Thesun 2009-04-28 Page15 Bnm Liberalisation In Sync With Financial Master Plan

theSun

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| TUESDAY APRIL 28 2009

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ECER courts German investors

BNM: Liberalisation in sync with financial master plan by Tim Leonard [email protected]

PUTRAJAYA: Bank Negara Malaysia (BNM) believes the liberalisation measures announced by Prime Minister Datuk Seri Najib Abdul Razak yesterday are consistent with the objectives of the 2001 Financial Sector Master Plan (FSMP) to develop a resilient, diversified and efficient financial sector. BNM said in a statement more than 90% of the FSMP initiatives have been completed or are being implemented on an ongoing basis. “Domestic banks today are well capitalised with risk-weighted capital ratio (RWCR) of 12.5% and an average asset size of RM91.6 billion. Domestic banks are also more resilient with strengthened corporate governance, efficient internal structures, robust risk management practices and diversified sources of income. “Despite the increasingly challenging environment, domestic banks have managed to maintain a market share of above 70%. Malaysia’s approach towards the liberalisation will be selective and sequenced to ensure maximum benefits to the country,” said the statement. “Financial institutions are in a greater state of

readiness to compete in a more liberalised and challenging environment. The financial services sector has progressed beyond its role as a facilitator of growth to become a growth sector in its own right, generating valueadded businesses, attracting investments and creating employment “The liberalisation plan will be supplemented with sufficient safeguards to ensure that the overall financial intermediation function of the financial system remains intact, effective and sound,” it said. “Capacity and institutional building efforts will continue to be pursued, complemented by enhancements to the regulatory, supervisory and surveillance framework to preserve the resilience of the financial system. “With immediate effect, existing domestic Islamic banks that wish to scale up their operations and expand into global markets are given greater flexibility to enter into strategic partnerships with foreign players through an increased foreign equity limit of up to 70%. These banks will be required to maintain a paid-up capital of at least US$1 billion,” read the statement. With immediate effect, investment banks are

India keen to sell nuclear reactors to Malaysia NEW DELHI: India has expressed interest in selling small nuclear reactors to Malaysia and other developing countries, if the governments are keen to use it to generate power. At present, India is the only country in the world that produces the 220-megawatt (MWe) pressurised-heavywater reactor after Canada, a key producer, abandoned the project as production was no longer economical. “We are willing to sell to friendly nations like Malaysia, if there is a genuine interest, as nuclear power production is a long term commitment,”

Sudhinder Thakur, executive director (corporate planning) of the Nuclear Power Corporation of India Ltd (NPCIL) told Bernama. After India conducted a nuclear test in 1974, the Nuclear Suppliers Group barred it from trading in nuclear technology. But when India signed a controversial nuclear deal with the US last October, the sanction was lifted. “From a technical point of view, we can sell these reactors,” said Thakur, adding that India was ready to promote the indigenous reactor to other countries.

given flexibility to enter into foreign strategic partnerships to enhance international linkages and business opportunities. In this regard, the foreign equity participation in investment banks will be increased to a limit of up to 70%. Meanwhile, BNM Governor Tan Sri Dr Zeti Akhtar Aziz said the local economy would improve from the second half of the year onwards. Speaking to reporters yesterday, Zeti said the economy would see effects from the contraction in the first half due to the global slowdown but the second half would see things improving. “The domestic economy continues to grow and the results for any measure taken now will only be seen in nine months. The setting up of ‘mega’ Islamic banks here with paid-up capital of US$1 billion is a major milestone in the country’s effort to tranform into a world Islamic financial hub.

AirAsia offers more free seats KUALA LUMPUR: AirAsia is once more offering sweet deals to its guests, by offering free seats as introduction to its two new routes – Singapore-Langkawi and Penang-Singapore. These new routes will simultaneously commence on June 1, 2009 with daily services. “By opening up these routes, we are looking forward to stimulating more travel and tourism activities which will definitely benefit the country’s economy,” said AirAsia Regional Head of Commercial, Kathleen Tan, in a statement yesterday. The free seats deals are exclusively available online via AirAsia’s website at www.airasia.com or mobile.airasia.com. Booking period is from April 27 to May 3, 2009 for travel between June 1, 2009 and Jan 31, 2010.

Najib speaks to the press after chairing the Liberalisation of Financial Sector Special Meeting at his office yesterday. With him is Zeti.

FRANKFURT: Representatives of Malaysia’s East Coast Economic Region Development Council, who were recently part of a 70-member strong Malaysian business delegation on a visit to Germany, made a strong pitch before a large audience of potential German investors and invited them to avail of the “incredible business opportunities” available to them in Malaysia’s east coast. “We have earmarked a huge outlay of some RM15 billion (about US$4.1 billion) over the next 15 years. Half of the allocations will be spent for infrastructure development while the other half from the private sectoris to develop a number of industries,” said Datuk Jebasingam Issace John, chief executive officer of the East Coast Economic Region Development Council, in an interview with Bernama in Frankfurt. “We are looking at all approaches and programmes to accelerate the region’s development from 5% to 7% of the national gross domestic product and in the process expect to create half-a-million new jobs by 2020,” he said. He listed a number of areas where the ECER was inherent with good business potential. The attractive features of Kuantan Palm Oil Industrial Park, Pekan Automotive Industrial Park,

Pahang Technology Park, Kemaman Heavy Industrial Park, Halal Park, Kuantan Palm Oil Industrial Park, Kertih Plastics Park were highlighted before the investor audience. Because of the imbalance in the development between the east and west coasts of the peninsula, the government’s strategy is to develop logistics infrastructure, including ports, airports, roads and highways which will make shipments and distribution easier. The private sector would concentrate on developing oil, gas and petrochemicals, resource-based manufacturing industries, tourism, agriculture and education, he said. One of the “most important projects,” according to Jebasingam, is development of the Kuantan Port which will offer connectivity to two billion people in the Asia-Pacific region. The port recorded a throughput of 10 million tonnes in 2008 and has projected it to grow to 30 million tonnes in 2020. “Kuantan Port is also being developed to accommodate larger vessels of the current generation. The expansion is being done to facilitate oil and gas shipments and other commodities, mainly, to Asean markets.