EVENING 5: Govt to allocate RM270 bil dev expenditure under final three years of 12MP

The Edge TV

In today’s edition of Evening 5 — Putrajaya says that it will spend RM270 bil in development expenditure in the final three years of the 12th Malaysia Plan. Meanwhile, the list of bidders for the Ramsay-Sime Darby healthcare JV is narrowing.

Transcript

00:00 [Music]

00:04 Putrajaya is to spend 270 billion in the final three years under the 12th Malaysia Plan

00:10 as the government aligns the five-year plan with the Madani economic vision

00:14 targeted to empower and stimulate the economy.

00:18 When tabling the 12 MPs midterm review in the Dewan Rakyat,

00:21 Prime Minister Dato' Sri Anwar Ibrahim said the government is committed to spending at least

00:26 90 billion in the development expenditure annually from 2023 to 2025.

00:33 Anwar explains that the government will spend the entire 400 billion allocation under the 12 MP

00:38 and even increase the ceiling by 15 billion to give a total of 415 billion ringgit.

00:45 He says that this increase is to fund the needs of the rakyat's priority groups

00:49 in addition to improving the quality of management

00:52 and retargeting subsidies to meet the basic needs of the rakyat.

00:56 For context, Anwar said development expenditure only stood at 64.3 billion in 2021

01:02 and 71.6 billion in 2022.

01:06 He said this was only 34 percent of total development expenditure

01:11 allocated under the five-year plan, 135.9 billion out of 400 billion ringgit.

01:17 The Dewan Rakyat is currently in session for a six-day special sitting

01:21 focusing on the tabling of the 12 MP MTR.

01:24 Anwar said that 31 percent of the 175 targets set out in the five-year plan had been achieved

01:31 and another 59 percent is progressing as scheduled.

01:35 Economy Minister Mohd Rafizi Ramli clarified that the higher spending ceiling of the 12 MP

01:40 will not come from more loans but rather from expected better national growth in 2024 to 2025

01:48 and domestic savings.

01:50 He said the government will implement cost savings by adopting better governance.

01:54 Meanwhile, a total of 11 new transport and logistics projects have been introduced

01:59 to ensure the development of a sustainable and resilient national infrastructure, said Anwar.

02:04 The projects in question are the construction of Pan-Borneo Highway Sabah's Phase 1B,

02:10 the Penang LRT, the expansion of the Penang International Airport,

02:14 the redevelopment of the Sultan Abdul Aziz Shah Airport in Subang

02:17 and the upgrade of the East-West Highway from Geret Perak to Jelik Kelantan.

02:22 Anwar also announced that government projects, including those under the previous Malaysia plan,

02:27 which could not be implemented within a reasonable period after their approval,

02:32 will be cancelled so as to make way for more pressing people-oriented projects.

02:36 Ramsay Healthcare and Slamdabi have shortlisted candidates for the sale of their hospital unit,

02:47 which could fetch about US$1.5 billion, according to people with knowledge of the matter.

02:52 Bloomberg reported that TPG Inc-backed hospital group Columbia Asia and Sunway Medical Center,

02:58 a unit of Sunway, were picked to proceed to the next round of bidding.

03:02 Macquarie Asset Management and PT Mitra Kuager Karya Sehat are also among the shortlisted suitors,

03:08 the people said, asking not to be identified as the process is private.

03:12 The sellers invited some healthcare companies and private equity firms

03:16 to submit non-binding bids by end August.

03:19 The revival of the deal comes after discussions with IHH Healthcare collapsed last year.

03:24 Binding bids for Ramsay Slamdabi Healthcare are due in October, the people said,

03:28 adding that deliberations are ongoing and there is no guarantee the deal will proceed.

03:33 The healthcare JV owns four hospitals in Malaysia and three hospitals in Indonesia

03:37 and provides inpatient and outpatient services from primary care to surgery,

03:42 as well as mental health care and rehabilitation.

03:45 [Music]

03:50 Manufacturers experienced an increase in costs of doing business in the first half,

03:54 arising from both domestic and external factors,

03:56 according to the latest Federation of Malaysian Manufacturers' Business Conditions Survey.

04:02 The biannual survey showed that most of the costs incurred by the respondents

04:06 had increased by up to 20% in the first half, with labour, maintenance of machinery,

04:11 raw materials and energy comprising the top cost increases.

04:15 FMM President Tan Sri Sotian Lai said the cost of doing business was trending up

04:20 in the first half, induced by global supply chain disruption,

04:23 the implementation of the minimum wage, removal of utility subsidies by the government

04:28 and higher import costs due to the weak ringgit versus the US dollar.

04:32 So called for the government and Bank Negara to come up with a solution

04:36 to strengthen the ringgit against the greenback.

04:38 He also called on BNM to retain the current overnight policy rate,

04:42 saying that if the OPR should increase by a further 25 BPS by end 2023,

04:48 71% of the respondents will face impacts on revenue,

04:52 while 80% of respondents see this impacting profit.

04:56 Meanwhile, the FMM survey also showed that manufacturing activities

05:00 are expected to remain slow for the second half.

05:02 According to the FMM, the latest expected indices for business activity,

05:07 local sales, production volume, capacity utilisation, capital investment and employment

05:12 have also dipped to two-year lows,

05:14 a further reflection of the manufacturing sector's temperate expectations going forward.

05:19 UEM Sunrise's unit, Mega Legacy Malaysia, is disposing of 4.01 acres of land in

05:30 Kiara Bay, Kuala Lumpur for RM85 million to a subsidiary of Melati Esan Holdings.

05:36 UEM Sunrise also entered into a development rights agreement with Melati Esan's Pembinaan Keri

05:42 to develop and market completed property units at a development rights value of RM93.5 million,

05:48 the company said in a BOSS filing.

05:50 The proceeds from the sale will bolster UEM Sunrise's financial position,

05:54 helping to reduce debt and aid in land acquisition efforts.

05:58 The DRA will serve as a valuable tool for UEM Sunrise to maintain control

06:03 over Kiara Bay's development concept while minimising potential conflicts

06:07 associated with common facilities and shared spaces.

06:10 Based on the audited financial statements for FY2023,

06:14 UEM Sunrise's earnings at EPS could potentially see an increase of 48%.

06:19 Melati Esan's founder, Tan Sri Yip Swan Chee, who is also a director and substantial shareholder of

06:25 Mega Legacy, will abstain from deliberating and voting on any resolution pertaining to

06:30 the transactions due to his interests as a related party.

06:34 Magnitech Industries' first quarter net profit jumped 36% year-on-year to $32.7 million on the

06:45 back of a decline in operating expenses, higher investment income and foreign exchange gains.

06:51 The stronger earnings came in despite revenue from the quarter slipping almost 5%

06:56 to $324.4 million from $340.9 million a year earlier, mainly due to lower sale orders received.

07:04 The garment supplier declared a single-tier interim dividend of $0.08 per share.

07:09 On prospects, Magnitech, which also supplies a wide range of flexible plastic

07:14 and corrugated packaging products, said the group remains optimistically cautious over

07:19 its business outlook for the rest of FY2024. It says it will continue to be vigilant in

07:24 cost management and to drive operational efficiency to remain competitive,

07:29 as well as to drive sales and production output.

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