian Central Bank raises defence; weak currency

 

Malaysia banks told to set minimum CA ratio at 1.2% of total loans

PETALING JAYA: Banks have been told to have a minimum collective assessment (CA) ratio of 1.2% by the end of next year, sending a strong signal to the industry to improve its standards of prudence.

According to a circular from Bank Negara to financial institutions early last week, all banks are required to set aside a minimum of 1.2% of total loans effective Dec 31, 2015.

The requirement, effectively, will put a stop to the present situation where banks are left to set aside their CA ratio based on their own risk assessment of their asset profile.

“Most banks have maintained a CA ratio of lower than 1.2% because there is no minimum set by Bank Negara. This circular effectively sets the standard for a minimum requirement,” said a banker.

The CA ratio was previously known as the general provisions that all banks were required to adopt. The general provisions requirement was a minimum of 1.5% of total loans, a ratio set by the central bank.

However, after the introduction of the new accounting standards three years ago, the general provisions requirement was replaced with a CA ratio, with banks free to set their own ratio.

The central bank no longer set the minimum requirement for banks to comply with in regards to the provisions.

According to a research report by CIMB, banks that had a CA ratio of less than 1.2% as of September last year were Malayan Banking Bhd, Public Bank Bhd, Affin Bank Bhd and Alliance Bank Malaysia Bhd.

Bankers, when contacted, were divided on the impact that the requirement would have on their bottom lines.

According to one banker, the move to comply with the ruling will not impact profitability because the additional amount required to be set aside can be transferred from retained earnings.

“Funds out of retained earnings will not impact the profit and loss (P&L) account of banks. It’s not a P&L item,” he said.

However, it would affect the dividend payout ability of banks, added the banker.

Another banker said the financial institution was seeking clarification from Bank Negara on whether to set aside the provisions from its profits.

“If that were the case, then it would impact profitability,” said the banker.

OCBC Bank (M) Bhd country chief risk officer Choo Yee Kwan said the background to the new requirement was that Bank Negara wanted to ensure that impairment provisions could keep pace with strong credit growth.

“In addition, the regulator would like to promote consistency in practices in ensuring adequate rigour and data quality in arriving at the appropriate level of collective impairment and the factors that are considered by banking institutions.

“Adequate impairment provisions serve as necessary buffers against potential credit losses; hence, they can reduce the likelihood of systemic risk for the banking sector,” he said in an e-mail response to StarBiz.

He said the sector might witness an increase in the overall level of impairment provisions at the industry level.

“Nevertheless, this should be seen positively, as the higher credit buffers would now render the sector stronger,” he noted.

CIMB Research in a report stated that the proposed new guideline could have a negative impact on banks based on its theoretical analysis.

It pointed out that several banks would have to increase their CA provisions under the new ruling and this would lead to a rise in the banks’ overall credit costs.

“Those which do not meet the requirements would have to increase their CA (and ultimately credit cost) in 2014-2015, even if their asset quality is improving. For banks with a CA ratio of above 1.2%, the new ruling would limit the room for them to further reduce their CA ratios,” CIMB Research explained.

According to CIMB Research’s estimates, banks’ net profits could be lowered by around 0.5% (for Hong Leong Bank Bhd) to 11% (for Public Bank) in 2014 to 2015 if a minimum requirement of 1.2% for the CA ratio were implemented.

Another analyst, however, is of the view that the new requirement from Bank Negara would have a negligible impact on the operations and earnings of banks.

“We think it is not a major concern for most banks because, firstly, the grace period for the implementation of the new guideline is long. Secondly, the minimum ratio of 1.2% will not comprise of only the CA component alone, but is also a combination of the CA and the statutory or regulatory reserve.

“In general, we see the new guideline as a measure to standardise the way banks gauged their capital buffers.
“The bottom line is, we think the new guideline will only serve to further strengthen banks’ capital buffers,” the analyst added.

By Cecilia Kok and Daljit Dhesi StarBiz, Asia News Network

Silver lining in weak currency

Weaker currencies are a boon for Malaysia and Indonesia, helping to tip the balance of trade back in their favour, as exporters benefit from rising demand for goods and commodities from advanced economies, coupled with steady growth in China.

The favourable trade surplus, economists said, would ease the pressure on these emerging countries’ deteriorating external accounts, which is a major sore point for foreign investors.

They added that rising exports would provide the much-needed tailwind for Asian economies to sustain growth even as domestic demand moderated.

Malaysia on Friday reported a 2.4% growth in exports in 2013, backed by a 14.4% jump in December that exceeded the market’s expectation by a wide margin.

“We still maintain our long-term view of impending growth momentum in the coming quarters,” Alliance Research economists Manokaran Mottain and Khairul Anwar Md Nor said in a report.

They predicted exports in 2014 to grow at a faster pace of 5%, backed by steady but improving export demand from advanced economies.

While imports grew at a faster pace than exports in 2013, Malaysia continued to enjoy a strong trade surplus.

The favourable trade surplus combined with an anticipated smaller services deficit and transfer outflows would translate into a larger current account surplus of RM16.7bil or 6.6% of gross domestic product (GDP) in the last quarter of 2013.

“The cumulative current account surplus is estimated to reach RM37.8bil or 3.9% of GDP in 2013, helping to assuage fears of a current account deficit,’’ CIMB Research economist Lee Heng Guie said.

This, he said, was positive for the ringgit and the capital market.

The ringgit, along with other emerging Asian currencies, have been under pressure since June last year after the US Federal Reserve began talking and later started to reduce its quantitative easing (QE).

The US Fed first pared its monthly bond purchases programme from the original US$85 billion a month to $75 billion in January. This was cut further by $10 billion starting from February.

“Capital outflows from emerging markets are likely to continue in the months ahead as the Federal Reserve winds down its QE3 programme,” said Macquarie Bank Ltd’s Singapore-based head of strategy for fixed income and currencies Nizam Idris.

Fears about the US Fed tapering down the supply of cheap money to the market first surfaced in May last year and it triggered a huge sell-off on emerging market assets.

Countries such as Indonesia and India had seen their currencies depreciate the most in 2013, Both economies had wide current account deficits.

Last year, the Indian rupee plummeted the most in two decades, while rupiah depreciated by about 20% against the US dollar over the past 12 months.

Not helping emerging market currencies is the recovery in advanced economies, such as a rebound in economic growth in the US which rose by 3.2% in the fourth quarter of last year.

But if economic recovery in the US and eurozone were to stay on course, so would demand for cheaper emerging market exports. This, in turn, would help shrink the huge current account deficits that had hobbled countries such as Indonesia, India and Turkey.

For many emerging economies, 2014 had gotten off to a grim start.

Concern over the Chinese economy’s marked slowdown and the Argentine peso’s steep slide in January has brought upon renewed pressure on the currency market.

But the current market volatility does not portend weaker growth.

CIMB Research in Indonesia observed that the strains in the financial markets did not translate into a significant slowdown in the economy as the country’s real GDP growth accelerated to 5.7% in the last quarter of 2013.

Its exports surged in December, while imports slowed on the weaker rupiah. This helped to widen its trade surplus to $1.52 billion, the largest since November 2011.

The favourable trade numbers narrowed its current account deficit of $4.06 billion.

CIMB Research expects growth in Indonesia “to trough” in the first half of 2014 as the lagged effect of the rupiah depreciation and Bank Indonesia’s aggressive policy-tightening cycle in June-November 2013 works through the economy.

“Pre-election bounce in consumption should offset the weakness, allowing Indonesia to post 5.6% GDP growth in 2014,’’ it said.

Malaysia, too, is on track for sustained growth. CIMB Research projected GDP growth in the third quarter would probably expand by 5.3%, taking the full year growth rate to 4.7% for 2013. - The Star/ANN

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Education woes in Malaysia, etc, act now to address the weaknesses!

Policies have been formulated to improve and facilitate teaching and learning at all levels, yet there are weaknesses in the system that need to be urgently addressed.

THE dismal performance of our students in the Programme for International Student Assessment (Pisa) in 2013, where 51.8 % of our 15-year old students failed to reach even the baseline level for Reading, Mathematics and Science, has rightly alarmed many concerned Malaysian parents and educationists.

It bears repeating that the quality of an education system simply cannot exceed the quality of its teachers, no matter how many billions of ringgit is used in educational development plans or blueprints to improve our school system.

Prominent lawyer, politician, columnist and author Datuk Zaid Ibrahim, could well be expressing the sentiments felt by many informed Malaysians when he wrote in his book I, Too, Am Malay, that many teachers, are “poor in quality” and the school curriculum is irrelevant while administrators are too political.

The fact that 70% of our English teachers failed to make the grade in the Cambridge Placement Test speaks volumes of why and how we continue to witness a decline in English proficiency in our schools and universities over the years.

If it is true that a large number of our teachers are incompetent, then policy-makers will have to get the views of all the major stakeholders, accept sound suggestions from various quarters, before they attempt to tinker with our school system.

M. Bakri Musa, columnist and author in his book An Education System Worthy of Malaysia, mentioned the greatest weakness of all our educational reforms is the government’s exclusive dependence on in-house or Education Ministry officers, who have somehow failed to improve the quality of our education system over the years, in spite of all their grand schemes.

Let’s review how effective, practical or meaningful the educational reforms have been at school level.

Motivating students

When the co-curricular points system was first implemented in our schools, it seemed like a good way to motivate our students to participate more actively in sports clubs and societies to make them well-rounded students.

In the first place, the system was never implemented in good faith.

Students sitting for the Sijil Tinggi Persekolahan Malaysia (STPM) exams face a serious handicap when it comes to applying for admission to local universities for some degree courses compared to Matriculation students, who study for a shorter period of time and sit for their relatively easy internally-marked exam papers.

And as if things are not bad enough for STPM students, it looks like the co-curricular points system was designed to make university admission even easier for Matriculation students. The system enables them to secure high marks for co-curricular activities which account for 10% of the entry-score requirement for public university admission.

In matriculation colleges, students who participate in co-curricular activities among hostel block members are awarded marks meant for district level events, while students who compete in activities in college are awarded marks that are equivalent to state level grades. When students compete in inter-college events, they are accorded marks equivalent to that of national level!

Any wonder why so many SPM students choose not to do their Form Six?

The system is biased as it favours Matricu-lation students over STPM students. Moreover the chances of STPM students who score 4As getting courses of their choice at varsity level is also uncertain.

Considering the circumstances, many bright students simply don’t want to continue with Form Six.
Why experience the mental agony of getting 4As in the STPM exams only to be denied places for courses like medicine and pharmacy?

Let me reiterate that the STPM is a tougher exam and the co-curricular point system for matriculation students gives the latter an unfair advantage.

Research suggests that superior learning takes place when classroom experiences are enjoyable and relevant to students’ lives, interest and experiences.

As such, it is rather unfortunate that at a time when our education system is already failing to provide students with appropriate problem solving, critical and analytical skills and knowledge content, especially in Science and Mathematics, our policy-makers see it fit to make all students take up History (now made a compulsory subject to pass in the SPM exam).

Instead of learning world history and exposing our students to lessons we can learn from major historical events, much of our Form Four History textbooks are devoted to specific topics all in the name of promoting patriotism and national unity.

And why bother to introduce the SPM open certification exam in the first place when we have no real intention to offer our students real flexibility in their choice of subjects and electives based on their interests, abilities and aptitudes?

In his best seller, The World is Flat, Thomas L Friedman, points out that in today’s world, how children are educated may prove to be more important than how much they have to learn in school.

If what he says is true, why should we stifle our students’ initiative, curiosity and creativity by burdening them with uninspiring and even unnecessary subjects that have made school life such a dreadful and boring affair.

And yet, despite repeated calls to scrap Moral Education, such pleas have fallen on deaf ears. It has been pointed out that Moral Education, instead of exploring how we can effectively teach and test moral reasoning, only serves to indoctrinate our students and subjects them to mindless memorisation of core values.

To make things worse, our policy-makers decided that learning Moral Education was not good enough; in order to make our students more civic-conscious and patriotic, they went on to introduce yet another subject called “Civics and Citizenship” for our secondary school students from Form One in 2005.

Holistic development

Our national education philosophy emphasises holistic development of our students. That being the case, won’t Physical Education (PE) play an important role in producing physically fit and well-rounded students?

And yet with our students experiencing so much stress in their school life, they have to make do with just two periods for PE!

If that is not bad enough, some schools even use PE periods to teach “more important subjects” like Health Education. And what about our school-based assessment?

Various quarters have already pointed out that simply scrapping the Ujian Pencapaian Sekolah Rendah (UPSR) and Penilaian Menengah Rendah (PMR) exams to introduce the current school-based system may not necessarily serve to enhance learning and make school life more enjoyable for students.

When the school-based assessment system was introduced to schools in 2011, it was assumed that teachers would be able to assess their students’ abilities and potential.

But with so many “poor quality” teachers it will not be fair to assume that they are sufficiently equipped to evaluate their students based on internally-prepared assessments, that they take pains to assess their students properly, and that they are unbiased towards their students.

Well, that’s really a tall order. Already, we have heard stories from schools of incompetent and indifferent teachers teaching weak classes and yet awarding their students Band Six, no less, in their respective subjects!

And as usual, many schools are already resorting to buying workbooks in the market instead of getting their teachers to come up with their own worksheets and materials to assess their students, making a mockery of introducing the school-based assessment in the first place.

But we can’t blame the teachers, not when they are burdened with so much paperwork and keying data online into the SPPBS (Sistem Pengurusan Pentaksiran Berasaskan Sekolah).

It is worth noting that our current school-based assessment at the end of the day, is not much different to the A-B-C-D-E grade system or even the Percentage Score system. So why should teachers need to waste time with the banding exercise when in their daily dealings they can easily discern the band(s) the students actually deserve for the topics taught?

Wouldn’t it be better to reflect on their teaching approaches and enhance their professional knowledge, rather than waste time with paperwork and keying data?

It is about time to address the problems facing our education system.

For a start, the government should really grant greater autonomy to good schools in both urban and rural areas to adopt a broad-based curriculum, save for a few core subjects under the supervision of the Education Ministry, to let students learn what they ought to learn in today’s challenging world.

Get dynamic school principals to manage such schools and empower them to make decisions on matters related to school operations with the participation of parents and the local school communities.

If the principals are allowed to hire competent teaching staff, and be accountable for their performance, then we stand a better chance to improve our education system at the school level, specially when we are in a position to compare the performance of such autonomous schools with our national schools.

And with so many parents paying for tuition lessons these days, they would gladly pay school fees to get their children to study in such autonomous schools.

When such schools, gain a good reputation, the tuition syndrome will slowly die and more parents would choose to place their children in such schools rather than vernacular or international schools, resulting in a win-win situation!

With the current rot in the school system, the authorities should no longer be so protective over their turf. They must have the courage to admit the serious shortcomings of their policies and display greater commitment to think out of the box. It is now in the hands of the ministry to make it all happen.


 Contributed by Henry Soon - The Star/Asia News Network

The writer, a retired teacher, is still passionate about education. He hopes the Education Ministry will be bold enough to bring about changes for the greater good of students, teachers and parents.

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Interesting times in East Asia

South-East Asia is in a strategically unenviable spot – too small to shape North-East Asia, and too near to it to avoid the havoc of conflict there.

Troubled waters: South Korea conducting a drill to guard a maritime science research station set up on the South Korea-controlled underwater reef of Ieodo. Conflicts can result from miscalculation, misperception or misinterpretation of an adversary’s actions or intentions. -EPA

IF outright aggression between nations often results in conflict, conflicts need not result directly from aggression alone.

Conflicts also arise from doubts, uncertainty and lingering suspicions. They can result from miscalculation, misperception or misinterpretation of an adversary’s actions or intentions.

Several of these “triggers” are on full display in North-East Asia today. Contributory factors include historical grievances between Japan and its immediate neighbours China and the Koreas, China’s growth and assertiveness, Japan’s brashness, Korea’s sensitivities and US ties to Japanese security interests.

That these countries are major players does not insure against open conflict between them. These major powers have the means to initiate and sustain full-scale war.

Nor is the location of potential conflict in North-East Asia a comfort to South-East Asia. Whether individually or together, Asean countries are not strong enough to deter or resolve such conflict, yet are not sufficiently far away to avoid its fallout.

Several of the disputes stem from Japan’s 2012 nationalisation of the Senkaku/Diaoyu/Diaoyutai islands also claimed by China and Taiwan in the East China Sea. As with other provocations, this occurred against the backdrop of Japanese atrocities against Chinese and Korean populations during the Second World War.

Then last November, China declared an Air Defence Identification Zone (ADIZ) over disputed islands and waters. After the United States declared the first ADIZ in 1950, Britain, Canada, India, Japan, Norway, Pakistan, South Korea and Taiwan followed. 

A country’s ADIZ requires foreign civilian vessels to identify themselves before entering. Essentially controversial and provocative, it is unilateral, unregulated and unauthorised multilaterally.

Beijing presumably thought that all countries had equal rights to declare such a zone. It may not have anticipated the protests it received, particularly from countries that had done the same thing before.

In December, Chinese and US warships narrowly avoided a collision. Despite both countries downplaying the incident subsequently, different versions of the event resulted.

Spats had erupted between China and Vietnam, and the Philippines, over the People’s Liberation Army (PLA) Navy’s presence in disputed territories in the South China Sea. Then in mid-2013, a China-Vietnam summit cooled tensions, leaving the Philippines somewhat in the cold.

But as if to sow doubts about Beijing’s own diplomatic competence, PLA(N) ships were reported in disputed waters off Sarawak late last year and early this year. This surprised Malaysian diplomatic and policy circles, since China had previously avoided upsetting Malaysia.

Countries in the region puzzle over why China is putting on such provocations, beyond testing the reactions of the other claimant countries. However, such tests can be made by other countries as well.

Late last month, Japan’s Asahi Shimbun newspaper reported that China was preparing to declare an ADIZ in the South China Sea. The area includes disputed islands and waters claimed by China, Taiwan, Malaysia, Brunei, the Philippines and Vietnam.

The report suggested the new ADIZ would initially cover the Paracel Islands and eventual­ly include virtually the whole sea. Beijing immediately retorted, warning Japan against spreading baseless rumours.

The Japanese report was either a truthful account or an attempt to test China’s response. That response has been clear enough.

The Japanese government, meanwhile, has been working hard producing its share of follies and fumbles.

In mid-December, Tokyo called a meeting with Asean countries to discuss defence concerns vis-à-vis China. That meeting flopped, as Asean leaders downplayed the defence aspect and preferred discussing economic relations with Japan.

Then after Prime Minister Shinzo Abe’s controversial visit to the Yasukuni Shrine in December, Tokyo announced plans to nationalise another 280 islands. It coincided with the National Security Council’s launch to streamline the operations of security agencies and military forces under the office of the nationalist Abe.

That month, Abe criticised China’s ADIZ, calling it an attempt to change the regional status quo “by force”. Observers in the region were baffled by Tokyo’s definition of “force”.

Then the Japanese government revised textbooks to instruct schoolchildren that the islands in dispute with other countries were “an inherent part” of Japan. That again brought Beijing and Seoul together to condemn Tokyo.

At the same time, Japan planned military exercises with US and Indian forces, incorporating a US$2bil (RM6.65bil) loan to India. Days later, Tokyo planned more military exercises with US and Australian forces.

Such military responses with major countries outside East Asia do nothing to improve fraying relations within the region. But that disconnect apparently fails to concern policymakers in Tokyo.

Within Japan, Abe’s government is expanding its military forces over the Nansei Islands, covering Okinawa and the Senkakus. But reactionary nationalists had long seen the restrictions of Japan’s post-war “pacifist” Constitution as a hindrance.

Abe is now on a personal crusade to revise the Constitution to allow for a more assertive military. In his “historic mission”, Abe’s target is Article 9 which bans the use of military force to resolve disputes abroad.

The problem for Abe: a news survey last month showed 53.8% of the Japanese public opposing changes to the Constitution. How would a democratic Japan reject that majority view?

Abe seeks changes to permit Japanese force­s to make pre-emptive strikes, amounting to unilateral attacks on another country where self-defence may not be invoked.

After the US government advised US commercial airlines in November to abide by China’s ADIZ, Tokyo expressed bewilderment. Abe promptly concluded that the US had made no such decision.

Reports early this month said that Japan and the US had agreed to ignore China’s ADIZ in their military manoeuvres. But an ADIZ customarily applies to civilian, not military, vessels.

In other matters, however, there has been less agreement between Washington and Tokyo. A senior US military official warned against revising Japan’s Constitution. Since the overriding purpose was to build a trilateral alliance in North-East Asia comprising the US, Japan and South Korea to alienate China, a revised Japanese Constitution would instead alienate South Korea and disrupt the alliance.

In December, the US expressed “disappoint­ment” over Abe’s visit to the controversial Yasukuni war shrine. The following month, Ambassador Caroline Kennedy objected to the cruelty of Japan’s annual dolphin hunt, provoking protests.

Three US Congressmen have lobbied Secretary of State John Kerry to address the “comfort women” issue with Japan. It involved more than 200,000 Korean women and girls who had been sexually abused by Imperial Japanese forces.

When NHK broadcast chief Katsuto Momii trivialised the issue, suggesting Japan’s wartime actions were acceptable, he caused more controversy. Momii was Abe’s pick for the top media job.

Kerry is due in China and South Korea in a week to discuss North Korea. Japanese observers note that he will be bypassing Tokyo. However, Foreign Minister Fumio Kishida was in Washington on Friday to discuss with Kerry the Abe-Obama summit in Tokyo in April. Abe has found a compelling need to reaffirm bilateral ties with the US.

While the scheduled summit will bear on the “US pivot” to East Asia, other countries may also do a pivot or at least a pirouette. Russian Prime Minister Dmitry Medvedev has directed major state-owned companies to relocate their head offices to Russia’s far east to help develop the region.

Where political and economic concerns converge, strategic considerations are never far behind. Such concerns, never lacking in East Asia, are now set to multiply.

 Behind The Headlines by Bunn Nagara Asia News Network

• Bunn Nagara is a Senior Fellow at the Institute of Strategic and International Studies (ISIS) Malaysia.
• The views expressed are entirely the writer's own. 

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Rosy outlook for Penang 2014: Strong growth, rise in FDI seen

A roundtable organised by KPMG Penang this week at KPMG new office, the Hunza Tower in Kelawei Road, George Town concludes that Penang will continue to enjoy high economic growth in 2014 and attract foreign direct investors.

Its tourism and property sectors will stay buoyant this year and the recovery in its electrical and electronic sector will continue into 2014.

Penang’s GDP growth in 2013 is estimated to be slightly less than 5%, according to official data.

“Penang remains a highly attractive location for local and foreign investors alike. It is also noteworthy that Penang ranks as one of the top emerging business processing locations worldwide.

“We certainly see healthy prospects for Penang across several industries,” said Johan Idris, managing partner of KPMG in Malaysia.

Penang’s property sector was also expected to maintain its 2013 growth momentum through 2014, he added in a KPMG statement this week.

“The uptrend in businesses and Penang as a desirable location has led to the consistently high demand for both residential and commercial properties on the island.

KPMG Penang, which highlighted tourism as a key sector for the state, expected tourism to remain a mainstay for the state in terms of revenue.

“As a designated UNESCO World Heritage site since 2008, tourist arrivals have steadily increased 14% as at October 2013 recording 4.4 million tourists.

“Penang’s hospitality industry is expected to chalk good returns, particularly as occupancy rates are slated for an upswing. Tourist arrivals are not limited to the ASEAN region but also from across the globe.”

KPMG Penang’s partner, Ooi Kok Seng, said: “The electrical and engineering sector, specifically solar energy equipment manufacturers, has seen a renewed demand.

“We believe that the positive turnaround will continue into 2014 due to the government’s allocation of additional land bank in Batu Kawan. Slated for development, Batu Kawan is an extension of the Bayan Lepas Free Trade Zone which is currently facing limited land space due to rapid expansion.”

KPMG Penang also said foreign direct investments (FDIs) were expected to escalate in 2014 as a result of the completion of major restructuring projects in Penang.

It foresaw additional advisory work in relation to mergers and acquisitions (M&A), transaction and restructuring projects. –The Edge

Rosy outlook for Penang

PENANG can expect strong economic growth this year following the upgrade in ranking by Moody’s Investor Service outlook in November.

KPMG Penang Partner-in-Charge Ooi Kok Sheng said the rating upgrade was an encouraging sign for the country.

“With active steps taken by the Government to implement fiscal reforms, Malaysia remains resilient amidst global economic uncertainty,” said Ooi.

He was speaking during KPMG Penang’s inaugural Economic Outlook Roundtable session at their new office at the Hunza Tower in Kelawei Road, George Town.

“Penang remains a highly attractive location for local and foreign investors alike.

“It is also noteworthy that Penang ranks as one of the top emering business processing locations worldwide.”

He said KPMG Penang saw tourism as a key sector for the state and expected it to remain as the mainstay for the state government in terms of revenue.

“Penang’s hospitality industry is expected to chalk good returns, particularly as occupancy rates are slated for an upswing.

“Tourist arrivals are not limited to the Asean region. The state has many visitors from all over the globe.”

Ooi also anticipated a sustained demand for audit, tax and advisory work in 2014.

“With Penang as a manufacturing and export hub for the northern region and dubbed the semiconductor Silicon Valley of Malaysia, many public-listed companies have based their operations in the state,” he said.

Malaysian Association Hotels (Penang Chapter) chairman Mary Ann Harris said prospects for the state’s tourism sector looked good in Visit Malaysia Year 2014.

“However, we are not without our problems as we are in urgent need of a viable public transportation system,” said Harris.

Penang Rehda chairman Datuk Jerry Chan said the state should benchmark according to international standards, rather than local.

“We have been noted as one of the best food destinations in the world and one of the most liveable cities in the world,” he said.

“It is time for us to set a global benchmark in other sectors.”

- The Star/Asia News Network

'Penang set for healthy growth'

THE opening of the Second Penang Bridge, six new hotels and an influx of medical tourists into the state are expected to keep Penang's economy healthy this year, say captains of various industries.

Malaysian Association of Hotels (MAH) Penang chapter chairman Dr Mary Ann Harris said the soon-to-be opened longest bridge in Southeast Asia is expected to be a tourism draw.

"There is definitely going to be more tourists drawn to the new bridge and we expect many of them to participate in the Penang Bridge International Marathon 2014, which is expected to be held at the second bridge," she said.

The RM4.5 billion Second Penang Bridge, which connects Batu Maung on the island to Batu Kawan in the mainland, serves as a second land crossing after the first Penang Bridge was opened in 1985.

Harris was speaking after presenting Penang's economic outlook for 2014 at a roundtable session hosted by audit, tax and advisory firm KPMG Penang here yesterday.

The roundtable, which was opened by state executive councillor Datuk Abdul Malik Abdul Kassim; also saw presentations from the Real Estate and Housing Developers Association (Rehda), Penang branch chairman, Datuk Jerry Chan; the Free Industrial Zone, Penang, Companies' Association president Heng Huck Lee; investPenang general manager Loo Lee Lian; and Malaysian American Electronics Industry (MAEI) Association chairman Datuk Wong Siew Hai.

Also present were KPMG Malaysia managing partner Johan Idris and KPMG's northern region partner-in-charge Ooi Kok Seng.

Harris said the state's tourism sector is expected to see the entry of six new hotels of two- to five-star, and the availability of some 1,000 room keys.

MAH Penang's membership is made up of 50 hotels with a total of 10,000 room keys.

Among the new properties expected to open their doors include the Royale Bintang and Rice Miller Hotel, which are both located at Weld Quay.

Other projects are said to include a hotel in Seberang Jaya and serviced apartments in Teluk Kumbar on the island.

Meanwhile, Penang Health Association chairman Datuk Dr Chan Kok Ewe told the roundtable session that seven private hospitals in Penang (with a total of over 1,000 beds), which are members of the association, had recorded RM370 million in revenue from medical tourists last year.

"Prospects for this sector are encouraging. There have also been suggestions to make Yangon in Myanmar a sister city of George Town in Penang, due to the shared heritage of the two cities.

"There is also anticipated demand from medical tourists in China but whether our hospitals, which have been making significant investments with expansion programmes to cater to medical tourists, can cope with the capacity is the question," he added, saying that private hospitals in the state are also experiencing manpower shortage.

Meanwhile, Johan in his welcoming address, said KPMG Penang expects the state's property sector to maintain its momentum throughout this year.

"The industry has certainly fared positively with healthy uptake in retail, residential and industrial lots and is indeed diverse, given the many types of businesses operating in there."

- Business Times

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There’s no place like Penang, said Briton

Briton lured by multiracial culture to settle down in the Pearl of the Orient

Home sweet home: Makins, in his Scottish kilt, posing for a photograph with several hikers during a recent hiking trip up the Moon Gate Point Five trail in the Penang Municipal Park.

BRITON Jonathan Makins has travelled far and wide and lived in various places around the world but Penang has a special place in his heart.

Makins, 59, born in Italy to a Scottish father and an English mother, has been living in Penang since February 2012.

He hopes to continue staying in George Town, which he now calls home.

Currently enrolled under the ‘Malaysia, My Second Home’ programme, Makins has lived and worked in Africa, London and Sweden.

The avid traveller, who considers himself a global citizen, also spent four years in Bangkok before coming to Penang.

“I wanted to stay in an Asian country as I love the climate here, which is better than in Europe,” he said.

“Besides, my Thai visa was coming to an end and I was also not very happy in Thailand.

“I visited Penang about four times before settling here, and I find that it is the right place for me.

“I visited Kuching, Sarawak, once but it is very quiet, while travelling to other areas there takes long hours. I have also been to Kuala Lumpur a few times but it was too noisy and dusty,” he said.

After he was born, Makins’ parents briefly brought him back to England before taking him to Tanzania when he was two.

“After Tanzania, I was raised in Nairobi, the capital of Kenya, when I was about six, before I left for school in England at the age of 10, while my parents remained in Kenya.

“After university, I worked as a civil and structural engineer in South Africa and Botswana for about nine years before becoming a cabinetmaker in London, England, for seven years,” he said.

Makins then went on to become an English teacher in Sweden for nine years before settling down in Thailand, where he spent the following four years.

“Having been to so many places, I consider myself a citizen of the world.

“As of now, I hope to continue staying in Penang. I love how it is so multiracial and everyone has friends of different races, religion and beliefs,” he said, adding that among his favourite delicacies were Indian vegetarian meals and simple home-cooked Chinese dishes.

Makins, who lives on his own at a condominium unit in Tanjung Bungah here, said besides the unique culture and heritage, he also found it easier ‘to make friends’ with the locals in Penang.

“The people here are friendlier and more hospitable when compared to some in other places that I have been to,” he added.

To keep fit, Makins goes hiking at the Moon Gate Point Five trail in the Penang Municipal Park at least twice a week, and recently he drew curious stares from hikers when he went there dressed in a Scottish kilt on Christmas Day.

“I also swim and keep in touch with friends through the Internet during my free time. Music is my main companion.

“I play the flute and am teaching myself the piano,” he said.

Makins, who was born in the Year of the Horse, added that he travelled to Bedong, Kedah, for the Chinese New Year celebrations with some friends.

By  Cavina Lim The Star/Asia News Network

Get an Islamic syariah home loans with discount on stamp duties

Boost for syariah home loans, Govt gives 20% stamp duties discount 

KUALA LUMPUR: Islamic home loans in Malaysia may beat last year’s record in 2014, as the Government provides tax incentives to get more people to use syariah-compliant borrowing, according to CIMB Group Holdings Bhd.

Mortgages that comply with the ban on interest climbed 30% in 2013 to an unprecedented RM61.9bil (US$18.7bil), Bank Negara data showed. Conventional home financing grew 10% to RM271bil, the same pace as 2012, even after the Government introduced property curbs to rein in speculation.

The Government is giving a 20% discount on stamp duties for mortgages that comply with religious tenets as it seeks to boost Islamic banking assets to 40% of the total by 2020 from 24%. The Government started holding monthly roadshows last year to create greater awareness of such financing principles, as it strives to enhance the nation’s status as a global syariah hub.

“There’s still strong potential for Islamic financing,” Badlisyah Abdul Ghani, chief executive officer (CEO) at CIMB Islamic Bank Bhd, a unit of CIMB Group, said in a phone interview in Kuala Lumpur on Wednesday. “The roadshows and the incentives are helping syariah mortgage growth.”

Malaysia is also trying to boost such mortgages by offering to waive stamp duties for the refinancing of existing home loans that don’t conform to syariah principles. Syariah-compliant property borrowings had risen an average 31% per annum over the past five years to account for 19% of the total RM333bil market in 2013, central bank data showed.

Syariah home loans differ from their conventional counterparts in that a bank typically buys the property on behalf of the customer and rents it back at a mark-up to avoid interest payments. Some of the more popular options include contracts such as Ijarah, Murabaha and Tawarruq.

The central bank cut the maximum duration on all mortgages to 35 years from 45 years in July to rein in household debt, which had risen an average 12% per annum since 2008. In October, the Government increased property gains taxes and imposed curbs on foreign ownership.

The nation’s Islamic banking assets had more than doubled to RM543bil in the past five years, according to October figures issued by the Treasury. Sales of syariah-compliant bonds, or sukuk, rose 69% in 2014 from the year-earlier period to RM5.9bil, data compiled by Bloomberg showed. Issuance totalled RM49bil last year after reaching a record RM95.8bil in 2012.

The Bloomberg-Aibim Bursa Malaysia Corporate Sukuk Index of ringgit-denominated debt fell 0.9% this year to 104.155 as of Feb 4, almost erasing last quarter’s 1.1% gain.

“Islamic mortgages complement conventional ones,” Syed Abdull Aziz Jailani Syed Kechik, CEO at OCBC Al-Amin Bank Bhd, the Islamic unit of Oversea-Chinese Banking Corp, said in a Feb 4 e-mail interview. “One of the draws can be said to be the efforts by the Government and central bank to boost the market through incentives related to taxes.”

Last year’s curbs failed to prevent Malaysia’s House Price Index from climbing 1.4% to a record 194 in the three months ended September, the 19th straight quarterly advance, according to data from the Finance Ministry.

Mortgage demand might also pick up this year, particularly in the first half, as property investors sought to guard against a potential acceleration in inflation, CIMB’s Badlisyah said.

Consumer prices climbed 3.2% in December from a year earlier, the biggest gain since November 2011, an official report showed on Jan 22. Costs may increase further after Tenaga Nasional Bhd raised electricity tariffs on Jan 1.

“The products that have been put out in the market have been very well-received both by Muslims and non-Muslims,” Baiza Bain, managing director at Amanie Advisors Sdn Bhd, a Kuala Lumpur-based Islamic finance consultancy, said in a phone interview on Wednesday. “Islamic finance is still very nascent compared to conventional finance. It definitely needs incentives to push the assets toward the right level.”

- Bloomberg

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