Ringgit: Plunging to new lows

This is not good news.Read this Bloomberg report.

Malaysia’s ringgit fell, poised for its biggest drop in 12 years, after investors sold regional stocks as a weaker-than-estimated US jobs report renewed concerns about the pace of the global economic recovery.

The currency halted a two-week gain as regional equities tumbled, crude-oil prices dropped and the 16-nation euro reached the lowest level since March 2006. US payrolls and Malaysia’s exports increased at a slower pace than economists predicted, reports on June 4 showed. Factory output in Malaysia may have eased in April as overseas shipments slowed, a government report this week is forecast to show. Bonds dropped as the government prepares to sell debt after a pause in May.

“Investors wanted to see a quicker recovery, and the data shows it will take a few years rather than months,” said Calbert Loh, head of treasury at Bangkok Bank Bhd in Kuala Lumpur. “If stocks plunge, the ringgit and regional currencies will likely suffer too.”

The ringgit weakened 1.7 per cent to 3.3325 as of 5:13 pm in Kuala Lumpur, according to data compiled by Bloomberg, the biggest drop since June 1998. The currency has declined 2.1 per cent this month, adding to a 2.4 per cent slide in May. The MSCI Asia-Pacific Index of regional shares dropped 3.3 per cent.

Industrial production probably rose 12.4 per cent, versus a 14.1 per cent gain in March, according to a Bloomberg News survey before a statistics department report on June 10. Exports gained 26.6 percent in April from a year earlier, versus 36.4 per cent in March.

Malaysia: Last Oilman Standing by 2014?

But would you believe it?

Malaysia is expected to become the only net exporter of oil in AsiaPacific by 2014 although its proven oil reserves is declining, Malaysian Exhibition and Services Sdn Bhd (MES) general manager Alun Jones said.

Quoting Business Monitor International's (BMI) latest Malaysia oil and gas outlook, he said this London-based independent information provider had projected Malaysia will account for 1.81 per cent of Asia Pacific's oil demand by 2014, while providing 8.36 per cent of supply.

"Regional oil imports are growing rapidly because demand growth is outstripping the pace of supply expansion. The principal importers will be China, Japan, India and South Korea. By 2014, the only net exporter will be Malaysia," he said in an interview with Business Times and Berita Harian in Kuala Lumpur to announce the Subsea Asia 2010 conference and exhibition scheduled for June 10-11. The event is jointly organised by MES and Subsea UK.

Jones also said according to 2008 BP statistical energy survey, Malaysia has proven oil reserves of 5.357 billion barrels as at the end of 2007.


He said despite its active exploring in offshore areas and several new projects due to come onstream in the next several years, it is expected that Malaysia's oil production will fall in years to come as its proven oil reserves decline.

Jones said Malaysia is currently driving the region's subsea industry and has been at the forefront of this development through Petroliam Nasional Bhd (Petronas), which is committed to exploring offshore areas especially deepwater zones that require substantial technical expertise.

With a number of major projects currently under way, he said Malaysia continues to strengthen its position as the region's hub for subsea knowledge and excellence, with many of the world leading oil companies having set up their regional bases within the country.

As such, the Subsea Asia 2010 conference and exhibition will serve as a platform to disseminate information pertaining to the subsea industry in Malaysia as well as its outlook and also to showcase the latest and sophisticated technology used in the industry.

A total of 15 companies are participating in the Subsea Asia 2010 exhibition from 18 countries, including Austria, Australia, India, Indonesia, France, Italy, Norway, the UK, the US, Scotland and Singapore.

Major international and local companies participating in the exhibition include Framo Engineering, Subsea 7, Technip, Roxar, IEV Group, Haliburton, Expro Group, Matrix, Magnum Subsea and BJ Services.

Apart from individual companies' booth, Jones said there will be two national pavilions - the UK and Norway, of which the latter is participating for the first time as a country pavilion.

Norway ambassador to Malaysia, Arild Braastad, said the Norwegian companies are participating at the Subsea Asia 2010 exhibition to showcase their latest products and services in the industry.

"We have been in the oil and gas industry for about 40 years and our companies have grown to become internationally recognised. This is one of the reasons why we are participating in this Subsea Asia conference and exhibition," he said.

A total of 10 Norwegian companies are participating in the Subsea Asia 2010 exhibition. They are DNV, Jotun, Roxar, SPT Group, Vector International, XAIT, AGR Group, Framo Engineering AS, IKM Subsea and TCO.

Meanwhile, Technip GeoProduction (M) Sdn Bhd sales manager for subsea division Christophe Dieumegard said Technip's participation in the conference and exhibition provides a good opportunity for the French company to promote its technologies and the company in Malaysia.

"Our participation will mainly focus on subsea because Technip is a large engineering project management and construction company that specialises in oil and gas, with more than 23,000 people employed worldwide," he said.

In Malaysia, Technip has about 1,600 staff, with Kuala Lumpur serving as the company's head office for Asia Pacific.

"Only two years ago we moved our subsea office from Australia to Malaysia because we want to be part of the deepwater hub that Malaysia aspires. We want to be part of this dynamic effort," he said.

Having made its foothold in Malaysia some 28 years ago, Dieumegard said the company will continue to invest in Malaysia to tap on the booming oil and gas market.

"Our latest and major investment in the country recently was the construction of the E120 million flexible-making plant in Pasir Gudang, Johor.

"Construction work which began in 2008 has been completed and the plant is currently ready for operation. These pipes are not solely produced for the Malaysian market but also abroad," he said. The company is expected to deliver its first pipe supply contract to a Chinese company by February next year.

Just Imagine the Extent of Rent-Seeking.....

The termination in the use of middlemen in the maintenance and overhaul of the Sukhoi jet-fighters will half the costs of doing business.Such a shocking revelation!

It shows for the first time, the yawning profit gap of rent-seekers in this maintenance project. Just do nothing and collect!Walla!

This was revealed by the Minister of Defence. He said the contract for the maintenance and overhaul of the Sukhoi SU-30MKM jet fighters, which was previously awarded to agents or 'middlemen' in Malaysia and Russia, has been terminated, adding that the maintenance and overhaul of the jet fighters would now be undertaken by a leading local company that carried out maintenance, repair and overhaul works which is Airod Sdn Bhd.

"With the measures we are taking, the maintenance and repair costs will be reduced by 50%," he told reporters after witnessing the signing of the agreement between Crecom Burj Resources Limited and IRKUT Corporation, here Monday.

At the Parliament sitting in March, Defence minister Zahid Hamidi had said that the cost to maintain the Sukhoi jet fighters was RM220 million annually.

He said 15 Sukhoi jet fighters had been acquired for the country's defence inventory while three more units were expected to be acquired very soon.

Zahid said the warranty period for the 15 Sukhoi aircraft had been extended until the remaining units had been acquired.

I think this is a good beginning. Bravo, Minister Zahid!

Who's Calling the bluff here, Poker Face?

It was swirling around like wildfire!

The powers to be let the sports betting licence controversy to bubble and spillover from their official pronouncements and awaited to ensnare the uninitiated and gullible green-horns. From both sides, they were firing from the broadsides.

Did Vincent Tan carried on the charade knowingly or was it the government that backpedaled again to the detriment of the speculative stock market that bought into Berjaya Corp and the consternation of a nation?

When all is said and argued, now the government tells the world with a cheeky grin they have yet to issue the licence and the conditions for its issue has not even being stipulated. This is on hindsight after so much discussions and protests from the Opposition parties and the ultra ulamaks bent against gambling.

Issuing the licence is going to erode the electoral vote bank of the BN. Are they willing to take on the bet?

Funny thing is that the government now want to hear what the Malaysian public has to say before considering the licence and its conditions.

Again, it is bluffing and disinformation. The innocent and the gullible has to pay the price of procuring Berjaya Corp  shares that is supposed to buy 70% of Ascot Sports. This is going to amount to nothing and as a consequence, a thinner wallet.

Also Vincent's RM525 million may just about dissipated into thin air to the chagrin of all!

Wasn't it a good exercise in irrelevance while it last?