Thesun 2009-06-01 Page14 Bnm And Bot To Bolster Msian-thai Trade Integration

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theSun

| MONDAY JUNE 1 2009

business

KL market summary MAY 29, 2009

KL shares expected to trade higher this week SHARE on Bursa Malaysia are expected to trade higher this week as there is still ample of liquidity in the market coupled with positive sentiments arising from the region. “The market could climb further as when compared with last week the index hardly changed,” said Jupiter Securities head of research Pong Teng Siew. He said investors have started to set aside news of economic contraction in Malaysia and looked for leads on improvements, especially within the region.

Pong said news of Japan’s industrial production rising 5.2% in April and India’s economic expansion at a faster-than-expected pace of 5.8% in the quarter ended March 31, helped to stabilise sentiments in the region. “The news actually spurred the market on Friday and we expect a spill-over effect from it next week,” said another analyst. Hence, Pong expects the local market to continue to attempt the resistance level of 1,070 points with support at 1,010 points this week.

On Wednesday, the central bank had announced that Malaysia’s first quarter Gross Domesic Product contracted by 6.2% from a growth of 0.1% in the fourth quarter last year. Prime Minister Datuk Seri Najib Abdul Razak announced on Thursday that the economy will contract by between -4 and -5% this year but it is expected to do better in the second half of the year. During the week, the KLCI hit a new high of 1,053.14 on May 25, but trimmed most of the gains the next day. On a Friday-to-Friday basis, the

INDICES

KLCI closed the week at 1,044.11, down 1.15 points from the previous week’s closing of 1,045.26. The Finance Index shed 144.26 points to 8,004.49 but the Industrial Index gained 20.84 points to 2,322.10 and the Plantation Index fell 162.64 points to 5,295.77 and the FMBEmas was 13.89 points higher at 6,984.21. The FBM2BRD advanced 47.89 points to 4,575.77 and the FBM30 went down 20.21 points to 6,677.27 while the FBMMDQ rose 541.77 points to 4,039.69. – Bernama

BNM and BOT to bolster M’sian-Thai trade integration KUALA LUMPUR: Bank Negara Malaysia and the Bank of Thailand (BOT) will pursue avenues to further bolster bilateral initiatives in the financial system to reinforce the high degree of economic and trade integration between Malaysia and Thailand. The central banks of both countries would also endeavour to explore and pursue new avenues of cooperation and to broaden the activities of financial institutions in their respective economy. This was agreed to when senior officials of Bank Negara and BOT met in Bangkok on Saturday as part of their regular dialogues and exchange of views on current issues facing the domestic, regional and international economy and financial system. The bilateral meeting was attended by Bank Negara Governor Tan Sri Dr Zeti Akhtar Aziz and BOT governor Dr Tarisa Watanagase.

In a joint statement yesterday, Bank Negara and BOT said the meeting also shared a concern that the approach being adopted by international rating agencies to give importance to the capacity of governments to provide assistance to financial institutions. They said that this could send a wrong signal to the market and induce incentives for greater risk taking by financial institutions. The meeting reviewed recent economic and monetary developments in Malaysia and Thailand, and discussed the issues as well as implications of the global financial crisis on their respective economies and financial systems. Both central banks shared their experiences on their policy responses to deal with the spillover effects of the global financial crisis and the sharp contraction in economic activities in the major advanced economies.

The officials noted that the financial system in both Malaysia and Thailand is strong and resilient and that financing to the economy has been flowing adequately. The central banks also discussed avenues to further strengthen bilateral initiatives in the financial system to reinforce the high degree of economic and trade integration of both Malaysia and Thailand. The governors agreed to explore and pursue new avenues of cooperation and to broaden the activities of financial institutions in their respective economy. The meeting also reinforced the view that a strong balance sheet with adequate capital buffers, sound risk management and good governance process in financial institutions are critical to the building of a resilient and well functioning financial sector. This in fact has been achieved in the financial system of both countries, the statement said. – Bernama

Devils learn lessons the hard way pg 28

EchoPark plans overseas expansion MIRI: Malaysia’s very own hip-hop wear franchiser, EchoPark, plans to expand its business with outlets in Singapore and Thailand within this year. EchoPark managing director Alex Yong told Bernama on Saturday that the company, established six years ago under the then Entrepreneur and Cooperative Development Ministry’s franchising development

programme, had successfully set up its first outlet in Damman, Saudi Arabia in December last year. A member of the Malaysian Retailer Chains Association and Branding Association Malaysia, he said EchoPark built up as a specialised hip-hop wear centre had already set up 13 outlets throughout Malaysia, with its outlet at Bintang Megamall here being its latest and

first in Sarawak. He said the setting up of their outlet here would be a strategic move particularly to tap the market from nearby Brunei Darussalam, which had a strong market for hiphop fashion wear. Yong said the company is also planning to set up another outlet in Kuching sometime this year. – Bernama

CHANGE

FBMEMAS COMPOSITE INDUSTRIAL CONSUMER PROD INDUSTRIAL PROD CONSTRUCTION TRAD/SERV FINANCE PROPERTIES PLANTATION MINING FBMSHA FBM2BRD TECHNOLOGY TURNOVER

6984.21 1044.11 2322.10 305.29 82.52 200.22 141.85 8004.49 695.80 5295.77 281.68 7340.85 4574.77 14.52

+30.34 +2.87 +34.64 -2.93 +0.92 -4.35 +2.26 -89.17 +3.41 -36.32 -6.07 +85.87 +27.51 +0.08

VALUE

1.770bil

RM2.362bil

‘Bilateral trade with India continues to grow despite economic crisis’ KUALA LUMPUR: The current economic crisis has not dampened bilateral trade between Malaysia and India and the two nations expect an increase in trade growth in comparison to last year. Domestic Trade and Consumer Affairs Minister Datuk Seri Ismail Sabri Yaakob told a press conference on Saturday that in the first half of the year, trade between the two countries stood at RM5.2 billion compared with RM8.1 billion seen the whole of last year. “Even through the economic crisis, we can expect an increase in bilateral trade between Malaysia and India. We can probably achieve a total of RM10 billion to RM11 billion in bilateral trade. “A recently concluded joint study has indicated that the two countries could catapult bilateral trade to 16 billion ringgit by 2012,” explained Ismail after launching the Seventh Global Indian Festival 2009 (formerly known as the Global Indian Shopping Festival) here on Saturday. “The implementation of the trade in goods agreement under the Asean-India FTA in early 2009 would help boost trade. Indian businesses will be able to use Malaysia as a base for entry into the Asean Market,” he said. Malaysia is geo-strategically located in South East Asia and is in an advantageous position as the gateway for Indian companies to penetrate other markets in the region,

Ismail further clarified. Other areas of possible bilateral cooperation between the two nations include a collaboration with Indian institutions of higher learning for joint-research and research centres. “Malaysia and India have identified petroleum and gas; processed food; animal feed; petrochemical; oleo chemicals and medicine as potential sectors for intra industry (cooperation). “Trade and healthcare; education; IT and telecommunications; financial; tourism; architectural; construction and engineering; distribution and human resource development are other key areas for collaboration between India and Malaysia,” said Ismail. Touching on the consumer portal Price Watch, Ismail admitted that in the beginning the portal experienced too much traffic and is undergoing an upgrade to ensure better service. “Consumers will be able to compare prices of goods sold. This will help standardise the prices of goods sold in Peninsular Malaysia, Sabah and Sarawak,” Ismail said. Indian High Commissioner to Malaysia Ashok K. Kantha, who attended the function, said the new Indian cabinet looked forward to reinforcing ties with South East Asia and has placed an emphasis on economic recovery and greater India-Malaysia trade. – Bernama

10th Malaysia Plan to be based on new economic model BUTTERWORTH: The 10th Malaysia Plan (10MP) will be based on a new economic model to ensure that all efforts towards economic recovery in the country run smoothly. Minister in the Prime Minister’s Department Tan Sri Nor Mohamed Yakcop (pix) said that although 10MP will take effect only in 2011, the government has started early planning on the five-year economic programme to ensure a sustainable development. The MP for Tasek Gelugor said that among the areas of focus under the new model will be to create many more industries to generate higher

income for the people and help them face future economic challenges as well. Speaking to reporters following a meeting with the people from his parliamentary constituency, he said that besides aiming for high income, attention would also be paid to utilising lower production costs. “The government has already started drafting the 10MP and has

the cabinet’s approval so that it can be implemented earlier, and when the world economy makes a recovery, we would be at the right platform for recovery,” he said. Nor Mohamed said that among the sectors identified to drive the new economy were knowledge, skills and creativity based industries including tourism. However, the traditional

industries such as manufacturing will be continued with new impetus through knowledge based industries so that they are able to generate higher income. “We see this current economic downturn as a “blessing” to push the country towards a new economic direction capable of more progress and that all the stimulus packages given by the government so far have started to show results,” he said. Although there has been a contraction in economic growth, the plan to liberalise the 27 economic sectors

including the financial sector has started to take effect, he said, adding that he was confident that the country’s economy will start to recover in the second part of the year. “The negative growth projection will not jeopordise the plans of 9MP as each programme has already been given the special allocation,” he said. Nevertheless, Nor Mohamed said in order to make a success of a modern economy, the people, especially those retrenched should take up the opportunity of training provided by the government. Increasing the level of

skills and knowledge of the new economy will be crucial for workers so that they can compete and generate higher income as well, he said. “Although we know the response towards the retraining schemes and programmes for workers has not been as good, the people must realise that new skills are required to face the challenges of the new economy. “A crisis is not always a bad thing as it also gives us the opportunity and space to reassess the existing strategies to continue to progress in line with current changes,” he said. – Bernama