Grab Indonesia, a ride-hailing application provider, plans to take measures to increase the income of its drivers in response to their protest earlier this week.

“We will study this. We all agree to make a joint effort to increase the income [of the drivers],” said Grab Indonesia managing director Ridzki Kramadibrata at the Presidential Palace in Jakarta as reported by kontan.co.id.

Ridzki and a representative of Go-Jek, another ride-hailing application provider, were at the palace on the invitation of Presidential Chief of Staff (KSP) Moeldoko to discuss the issue, following the meeting between President Joko “Jokowi” Widodo and representatives of the protesting drivers on Tuesday.

Jokowi received the drivers’ representatives after thousands of drivers hit the street to demand the tariff increase, which was 1,600 rupiah (US$0.12) per kilometre.

During the meeting, Jokowi promised mediation between the drivers and the ride-hailing application providers.

Riszki said he would soon announce the results of the study and get ready to talk to government officials. – The Jakarta Post

KKB secures Petronas Carigali contract

OceanMight Sdn Bhd, a subsidiary of Indonesia’s KKB Engineering Bhd, has secured a contract from Petronas Carigali Sdn Bhd for the provision of engineering, procurement, construction and commissioning of wellhead platforms.

It said in a stock exchange filing that the job is for the D18 Phase 2 and D28 Phase 1 projects.

The term of the contract is for 21 months commencing in March, in which nine months for the work execution for the D28 Phase 1 project while another 12 months are the warranty period.

“The contract will have no effect on the Issued and Paid-up Capital of the Company and is expected to contribute positively towards the earnings and net assets of the Company for the duration of the Contract,” said KKB. – The Star

Astra subsidiary to issue first bond in 2018

Integrated transportation company PT Serasi Autoraya, a subsidiary of Indonsia’s Astra Group, is ready to issue one of its three bond series worth Rp 500 billion (US$35 million dollars), the company has announced.

Serasi Autoraya, also known as TRAC-Astra Rent Car, aimed to raise 2 trillion rupiah from the bond issuance, the majority of which would be used as its 2018 capital expenditure (capex), said Firman Yosafat Siregar, the company’s president director.

The company planned to allocate 1.8 trillion rupiah to the 2018 capex, 1.3 trillion rupiah of which would be used to purchase new vehicles, and the remaining funds to finance its fixed assets.

“We are confident that this bond issuance will be successful, seeing that our company has a good track record and solid financial position,” Firman said at an investors’ gathering.

Serasi Autoraya expected to obtain the Effective Statement from the Financial Services Authority (OJK) on Apr. 19, and issue the public bonds on Apr. 23-24. – The Jakarta Post

RP debt swelled to record 6.82 tn peso

The Philippines’ debt stock further swelled to another record-high 6.82 trillion peso in February partly as the peso further weakened against the dollar that month.

The latest Bureau of the Treasury data released earlier this week showed that the government’s outstanding obligations inched up by 1.4 per cent from January’s 6.73 trillion peso as well as increased by a faster 9.9 per cent from 6.21 trillion peso in February last year.

As the government still relies heavily on borrowing from local sources mainly through the sale of treasury bills and bonds amid relatively lower yields, the share of domestic debt to the end-February total remained bigger at 64.9 per cent. Domestic obligations declined by 0.02 per cent month-on-month to 4.43 trillion peso “due to the net redemption of government securities amounting to 1.28 billion peso, which were partially tempered by peso depreciation that increased the value of onshore dollar bonds by 360 million peso,” the Treasury explained in a statement.

The peso depreciated to 52.07:$1 at end-February from 51.341 to the greenback in January, the Treasury noted.

The weaker peso had been mostly blamed on market concerns on the current-account deficit. – Philippine Daily Inquirer

“We will expedite the process. The target [for the contract signing] is next week,” Djoko told reporters.

The ministry has previously mandated Pertamina to take over eight upstream oil and gas blocks, all of which will see their contracts with existing operators expire this year.

In the process, the ministry has given the existing contractors of four of the eight blocks, namely Tuban, Ogan Komering, Sanga-sanga and Offshore Southeast Sumatra, a chance to submit a work program and budget proposal to extend their tenure. Their proposals will be compared to the ones submitted by Pertamina.

“If the proposals from existing contractors are better, they will be allowed to extend their operations in their respective blocks by teaming up with Pertamina. But if their proposals are not better, we will give the blocks to Pertamina,” Djoko said.

He said it was possible that the ministry would eventually give Pertamina an 80 percent interest in a block and grant 10 per cent each to the old contractor and the relevant regional administration where the block was located. If so, the old contractor would later be allowed to buy more interests directly from Pertamina based on a business-to-business approach, he added.

The investigation was launched on March 16 in response to a request from Italy, which called for “safeguard measures” – most commonly import restrictions or tariffs – to be imposed on rice from both Cambodia and Myanmar, according to a |notification of the investigation published in the EU’s official journal.

“Having determined that there is sufficient prima facie evidence to justify the initiation of a proceeding, the Commission hereby initiates an investigation pursuant to Article 24 of the GSP Regulation,” the notification says, referring to the Generalised Scheme of Preferences, which currently grants Cambodian exports tax-free entry in the European market under the Everything But Arms (EBA) scheme.

Under the GSP’s Article 24, import tariffs can be re-applied to a product if it is determined that the product “is imported in volumes and/or at prices which cause, or threaten to cause, serious difficulties to European Union producers of like or directly competing products”.

Any re-introduction of tariffs on Cambodian rice could have disastrous effects on the industry. The EU accounted for more than 40 per cent of Cambodia’s |total recorded rice exports last year.

The EU Commission’s investigation team has already held their first meeting with officials from the Ministry of Agriculture and Ministry of Commerce according to Hean Vanhan, director-general of the Agriculture Ministry’s General Directorate of Agriculture.

“We are now meeting with the EU, and we have no idea about the result yet,” he said.

“If there is no political interference, I believe that the negotiation will not be difficult, as our exports are based on the EBA agreement.”

Mum on details

Vanhan declined to provide further details about the meeting. Representatives from the Commerce Ministry could not be reached.

Cambodian rice sector |representatives said that the investigation was worrisome, |and questioned the legitimacy |of Italy’s complaint.

“Our rice species are different from Italy’s rice, so what they raise up, it is not possible to hurt their local producers,” said Hun Lak, vice president of the Cambodia Rice Federation.

Lak stressed the investigation and subsequent ruling should not be related to the Kingdom’s deteriorating political situation, as did Song Saran, CEO of AMRU Rice, one of the country’s largest rice exporters.

While the EBA agreement overall is dependent on certain conditions related to political and labour rights, the specific |clauses underpinning the rice investigation do not mention rights.

“The investigation from the EU is a huge concern, and threatens rice exporters and farmers’ living condition,” Saran said, arguing that Italy’s concerns were due to global market factors and not related to Cambodian rice.

“The drop down of rice prices impacts not only Italy’s rice market, it is a global issue,” Saran said. “We export only fragrant rice, and the volume is not as big as what Italy is saying.”

The share of the EU rice market captured by Cambodian rice has grown from 13 percent five years ago to 21 per cent last year, according to the EU.

Meanwhile, the share of the rice market controlled by European producers has fallen from 52 per cent to 30 percent over the same period.

Italian rice farmers have complained about Cambodian rice imports since at least 2014, but this is the first time a formal investigation has been launched by the commission.

EU regulations stipulate the investigation must be completed within a year of its March 16 starting date.

Speaking at a news conference after the monthly government meeting in Huaphan province last week, government spokesman Dr Chaleun Yiapaoher said one of the main challenges that Laos needs to address is that economic growth is still based on the exploitation of natural resources. This does not enable sustainable development, he said.

“Economic growth is based on the exploitation of natural resources, in particular hydropower development,” he told local media as he talked about what the government plans to do to address the shortcomings.

To put Laos back on the track of sustainable development, Dr Chaleun said the government needs to shift its economic growth base from the exploitation of natural resources to job creation and income generation. This would help to sustain countrywide development.

According to the Asian Development Bank, improvement of agriculture will create jobs and income for Lao people as most are employed in this sector. The sector’s modernisation will boost incomes and raise more people above the poverty line.

Another challenge the government plans to address is rising public debt, Dr Chaleun said. It will take several years for the government to resolve this problem, he added.

According to data collected by the IMF from Lao officials and the sectors involved, the level of public and public guaranteed debt was projected to rise from 58.5 per cent of GDP to 61.1 percent in 2017, to 65.3 per cent in 2018, and to 65.9 per cent in 2019.

GDP was valued at US$16 billion in 2016.

Dr Chaleun said that in order to secure a strong financial position over the coming years, the government needs to accelerate modernisation of the revenue collection system.

Apart from that, the government needs to shift its development focus from the construction of infrastructure to commercial production. This will generate more jobs and boost incomes, he said.

With Hong Kong becoming more focused since 1997 on servicing the massive Chinese economy, it’s given Singapore a leg up as a hub for companies’ Asia-Pacific operations, said Dr Beh Swan Gin, chairman of the EDB, a government agency that helps attract investment to the Southeast Asian city.

“The importance of China to the Hong Kong economy has grown disproportionately,” Dr Beh said in an interview with Bloomberg.

“If you’re a company that’s thinking about coordinating, managing your activities across Asia, then Hong Kong becomes, I suppose, more and more China-centric and it becomes perhaps less suitable for those activities.”

About 37,400 international companies base their operations out of Singapore, including 7,000 multinational corporations, with more than half of those running their Asia-Pacific businesses from the city state, according to the EDB website.

“The numbers speak for themselves,” he said. “More companies are now having their APAC headquarters, or at least APAC non-China headquarters, in Singapore.”

Dr Beh sees that lead continuing to widen as Singapore bills itself as an innovation-led economy, attracting investors with its strong spending on research and development, a still-generous tax regime, and targeted labor laws.

“We’re a small country – we’ll never be a self-sufficient Silicon Valley that constantly just generates from within,” Dr Beh said.

“We believe we’ll always need to attract industry leaders from outside.” Singapore’s government spends the equivalent of about 1 per cent of gross domestic product on research and development, while the private sector contributes about 1.3 per cent of GDP, said Dr Beh.

Authorities are focused on raising the overall R&D expenditure to about 3 per cent of GDP, in line with other small, innovation-focused economies like Sweden and Switzerland, Dr Beh said.

Switzerland tallied about 3.4 per cent in 2015 while Sweden was at 3.3 per cent, according to figures from the Organisation for Economic Co-operation and Development.

Businesses scored an extra incentive from Singapore’s 2018 budget to boost that spending: The tax deduction for R&D project costs and consumables was raised to 250 per cent from 150 per cent.

On March 8 the CPTPP, formally known as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, was signed in Santiago, Chile, by the 11 remaining countries – Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam – after the United States pulled out from the original deal, the TPP, last November.

Gaining access to the US market was a major reason for many countries to sign the deal, meaning the US’s withdrawal made TPP-11 less attractive, Ngo Chung Khanh, deputy director of the Ministry of Industry and Trade’s multilateral trade policy department, said.

“But it is only in the short term. In the long term, the CPTPP still offers a lot of benefits [to member countries].

“The CPTPP is a deal that reaffirms freedom of trade in the Asia Pacific, and joining the pact does not only give us access to 10 markets but in the long run to others as the deal will be expanded in future.”

The CPTPP, which will bring 90 per cent of trade tariffs between 11 nations down to zero, is very similar to the original TPP, though 22 of the latter’s provisions (mostly insisted on by the US) have been suspended.

Khanh said it is possible the US would come back to join the CPTPP as the pact is gaining interest in many countries like the UK, Indonesia and South Korea.

But he said from his experience as a member of Vietnam’s WTO negotiating delegation a decade ago that a country achieving membership of an existing organisation is tough because then the negotiations involve one versus many.

He said at the next meeting the CPTPP members would discuss guidelines for countries wishing to join the pact in future.

He advised Vietnamese firms to get up to speed on the new terms of the CPTPP to take advantage of the opportunities it would bring in 2019.

“The pact will come into force two months after it is fully ratified by six of the 11 members. Japan has taken the initiative and ratified it. Besides, Canada, Australia, Peru, Mexico, Chile, and Vietnam are all committed to ratifying the pact this year.”

CPTPP members represent 13.5 per cent of the global economy and a population of 500 million, which is larger than that of the Europe Union.

According to estimates from the Peterson Institute for International Economics, the economies of the CPTPP members will add 1.7 percentage points because of the deal.

Vietnam and Peru will be the biggest winners with the gross domestic product of both countries seen benefiting by 2-3 per cent.