News

KUALA LUMPUR: The startup ecosystem in Kuala Lumpur has generated more than RM220 billion (US$47 billion) in ecosystem value from 1 July 2021 to 31 December 2023, said Cradle Fund Sdn Bhd. The agency – operating under the Finance Ministry and administered by the Ministry of Science, Technology and Innovation (MOSTI) –  said that the ecosystem value measures the city’s economic impact from the value of exits and startup valuations. In a statement, Cradle said that KL also received recognition in the latest Global Startup Ecosystem Report (GSER) 2024, placing it among the top 30 emerging ecosystems, which reflects its rapid growth and substantial economic impact. Its Group Chief Executive Officer Norman Matthieu Vanhaecke said these achievements underscore the efforts and strategic initiatives to foster a conducive environment for startups. “Malaysia views startups as a pivotal force in driving local innovation and technological advancement. Cradle seeks to combine the resources and experiences of all ecosystem stakeholders. “With a consistent commitment to cultivating a high-performing, inclusive, globalised and sustainable ecosystem, Cradle envisions propelling Malaysia to the forefront of the global startup ecosystem,” he said. According to the GSER 2024 report, Kuala Lumpur’s ecosystem has also received notable rankings in several key areas within Asia, namely the Top 15 Asia Ecosystems in Funding, the Top 20 Asia Ecosystems in Performance and the Top 20 Asia Ecosystems in Talent and Experience. — BERNAMA

KUALA LUMPUR: Malaysian Reinsurance Bhd and the Singapore branch Pacific Life Re Ltd have inked a Memorandum of Understanding (MoU) to provide sustainable retakaful solutions to takaful operators. In a statement, Malaysian Re’s President and Chief Executive Officer Ahmad Noor Azhari Abdul Manaf said the collaboration has allowed both parties to deliver exceptional retakaful solutions to meet the diverse needs of their customers. The collaboration was first established in 2019 and since then, Malaysian Re through its retakaful division Malaysian Re Retakaful Division (MRRD) has worked with Pacific Life Re to provide family retakaful solutions leveraging on Pacific Life Re’s global experience and technology solutions powered by UnderwriteMe, Pacific Life Re’s fully-owned subsidiary. “Within the first 5 years of this collaboration, Malaysian Re has expanded not only its takaful business but also its conventional business and we look forward to unlocking new opportunities from the extension of this collaboration. “By combining both Malaysian Re and Pacific Life Re’s strengths and advantages, we are well-positioned to continue providing innovative retakaful solutions to address complex risk challenges faced by the industry as well as promote the benefits of retakaful to a larger pool of industry players,” Noor Azhari said. Meanwhile, Pacific Life Re’s Managing Director Vasan Errakiah said this collaboration underscores the shared vision and commitment of both Malaysian Re and Pacific Life Re to meet the demands of the sector and contribute to the enhancement of retakaful solutions. “By combining our expertise, we are confident that we will continue to deliver greater value to our customers and contribute to the development of a robust and innovative retakaful market,” he added.

KUALA LUMPUR: Malaysia’s tax system requires reform due to its imbalanced distribution of non-tax revenue, which tends to narrow the tax base, said an economist. Bank Negara Malaysia’s (BNM) board of directors member, Dr Nungsari Ahmad Radhi said that the country’s taxation system must undergo reform to give greater buoyancy to government revenue and to broaden the tax base. “The problem with our tax base is that it is not buoyant to show a 1% gross domestic product (GDP) growth yields more than 1% tax revenue,” he said at the BNM-organised Sasana Symposium 2024. Nungsari emphasised that the current taxation system relied on direct taxes, such as income and corporate taxes and taxpayers will be monitoring government spending. Nungsari said the dependency on non-tax revenue in the form of dividends from Petroliam Nasional Bhd (Petronas) is not sustainable in the long run. “We have been taking so much from Petronas, that they are not making enough investments to explore more wells to pay the dividend they have been paying. “We have to be prepared for the post-carbon, post-(crude) oil scenario where petroleum-based revenues will no longer be there as in the past,” he said. Nungsari also said that in the longer term, structural issues highlighted in Madani Economic framework would need close attention. — BERNAMA

KUALA LUMPUR: Finance Minister II Datuk Seri Amir Hamzah Azizan expects the Malaysian economy is projected to grow between 4-5% in 2024, supported by export recovery and resilient domestic demand. He mentioned that trade recovery will be underpinned by the global technology upcycle and further recovery in tourism activity. “Household spending would be underpinned by improving income and employment. “Investment activities will be driven by further progress of multi-year investment projects by both the public and private sectors,” he said in his keynote address at Bank Negara Malaysia’s Sasana Symposium 2024. He also said that the implementation of catalytic initiatives under various master plans, such as the National Energy Transition Roadmap (NETR), New Industrial Master Plan 2030 (NIMP 2030) and the 12th Malaysia Plan, would further boost investment. Amir Hamzah also said that the government is committed to delivering meaningful structural reform as it is necessary to build a more prosperous and inclusive Malaysia. In this regard, he noted that parallel multi-pronged strategic reforms are being pursued to support this endeavour. “First, to raise the floor by creating more fiscal space and making the economic pie bigger for more participation. Second, to raise the ceiling by enhancing social protection and third, to put in place good governance,” he said. He also said that the Public Finance and Fiscal Responsibility Act (FRA) and the Medium-Term Fiscal Framework (MTFF) are crucial measures to broaden and diversify the revenue base. “To make the most of this opportunity, we prioritise policies to attract high-quality investments that boost our economic competitiveness and create high-value jobs,” he added. Hence, by advancing these structural reforms, Malaysia will enhance its global competitiveness relative to other nations that are also rapidly working to bolster their growth potential, address fiscal deficits and improve resource efficiencies. — BERNAMA

JAKARTA: In a significant move signalling a new phase of growth and expansion, PT Gunung Raja Paksi Tbk (GRP) and its affiliated company, PT Gunung Garuda (GRD), announced the completion of the sale process involving a combined 95% stake in its subsidiary, PT Nusantara Baja Profil (NBP), to Yamato Kogyo Corporation (YKC), Siam Yamato Steel (SYS), and Hanwa Indonesia (HWI), a subsidiary of Hanwa Co Ltd, as agreed upon in definitive agreements executed on 8 August 2023. This strategic alignment of vision and goals among all parties involved signals a new phase of growth and expansion for the companies. Alongside the successful acquisition, NBP also changes its name and identity to Garuda Yamato Steel (GYS). Before the sale, GRP and GRD held 81.07% and 18.93% respectively. Following the sale, GRP will retain a 5% stake with YKC holding 45%, SYS holding 35% and HWI holding a 15% stake in GYS respectively. The investment in GYS represents a strategic move by YKC, SYS and HWI to expand their business in Southeast Asia. The transaction, valuing GYS at US$450 million, underscores the immense potential and attractiveness of the Indonesian steel market. This investment by a diverse and strategic group of investors is a testament to the successful transformation of the company. “With the collective financial strength and operational expertise of our investment partners, GYS is well-positioned to be the leading structural steel company in the region. “We have exciting plans ahead to launch new steel products that will capture the immense market opportunities in Indonesia and will continue extracting further margin expansion through our production efficiency initiatives,” said Garuda Yamato Steel President Director, Tony Taniwan. The acquisition of GYS by YKC, SYS, and HWI emphasises their strategic vision to expand their presence in the domestic market, reflecting a shared vision for growth and prosperity in the region. The companies’ collaborative effort aligns with the projected growth in national steel consumption, estimated to reach 18.3 million tonnes in 2024 with a 5.2% increase. Collectively, the strategic investors will focus on growing their presence in SEA and be able to bring synergies through their expertise in the structural steel business, global procurement and marketing networks and financial strength. “This strategic realignment not only creates tangible value for shareholders but also reinforces GRP’s financial position, empowering management to focus on further enhancing the company’s competitiveness and sustainability efforts,” said GRP Finance Director, Roymond Wong. With the conclusion of the transaction, GRP will focus on its existing flat business and has big and exciting plans to transform into the lowest carbon-emitting steel producer in the region. “Our vision for the future of GRP lies in green steel and signals our strong commitment and support to Indonesia’s government initiative to achieve net zero emissions by 2060. There is going to be massive market disruption as carbon policies around the world put pressure on supply chains to deliver low-carbon solutions and players that are not able to adapt will not survive,” said GRP Chairman of the Executive Committee, Kimin Tanoto. Meanwhile, GRP Strategic Advisor, Kelvin Fu said, “Through this transaction, we have achieved significant value creation for shareholders, bolstered GRP’s financial strength and empowered management to focus on developing the flats business. “We deeply appreciate the unwavering support, dedication, and confidence demonstrated by our Japanese and Thai investment partners, and we are committed to maintaining and enhancing our partnership.”