Latest Business News in South East Asia



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Singapore And Indonesia Sign Bilateral Investment Treaty

Singapore  -  October 2018

Singapore and Indonesia signed an Agreement on the Promotion and Protection of Investments, also known as the Bilateral Investment Treaty (BIT), at the Singapore-Indonesia Leaders’ Retreat in Bali, Indonesia, on 11 October, 2018.

Singapore has been the largest investor in Indonesia since 2014, with realised investments reaching USD 8.4 billion in 2017. The BIT aims to protect investors’ interests and reinforce the strong economic ties and cooperation between Singapore and Indonesia.

The BIT is a legally-binding agreement between the two countries and it will complement the ASEAN Comprehensive Investment Agreement (ACIA), that Singapore and Indonesia are also Party to. It establishes rules on how Indonesia should treat investments and investors from Singapore and vice-versa. With the BIT, Singapore companies operating in Indonesia will enjoy protection on their investments, on top of that already accorded under Indonesia’s domestic laws. Similarly, Indonesian companies operating in Singapore will also enjoy investment protection.  Some of the key areas of protection are:

  • Non-discriminatory treatment compared to other foreign investors and their investments (Most-Favoured-Nation treatment)

  • Non-discriminatory treatment compared to local investors and their investments (National Treatment) in most sectors

  • Fair and equitable treatment, and full protection and security, based on customary international law

  • Protection from illegal expropriation

  • Compensation for losses arising from war, armed conflict, civil strife

  • Freedom to transfer capital and returns

  • Right for investors to submit dispute claims on behalf of their locallyestablished enterprise in the host State

  • Access to international arbitration for investment disputes

(Source: Ministry of Trade and Industry, Singapore)

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Singapore Seeking To Translate Quantum Technologies Into Real World Applications

Singapore  -  October 2018

In September 2018, the National Research Foundation Singapore (NRF) launched a SGD 25 million  (USD 18 million) Quantum Engineering Programme (QEP) to translate quantum science and technologies into engineering devices and capabilities that meet industry needs. QEP will connect researchers in quantum science, photonics devices, and system engineering, with industry partners and local start-ups, with the aim of developing the engineering capabilities needed to commercialise quantum technologies into quantum communication systems, quantum sensors and devices, with applications in areas such as cybersecurity, global navigation systems, sensing technologies, and diagnostic imaging. For instance, quantum enhanced imaging technologies are, in principle, much more effective than existing classical techniques and their use would include fluorescence and phase microscopy, space telescope imaging, magnetic and gravitational sensing, and thermal imaging.

QEP will focus on building engineering capabilities in three research themes:

  1. Quantum cryptography:  While quantum computers when implemented could easily break today’s most prevalent cryptosystems in minutes, quantum cryptography can prevent this scenario. QEP will therefore focus on developing viable and portable quantum crypto-systems that are widely deployable in practice. For instance, quantum crypto-systems developed in the programme could be used to encrypt and protect secret documents, and provide quantum-certifiable random numbers for biometrics, computing, machine learning, artificial intelligence, and information security.

  2. Quantum networks: Today, most countries depend on Global Positioning System (GPS) and global navigation satellite systems to derive precise timing information. However, these time sources are vulnerable and prone to active disruption efforts. Quantum clocks, if made portable, can provide a robust ground-based source of timing information with key applications in telecommunication, banking, space communication, and radar technology. 

  3. Quantum devices: QEP will seek to strengthen Singapore’s capabilities in engineering integrated quantum devices, generate quantum technology patents, and support local start-ups specialising in quantum technologies.

SG-UK Collaboration to develop quantum-secured communications networks

A few days after the announcement of the QEP, the Singapore and UK governments entered into a SGD 18 milllion (USD 13 million) initiative to build and deploy a satellite quantum key distribution (QKD) test bed. Singapore and UK will co-develop a “QKD Qubesat”, a satellite based on the CubeSat standard that will use a pioneering QKD technology from Singapore to test the secure distribution of cryptographic keys over globe-spanning distances. The satellite is expected to be operational in late 2021. This new joint quantum technology satellite mission could potentially open access to a global market estimated to be worth up to SGD 20 billion (USD 14.5 billion) over the next decade. 

(Sources: National Research Foundation; Channel NewsAsia; Today)

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BCA Singapore Launches 'Super Low Energy' Rating For Buildings

Singapore  -  September 2018

The Building and Construction Authority (BCA) of Singapore has launched a new rating for the energy efficiency of buildings. This is a part of the super Low Energy (SLE) Programme, which includes initiatives such as the SLE Buildings Technology Roadmap and the SLE Challenge to encourage the adoption and design of cost-efficient SLE buildings. 

This rating is a voluntary certification framework for SLE buildings, based on the BCA Green Mark (GM) scheme. BCA Green Mark for SLE targets new and existing non-residential buildings such as offices, commercial/retail, industrial, institutions and schools, including demonstration projects from Research & Innovation efforts. Under BCA Green Mark for SLE, there are two building categories: (a) Super Low Energy buildings and (b) Zero Energy Buildings. To be classified in the first category, the buildings need to have achieve at least 60% energy savings through adopting energy efficient measures and onsite renewable energy based on 2005 building code level. Project teams can also choose to attain SLE by having energy Use Intensity (EUI) of the building less than the benchmark EUI - 25 kWh/m2yr for schools, 100 for offices and 160 for hotel, retail & other mixed commercial development. Zero energy buildings have to demonstrate use of onsite and off-site renewable energy to generate more than 100% of energy needed for building operation including plug load.

Green Mark Gold rating is the minimum requirement for SLE and ZE buildings in order to meet the holistic environmental sustainability indicators, such as greenery, indoor environmental quality and other nonenergy aspects. This ensures the overall environmental sustainability performance indicators are being looked at holistically, while pushing the boundaries in terms of building energy performance.

BCA has been working with the industry and academia closely to develop a Super Low Energy Buildings Technology Roadmap that charts the pathways towards SLE via development, demonstration and application of technologies. The Roadmap outlines broad strategies of technology development towards mainstream adoption of SLE by 2030. The roadmap identifies 60 potential solutions from enhanced existing technologies and emerging R&D innovations and groups them under four broad categories, namely Passive Strategies, Active Strategies, Smart Energy Management and Renewable Energy. It also says that lower rise institutional buildings and schools have the potential to achieve zero or positive energy target first.

(Sources: Straits Times; Building and Construction Authority, Singapore)

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New Center Opened In Singapore To Address Health Challenges In South East Asia

Singapore  -  October 2018

Singapore's Minister for Foreign Affairs launched the SingHealth Duke-NUS Global Health Institute (SDGHI) on 21 September 2018. The institute aims to address global health challenges presented by rapid globalisation, increasing disease burden and new and emerging infectious diseases in South East Asia. 

It will focus on four areas – research to respond to current and emerging health issues; education and training of future global health leaders; policy development to implement strong regulatory practices and high value health systems; and capacity building to develop a robust collaborative network of regional partners. Researchers, educators, and healthcare practitioners in the SDGHI will work across borders to gain deeper insights into diseases seldom seen locally, be exposed to diverse patient case-mixes and disease manifestations, and conduct multi-national research studies.

Professor Michael H. Merson, former vice-provost for global affairs at Duke University and founding director of the University’s Duke Global Health Institute, will lead the new institute. Prof Merson has served in advisory capacities for UNAIDS, WHO, the Global Fund to Fight AIDS, TB and Malaria, World Bank, World Economic Forum, and the Bill & Melinda Gates Foundation, and is an elected member of the National Academy of Medicine.

(Sources: SingHealth; Straits Times) 

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Singapore To Expand Adoption Of Pneumatic Waste Conveyance Systems

Singapore  -  October 2018

On 2 October 2018, the Environmental Public Health (Amendment) Bill was passed in the Singapore parliament. The Environmental Public Health Act (EPHA) was enacted in 1987. One of the provisions in the amended Bill is to drive wider adoption of pneumatic waste conveyance systems (PWCS) to automate waste collection in Singapore. 

In 2015, the Housing & Development Board (HDB) retrofitted 38 blocks in Yuhua estate. Earlier in 2018, the government made it mandatory for new development applications for non-landed private residential developments with 500 Dwelling Units (DUs) or more to implement PWCS. This is in addition to the more than 140 private residential and commercial developments which have already implemented PWCS. The Bill will enable PWCS to be deployed at the district level, beyond individual developments. The first District Pneumatic Waste Conveyance System (DPCWS) willl be implemented at at Kampong Bugis. Dr. Amy Khor, Senior Minister of State for the Environment and Water Resources, explained that legislation is necessary as private developers are unlikely to, on their own, come together to embark on a district-level system. 

PWCS at the district level will provide economies of scale. Instead of having bin centres in each development, the district can share a central bin centre. Refuse truck traffic within the district will also be reduced, as refuse will only be collected from one bin centre, which can be located away from residents. Developments with PWCS will benefit from reduced pests and odour, and manpower savings from not needing to manually transport waste within the premises.

The Bill also makes it mandatory for every licensed cleaning business to provide for the payment of an annual bonus to its eligible resident cleaners, regardless of the worker’s performance. Cleaning businesses who do not comply will face financial penalties or risk losing their licence. Around 40,000 resident cleaners are expected to receive up to 4% more in wages each year through this bonus.

(Sources: Ministry of the Environment and Water Resources; Channel NewsAsia)

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Surbana Jurong-Mitsubishi JV To Invest In Emerging Asia Urban Development

Singapore  -  October 2018

Surbana Jurong Capital, the newly established financial services arm of Surbana Jurong, and Mitsubishi Corporation signed an agreement on 14 September to set up a fund management company (FMC). The FMC will be a 50:50 joint venture between the two companies and will be jointly managed by both partners. 

The FMC will set up an Investment Fund (Fund), with seed capital of USD 250 million from each partner, to invest in urban infrastructure projects in emerging Asia, primarily in Myanmar, Vietnam, Philippines, Indonesia, India and Sri Lanka. Projects might include transit-oriented developments (TOD) such as aviation or rail-related developments, affordable housing, as well as other urban-related infrastructure. It aims to select commercially-viable projects which are in an advanced feasibility stage or in the early phases of construction, and provide equity investment to support such projects. Qualifying projects will need to meet sustainable environmental, social and corporate governance metrics.

The FMC will also raise and manage funds from other accredited or institutional third-party investors.  Institutional investors seeking to participate in the sustainable growth of the region can do so through the Fund.

The partnership seeks to leverage on the strengths of both partners. Singapore-based Surbana Jurong has over 70 years of successful project deliveries and technical teams in over 40 countries to provide insights on the risks of such projects. Mitsubishi Corporation, a global integrated business enterprise with diverse business operations, has been investing in real estate projects in ASEAN countries since 2013 totalling JPY250 billion (USD 2.2 billion).

(Sources: Surbana Jurong; Straits Times)

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ABB Launches Innovation Center In Singapore

Singapore  -  October 2018

On 11 October, 2018, ABB  inaugurated its Singapore customer innovation center  to co-develop solutions that address business problems and produce tangible business opportunities for customers in the infrastructure, manufacturing, process industries, transportation and utilities sectors. The Center is built on ABB Ability™ – a unified, cross-industry digital technology platform extending from device to edge to cloud.

The center aims to help customers to harness major leaps in productivity and efficiency, driving competitiveness, quality and security, through smart grid technology, electrification of all points of energy consumption and advanced automation solutions, important building blocks to a future of autonomous operations.

Facilities include an ABB Ability™ Collaborative Operations Center, which enables clients to extract higher value from data through information analytics. The center opens with a number of customers already being served through its advanced data analytics and access to experts. Additionally, the facilities house a Digital Solutions Center, Digital Services Center for Drives, Power & Water Innovation Center, Robotics Applications Center, a Smarter Building Center, and state-of-the-art customer training facilities.

The space will also serve as a living laboratory where ABB will deploy its own products and technologies to intelligently manage its own energy use. These include wireless intelligent sensors, building management systems, control room solutions, renewable energy integration and digital grid technologies.

(Sources: ABB; Straits Times)

(Image credit: ABB)

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Contract Awarded For Improvement Of ATC Radio Communications At Changi Airport

Singapore  -  October 2018

The Civil Aviation Authority of Singapore (CAAS) has awarded a contract to Rohde & Schwarz, to upgrade and expand the Air Traffic Control (ATC) radio communications system at Singapore Changi Airport. The enhanced system will further strengthen safety for airlines and passengers.

Under the contract, Rohde & Schwarz will provide auxiliary equipment, software, project management, training as well as after-sales services for a 15-year period to CAAS. Rohde and Schwarz, a global manufacturer of information and communications technology products, will install more than 240 R&S Series 4200 VHF/UHF (ery high frequency / ultra-high frequency)  radios at Changi, including at the new radio stations to be built at Changi East.

Besides providing high-quality voice connections between pilots and air traffic controllers, these radios also deploy a new technology called Detection of Simultaneous Transmissions (DSiT). With the acquisition of these radios, CAAS will be the first air navigation service provider in the Asia-Pacific to adopt DSiT. DSiT enables the detection and notification of simultaneous radio calls to air traffic controllers who can communicate with two counterparts at the same time.

(Source: Civil Aviation Authority of Singapore)

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NTUC Enterprise Acquiring Food Court Operator

Singapore  -  October 2018

NTUC Enterprise Co-operative Limited (NTUC Enterprise) announced on 21 September that it is going to acquire ood court, coffeeshop and hawker centre operator, Kopitiam Investment Pte Ltd and its subsidiaries (Kopitiam). This acquisition is expected to support NTUC Enterprise’s social mission to ensure that cooked food remains affordable and accessible to the Singapore community.

The transaction is expected to be completed by the end of 2018. Upon completion of the transaction, the two entities will continue to operate separately, with their respective management teams and employees remaining in place. They will work together to leverage mutual capabilities and seek out common opportunities for synergies, including the use of technologies.

Founded in 1988, Kopitiam, operates 56 food courts, 21 coffeeshops, 3 hawker centres and 2 central kitchens. It serves about 350,000 meals a day nationwide, employs more than 1,000 staff and manages more than 1,000 food stalls.

NTUC Enterprise, the social enterprise arm of the National Trade Union Congress (NTUC), and its eight social enterprises provide access to affordable and quality goods and services in areas like health and eldercare, childcare, daily essentials, cooked food and financial services. Through NTUC Foodfare Co-operative Limited (NTUC Foodfare), NTUC Enterprise provides affordable, quality and healthier meal options. Every stall at an NTUC Foodfare coffeeshop and new hawker centre offers consumers a budget meal priced from SGD 2 and SGD 2.80 (USD 1.45 to 2), respectively. NTUC Foodfare also operates a social outreach programme, Rice Garden, designed with lower-income consumers in mind. Rice Garden offers affordable and nutritious meals priced from SGD 1.5 (USD 1.1). In 2017, Rice Garden  served more than 4.5 million meals.

(Sources: Business Times; NTUC Enterprise)


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Single Agency To Decide On Investments And Perks For Investors – MITI

Malaysia  -  October 2018

Malaysia's new government is currently restructuring agencies to be placed under new ministries, to ensure reduced overlap of functions. For example, the Export-Import Bank of Malaysia Bhd (Exim Bank) will soon be placed under Ministry of International Trade and Industry (MITI) alongside SME Bank Malaysia. Exim Bank is an agency under the purview of the Finance Ministry while SME Bank is under MITI. Such a move will allow Exim Bank to complement MITI's other agencies like Malaysia External Trade Development Corp in facilitating Malaysia’s global businesses by providing the necessary banking and credit support for cross-border business ventures. In addition, Invest KL Corp Sdn Bhd may also be under the purview of MITI as the government thinks that it can be better managed under the ministry, which has expertise in drafting international trade policies.

MITI is now proposing that a single agency should decide on investment decisions and perks to be offered to investors for the whole country. Currently, there is unhealthy competition among various investment promotion agencies, numbering between 30 and 40, under the purview of different ministries. MITI believes that the best way forward is to have one single agency to decide on the incentives for investors to improve efficiency and reduce the involvement of too many competing agencies. This will also help prevent investors bargaining for better perks.

MITI has provided assurances that both domestic and foreign investors will be given the right acceptable incentives, that would encourage them to create jobs and opportunities for Malaysians.  

(Sources: The Star; FMT News; The Malays Mail)

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NEC To Provide New Smart City Solutions In Sunway Iskandar

Malaysia  -  October 2018

Sunway Iskandar and NEC Asia Pacific Pte Ltd (NEC) today signed an MoU to explore a collaboration which aims to augment safety and security for the 1,800-acre Sunway Iskandar township in Johor and to develop smart city solutions together in an Innovation Centre of Excellence (CoE).

The MoU will see the appointment of NEC Asia Pacific as one of Sunway Iskandar’s preferred ICT Vendor (system integrator and equipment provider). NEC plans to invest an estimated USD 24 million into the township of Sunway Iskandar, which will create skilled tech jobs and develop local “technopreneurs” and tech-savvy talents within the economic growth corridor of Iskandar Malaysia.

As part of the MoU, NEC will explore the following:

  • The implementation of its range of digital solutions, including integrating IoT  and AI technologies such as fingerprint and facial recognition and video analytics technologies in Sunway Iskandar, augmenting its ongoing township security endeavours. 

  • The establishment of a one-stop service desk support centre for NEC’s Managed Service business in Sunway Iskandar

  • The creation of an 20,000 sq ft Innovation Centre of Excellence (CoE) in Sunway Iskandar in partnership with Sunway Innovation Labs. The parties will jointly explore the development of a pool of talent in the fields of public safety, transportation and healthcare, for the creation of new solutions by providing a “living lab” environment to allow proof-of-concepts before commercialization.

(Source: NEC)

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Malaysia's Ambitious New Goal Of 20% Clean Energy Generation By 2030

Malaysia  -  October 2018

Malaysia is looking to set an aggressive new clean energy target by 2030, which entails increasing the share of clean energy in its energy mix to 20%. At present, coal and natural gas account for roughly 50:50 ratio to the national power generation mix, while only 1% to 2% is generated by hydro and solar.

The Ministry of Energy, Science, Technology, Environment and Climate Change (MESTECC) will roll out an initiative to reform Malaysia’s electricity supply industry known as Malaysia Electricity Supply Industry 2.0 (MESI 2.0).  MESI 2.0 includes transformation programs such as generating renewable energy and green energy, developing the grid of the future and enhancing customer experience initiatives.

Through MESI 2.0, the Malaysian government is looking to increase the industry's efficiency, future-proof the energy industry’s structure, regulations and key processes, and democratise and decentralize the electricity supply industry. The transformational program which will be undertaken by the Malaysia Program Officer for Power Electricity Reform (MyPower), an agency under MESTECC.

Some sources in the country have opinioned that the government is likely to introduce large-scale solar systems on a contract basis and under a quota system, in order to achieve the new target by 2030.

The government has indicated that it will help green technology and renewable energy players to have access to cheaper funding as financing cost is not cheap for such initiatives. Additionally, the Ministry has given its assurance that the electricity tariff in the country is unlikely to be raised.

(Sources: The Edge Markets; The Sun Daily; The New Straits Times; Eco-Business)

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Mexter Partners Universiti Malaya To Provide Premium Fertility Services

Malaysia  -  October 2018

Mexter Technology Berhad, through its wholly-owned subsidiary, LYC Medicare Sdn Bhd (LYC Medicare) is partnering with Universiti Malaya Medical Centre (UMMC) to set up a fertility center called LYC Fertility Center.

The five-year service and collaboration agreement inked between the two parties will allow LYC Medicare to provide non-clinical services to LYC Fertility Center while UMCC will provide medical-related services to its high-end fertility patients and also to promote medical tourism to international patients. The contract comes with a five-year extension option, subject to the fulfilment of certain performance-based requirements.

LYC Medicare will leverage on the operational and medical excellence of UMMC’s fertility treatment division and market its services by establishing a premium category of service under the branding of LYC Fertility Centre to potential customers seeking treatments for infertility.

The Agreement is in line with Mexter’s current business direction and strategy to increase the revenue and profits contribution from the healthcare services business segment. With the commencement of its postpartum care business under LYC Mother & Child Centre Sdn Bhd at Plaza VADS, Taman Tun Dr Ismail, it believes the establishment of LYC Fertility Centre will allow it to generate business synergies by referral of potential customers upon successful fertility treatments.

The Agreement will also be beneficial to UMMC as it is able to attract fertility patients which are seeking premium services and also to promote medical tourism for international patients. It is expected that the Agreement will also help boost UMMC’s profile in the international market.

(Sources : The Edge Markets; The Star; Mexter)

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Plastic Waste Imports To Be Restricted; Permit Application Processes Tightened

Malaysia  -  October 2018

The Ministry of Housing and Local Government is considering imposing a levy on plastic waste imports to address concerns related to plastic pollution from the local recycling industry. Currently plastic waste importers are importing the waste for free, however this may change if the government proceeds with its plan to impose a levy of MYR 15 (USD 3.60) per tonne of imported plastic waste.

The authorities will also make the application process for plastic waste factories to obtain approved permits to import plastic waste into the country more stringent, while making it necessary to get approval from the Malaysian Investment Development Authority to obtain the permits.

There are currently 114 active legal plastic recycling factories across Malaysia. In July 2018, the ministry revoked permits to import plastic waste for three months, a move that affected all the licensed factories till October 23. Following China’s recent ban on the import of plastic waste, much of the plastic waste from western countries including Britain, Australia and New Zealand were rerouted to South East Asian countries, including Malaysia, Vietnam and Thailand. This is said to have caused serious pollution, especially in the Kuala Langat area of the state of Selangor, where many illegal plastic waste recycling factories operate in the middle of vast palm oil plantations.

(Sources: The Star; The Straits Times)

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MAHB Formulates Financing Models For Airport Infrastructure In Malaysia

Malaysia  -  October 2018

The Malaysian government is encouraging the private sector to invest in airport development and expansion throughout the country. Currently, more than 75% of airports in Malaysia are not commercially viable and are managed on a cross-subsidisation model to provide the Malaysian people with the required connectivity among its smaller towns and rural outposts.

The government is looking at new financing models, supported by private sector capital, particular from the Malaysia Airports Holdings Bhd (MAHB), the operator and manager of Malaysia's 39 airports which comprise international, domestic and Short Take-Off and Landing (STOL) ports. It should be noted that some of MAHB’s airports are reaching their maximum capacity, particularly at the main terminal Kuala Lumpur International Airports and other airports in Penang, Kuching and Subang. 

In turn, MAHB is formulating financing models for its airport infrastructure development to boost passenger traffic and tourism sector in the country. Its basket of capital expenditure (capex) financing models include a review of airport tax mechanism and user fee charges by the government. Currently MAHB pays about 12% of user fees to the government including PSC, parking, landing, check-in counter charges, hotel revenue and assets within the airports land, which amounts to between USD124.7 million to USD166.6 million annually.

MAHB is also keen to be inclusive in the development and integration of the nation’s socioeconomic goals while providing capacity expansion and deriving value from the connectivity to drive local tourism in the rural and remote areas.

The Malaysian aviation industry had contributed a total of USD1.97 billion in direct benefits, USD 2.59 billion in indirect benefits, USD 369 million in induced benefits and USD 6.3 billion in tourism benefits. According to the International Air Transport Association (IATA) economic report, air passenger growth in Asia Pacific is expected to remain robust, with the region being one of the fastest growing and largest contributors to the air travel market.

(Source: The New Straits Times; The Star Online)

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New Digital Manufacturing Hub In Malaysia To Help SMEs Prepare For Industry 4.0

Malaysia  -  October 2018

The Malaysia Digital Economy Corporation (MDEC) together with The Federation of Malaysian Manufacturers (FMM) have announced a partnership to form a Digital Manufacturing Hub. The Digital Manufacturing Hub will be a center of excellence that aims to spearhead the digital transformation of manufacturers in future proofing themselves, and is expected to be a focal place for awareness, adoption and knowledge acquisition in preparation for Industry 4.0.  

MDEC will oversee the Digital Manufacturing Hub, which will offer local manufacturers hands-on experience in embedding digital technologies and transformation, and serve as a platform for reskilling human capital in this field. Many Malaysian manufacturers, especially small and medium enterprises, are still not ready to operate in the IR4.0 environment and adopt automation process in their business. A key reason for their hesitation is the costs related to adopting Industry 4.0 initiatives, such as investment in automation and IT. Malaysia is regarded as stuck at the level of Industry 3.0 in terms of manufacturing technology, with many companies preferring to rely on foreign workers and labor-intensive processes.

FMM is also looking into working closely with the other partners such as Singapore Manufacturing Association (SMA) to increase the manufacturing competitiveness small and medium enterprises (SME) through IR 4.0 initiative adoption.

(Sources : Bernama; Daily Express; The Star)

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30 New Aerospace Manufacturing SMEs To Be Developed By 2020

Malaysia  -  October 2018

The aerospace sector remains a strategic industry for Malaysia, with the government planning to develop 30 new small and medium manufacturing companies focusing on the sector by 2020, in addition to the current 20 companies.

Within the aerospace industry, the aerospace manufacturing segment has been growing tremendously since 1990s, and recently surpassed the maintenance, repair and overhaul (MRO) segment as the top revenue contributor in the industry. According to Malaysia's National Aerospace Industry Coordinating Office (NAICO), the aerospace manufacturing segment contributed to 48% or MYR 6.6 billion (USD 1.6 billion) of the industry’s revenue in 2017, followed by 46% from MRO and the remaining 6% from engineering and design services segment. It is hopeful that aerospace manufacturing revenue will increase between 7% and 15% annually, depending on whether the industry will be able to attract more investors into the local scene.

Malaysia’s 2017 aerospace export surged 54% to MYR 8.51 billion (USD 2.05 billion) from 2016, with parts and components making the lion share of the main exports, particularly wings, empennage and aircraft fuselage. Companies in Malaysia contributed to the aerospace value chain covering engineering and design services, system integration, and the manufacture of aircraft parts and components including ground support equipment and MRO activities. The Malaysia Aerospace Blueprint 2030, launched in 2015, has been targeting an annual revenue of USD 14.3 billion by 2030 and the creation of over 32,000 high-income jobs for the industry.

During the bi-annual Kuala Lumpur International Aerospace Business Convention (KLIABC) event, Malaysia Aerospace Industry Association (MAIA) entered into a MoU with Indonesia Aircraft Component Manufacturer Association (INACOM) to collaborate to improve human capital development in both countries to win more jobs from big industry players such as Airbus, Boeing and Rolls Royce in the region. Another local player Sapura Industrial Berhad also entered into an MoU with two Japanese aerospace companies, Wada Aircraft Technology Co Ltd and Aero Inc, to form a joint venture in aerospace component manufacturing in Malaysia. Wada manufactures aerospace components, jigs, fixtures and tooling, whereas Aero assembles and manufactures aerospace parts. Recognized as one of the leading aerospace industry events in South East Asia, KLIABC was organized by MATRADE in collaboration with MAIA and ABE France, involving 150 aerospace industry organizations from 21 countries. First introduced in 2014, a total of 63 Malaysian aerospace companies were participating in the 3-day event.

(Sources: The Star; The New Straits Times; The Edge Markets; Daily Express; MIDA; MATRADE)

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LG To Open 20 More Stores Nationwide By 2020

Malaysia  -  October 2018

LG Electronics Malaysia has announced its plans to open at least 20 more LG stores nationwide by the year 2020. The company, which has existing 27 stores in Malaysia, expects to open seven new stores by end of 2018. It is aggressively promoting the sales of its premium and innovative products, such as TVs, audio-visual home entertainment products and washing machines, and is aiming for a double-digit percentage growth in sales in Malaysia this year.

LG is leveraging on its store-in-store (SIS) concept, which allows its customers to experience its products first-hand, and interact with its products. According to the company, its most popular products in Malaysia currently are its TVs. It is positive on Malaysian consumers' acceptance on its recently launched artificial intelligence (AI) enabled appliances, thus significantly boosting sales in the next one to three years. While LG considers it will be a long journey to get Malaysian consumers to fully adopt AI enabled electronics and appliances - called LG ThinQ, it is optimistic on long-term prospects in Malaysia. It hopes to become the leader in smart life innovator in Malaysia within one to three years.

(Sources: LG;; New Straits Times)


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Indonesia Increases Import Tax To Stabilize Currency

Indonesia  -  September 2018

The Indonesian government has been taking multiple steps to curb imports and support the weakening currency, which dropped to a 20-year low of nearly 14,800 (IDR/ USD) in early September 2018. While the central bank is intervening in the foreign exchange and bond markets and has raised benchmark interest rates four times since May 2018 to shore up the Rupiah, the government has been taking steps to curb imports. Indonesia has been among the most severely affected countries, apart from Turkey, Argentina and South Africa, by the emerging-market selloff, as investors move funds to the US to benefit from the US rates hike.

On 5 September, Indonesia’s Finance Minister Sri Mulyani Indrawati approved tax increase on imported goods. The Income Tax (Pph 22) increase for imported goods will impact 1,147 items, with rates rising to a maximum of 10% from the prevailing range of 2.5% to 7.5%.

For 210 items, rates rose from 7.5 % to 10%. Included in this category are luxury items such as CBU (Completely Built Up) cars, and large motorbikes. The import of luxury cars with engine capacity of 3.000 cc and above will be put to a halt. For a further 218 items, rates have been increased from 2.5% to 10%. This category includes consumer goods that can be produced domestically, such as electronic goods (water dispensers, air conditioners, lamps), daily necessities such as soap, shampoo, cosmetics, and cooking utensils / kitchen items. Taxes on 719 items rose from 2.5% to 7.5%. This includes building materials (ceramics), tires, audio-visual electronic equipment (cables, speaker boxes ), textile products ( overcoat , polo shirts , swim wear etc. 

The move by the Indonesian government is to complement other measures which have been put in force to narrow the current-account deficit, including using palm oil biodiesel to reduce imports of crude, delaying infrastructure investment and rescheduling shipments. 

(Sources: Ministry of finance, Indonesia; Bloomberg; The Jakarta Post; Straits Times; Nikkei Asian Review)

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Salim Group And Keppel To Jointly Develop Data Center In Indonesia

Indonesia  -  September 2018

The Salim Group and the Keppel Group, through the Alpha Data Centre Fund (Alpha DC Fund), managed by Alpha Investment Partners Limited (Alpha), and Keppel Data Centres Holding Pte Ltd (Keppel Data Centres), have signed conditional agreements to develop and operate a high-availability data centre in Bogor, outside of Jakarta, Indonesia. Dubbed IndoKeppel Data Centre 1 (IKDC) 1 will be developed and operated by a 60:40 joint venture between the Salim Group and Keppel Data Centres. The facility development will be in three phases. The data centre will have a gross floor area of approximately 105,300 sq ft with Tier 3 concurrent maintainability standards for power and cooling. The construction of the core and shell of the data centre, as well as the first phase fit-out, is expected to be completed by the first half of 2020. This will be the first phase of a larger 7ha data centre campus development.

IKDC 1 and its underlying 3ha land plot will be held by a 60:40 joint venture between the Salim Group and the Alpha DC Fund respectively. The Alpha DC Fund is a USD 1 billion real estate private fund investing in data centres in Asia Pacific and Europe. 

The Salim Group has been keen on expanding its Salim Digital Ecosystem to support the nation’s transformation to Indonesia Industry 4.0. One of Indonesia's biggest conglomerates with interests ranging from food, banking and telecommunications, the Salim Group currently owns and operates a data centre in Indonesia serving financial institutions and enterprise customers. It also has fibre optics cables laid out all across Sumatra, Java all the way to Bali. The conglomerate has also invested in submarine cables from Java to Singapore.The collaboration bring the Salim Group's experience together with the Keppel Group's established track record in owning, developing and operating high-availability data centres across the Asia Pacific and Europe, the collaboration pools both groups' expertise for the construction, fit-out and subsequent operation and maintenance of the data centre.

Indonesia’s data centre services market is one of the fastest growing in the region with a compound annual growth rate (CAGR) of 35%. This is largely supported by data onshoring regulations, increased smartphone adoption and the growing popularity of e-commerce.

(Source: Business Times, Kepcorp)

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Indonesian Government Expanding Biodiesel Subsidies

Indonesia  -  September 2018

Indonesia's President Joko Widodo signed a revised regulation for the Estate Crop Fund (BPDPKS) to support the country’s B20 Biodiesel Policy, which mandates all diesel in Indonesia to have a 20% bio-component, usually derived from palm oil, starting from September 2018. The new regulation will absorb excess supply of palm products in the market, as well as reduce Indonesia’s dependency on diesel fuel imports. 

BPDPKS was formed in July 2015 with the aim of managing the income derived from levies on exporters of palm oil commodities. Part of the funds are used to subsidize biodiesel, which is more expensive to produce as compared to petroleum diesel. To break even on production costs, biodiesel has to be sold at over IDR 9,000 (USD 0.61) a liter, while petroleum diesel currently costs around IDR 5,150 (USD 0.35) a liter. 

This revision expands the fund’s ability to subsidize the price gap between biodiesel and petroleum-based diesel. Earlier, the fund was limited to subsidize Public Service Obligation (PSO) sectors, such as certain transport and power stations. The fund collected IDR 14.2 trillion rupiah (USD 972 million) in levies last year, and provided subsidies on 2.3 million kiloliters of biodiesel.

Under the new rule, 19 biodiesel producers such as Wilmar and the Sinar Mas Group, will receive incentives to narrow the pricing gap between PSO and non-PSO sectors. 

The fund would require up to IDR 9.8 trillion (USD 672 million) to subsidize the production of 3.2 million kiloliters of biofuel for 2018. The government estimates that the policy would raise biodiesel consumption to between 5.5 million to 6 million kiloliters in 2019 from 4 million kiloliters on 2018. This is expected to help reduce fuel imports and bring down the current account deficit by around USD 6 billion per year. 

(Sources: Reuters; Jakarta Globe)

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Medication pills


Indonesian Regulation To Mandate Local Content For Pharmaceuticals

Indonesia  -  September 2018

Indonesia proposes a new regulation which could set a content requirement for raw materials at a minimum of 30%, with active ingredients comprising of 70% of that and additional ingredients 30%. The local content requirement will vary for each manufacturing stage and development process. It is expected to be finalized by sometime this year.

This is following the Presidential Directive No. 6/ 2016 on the Acceleration of the Development of the Pharmaceutical and Medical Equipment Industry. This is also backed by Minister of Health Regulation No. 17/2017 regarding Action Plan for the Development of the Pharmaceutical and Medical Equipment Industry.

Indonesia has long been reliant on imported materials for the development of its pharmaceutical industry. Only 10% of materials are sourced from domestic producers. The Ministry of Industry aims to register around 20% of local components. The new regulation aims to attract investors to set up manufacturing plants to produce and process pharmaceutical products in Indonesia.

(Source: Lexology)

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Chillers Installed At Pharma Factory Under German Funded Sustainability Initiative

Indonesia  -  September 2018

PT Phapros, a large Indonesian pharmaceutical company, has installed two propane (R290) chillers at its production facility in Semarang, Central Java. The R290 chillers were produced by a local company, Air Conditioning and Chiller (AICOOL). The new chillers will save the company about IDR 440 million (USD 26,300) per year and use approximately 151.078 kWh of electricity per year, as compared to its existing R134a units which needs 545.387 kWh of electricity per year.

The commissioning of R290 is part of the Green Chillers Nationally Appropriate Mitigation Action (NAMA) project. It is a sustainability initiative launched by the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU) in Indonesia in 2014. The project is supported by the Directorate General of New and Renewable Energy and Energy Conservation (EBTKE), Ministry of Energy and Mineral Resources (MEMR) and Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ).

The goal of the project is to excite the development of green cooling technologies in Indonesia through pilot projects, training, certification and creating standards. MEMR aims to include more industries to embrace hydrocarbon-based technology because of its energy efficiency.

(Source: Hydrocarbons21) 

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Indonesia Courting Chinese Investors For Infrastructure Projects

Indonesia  -  September 2018

Indonesia unveiled  infrastructure projects worth an estimated USD 13.2 billion during a market sounding event in Guangzhou in southern China. The event was organized through cooperation between the Indonesian Investment Coordination Agency (BKPM) and the country's Consulate General in Guangzhou. The projects on offer include power plants under the independent power producer (IPP) scheme and toll roads. 

Indonesia is actively looking for domestic and international investors to take part in these projects and it is providing support in the form of guarantees and also, fiscal and non-fiscal incentives. Through the infrastructure financing guarantee agency PT Penjaminan Infrastruktur Inodnesia (PII), Indonesia government has the ability to give guarantees for any companies who are eager to take part in the government-to-business cooperation (KPBU) scheme. 

Since January 2016, the Beijing-based Asian Infrastructure Investment Bank (AIIB) has approved  loans amounting to USD 691.5 million for four infrastructure projects in Indonesia: two irrigation improvement projects, a slum improvement and a regional infrastructure development fund. The loans are co-financed with the World Bank and the Indonesian government. AIIB is also currently finalizing the approval process of another USD 260 million loan for the Mandalika urban and tourism infrastructure development on Lombok Island. Mandalika Resort Area is an under-construction integrated resort area in the island of Lombok, Indonesia. It is designated as a Special Economic Zone (KEK) on Mandalika Beach

(Sources: Straits Times; The Jakarta Post)

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Indonesia Manufacturing Sector Expands In August

Indonesia  -  September 2018

Indonesia manufacturing sector witnessed the fastest growth in more than two years. The Nikkei Indonesia Manufacturing Purchasing Managers’ Index (PMI) jumped to 51.9 in August 2018 from 50.5. The manufacturing sector was boosted by the increase in domestic demand, offsetting the decline in export orders. To meet the growth in demand in new domestic orders, the manufacturing sector recorded the strongest job growth rates in nearly 7.5 years.

Purchasing activity in the manufacturing sector grew modestly for the seventh consecutive month in August, while pre-production inventories lagged behind. Export orders remained weak for a ninth straight month. Input costs have also been rising sharply due to the downwards pressure on Indonesian Rupiah against the US dollar. The one-year outlook sentiment for production in Indonesia's manufacturing sector strengthened to a three-month high in August.

(Sources: Indonesia Investments; Financial Times)

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Turkey And Indonesia Collaborate On UAV Development

Indonesia  -  September 2018

Turkish Aircraft Industries (TAI) has expanded its partnership with Indonesia’s state-owned aerospace firm PT Dirgantara Indonesia (PTDI) to develop a new medium-altitude long-endurance (MALE) unmanned aerial vehicle (UAV) for Indonesian Air Force (Tentara Nasional Indonesia – Angkatan Udara: TNI AU). The development will promote technology transfers from Turkey to Indonesia to support joint development and localized manufacturing. Through this collaboration, PTDI is seeking to reduce dependency on manufacturers in Western countries. 

This is in line with a previous agreement between the two parties signed on 17 January this year to develop the new UAV with an operating altitude of 40,000 feet. TAI has modified its MALE UAV, Anka, to meet Indonesian’s regulations by integrating Indonesian suppliers into its supply chain. The development would be finalized within one to three years. 

The UAV project follows on a framework signed by two companies on July 2017 to collaborate on PTDI’s N219 and N245 small and regional turboprop projects which are still under development.

(Sources: Jane’s 360; Ainonline)

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Improved Access To Indonesian Markets For Australian Agriculture Products

Indonesia  -  September 2018

Australia recently completed negotiations with Indoensia for an extended economic partnership between the two countries. The Indonesia -Australia Comprehensive Economic Partnership Agreement (IA-CEPA) builds on commitments under existing free trade agreement, the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA) across goods, services and investment. Over 99% of Australian goods exports by value to Indonesia will enter duty free or with significantly improved preferential arrangements. The Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) will come into effect by 2020.

This will benefit Australian exporters greatly, particularly the Australian farmers. Indonesia will guarantee automatic issue of import permits for key products such as live cattle, frozen beef, sheep meat, feed grains, rolled steel coil, citrus products, carrots and potatoes. Import licences are a major barrier for many Australian exporters into Indonesia. 

Australian farmers will be able to export 500,000 tonnes of feed grains such as wheat into Indonesia tariff free and this will increase by 5% annually in volume. Tariff on frozen beef has been cut to 2.5% (from 5%) and there will be access for unlimited volume. The tariff will be eliminated after 5 years. 575,000 live cattles can be imported duty free in the first year, compared to the current 5% tariff. This will undergo 4% annual growth in volume reaching 700,000 by year 6. There will be a review for subsequent increases. Tariffs across a number of dairy lines have been reduced or eliminated and the remaining tariffs will be gradually removed. 

Apart from the food sector, the partnership will also elevate Australian industrial producers covering sectors such as steel, copper and plastics. The service industries including health, mining, telecommunications, tourism and education will be boosted through a guaranteed levels of Australian ownership.

As for Indonesia, IA-CEPA will immediately eliminate all remaining tariffs on Indonesian imports into Australia. The Australian government has also agreed upon a reciprocal Skills Exchange and encouraged further investment from Indonesia.

(Source: Australian Minister of Trade, Tourism and Investment; Australian Government Department of Foreign Affairs and Trade)


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Thailand’s Economy's Quarterly Growth Exceeds Forecasts

Thailand  -  September 2018

The Thai economy has grown more robustly than expected in the second quarter of the year, buoyed by solid export and investment gains. The country’s recovering is underpinned by solid export demand and tourism.

The economy expanded 4.6%. Total investment increased 3.6% year on year and public investment expanded 4.9 per cent year on year in the second quarter. Exports, a key driver of the economy, climbed 12.3% year on year for the quarter. The National Economic and Social Development Board (NESDB) is maintaining its 2018 forecast for GDP growth, but it has raised its estimate for expansion in exports, citing an improvement in the economies of the country’s trading partners.

According to news reports, the first interest rate hike since 2011 can be expected from the Bank of Thailand if GDP growth is maintained. The Thai Baht has been performing well in a difficult environment for many emerging market's currencies. The Baht has moved up by nearly 2% in the last quarter against the US Dollar, making it the best performer among 12 major Asian currencies tracked by Bloomberg. A rise in interest rates would help to draw investors. 

(Sources: The Nation; The Business Times)

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Bank Of Thailand Planning To Develop Cryptocurrency For Inter-Bank Transfers

Thailand  -  September 2018

The Bank of Thailand (BoT) is initiating a project aimed at developing and eventually launching a cryptocurrency to be used as a trading platform for transfers between participating banks. The project intends to explore the implications and the potential benefits of Distributed Ledger Technology (DLT) to enhance efficiency of the Thai financial market infrastructure. The BOT and the participating banks will collaboratively design and develop a proof-of-concept prototype for wholesale funds transfer by issuing wholesale Central Bank Digital Currency (Wholesale CBDC). The prototype will be built on Corda, a DLT platform developed by R3. R3 has ebeen involved in similar DLT projects for other major central banks, such as the Monetary Authority of Singapore. 

The initiative is called ‘Project Inthanon’, and it is led by the BoT, iin collaboration with technology partners R3 and eight participating banks, namely Bangkok Bank, Krung Thai Bank, Bank of Ayudhya, Kasikornbank, Siam Commercial Bank, Thanachart Bank, Standard Chartered Bank (Thai) PCL and The Hongkong and Shanghai Banking Corporation Ltd (HSBC).

During Phase 1 of Project Inthanon, which is expected to be completed by the first quarter of 2019, BOT and the participating banks will collaboratively design, develop and test a proof-of-concept prototype for domestic wholesale funds transfer by using wholesale CBDC. Key payment functionalities such as liquidity saving mechanism and risk management will also be developed and tested during this phase. BOT will publish a project summary and based upon the findings and outcomes from Phase 1, the project participants aim to further develop the capabilities of the prototype for broader functions including third party funds transfer and cross-border funds transfer.

In addition to Project Inthanon, the BOT is conducting a DLT proof of concept for scripless government savings bond sale to improve operational efficiency

(Sources: The Phuket News; Bank of Thailand)

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Gas energy home fire


EGAT Invites LNG Producers And Businesses To Be Gas Suppliers

Thailand  -  September 2018

State-owned power utility, Electricity Generating Authority of Thailand (EGAT), has issued a Request for Expression of Interest for importing 800,000-1.5 million mt/year of LNG for four to eight years starting March 2019. This move signals the opening up of the country's gas markets, which have been controlled by state-run oil and gas company PTT. EGAT, which is Thailand's largest power producer, will import the gas at PTT's Map Ta Phut LNG receiving terminal.

EGAT has invited LNG producers and businesses in the international market to submit a Request for Expression of Interest (REOI), along with information of their readiness to supply LNG in order for EGAT to select and register before entering the bidding process. EGAT will choose the producer or business with experience, financial stability, and readiness to supply LNG in both quantity and quality. EGAT’s LNG price must not exceed the lowest LNG price of Thailand’s current long-term supply contract. This is in line with the resolution of the National Energy Policy Committee to promote competition in the LNG business on July 31, 2017, and for EGAT to become a new LNG importer of Thailand.

The power producer, which has an installed generation capacity of over 15 GW as of March 2018, will use the imported gas to feed its gas-fired power plants including 1,220 MW of capacity at South Bangkok, 710 MW at Bang Pakong and 750 MW at Wang Noi. EGAT expects a significant portion of its gas demand to be met through direct LNG imports instead of having to rely on PTT. 

(Sources: S&P Global Platts; Electricity Generating Authority of Thailand)

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Hospital equipment


Thai Hospital Operator Booms Backed By Aging Thais And Medical Tourism

Thailand  -  September 2018

Bangkok Dusit Medical Services Pcl, a Thai hospital operator, has seen its shares to boom in 2018, becoming the most-valuable such business in any emerging market, with a value of USD13 billion.

The growth is being backed by rising demand from Thailand’s aging population as well as an increase in medical tourism.  “The inadequacies of public healthcare will continue to bolster the earnings growth of Bangkok Dusit”, said Adithep Vanabriksha, Bangkok-based chief investment officer of Aberdeen Standard Investments during an interview with Bloomberg.

Bangkok Dusit today operates 45 hospitals under six brands in Thailand, counting a combined 8,000 beds. The company has expanded mostly through acquisitions, including hospitals and wellness centers in resort hubs such as Phuket and Samui.

(Source: Bloomberg)

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Electric charge hybrid green


Thai MEA And Nissan To Work Together For EV Infrastructure Development

Thailand  -  September 2018

The Thai Metropolitan Electricity Authority (MEA) and Japan's Nissan Motor Thailand have agreed to join forces to install quick-charging outlets in households, supporting the future introduction of the Nissan Leaf, a fully electric vehicle (EV), in the Thai market. A Memorandum of Understanding was signed which will last for two years. The agreement is focused on studying know-how from MEA in developing new wall outlets for electrified vehicles (EV) in Thailand.

Nissan Thailand president Antoine Barthes said that the move is part of their plan to introduce in Thailand the Leaf, EV wall charger. “The move would address fears that EVs were uneconomic, and set a cornerstone for the future development of electrified mobility in the nation.

The Leaf uses a CHAdeMO charging type, meaning that Thailand will likely consider following the standard as well, making another potential addition to the growing movement to standardize EV charging across the world. CHAdeMO is a quick charging method for battery electric vehicles delivering up to 62.5 kW by 500 V, 125 A direct current via a special electrical connector. A revised CHAdeMO 2.0 specification allows for up to 400 kW by 1000 V, 400 A direct current. Other reports claim that the Thai government is more interested in establishing a type 2 standard, similar to the European CCS (Combined Charging System) standard. The Combined Charging System allows AC charging using the Type 1 and Type 2 connector depending on the geographical region. 

(Sources: Bangkok Post;

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PTT Eyes Rail Project

Thailand  -  September 2018

PTT, a Thai state-owned oil and gas company, is discussing with potential partners a joint bid for a USD 7-billion high-speed train project, whose aim it to connect three major Thai airports, namely Bangkok’s Suvarnabhumi and Don Mueang airports and U-Tapao airport in Rayong. This initiative is to be considered in the context of the government-backed Eastern Economic Corridor (EEC) plan. 

The EEC is US$52 billion plan to modernize the infrastructure and the industries of the strategic provinces of Rayong, Chachoengsao and Chon Buri.

Around 31 firms, mostly from Thailand, China and Japan, are reportedly studying the project’s terms.

PTT is the largest Thai company by market value. The company seems poised to make its first investment in railways. It said running a train line would help it cut logistical costs and allow its retail business to expand before it floats on the Thai stock exchange in 2019.

(Source : ASEAN Economist)

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Covestro To Boost Thai Investment With Plant Expansion

Thailand  -  September 2018

Germany company Covestro, one of the world's leading polymer companies, has decided to make a significant investment in Thailand. The company wants to boost its production capacity for specialty filmsin Rayong province. The company’s plan to expand its manufacturing plant in Map Ta Phut will allow Covestro to keep pace with rising global demand, the company's chief financial officer, Thomas Toepfer, said during an interview with The Nation. The expansion of its specialty films production in Thailand is expected to be completed by the end of 2019, hence increasing the production capacity by around 50 per cent.

Covestro’s manufacturing plant in Map Ta Phut is among the eight largest production facilities that it operates worldwide

Covestro has three businesses in Thailand covering polyurethanes, polycarbonates, and also coatings, adhesives etc. and most of the production is exported. The factory in Map Ta Phut produces polycarbonates and specialty films. Covestro also has a facility in Bangpoo, Samut Prakarn, which produces polyurethanes and tailor-makes them to meet customer needs. 

Toepfer said that the sales revenue of Covestro's three existing businesses in Thailand registered annual growth in the double digits for the second quarter of this year.

 “Thailand is very well served as our strategic location for production and further investment. It offers good infrastructure, talented people in technical fields, support on FDI (foreign direct investment) from government including the new projects in the EEC and a great logistics network” Toepfer said. 

(Source: The Nation)

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Thai Airways Enters Into R&D Collaboration With Rolls-Royce

Thailand  -  September 2018

Thai Airways International has initiated a R&D collaboration with British company Rolls-Royce for the Trent XWB engine. The Trent XWB Development Testing partnership will take place over a two-year period at Don Mueang airport. The project, which is the first first overseas engine research and development testing for Rolls-Royce outside the United Kingdom, is expected to further strengthen Thailand's aviation industry.

The collaboration encompasses manufacturing; maintenance, repair and operations (MRO); and development testing. The initial objective is to conduct R&D on the engine which powers the Airbus A350-1000 aircraft that was launched at the beginning of 2018. In 2020, THAI Airways and Rolls-Royce will cooperate on Trent 700 engine maintenance and overhaul, making THAI's facility a certified and authorised engine maintenance centre for Rolls-Royce. Becoming an Authorised Maintenance Centre (AMC) for Rolls-Royce will enable THAI to support their growing fleet of Rolls-Royce engines while also generating additional capacity and flexibility within the Rolls-Royce CareNetwork. THAI operates around 80 widebody aircraft, of which more than 50 are powered by Rolls-Royce engines.

Rolls Royce entered the Thai market over 50 years ago and today Rolls-Royce invests about USD100 million a year to support the manufacturing supply chain footprint in Thailand.

(Source: Bangkok Post; Rolls Royce)

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Tesco Lotus Beefs Up Retail Portfolio

Thailand  -  September 2018

The operator of Tesco Lotus hypermarkets, Ek-chai Distribution System Co, is expanding its retail space by a total of 55,000 square metres this fiscal year, capitalizing on improved prospects in the retail business sector next year.

Just in 2018, the company opened 45 new Tesco stores, including six hypermarkets, one department store, one Talad and 37 Tesco Express outlets. The company is now planning to focus on  second-tier cities.

Thailand is Tesco Group's largest international market outside the United Kingdom. It currently operates 2,000 outlets across the country. Chief executive Sompong Rungnirattisai said, in an interview with Bangkok Post: "We are committed to continuing to invest here. Thailand is an interesting country to invest because per capita income keeps rising along with increased urbanisation. These are both positive factors for our retail business."

(Source: Bangkok Post)


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Farming paddy asian


81 Projects In Kien Giang Province Open For Investment

Vietnam  -  September 2018

Eighty one projects in Kien Giang province, Mekong Delta are opening for investment until 2020. Of the 81 projects, 15 will be in industrial production; 13 in hi-tech agricultural and aquatic cultivation and processes; 11 in commerce; 10 in technical infrastructure in industrial parks; nine in transport; seven in tourism; six in the environment; six in water supply in urban and rural areas; and four in housing and urban development. Many of them are now operating and providing jobs for local residents. 

According to the provincial Department of Planning and Investment, more than USD 1.34 billion of investment capital has been registerd by Japan, Russia, Australia, Korea and Malaysia focusing on transport, tourism, services, petroleum transport and sport shoe production. These projects are among the total 48 foreign direct investment (FDI) projects with total registerd investment cpaital of USD 2.7 billion. 

The province ha been focusing on transport infrastructure, electricity grids and water drainage systems and also improving local administration, and setting preferential policies and assistance for the investors. 

(Source: Vietnamnews)

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Artificial intelligence robotics


Vingroup To Diversify Into AI, Big Data and Other Technological Services

Vietnam  -  September 2018

Vingroup, Vietnam’s biggest private-sector organization which is mainly involved in real estate, has recenly announced its plan to expand into artificial intelligence, software and big data and set up a Silicon Valley-style tech hub in Hanoi. Vingroup signed an agreement with the country’s top 50 universities to provide funding for these universities' science & technology projects and co-operate with them on training and educating programmers. In addition, Vingroup has committed to employing 100,000 technology students within the next 10 years. Included in the plan is the setting up of a fund to support research projects for domestic students and lecturers to pursue science and technology application.

Vingroup will also enhance the production of automobiles and smart home-appliance products through the establishment of its software development company VinTech, which has split from another sub-unit VinSmart. VinTech will specialise in developing artificial intelligence (AI) products, software programmes and new-generation materials. Vingroup’s newest business has set up two research institutions – the Big Data Research Institute and Vin Hi-Tech Research Institute.

A tech hub in Hanoi called VinTech City will also be developed following the US tech cluster Silicon Valley. VinTech City aims to create a business ecology that is similar to the Silicon Valley to serve information-technology startup companies. 

Moreover, a technology investment fund will be founded to seek opportunities in technology and AI projects that are applicable on a global scale.

These activities are parts of the group’s plan to become an international-standard technology-industry-service conglomerate by 2028, with a focus on technology development and application.

(Sources: Vietnam Insider; Viet Nam News; Business Insider;

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Re wind energy power


Vietnamese Increasing Feed-In-Tariffs For Wind Energy Projects

Vietnam  -  September 2018

A draft decision to increase feed-in tariffs (FITs) for wind power has been approved by the Vietnam government. Accordingly, FITs price for wind power projects will be increased from the current USD 7.8 cents/kWh to USD 8.5 cents/kWh applicable to onshore wind power projects, and USD 9.8 cents/kWh applicable to offshore wind power projects.

For new power plants that come into operation before November 2018, the new FiTs will be applicable for the remaining term of the project’s power purchase agreement (PPA). 

The new FiTs are expected to boost interest from investors by enhancing feasibility and practicalityof wind power projects. For the country, wind power contributes more to national energy security, supports the country’s constant economic development and the mitigation of climate change in a more efficient manner. 

(Sources: Renewablesnow; Evwind)

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Pharmacy pills retail medical


Portal For National Pharmacy Network Officially Launched In Vietnam

Vietnam  -  September 2018

A portal for pharmacies throughout Vietnam was officially launched on August 24, as an attempt to ensure the quality of drugs sold on the market and keep prices in check. With this platform, users can easily look up the use, price and origins of available drugs, as well as receive updated warnings from health authorities about medicines of questionable quality. 

This was done under a government initiative to strengthen management of prescriptions and sale of prescription drugs between 2017 and 2020. The government is preparing to enforce all drug stores to connect to a common network. Those who deliberately fail to follow this regulation might even have their license voided. Around 72% percent of all drug stores in the country have internet access, but only 48% are managing sales through software platforms. 

The piloting project has started with selected provinces – namely Phu Tho, Hung Yen, Vinh Phuc and Nam Dinh. Out of nearly 62,000 pharmacies in Vietnam, around 4,200 are current participating in the portal. 

This aims to adddress issues such as high antibiotic resistance in the country due to sale and purchase of medicines without prescriptions and middlemen in the drug supply chain inflating prices and making it difficult to trace product origins. 

(Source: Vietnamnet)

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Waste to energy


HCMC Calls For Investment In Waste To Power Project

Vietnam  -  September 2018

The Department of Natural Resources and Environment of Ho Chi Minh city is seeking approval from People’s Committee to call for domestic and foreign investors for a waste-burning power project. According to the proposal, the investor must commit to buy all new equipment and machinery and report serial numbers, product specifications and production life of all equipment to the city’s department. Another criteria is investors' commitment to training human resources to operate the projects.

The authority will prioritise investors who have experience in operating electricity generation projects with automation systems meeting the G7 standard, and classification systems for recycling waste before burning. In returns to the investment, investor will receive rental exemption for 11 years or a 70 per cent discount, import tax exemptions, and facilities support. Furthermore, the investors will earn US$21 for each 1,000 tonnes of garbages treated. 

HCMC collects 8,700 to 9,300 tonnes of solid waste per day, most of which ended up in the landfills of the city. 

(Source: Vietnam News)

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Road building


Development Work To Commence On North-South Link  

Vietnam  -  September 2018

An expressway from the North of Vietnam to the South will start the construction next year and is schedule to finish by 2021, according to the Ministry of Transport. The new expressway, which will create more room for vehicles will have a total length of 654 kilometres and run through 13 provinces and citites. There will be 11 sub-projects, 03 of which are managed by the goverment and the rest are implemented in public-private-partnership (PPP) model. The total investment is projected to reach VND 118.7 trillion (USD 5.1. billion).  

Vietnam's Ministry of Transport is conducting technological design for the three sub-projects with state investment, and construction work on them is expected to start in April next year. Furthermore, selection of contractors for public parts and investors is already in the processind. Ground clearance will finish by October 2020, according to the plan.

(Source: Vietnam News)

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Chemical production


Chemicals Manufacturer To Open New Facility In Vietnam

Vietnam  -  September 2018

Global chemicals manufacturer, Huntsman Corporation, has announced a plan for a new multi-purpose facility near Ho Chi Minh City, Vietnam. The site, located at the Amata Vietnam Industrial Park, is a greenfield investment, and it will host Huntsman's Polyurethanes and Advanced Materials businesses, including manufacturing; research and development capabilities. The compound will also have a technical service center; warehouse and distribution space and a commercial office.

President of Huntsman's Advanced Materials business added: "This is the first manufacturing expansion investment outside China for our business in Asia Pacific and we see many opportunities in Vietnam to support large-scale infrastructure and construction projects in one of the fastest growing economies in the region.The new plant is said to give the capability to efficiently supply customers across the ASEAN region with high quality electrical insulation, coatings and adhesive solutions.

In addition to this facility, Huntsman has a distribution warehouse located in the inland container depot at Long Binh - Dong Nai Province, and a site in Hanoi which offers technical service and comprises warehouse and distribution space and a commercial office.


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France and Vietnam Sign Joint Vision Statement On Defence Cooperation

Vietnam  -  September 2018

France and Vietnam signed a joint vision statement on 18 September 2018, on defence cooperation for 2018 to 2028, and an agreement on amending the Vietnam-France co-operation agreement signed in 2009, with the aim of deepening the defence bond between the two countries. 

Through the statement, the two countries are to promote common concerns, thus reinforcing and stepping up mutual trust and moving towards expanding co-operation, maintaining security and stability in the region and the world; ensuring compliance of international law, freedom of travel on land, sea and air routes; and coping with non-traditional security threats, with the impact caused by climate change and environmental degradation for security taken into account. To implement the above, the two sides will maintain regular visits and meetings at all levels; increase high-level exchanges and diversify mechanisms for bilateral consultations on international and regional security issues of mutual concern.

The two countries will intensify co-operation and mutual support at multilateral organisations and forums and foster the bilateral and multilateral partnership to contribute to promoting peace and security in both regions. They also agreed to support each other in capacity building and share experience in peacekeeping operations and strengthen collaboration in the fields of defence industry, military medicine and hydrography.

Lastly, the two sides will focus on enhancing co-operation in maritime security and safety, as well as non-traditional security issues; and exchanging experience and seeking new opportunities to co-operate in environmental security.

(Sources: Viet Nam News; Nhan Dan Online)


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Convenience store mart shop


Thai Retail Giant To Spend USD 500 Million In Vietnam

Vietnam  -  September 2018

Central Group, Thailand's largest retail conglomerate headquartered has unveiled plans to spend as much as USD 500 million to expand its retail network in Vietnam over the next five years. The investment will directed towards tripling the number of its stores and shopping malls to as many as 750. The company is also adding  new retail formats to capture growing consumer demand for non-food items. Their LookKool gift shop has already expanded to 27 stores since its launch late 2017. They are experimenting to check the viability of other brands such as cosmetics shop Hello Beauty and DIY store Home Mart. 

Central Group is the largest foreign retailer in Vietnam. The group currently has 250 outlets in Vietnam with a floor space of 700,000 square feet. This includes 31 Big C shopping malls; 35 Big C hypermarkets; 25 Lanchi Mart outlets; 50 fashion stores under the Robins, DELALA, Supersports, and Marks & Spencer brands; 56 Nguyen Kim electronics stores; more than 40 stores of the new retail concepts such as LookKool, C-express, B2S, Hello Beauty; and three online platforms,, and

Since its establishment in July 2011, it has made several investments, including acquiring a stake in electronics retailer Nguyen Kim and the acquisition of Big C supermarket chain. 

(Source: Nikkei Asian Review; The Nation)


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Philippines And Israel Sign 21 Business Deals Valued At USD 84.9 Million

Philippines  -  September 2018

During the visit of President Rodrigo Duterte to Israel, 21 business deals worth USD 84.9 million were sealed. These are expected to generate 790 jobs in the Philippines. 

Some of the agreements were security-related, such as the transfer of know-how and technology agreement by Israeli weapons manufacturer, EMTAN to the Philippines-based arms manufactuer, Armscor for the latter to create a local weapons manufacturing facility in the Philippines under the license of EMTAN; exploring a mutually beneficial opportunities for collaboration on security, intelligence data mining and information technology; cooperation to develop cybersecurity-related certification courses in the Philippines; and, exploring opportunities in the manufacturing and refurbishment of small arms and ammunition.

Other MoUs and LOIs were on trading, agriculture and environment-related projects, tourism and shipping such as the collaboration to provide additional ships/vessels to service the country's local and international shipping requirements.

Below are the 21 agreements: 

  • MOA between Stone of David Corporation and Gaia Automotive Industries Ltd - Marketing and promotion of "tactical vehicles," technology transfer

  • MOA between Stone of David Corporation and MCTECH RF Technologies Ltd - Development of military and intelligence products and hardware

  • MOU between Integrated Computer Systems, Inc and Verint Systems Ltd - Explore collaborations on security, intelligence data mining, and information technology

  • MOU between AMA Education Systems (AMAES) and HackerU - Develop cybersecurity-related certification courses in the Philippines

  • MOU between Armscor Global Defense, Inc and EMTAN Karmiel Ltd - EMTAN to transfer know-how and technology to Armscor so that Armscor can create a weapons manufacturing facility in the Philippines, under license from EMTAN. This project has an estimated cost of USD10 million and is projected to generate 200 jobs.

  • LOI of Silver Shadow Advanced Security Systems and Rayo Illuminar Corporation - Explore opportunities in the manufacturing and refurbishment of small arms and ammunition, together with local partner Rayo Illuminar Corporation. This project is estimated to cost USD 50 million and is expected to create 160 jobs by 2019.

  • MOA between Century Properties, Inc and Globe Invest Ltd - joint venture agreement on energy, agriculture, and urban farming; prefabricated houses; wate desalination; real estate.

  • MOU between Century Pacific Food, Inc and Kvuzat Yavne - Distribution of Century canned tuna products within Israeli and Palestinian National Authority

  • MOU between the Philippine Center for Entrepreneurship (PCE) -7Go Negosyo and Israel-Philippines Chamber of Commerce/Israel Chamber of Commerce - Develop and undertake initiatives related to the Kapatid Mentor ME Program

  • MOU between the Philippine Chamber of Commerce and Industry (PCCI) and the Federation of Israeli Chambers of Commerce - Exchange information on commerce, industry market updates, and identification of business and trade opportunities

  • MOU between the PCCI-National Capital Region and Jerusalem Chamber of Commerce (JCC) - Promote, strengthen, and expand trade, economic, scientific, and technological cooperation and exchange information on commerce, manufacturing, pharmaceutical industry, health and wellness, real estate, information communication technology, and renewable energy

  • MOU between Subic Bay Metropolitan Authority (SBMA) and Eilat Port Company Ltd - Promote an "all-water route" between Port of Subic Bay and Eilat Port in Israel for trade and investment

  • MOU between Le Soleil Shipping Agencies, Inc and ZIM Integrated Shipping Services Ltd - Provide additional ships or vessels to service the country’s local and international shipping requirements.

  • MOU between KEREM IT Solutions and Carbyne Ltd - The selling of each other's products in their respective countries.

  • MOU between KEREM IT Solutions and SuperCom - The selling of each other's products in their respective countries.

  • LOI of Amdocs Philippines, Ltd - Expand software development and support services in the Philippines as the company's hub in Asia-Pacific

  • LOI of TrueLogic Online Solutions, Inc - Expand software operations, systems development, and support services. This venture has an estimated cost of USD 500,000 and is projected to generate 100 jobs by 2019.

  • LOI of MIMA TECH and I GilanGroup - Expand operations in the field of agriculture and wastewater and sewerage treatment projects. This project is estimated to cost USD 20 million and expected to generate 300 jobs by 2019.

  • LOI of FlyEast Philippines - Expand Philippine operations on tourism development. This project is estimated to cost USD 400,000 and is expected to create 30 jobs by 2019.

  • LOI of FoodLab Capital - Build a FoodTech Acceleration Center within the Cagayan Special Economic Zone and Freeport (CSEZFP) to service the food industry locators of the Cagayan Economic Zone Authority (CEZA). This project is projected to cost USD 1 million.

  • LOI of Assuta Medical Center and I-DEA Ventures Group Inc - Build a "state-of-the-art" medical center CSEZFP for the medical needs of the locators of the CEZA. Also expected to cost USD 1 million.

(Sources: Philippine News Agency; Rappler) 

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Philippines Plans To Rollout National Biometric ID System

Philippines  -  September 2018

President Rodrigo Duterte recently signed into law the Philippine System Identification Act (PhilSys Act) which mandates the government to create a single identification card for all citizens. The Philippine Statistics Authority (PSA) is the agency in-charge of the massive USD 562 million project.

Under the law, PSA, which will act as the PhilSys Registry, will require the biometrics of applicants, along with response to 10 basic identity questions, three of which may be optional. For newborns, PhilSys registration will be upon birth sans the biometrics. The first biometrics for child applicants will be captured at age five and they will be updated when he/she reaches the legal age of 18. Amidst concerns of breach of privacy and data leakage, the PhilSys Act ensures that biometrics and personal information will be kept in a resilient data system subject to the country’s data privacy law.

PSA is on-track to bidding out the contract and is finalizing the Terms of Reference (TOR) in coordination with the Department of Information and Communications Technology (DICT) and the National Privacy Commission (NPC). The agency has already received proposals from private-sector firms, one of them is the consortium of Ayala and Aboitiz, in partnership with Unisys Philippines, which will disburse PHP 15 billion (USD 270 million) in its proposal to design and develop said infrastructure.

The Implementing Rules and Regulations (IRR) will be ready by the first half of October 2018. The pilot launch in December 2018 will enroll one million households who are beneficiaries of the state cash handouts. The entire population is expected to be registered in two to five years. Upon full implementation, several government-issued IDs will be invalidated. For initial registration, the PSA will enroll the first one million, who are beneficiaries of the Unconditional Cash Transfer (UCT). 

The new ID system will give not just an easy access to government’s social benefits but also in securing jobs and opening bank accounts. It is believed that there are millions of undocumented Filipinos who do not even have the basic requirements like birth-certificate required to obtain any of the thirty (30) types of ID accepted as proof of identity, making it a barrier for work opportunities. According to the central bank, about half of the population did not have access to banking services last year – one fifth not having the required documents, such as two nationally accepted IDs.

(Sources: Philippines News Agency; Nikkei Asian Review; Business Mirror; ABS-CBN News)

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Ships lng rigs oil gas


Philippine National Oil Co Seeks Partner For LNG Terminal

Philippines  -  September 2018

Government-owned Philippine National Oil Co. (PNOC) is shifting from unsolicited tender to solicited tender scheme for liquefied natural gas (LNG) terminal facility in the country.

According to the Department of Energy (DOE), there were no compliant or comprehensive tenders received during the unsolicited bidding scheme. PNOC received offers from several firms including Korea Electric Power Corp. (Kepco), Lloyds Energy Group and China National Offshore Oil Co. (CNOOC), First Gen Corp., Energy World Corp., PT. Jaya Samudra Karunia, and PT PGN LNG Indonesia/PT Bosowa Corporindo with their local partner MOF Corp.

Lloyds Energy Group of Dubai was the first in line among the interested organizations who expressed its intention to submit a proposal for partnership with PNOC to build the LNG terminal hub soon. Meanwhile, First Gen Corp. of the Lopez Group also expressed interest in partnering with PNOC. However, proponents have to wait until PNOC and the Asian Development Bank (ADB) to finish formulating the guidelines for the solicited scheme. ADB was tapped by PNOC to be its consultant in finding a suitable partner and development of the LNG hub.

The key features of the LNG project under the PNOC’s solicited scheme, which is estimated to cost between USD 600 million to USD 1.4 billion are the following:

  • Minimum capacity of three metric tons per annum, equivalent to 3,000 MW to cover existing immediate needs with future increase to five MPTA.

  • Phased development to cope with future market developments.

  • Flexibility to allow Floating Storage and Regasification Unit in the first phase, but eventually, the terminal will be land-based as demand increase and to ensure greater security.

  • Implemented as a joint-venture with PNOC to ensure public oversight of the project development and operation.

  • PNOC would make site available in the Batangas area.

(Sources: Business Mirror, Manila Standard. Philippine Star, Manila Bulletin, Philippine Resources)

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Health insurance


IFC Invests USD 40 Million In Fullerton Health Philippines

Philippines  -  September 2018

Fullerton Health Philippines Holdings Corporation and Fullerton Health Philippines Pte. Ltd., two wholly-owned subsidiaries of Singapore-based Fullerton Health, have secured a USD 40 million investment in the form of a long-term loan facility from World Bank member group, International Finance Corporation (IFC).

The investment from IFC will enhance the provision of affordable, quality healthcare in the Philippines and enhance efficiencies in the health maintenance organisation (HMO) market through increased integration between the financing and provision of healthcare. HMOs are private providers of healthcare insurance, providing access to doctors within their network. The funding will also be used to provide training opportunities for health practitioners. 

In May 2018, Fullerton Health entered the Philippine market by acquiring 60% stake in the Intellicare Group. The acquisition reinforces Fullerton’s strategy of expanding its presence in markets across the Asia Pacific region.  Intellicare Group is comprised of three (3) companies: Asalus Corporation, engaged in the delivery of health maintenance organization (HMO) services, Avega Managed Care Incorporated, a third-party service provider for corporate clients, and Aventus Medical Care Incorporated, which operates a network of outpatient and mobile clinics.

The financing is in line with IFC’s goal of financially supporting long-term sustainable development projects as it sees addressing wide gap in health insurance coverage crucial in the Philippines. The growth of Intellicare and other companies in this segment is expected to reduce low and middle-income households’ reliance on out-of-pocket payments to fund healthcare expenses.

(Sources: Manila Bulletin; International Finance Corporation)

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Water resources pipeline sewerage


MWSS, SKorea’s Daegu Ink Water Agreement

Philippines  -  September 2018

The Metropolitan Waterworks and Sewerage System (MWSS) and South Korea’s Daegu City signed a memorandum of understanding to develop solutions to water-related problems, improve their respective water systems, and strengthen cooperation among their water institutions.

The signing of agreement happened in a special ceremony at the Korea International Water Week in Daegu Exco on September 12. Specifically, the two parties agreed to:

  • Share information on water related challenges and issues encountered by the two cities.

  • Develop an integrated water-resource management that will address the challenges and issues as well as pioneer new markets and share strategic technologies related to their respective water and sewerage systems.

  • Both parties will select, develop and implement regular cooperation programs to further develop the water industry, and boost cooperation between water-related businesses, educational institutions, and industry organizations.

According to MWSS Administrator, the agency can tap Daegu to act as third-party consultant for the sewerage and wastewater management system in Metro Manila.

(Sources: Business Mirror, Manila Times)

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USD 423 Million Allocated For Manila North Harbor Port Modernization

Philippines  -  September 2018

Philippine conglomerate, San Miguel Corp (SMC), has allotted PHP 22.9 billion (USD 423 million) for the rehabilitation and modernization of the 55-hectare port facility Manila North Harbor located in Tondo, Manila. Manila North Harbor is one of the busiest ports in the Philippines with quay length of 5,200 meters and 41 berths that can accommodate all types of vessels such as containerized and non-container types vessels.

SMC intends to develop Manila North Harbor to become the country’s biggest domestic port that would grow two or three times its current size. Port congestion is among the major problems in the country’s port operations and as an archipelago of more than 7,000 islands, the Philippines not only needs to build more ports, but it also needs to expand the capacity of existing ones to make them more competitive and get a larger share of the international trade and tourism markets.  

SMC has already spent PHP 13.8 billion (USD 254 million) for the improvement and upgrading of Manila Harbor’s passenger terminal complex. This includes the development of berth and quay lines, reclamation of the piers, rehabilitation of container yards and the construction of new passenger terminals. The remaining budget will be used for the phase 2 rehabilitation target to be completed by December 2022.

SMC holds a 43.3% stake in Manila North Harbor. International Container Terminal Services Inc. (ICTSI), the Philippine port-handling leader, recently increased its holding in the harbor to 50%. ICTSI acquired 34.8% of the harbor's shares from Petron Corp (controlled by SMC) last year.

(Sources: The Philippine Star; Rappler) 

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Israeli Arms Manufacturer To Open Plant In Philippines

Philippines  -  September 2018

Israeli firm Silver Shadow Advanced Security Systems Ltd (SSASS) and the Philippines’ Rayo Illuminar Corporation (RIC) signed a memorandum of undetaking to set-up a manufacturing plant in the Philippines.

Under the agreement, the facility will initially manufacture and assemble firearms and ammunitions which is anticipated to employ at least 160 personnel. SSASS is committing to put an initial investment of USD 50 million and will provide training.

SSASS’ CEO Amos Golan is expected to visit the country soon to finalize the partnership and begin the construction and installation of essential apparatus. Limay, Bataan is the prospective location being eyed by the two firms for the manufacturing facility. While the agreement was signed during President Rodrigo Duterte’s visit in Israel, RIC and SSASS already had a series of exploratory meetings.

SSASS specializes in the production of weaponry systems and small arms, such as various assault rifles, submachine guns, sniper rifles and more, for military, police and security applications.

(Sources: Philippine News Agency; The Asian Policy; The Jerusalem Post)

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“Super Consortium” of Philippine Top Conglomerates Progresses Towards NAIA Redevelopment

Philippines  -  September 2018

Philippine’s biggest conglomerates Metro Pacific Corp, Aboitiz Group, Ayala Inc, Alliance Global Group, Emerging Dragon Corp, Filinvest Development Corp and JG Summit have formed a consortium that plans to redevelop the Ninoy Aquino International Airport (NAIA) in Manila. The consortium submitted an unsolicited proposal to the Department of Transportation (DOTr) and the Manila International Airport Authority (MIAA) last February 12, 2018, seeking to transform NAIA into a regional airport hub and expanding its capacity to meet the anticipated growth in passenger traffic from the strong economies of the Philippines and the region.

DOTr and MIAA have granted Original Proponent Status (OPS) to the “NAIA Consortium” for its proposal to rehabilitate, upgrade, expand, operate, and maintain the Ninoy Aquino International Airport (NAIA) for 15 years, brought down from the originally proposed concession period of 35 years. This OPS is the first step in the NAIA receiving an upgrade to improve the passenger experience for Manila’s international gateway airport. The proposal will still be subjected to a Swiss challenge, where the government will invite other players to make bids..

The PHP 102 Billion (USD 1.8 billion) proposal involves expanding and interconnecting the existing terminals of NAIA, upgrading airside facilities, developing commercial facilities to increase airline and airport efficiencies, enhancing passenger comfort and experience, and elevating the status of NAIA as the country's premier international gateway. According to the proposal, these improvements will be implemented with minimal disruption to ongoing airport operations.

The NAIA project supports the government’s ‘Build, Build, Build’ program with its plan to develop NAIA into a world-class facility and a regional air transport hub by upgrading its airside, landside, and air navigation support—building on the gains already achieved by the DOTr in terms of improving the traffic of aircraft movements on its runways.

(Sources: Metro Pacific; The Philippine Star) 

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Philippines Reducing Non-Tariff Barriers To Agricultural Imports

Philippines  -  September 2018

President Rodrigo Duterte issued an administrative order on 21 September to eliminate non-tariff barriers to the imports of rice and other agriculture products. The order aims to address the impact of inflation which rose to 6.4% in August, the highest since 2009, and ensure the stability of the prices of agricultural products in the domestic market. Applicable fees will reduced or removed. 

According to the Administrative Order Subject to conditions imposed by applicable laws and consistent with their respective legal mandates, the National Food Authority (NFA), SRA, and DA, in coordination with the Department of Trade and Industry (DTI), will undertake immediate measures to remove administrative constraints and other non-tariff barriers on the importation of agricultural products. 

This includes streamlining procedures and requirements for the accreditation of importers and minimizing the processing time of applications for importation. Traders already accredited will be exempt from registration requirements. It will also allow the import of food products beyond the authorized Minimum Access Volume (MAV) and where applicable, reduce or remove fees in order to ensure their sufficient supply in the domestic market at more affordable prices. 

The order also aims to liberalize issuance of permits and accreditation of traders who want to import rice to break monopoly. It will temporarily allow direct importation by sugar-using industries to lower their input cost. 

DTI and DA have also been asked to take concrete steps to improve logistics, transport, distribution and storage of agricultural products to reduce input costs.

(Sources: PhilStar;