CPO Receives Energy Boost

May 2008

Crude palm oil (CPO) prices are moving in sync with escalating oil prices, demonstrating an increasing correlation in commodity price behaviour. When crude oil rose to its then all-time high of US$112.21 (RM359) per barrel in early April, palm oil futures for June delivery likewise increased to RM3,455 (US$1,095) per tonne on the Bursa Malaysia Derivatives Exchange. CPO price volatility is also being fuelled by a drop in palm oil stockpiles and excessive hedging in futures, apart from increasing demand for biodiesel due to the uptrend in crude oil.

Larger Balance of Payments in 2007

May 2008

Malaysia's external position strengthened in 2007, as reflected by the larger overall balance of payments, due to a larger current account surplus, while net outflows in the financial account moderated, according to the central bank's annual report 2007. The sustained large trade surplus, underpinned by strong growth in commodity exports and an improvement in the services and income accounts, contributed to the larger current account surplus of RM99.3bn (US$31.47bn) or 15.8% of gross national income, compared to RM93.4bn (US$29.6bn) or 16.8% of gross national income in 2006. In particular, the services account recorded its first surplus, due mainly to higher tourism and transportation receipts.

CSR Still Wanting

May 2008

Malaysian Plcs generally lag behind international best practices and disclosures in corporate social responsibility (CSR), revealed a pioneering 2007 survey commissioned by stock exchange Bursa Malaysia.

The findings of the CSR 2007 Status Report showed that, on average, the Plcs surveyed demonstrated lack of knowledge and awareness of key CSR concepts. The study also pinpointed the absence of top management commitment towards CSR, which could explain the lack of integration between sustainability measures and business strategies. Interestingly, many companies still equate CSR reporting solely to community investment and philanthropy, demonstrating the lack of understanding among companies.

The survey, which sampled 200 listed corporations, measured their impacts across four dimensions, namely, the marketplace, workplace, environment and community. Results showed that only 32.5% of companies ranked in the above average, good or leading categories of CSR practices, while two-thirds of Plcs ranked either average (27.5%), below average (28.5%) or poor (11.5%). Listed multinational corporations achieved the highest score.

Among the best performers were gaming, tobacco and alcohol-related firms, possibly due to the businesses' social and environmental impacts, whereas construction firms emerged as the least CSR-savvy.

The survey highlighted weak corporate commitment to the environment and diversity. There was a lack of environmental preservation efforts by local firms, along with inadequate female representation at top management level, and less than satisfactory Malay and Indian representation in the senior company hierarchy. Malays make up the majority of the multiracial population that also comprises Chinese, Indian and indigenous peoples.

The exchange urged companies to manifest CSR in their business practices and not to treat CSR initiatives as an add-on list of activities in order to promote business sustainability and add value to the capital markets, as well as to enhance the international reputation of Malaysian companies.

Streamlining the Capital Market

May 2008

Malaysia's stock exchange Bursa Malaysia has proposed to merge its Main and Second Boards as part of a move to provide better access to the capital market, facilitate capital raising exercises, and inject further confidence into a lacklustre stock market.

According to the Securities Commission (SC), the Main and Second Boards will be merged into a unified board for companies with an established profit track record, where the qualifying criteria for listing will be based on the current Second Board criteria. The SC hopes that this move will negate the differentiation of companies based on size and facilitate the assessment of companies on the basis of quality of earnings.

The MESDAQ Market, which was initially set up to house tech and high-growth companies without a profit track record, will be transformed into a sponsor-driven market and expanded to include the listing of both technology and non-technology emerging companies.

The SC also plans to introduce a new regulatory approach for listings and fund-raising on the unified board and MESDAQ, whereby principal advisers and sponsors will be bringing companies to list on Bursa Malaysia and will be responsible for ensuring the quality and suitability of companies for listing. In addition, sponsors will be expected to ensure ongoing supervision of companies post listing for the MESDAQ market.

The new approach will enable the SC to shift its focus from assessing the suitability of proposals to ensuring the adequacy and quality of disclosures in prospectuses in order to safeguard corporate governance and public interest.

The streamlined board structure, together with the new regulatory and listing approach, will be implemented by the end of 2008.

Start saving for your future

Saturday June 28, 2008

By EDWARD RAJENDRA

SET aside some money for yourself first when you get your pay cheque, that is the advice given by a chartered financial consultant so that you can retire as a millionaire.

K.H. Tan said the idea of “paying yourself first” was good and should start early in one's working life.

“Paying yourself first means before you settle the bills or spoil yourself on designer coffees, you set money aside for yourself. Now this isn't cash to splurge but cash to save for the future,” he said.

Tan, 38, added that many young executives who had attended his financial seminars felt it difficult to set money aside for themselves.

“Salary adjustments, increments and bonuses are earned. No matter how much you earn, you must force yourself to set aside an amount for retirement. If you don't do it, nobody else will,” he said at his recent I Can Be a Millionaire seminar.

However, Tan said: “Human nature makes it difficult as people think they don't have enough to pay themselves first because there's always something to spend the annual salary increase on.

“We advice many to start on a small sum instead of a ambitious sum.

“As income grows, increase the savings and to make the pay your self first effective, the process has to be automatic. Apply for an automatic bank transfer to take effect each time your income is credited to your account,” he added.

Tan's business partner P. Utama Raj strongly believes in the pay yourself idea and suggest that young executives request their employers transfer a fixed percentage of their income from their monthly pay to an investment portfolio.

“By doing so, the process becomes automatic and it makes it easier to hit that million ringgit mark due to the consistent monthly deposits and power of compounding interest,” he said.

Raj, 35, added that young executives must avoid incurring credit- card debts and spend wisely.

“One good approach to spend wisely is to use cash whenever possible.

“Being discipline does not mean a lack of a social life or depriving oneself of every shopping urge.

“We must keep our spending habits within reason thus exercising delayed gratification,” he said.

Big money in oil sector

Wednesday June 25, 2008

KUALA LUMPUR: The oil and gas sector and the information technology industry saw the sharpest increases in salary, a survey has shown.

According to outsourcing and consulting group Kelly Services, which conducted the 2007/08 survey, base salary in both sectors increased by 30% followed by the engineering sector at 28%.

“Commodity-based companies like oil and gas and oil palm are able to absorb the salary increase as there is continued demand for their products and by-products,” said consulting director Anthony Devadoss at the launch of the Malaysia Salary Handbook 2008/09: A Practitioner’s Insight To Salaries Across Industries, here, yesterday.

“Both sectors also recorded an increase in hiring opportunities,” he said, adding that generally, “Malaysia experiences the most stable salary increment compared to India, Singapore and China.

“There is a 6% to10% increase annually, which is steady.”

He said that the survey, conducted during the first quarter of this year across salary trends among companies in the country, also found a robust situation in employment opportunities.

“There is an increase in the manufacturing, IT, engineering, marketing services and banking sectors with new job titles to cater to changing demands,’’ he said.

High value-added investments, which create jobs that command high incomes, and investment in human capital could form some of the core elements of sustaining growth.

Although most industries would see an increase in increment, there were sectors which would be hit, especially, with the economic uncertainties.

“With the price hike in food and fuel, businesses such as retail, FMCG (fast-moving consumer goods) companies, tourism, travel and automotive are much likely to be affected due to reduced and cautious consumer spending.

“Thus, an increase in salaries will be a tight squeeze for them,” he said. “These sectors will definitely take a cautious stand in raising salaries,” he added.

Kota Damansara-Cheras rail line right on track

Sunday June 15, 2008

By LEONG SHEN-LI

PETALING JAYA: More than one million Klang Valley residents will benefit from the much awaited new Kota Damansara-Cheras rail transit line.

The Government had earlier said the new line and extensions should be ready by 2012. Sources said with the average construction period taking three to four years, work would have to start by the end of this year.

The 40km route covers some of the most densely populated areas in the Klang Valley such as Damansara and Cheras as well as the fast growing area of Kota Damansara.

It will also serve the heart of the Golden Triangle, the business and financial hub of Kuala Lumpur.

Currently, the area is only served by KL Monorail, which is already suffering from overcrowding.
The new line, which sources said would cost between RM4bil and RM5bil and will be mostly elevated, will provide the much needed expansion to the current 56km, 48-station light rail transit network, especially in view of the rising fuel prices and the new emphasis on public transport.

The line was announced in October 2006 by Deputy Prime Minister Datuk Seri Najib Tun Razak but little has been heard about it since then.

The alignment, made available to The Star, showed the new line running from Kota Damansara along Persiaran Surian to the Damansara-Puchong Expressway and then heading towards the city centre along the Sprint Expressway, through Bangsar Baru and Jalan Bangsar.

It will then run parallel to the existing Kelana Jaya LRT line (formerly Putra-LRT) to KL Sentral, Pasar Seni and Masjid Jamek before heading to the Golden Triangle along Jalan Raja Chulan.

The route will then pass Pasar Rakyat in Bukit Bintang and then Jalan Tun Razak where it will join Jalan Cheras.

It will continue along the road and the Cheras-Kajang Expressway to the Balakong interchange near Cheras Batu 11.

Passengers will be able to switch with the existing Kelana Jaya LRT line at Bangsar, KL Sentral, Pasar Seni and Masjid Jamek; and the Ampang LRT line (formerly Star-LRT) at Masjid Jamek and Maluri.

There will be around 30 stations along the line, including the interchange stations.

Sources said the route was a “desktop alignment” which would form the basis for the eventual line. The number of stations has also not been finalised.

The final alignment and number of stations is unlikely to vary in any major way from the “desktop” plan.

As with the other lines, the new line will be owned by Syarikat Prasarana Negara Bhd and operated by RapidKL.

While the Government has yet to announce when work will begin on the new line, sources pointed to the “positive statements” by Second Finance Minister Tan Sri Nor Mohamed Yakcop after a briefing session with Backbenchers last Thursday.

Nor had announced that public transport would be getting more incentives, allocations and assistance in Budget 2009 and future budgets.

Sources said the Government was also currently conducting the mid-term review of the 9th Malaysia Plan and there were concerted efforts to get the new line in.

Besides the new line, the Government is also trying to get extensions to the Kelana Jaya and Ampang Lines started.

The extensions will cover Subang Jaya, USJ, Kinrara and Puchong and meet at Putra Heights.

RM16mil blissful insomnia

Saturday June 14, 2008

PETALING JAYA: A man who won a whopping RM16.4mil in the Mega Toto 6/52 jackpot only claimed his prize money 10 days later as he had to “compose and re-orientate himself” first.

He said he had had sleepless nights after his win but called it his “blissful insomnia,” he said in a press statement released by Sports Toto Malaysia Sdn Bhd on Thursday.

He explained that he had derived his numbers from the address of Sports Toto’s head office as well as the addresses of his family members, and six of the nine numbers he had chosen for the System Play were drawn as the first prize winning on Wednesday.

He also won an additional RM61,260 from 18 sets of the second prize, 45 sets of the third prize and 20 sets of the fourth prize.

Making it fast and easy for vehicle owners

Friday June 13, 2008

KUALA LUMPUR: Three minutes. That's about how fast vehicle owners can claim the cash rebates.

This assurance came from Pos Malaysia Berhad (PMB) executive director Datuk Abu Huraira Abu Yazid.

Vehicle owners can get their cash rebates of up to RM625 from 683 post offices nationwide beginning tomorrow.

He said those who renewed or bought their road tax from April 1 until May 31 this year were the ones eligible to start claiming the rebate beginning tomorrow until March 31 next year.

He said these groups were categorised under phase one of the implementation. The vehicle owner must be present with their original identity card and fill-up a simple form that would be given by the post office staff.

“After the form is filled, the details will be verified with Road Transport Department’s system database.

“Once that is confirmed, the thumbprint of the owner will be required on the form, before the cash is handed over. It is a simple process,” he told a press conference at PMB near here yesterday.

Abu Huraira said those who did not want to queue up could fill up the form and drop a section of it into a special box while keeping a customer's copy for themselves.

“Once the owner receives the money order, the person can either cash it at post offices or at banks,” he added.

He said vehicle owners who had renewed or plan to renew their road tax from June 1 until March 31 next year could start claiming their rebates starting from July 1.

On June 4, Prime Minister Datuk Seri Abdullah Ahmad Badawi had announced the new fuel price of RM2.70 a litre for petrol and RM2.58 a litre for diesel. In line with that, owners of private vehicles with engine capacity of 2,000cc and below would enjoy a RM625 rebate.

Owners of private pickup trucks and jeeps with engine capacity of 2,500cc and below will also receive the rebate. Owners of motorcycles of 250cc and below are eligible for a RM150 rebate.

Customers can contact PMB’s customer service centre at 1-300-300-300 or visit the website at www.pos.com.my should they have any enquiries.

Rebate in three minutes

Friday June 13, 2008

By MANJIT KAUR

KUALA LUMPUR: The process of getting fuel subsidy rebates will be simple and will only take three minutes, Pos Malaysia Bhd said.

At a press conference yesterday, Pos Malaysia executive director Datuk Abu Huraira Abu Yazid said car owners only needed to do the following to get the cash rebate:

> Go in person to any of the country's 683 post offices,
> Bring your identity card,
> Provide your car registration number, and
> Fill a money order form.

Rebates can be claimed from tomorrow until March 31 next year for those who bought new or renewed their road tax between April 1 and May 31 this year. For those after June 1, claims can be made from July 1.

More natural gas stations needed, say motorists

Fiday June 13, 2008

WITH the number of NGV users expected to rise soon, motorists and operators of NGV conversion centres are urging the government to provide more natural gas refilling stations.

They feel that it would not be practical for NGV users to travel freely without the easy availability of natural gas stations throughout the country.

It is learnt that there are only about 150 stations in the country, mostly in the Klang Valley, but the number is expected to increase to 200 by the end of this year.

According to motorist Ishak Junid from Kampung Pendamar in Port Klang, there should be more NGV stations so that motorists will be encouraged to switch to natural gas.

Ishak, who drives a Nazaria, said that before a new Petronas NGV station was opened near his house in Bayu Mas, he used to travel more than 20km to fill up gas from the station at Teluk Panglima Garang.

Ishak, like most NGV users, feels that the current monopoly of natural gas sale by Petronas is restrictive to the NGV motorists.

He said that other fuel companies should be allowed to open up NGV stations so that more people benefited by using NGV.

“I have been able to save a substantial amount of money since switching to NGV a year ago,” he said.

Hairul Idris of the Tunas Sanubari NGV centre from Meru said that the existing stations were insufficient for the increasing number of the natural gas fuel users.

“My business volume has increased tremendously over the past week and the waiting list has extended to July. I can only foresee demand increasing in the near future,” he said.

“It will be difficult for users to refill gas unless the stations are available everywhere,” Hairul said.

S. Poovalagu, from Subang, said that he had installed his Proton Wira with the NGV converter and hoped that he would not be facing problems finding the gas stations.

Poovalagu said motorists should be educated on the benefits of using natural gas so that people would not be ignorant and confused.

Norafizah Haidzir, 34, of Sungai Buloh was very excited after installing the NGV system into her car.

Norafizah said that she had no choice but to do so as the revised petrol price had hit her hard financially.

“I’m looking forward to drive without worrying so much about the cost of fuel and hope there are sufficient gas stations,” she said.

Rush to fit natural gas gadget

Friday June 13, 2008

Stories by Elan Perumal

THERE have been times when Steven Ng of Sugio NGV Technology had thought about giving up his involvement in the natural gas vehicle (NGV) business that he ventured into six years ago.

For the first four years, business was very bad. But Ng persevered with strong will power and determination, staying on in the business despite the odds.

Today, the plucky Ng can now stand and walk tall.

While everyone is complaining about the steep hike in petrol and diesel prices, Ng has reason to smile. Why?

People are suddenly realising that converting their vehicles to run on NGV would help ease their financial burdens.

“I had tough times during the first four years as the business was not good and I only saw some signs of progress after 2006,” Ng recalled.

“From the very first day, I knew this was the business of the future but things did not go as I expected until just a week ago when the government raised the petrol price to RM2.70 sen per litre,” Ng said.

“It is only due to the drastic increase in the petrol price that people are thinking of converting their vehicles to run on NGV,” Ng told StarMetro during an interview.

Ng said his business had grown sixfold over the last one week and he was having a tough time coping with the increasing demand from motorists who wanted their vehicles converted into the NGV mode immediately.

Ng said that in recent months, he used to have about five walk-in customers per day but the situation changed drastically now as his centre had been converting some 20 vehicles per day.

“There have been an average of 30 people lining up with their vehicles at my centre daily but it can only serve 20 vehicles per day,” he said.

Ng said that his centre was now operating at maximum capacity, with his workers putting in extra hours each day.

He said the demand for supply from dealers and other NGV conversion centres had also been overwhelming with orders amounting to hundreds per day.

“You would be surprised by the number of calls I have been receiving each day. I am forced to turn down orders from some the dealers due to lack of stock,” he said.

According to Ng, the parts for the conversion, including gas cylinders and reducers, are imported from Europe, Argentina and India.

Ng said that due to the current high demand, he had ran out of cylinders for smaller vehicles such as Perodua Kancil and Proton Iswara Aeroback, which required cylinders between 45 and 60kgs.

“However, we have a new stock of 75kg cylinders for the other vehicles that are made from fibre and metal. These are lighter than the metal cylinders,” he said.

Ng said almost all kinds of vehicles, including the small Kancil cars, could be converted into the NGV mode.

According to Ng, the price ranged from RM3,000 and above based on the engine capacity and size of the vehicles.

Vehicles operating with carburettor engines will cost less compared with those operating on fuel injection vehicles.

“Our technicians are very experienced and they will fix the cylinders in such away that only one-third of your boot will be taken up by the cylinders,” Ng said.

“The conversion can be done within half a day and customers will be provided with certificates from the Road Transport Department and a warranty as well,” he said.

Ng said the NGV conversion was an additional feature and the vehicle could still run on petrol if necessary.

He said that by converting a vehicle to run on NGV, a motorist could save 60% to 70% in fuel costs.

“You can travel at as low as 5 sen per km depending on the engine capacity of your vehicle,” he said.

Ng said NGV was environment-friendly and vehicles running on natural gas produced zero pollution.

“Our roads will be free from smoke pollution if all the vehicles turn to natural gas for fuel,” he said.

Ng said the NGV conversion could be done on all types of vehicles, including petrol and diesel cars, vans, four-wheel drive and multipurpose vehicles (MPV).

He said the power of the vehicles operated via natural gas would be slightly less than those operated with petrol.

“However, we can add components that will able to compensate the power and at the same time reduce the fuel cost if customers are willing to spend a bit of extra money,” he said.

Ng is obviously making regular trips to the bank, powered by, what else, NGV!

It’s on, free water from June

Thursday June 12, 2008

By EDWARD RAJENDRA

SHAH ALAM: Selangor residents will get to enjoy the first 20 cubic metres of water free after all from June now that the state government has agreed to conditions set by water concessionaire Syarikat Bekalan Air Selangor Sdn Bhd.

State investment arm Kumpulan Darul Ehsan Bhd (KDEB) and Syabas sealed the deal in just 50 minutes yesterday to resolve months of disagreement over the matter.

Mentri Besar Tan Sri Khalid Ibrahim said the issue was settled along a plan where KDEB would compensate Syabas RM1.8mil a month for the 1.1 million consumers to get that free water.

KDEB had earlier wanted to compensate Syabas after the water industry restructuring in September.

KDEB owns 30% of Syabas which has a 30-year concession to distribute water to consumers in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya.

Yesterday, KDEB president Datuk Abdul Karim Munisar, Syabas chief executive officer Datuk Ruslan Hassan and Khalid held a discussion where the terms and conditions were resolved.

On Monday, Ruslan had said in a statement that the company and the state investment arm KDEB could not agree on “terms and conditions” over how the free water was going to be compensated.

He added that Syabas could not accept KDEB’s offer to compensate the company for the free water in September after the proposed restructuring of water services in the state and wanted payment to be done in 14 days.

Further to that, he said the proposal would have adversely affected the water concessionaire’s cash flow and daily operations, so Syabas continued to charge for the first 20 cubic metres of water until it received favourable terms from KDEB.

Khalid said the cost of the free water would be borne by KDEB, the state’s business arm.

“You must understand that it is the first time such an endeavour is being done to give free water.

“So, there were certain terms that had to be clarified.

“We had to resolve the issue of how the billing would be carried out, the compensation issue and settlement of payment with Syabas,” said Khalid.

He added that there were three phases to the understanding with KDEB and Syabas.

“First phase is the billing exercise, the second is the restructuring of water industry in Selangor and the third is to restudy the allocation of funds and the water pricing as it had to take into account the change of economics,” he added.

Ruslan when met after the press conference said Syabas was in agreement with the understanding achieved in the 50-minute discussion.

“We will go ahead with the billing and consumers will receive their bills with the rebate,” he said.

Sime Darby sacks CFO

Wednesday June 11, 2008

By HANIM ADNAN

KUALA LUMPUR: Sime Darby Bhd on Monday sacked its chief financial officer (CFO) and another senior executive following an in-depth inquiry into RM120mil losses from crude palm oil (CPO) futures trading.

The services of group CFO Razidan Ghazalli and group vice-president (1) of downstream and biofuel Muhamad Mohan Kittu Abdullah were terminated with immediate effect.

In a statement yesterday, Sime Darby said the trading losses at Golden Jomalina Food Industries Bhd, a subsidiary of Golden Hope Plantations Bhd (GHope), were discovered in August 2007, several months before the merger of GHope, Kumpulan Guthrie Bhd and Sime Darby.

Shortly after the losses were discovered, KPMG Forensic was engaged to conduct an investigative review of the futures trading operations at Golden Jomalina.

The forensic accountants completed their report and handed it to Sime Darby this year. The issue was deliberated by the group’s board of directors at a meeting on May 28.

After having reviewed the forensic accountant's report and findings by a panel of independent directors set up by the audit committee, Sime Darby’s board determined that the persons concerned had failed to discharge their functions to the standard of care that were reasonably expected of them.

Razidan was GHope’s finance director while Muhammad Mohan was Jomalina’s general manager when the losses were racked up through futures trading between October 2006 and August 2007.

According to a Sime Darby spokesman, appropriate provisions had been made and the group would not have its future profitability affected by the past losses.

He added that measures had been taken to strengthen processes and trading parameters.

“The decision to terminate the services of the two staff members was taken after an extensive process of investigation and deliberation. While it is never a pleasant task to dismiss any personnel, the board felt that the move was necessary in the interest of accountability and to protect stakeholders of Sime Darby,” said the spokesman.

Meanwhile, industry analysts contacted by StarBiz said the RM120mil trading losses would not have an impact on their earnings forecasts on Sime Darby as the group confirmed that it already made ample provisions to account for the losses.

A plantation analyst with a bank-backed brokerage said while the revelation (of the losses) might raise concerns among investors, Sime Darby had made the right decision to make its top staff accountable for the glaring irregularities within the group’s highly diversified operations.

“The group is advocating transparency and issuing a stern warning that irrespective of the rank, none of its staff will be spared from the consequences of irregularities which can keep on cropping up in any big organisation,” the analyst said.

Another analyst concurred that it was a positive move by Sime Darby to reveal the losses rather than to cover up.

“I believe that some plantation analysts since last year have already sensed the irregularities, particularly the losses in the group’s downstream operations, attributing it to the unfeasible biodiesel operation.

“This losses were somewhat overlooked, given the good performance in the upstream plantation operation due to the higher CPO prices,” he added.

Taliworks eyes highway concession business

Wednesday June 11, 2008

By FINTAN NG

PETALING JAYA: Water resources concessionaire Taliworks Corp Bhd is eyeing a more meaningful role in the highway concession business following its acquisition of a stake in Sunway Infrastructure Bhd (SunInfra), the operator and owner of the 37km Kajang SILK Highway.

A source with knowledge of the deal said Cerah Sama Sdn Bhd acquired a 14% stake in SunInfra, equivalent to 25.48 million shares, at 21 sen a share or RM5.34mil. Cerah Sama is 55%-owned by Taliworks and 35%-owned by Singapore-based South East Asian Strategic Assets Fund (Seasaf). Filings with Bursa Malaysia showed the stake was acquired on June 2.

According to its website, Seasaf was launched in March 2006 with a mandate to invest in energy, infrastructure and natural resources sectors in South-East Asia.

Its Malaysian investments include US$8.1mil in International Medical University and US$29.1mil in Malakoff Corp Bhd. It has also committed to invest a further US$14.5mil in Metal Reclamation Bhd while it has invested US$20.4mil in Cerah Sama.

Taliworks currently manages six water treatment plants with a combined design capacity of 1.04 million litres of water per day that serves more than two million people in Selangor, Kuala Lumpur and Langkawi. Through Cerah Sama subsidiary Grand Saga Sdn Bhd, it is also the owner and operator of the 11.5km Cheras-Kajang Highway.

The source said through the stake acquisition, Taliworks hoped to have a more meaningful role in the management of tolled highways in Malaysia and the surrounding region in the years to come.

“Taliworks intends to use Cerah Sama to build a portfolio of tolled highways in Malaysia and the Asean region and the shareholders have the intention to list Cerah Sama in seven years,” he said.

The acquisition of the SunInfra stake comes on the heels of a failed takeover bid by Infra Bumitek Sdn Bhd, which already owned 65.09 million shares, or 36.16%, of the company that it acquired on Feb 27 for 17 sen per share.

Infra Bumitek had, via a mandatory takeover offer on April 8, offered to acquire the remaining 114.91 million shares, or 63.84%, of SunInfra for 17 sen per share and warrants at 0.01 sen each but shareholders were advised by brokerage PM Securities Sdn Bhd to reject the offer because SunInfra shares had been trading above 17 sen since last October.

Kuantan set to be AirAsia’s eastern hub

Wednesday June 11, 2008

KUANTAN: Low-cost carrier AirAsia plans to have direct flights from here to international destinations like Singapore, Jakarta and Bangkok.

This follows the airline's introduction of flights from the Low Cost Carrier Terminal (LCCT) at KLIA to the state capital from June 1.

Present at the official launch here yesterday were Tengku Puan Pahang Tengku Azizah Aminah Maimunah Iskandariah Sultan Iskandar, Mentri Besar Datuk Seri Adnan Yaakob and AirAsia Group Chief Executive Officer Datuk Seri Tony Fernandes.

Speaking to reporters later, Fernandes said there was potential for Kuantan to become the airline’s east coast hub.

“We have been looking for an east coast hub as we think the east coast has enormous potential. If there is good infrastructure, there is no reason we cannot sell the whole of east coast from Kuantan,” he added.

There was a huge demand from Singaporeans for direct flights from Kuantan, he noted.

Fernandes said the airline had already submitted its application to the Transport Ministry and was awaiting a reply.

On the fuel price rise and the company’s efforts to remain cost- effective while introducing new routes and more flights, Fernandes said the way to deal with the increase was for the airline to market its way out of the problem.

“We have developed many ways of keeping our fares low despite the rising oil price,” he added.

“We also sell more things now, including hot food instead of boxed food. We have to find ways to deal with it. We have a brand new fleet, and fuel burn is much lower. “

Tengku Abdullah, in his speech earlier, said he hoped AirAsia would continue to operate in Kuantan despite the oil price rise.

Syabas: No water rebate

Friday June 6, 2008

PUTRAJAYA: Syarikat Bekalan Air Selangor Sdn Bhd (Syabas) will continue to issue utility bills to consumers without any subsidy or reduction at the end of this month.

This is because the company has yet to receive any written order or undertaking from the state or Federal government to pay for the 20 cubic metres of free water promised to consumers.

Its chief executive officer Datuk Ruslan Hassan said Syabas had only limited discussions with the Selangor Government on free water.

“Discussions with the Selangor Government have not produced any result relating to legal matters, costs and approval from the Federal Government,” he said in a statement here yesterday.

“Until Syabas receives a written order from Selangor and the Federal Government or an undertaking from Selangor or any state agency to pay us for the 20 cubic metres, we will continue to issue water bills to consumers as usual, without any reduction or subsidy.”

Ruslan was responding to a statement from Selangor Mentri Besar Tan Sri Khalid Ibrahim that the water rebate was on from June 1 and that it would be reflected in this month’s bill.

Ruslan said Syabas’ policy on the matter was clear in that the water it supplied was governed by the privatisation agreement.

“According to this agreement, Syabas is only allowed to supply water to consumers based on water rates that have been gazetted.

“So, any action taken by Syabas will not only need approval from the Selangor Government but the Water Services Commission and the Energy, Water and Communications Ministry on the Federal Government’s behalf,” he said.

He said those who had enquiries could contact the company’s 24-hour customer service centre at 1-800-88-5252.

In Shah Alam yesterday, Khalid said the issue would be resolved by today.

“We will go through Kumpulan Darul Ehsan Bhd (KDEB) to issue the letter. The state government will not issue it directly by itself,” he told reporters after attending the handing-over of the official jersey for the Sultan of Selangor Cup 2008 to Sultan of Selangor Sultan Sharafuddin Idris Shah here.

It is understood that the state holds a stake in Syabas through its investment arm KDEB and only issue its directive through KDEB.

Electricity rates go up

Thursday June 5, 2008

PUTRAJAYA: Less than half of the Malaysian households will be affected by the new electricity tariffs that were announced together with the increase in fuel prices yesterday.

Prime Minister Datuk Seri Abdullah Ahmad Badawi said 59% of Malaysian households would pay the same rates as before the tariff hike, so long as they maintain their usage rates.

“The new tariff will not affect those who only use 200 kilowatts/hour (kWh) and below every month. Their estimated monthly bill should be less than RM43.60 a month,” he said in a statement released to reporters when he announced the increase in petrol prices here.

He said a new tariff structure would be announced soon for Sabah and Sarawak.

As for commercial and industrial consumers, Abdullah said their rates would see a 26% increase.

“However, for the commercial and industrial categories, consideration is made for shop owners and small restaurant operators, and rural industry users who use less than 200kWh a month will only see an 18% increase,” he said.

He said with the restructuring of the fuel subsidies and the increase in coal prices, the Government had approved the new electricity tariff structure to allow Tenaga Nasional to absorb the cost for both commodities.

Petrol price up by 78 sen - and will be reviewed monthly

Thursday June 5, 2008

PUTRAJAYA: The Government announced yesterday an increase in petrol and diesel prices, stating that it can no longer continue to subsidise fuel.

Prime Minister Datuk Seri Abdullah Ahmad Badawi said the new prices were still at a 30-sen per litre discount from market prices.

In other words, if the market price is RM3 per litre, Malaysians will be charged RM2.70 at the pump. He said the price would be adjusted monthly based on the global oil price.

“Malaysians still pay lower than the market prices as far as petrol is concerned,” he told a packed press conference when announcing the restructuring of the subsidy package.

Abdullah said that although the restructuring would result in consumers having to pay more, prices were still lower compared with Singapore and Thailand.

He said the Government would save RM13.7bil through the restructuring.

From the savings, he said RM4bil would go to the National Food Supply Guarantee Policy, RM1.5bil for subsidising cooking oil and RM400mil to subsidise rice imports to make the price uniform in peninsular Malaysia, Sabah and Sarawak.

The Government would also spend RM200mil on flour subsidy, RM100mil on bread subsidy and RM7.5bil was meant for contributions to the subsidies for petrol, diesel and gas.

On top of that, Abdullah said, the Government would have to fork out RM5bil to pay to owners of cars and motorcycles eligible for rebates introduced under the restructuring of subsidy package.

“Our effort is certainly not an attempt to be popular but we try our best to help the people. We cannot satisfy everyone,” he said.

Abdullah said demand for public transport would go up with the rise in fuel prices and the Government was currently addressing the need to improve services.

He reiterated that the public should make changes to their lifestyle, saying they must ensure there was no wastage in resources such as water, energy and food.

He said if certain adjustments were made, the public would not be “too badly affected by price increases”.

He said the hike in fuel prices would cause a projected increase in inflation of around 4% to 5%. It would also have an impact on the country’s gross domestic product (GDP) growth but was confident that it could be maintained at 5% this year.

Abdullah said the Cabinet committee on anti-inflation had to come up with a system to ease the public’s burden from higher fuel prices.

“What is important is that we want to ensure the restructuring will encompass a mechanism that will protect and benefit those in the lower and middle income group.

“We are truly committed in ensuring these groups will not be burdened by the increase in petrol and food prices,” he said.

Asked if the subsidy restructuring would result in Malaysians going to the streets to demonstrate their unhappiness, Abdullah was confident the people would not resort to that.

The Changes
Price increase
Petrol – RM0.78/litre
Diesel – RM1/litre
Electricity:Commercial and industrial – 26%
Retailers and small restaurant operators – 18% (for first 200kWh per month)
Residential – new pricing structure for users above 200kWh per month

Prices effective today (per litre)
Petrol – RM2.70 (previously RM1.92)
Diesel – RM2.58 (previously RM1.58)

Rebates
> RM625 per yearFor private vehicle with engine capacity of 2000cc and below, including private pickup trucks and jeeps with engine capacity of 2500cc and below.
> RM150 per yearFor each private motorcycle with engine capacity of 250cc and below
> RM200 reduction on road taxFor private petrol and diesel vehicles with engine capacity above 2000cc
> RM50 reduction on road taxFor private motorcycles with engine capacity above 250cc

Streamlined diesel subsidy(for approved transportation companies, vessel owners and fishermen)
> Diesel – RM1.43 per litre (previously RM1 per litre for fishermen and RM1.20 per litre for vessel owners)
> RM200 per month for every owner and employee of Malaysian-owned vessels registered with the Fisheries Department
> 10sen per kilo incentive for every kilogram of fish caught by registered vessels
> 10sen per litre for every litre of diesel used by river transportation operators according to approved quota

Gas subsidies restructure(for Peninsular Malaysia)
> For power producers – from RM6.40 per mmBtu to RM14.31 per mmBtu
> For industrial users (consuming less than 2mmscfd) – from RM9.40 per mmBtu to RM24.54 per mmBtu
> For industrial users (consuming above 2mmscfd) – from RM11.32 per mmBtu to RM32.56 per mmBtu

Electricity tariff restructure
> Households using 200kWh and below every month will not be affected. This covers 59% of households in Peninsular Malaysia with a monthly bill under RM43.60.
> Commercial and industrial users face 26% increase. Small retail and business outlets consuming under 200kWh per month face 18% increase.

Liquefied Petroleum Gas (LPG) andNatural Gas for Vehicle (NGV)
> No change. Prices remain at RM1.75 per kg (LPG) and RM0.635 per litre (NGV)
Oil palm windfall tax
> For Peninsular Malaysia 15% for every tonne of CPO exceeding RM2,000
> Sabah and Sarawak 7.5% for every tonne of CPO exceeding RM2,000
> Abolition of cess tax

Service tax threshold for restaurants and eateries
> Service tax now for restaurants with annual sales of RM3mil (previously RM500,000)

Bandar Mahkota intersection to remain open, upgraded

Thursday June 5, 2008

KAJANG: The controversial Bandar Mahkota Cheras intersection, which led to a Cabinet intervention on May 30, will be upgraded and will remain open to the people.

Works Minister Datuk Mohd Zin Mohamed, said the Malaysian Highway Authority and Cheras-Kajang Highway concessionaire Grand Saga Sdn Bhd had been instructed to begin upgrading works on the road that would by-pass the 11th Mile Cheras toll plaza.

Mohd Zin, who visited the site yesterday, said six more traffic lights would be installed at the intersection below the highway to make things better for road users from the Bandar Mahkota Cheras, Bandar Sungai Long, Bandar Tun Hussein Onn and Cheras Perdana townships. The road will also be resurfaced.

The intersection made headlines in recent days when the public demolished the barricades built by Grand Saga four times this year. Grand Saga had claimed losses due to their by-passing the toll. This led to a series of incidents filled with injuries and arrests.

The Government stepped in, ordering the removal of the last barricade and promised that the road would remain open until the legal dispute between Grand Saga and Bandar Mahkota Cheras developer Narajaya Sdn Bhd is resolved in court.