In his newsletter to investors, Mobius also noted that the country’s economic growth has been very good while the ringgit is undervalued. He also expressed optimism that issues surrounding 1Malaysia Development Bhd and the related political scandal would not have a long-term impact on Malaysia.

Looking at some other fundamentals in Malaysia, the fund manager noted that the country was a net exporter of oil and gas, so lower prices have had a negative impact.

“However, the use of palm oil globally is not declining, mainly because of demand from China and India, and we don’t expect prices to stay permanently depressed,” Mobius said, adding that Malaysia had a diverse array of export products and was actually predominantly a consumption-driven country, representing 60 per cent of gross domestic product (GDP).

“Malaysia’s economy has a large service sector, which to me is a sign of its maturity. GDP growth since 1996 has averaged about 5 per cent, and while various forecasters call for growth below that level this year, it still appears to be experiencing a solid growth rate. Looking at some other metrics, household debt is at 89 per cent and public or government debt-to-GDP is at 54 per cent.

“While those readings may seem high to some observers (and higher than they were in 1997 during the Asian financial crisis), both readings are actually less than that of the United States. Malaysia’s trade surplus is good (which not many countries can boast of) and foreign reserves remain at a healthy level,” Mobius said.

He believes that Malaysia’s demographics represented a positive factor going forward, as its young population was entering its most productive years and represents a big consumer market. He thinks that Malaysia has much more potential in many consumer sectors, as well as in tourism.

“If economic fundamentals do not seem to be signalling a crisis, it seems that political scandal has been more likely behind the flight of foreign investors from Malaysia,” he said.

Mobius said the default of 1MDB and the related political scandal had affected investor sentiment and confidence. However, foreign investor flows are often short-term in nature and temporary.

“Negative news certainly affects investor confidence, but we generally see these periods of market overreactions as opportunities – if we find reasons for a recovery long term.

“We find a number of sectors to be attractive in Malaysia today, including integrated oil companies involved not only in production but also exploration, refining and marketing, as well as companies involved in the consumer sector,” he said.

Maybank Investment Bank Research said a potentially slower UK economy (or even a recession) and a weaker British pound resulting from a Brexit would be negative but the impact on Malaysian public-listed companies would be limited to just a few.

Within its research coverage, major Malaysian investments in the UK are in property developments (Battersea by SP Setia Bhd, Sime Darby), regulated assets (YTL Power), casino operations (Genting Malaysia), and renewable energy (KNM Group).

“But a weaker pound should result in lower Malaysian ringgit profits (from the foreign exchange impact and margins).

“Based on our sensitivity analysis, a 10 per cent weakness in the pound/ringgit from our base case would impact our financial year 2017 net profit estimates for SP Setia and Sime Darby lower by 3.5 per cent and 1.1 per cent respectively,” the research house noted.

Battersea’s combined take-up rate averages 85 per cent, with an unbilled sales of 1.6 billion pounds as at end-Dec 2015.

The total development cost incurred as at end-Dec 2015 was 7.88 billion ringgit (US$1.92 billion), while the net asset value was 2.80 billion ringgit, according to SP Setia’s latest annual report.

Maybank Investment said the impact of slower future take-ups would show in the earnings only from 2020, potentially affecting the remaining unsold units of phase 3A and the yet-to-be launched phases.

A potentially slower UK economy should not impact demand much at Wessex but it could affect visitors and collections at Genting Malaysia’s UK operations, it noted. A potentially weaker pound should result in lower translated ringgit profits and investment values.

Based on the research firm’s sensitivity analysis, a 10 per cent weakness in the pound/ringgit from its base case would impact net profit estimates for YTL Power and Genting Malaysia lower by 7 per cent and 0.8 per cent respectively.

YTL Power bought into Wessex Water in 2002, and this year marks the 25th year of Wessex’s privatisation.

Wessex is a significant investment to YTL Power – its net asset value of 1.85 billion ringgit as at end-Jun 2015 made up 16 per cent of group net asset value, while its earnings contribution was larger at 74 per cent of group pre-tax profit last year.

Meanwhile, Genting Malaysia UK operations had a net asset value (before interest bearing instruments) of 4.91 billion ringgit as at end-December 2015, which made up 24 per cent of group net asset value (before interest bearing instruments).

At the topline, the UK operations contributed 16 per cent to group turnover in financial yaer 2015 but at the bottomline, the UK operations were loss-making due to low VIP hold rate, bad debts and pre-opening expenses at Resorts World Birmingham.

As for KNM’s Peterborough project, the brokerage added that a slower UK economy should not significantly impact the project’s financials.

Maybank Research said it had yet to reflect any earnings impact from this project in its forecasts for KNM.

Global markets are increasingly jittery ahead of the Brexit referendum on June 23 after recent polls suggest that the odds are tilting towards a “leave”, rather than a “remain” outcome.

Deputy Managing Director of Lao Freight Forwarder, Somphone Phasavath told Vientiane Times last week that there are plenty of domestic transport providers but most of the goods in transit are being moved by foreign freight companies.

Foreign operators can be seen transporting loads including minerals, instant products, timber and other goods.

This situation does not bring enough benefits to the government and Lao entrepreneurs will also lose the benefits of international goods transit.

Otherwise, he advised that the government should collect a road passage fee from all foreign trucks in order to boost revenue.

Each year, the government spends a large amount of funds from international assistance and the domestic budget for repairing and constructing the roads.

This revenue will be an important part of contributing to road improvement, he commented.

This priority for local transport companies will also help to reduce accidents as local drivers’ knowledge of Lao highways is better than that of foreign drivers, Somphone explained.

This suggestion has been exchanged and discussed at the Greater Mekong-Subregion but there has been no solution as yet.

A profitable freight industry is also one of the benefits to be garnered by transforming Laos from a landlocked country to a land-link in the region.

However the government and the business sector should also prepare a plan to invest in the construction of standard parking and warehouse facilities at the nation’s major borders, Mr Somphone suggested.

He noted that transportation companies in Laos still lack professional human resources, for example technicians, drivers, service personnel and others, according to the government’s research.

Compared to other Asean countries, the transport support industry in Laos is limited.

Hence, in order to gain benefits from entering the AEC, it is necessary to organise training for those staff, including transportation companies to strengthen their capacity to transit goods overseas, especially to Thailand, Vietnam, China, or other countries.

If a transport company has to hire foreign staff, they may end up paying as much as three times what they otherwise would in labour costs.

Tourism Minister Arief Yahya said the government would next year focus on boosting the promotion of the priority destinations, which are Lake Toba, Belitung, Tanjung Lesung, Thousand Islands, Borobudur temple, Mount Bromo, Mandalika, Komodo Island, Wakatobi National Park and Morotai.

Arief was quoted by Kontan on Monday as saying that the government would boost promotions, especially in the four countries that provided the biggest contributions to Indonesian tourism. “Those countries are China, Singapore, Malaysia and Japan.”

The government has allocated Rp 100 trillion for the development of infrastructure and basic facilities in the destinations.

Arief said earlier that Indonesia needed an additional 120,000 hotel rooms, 15,000 restaurants, 100 recreational parks, 100 diving operators, 100 marinas and 100 special economic zones.

President Joko “Jokowi” Widodo expects tourism to contribute 15 percent to gross domestic product (GDP), generate foreign exchange of Rp 240 trillion and create jobs for 13 million people.

San Miguel Corp and the group of businessman Manuel V Pangilinan have entered into discussions for the US$10-billion international airport project along the Cyberbay reclamation area that seeks to match world-glass gateways within the region, but this didn’t gain ground then.

San Miguel president Ramon S. Ang told reporters after the company’s stockholders meeting Tuesday that since the airport project was a big undertaking, his group was willing to bring in partners.

“Instead of us doing projects on our own, we decided to find areas of cooperation,” Ang said.

The cooperation with the group of Pangilinan—who heads Hong Kong-based First Pacific Co. Ltd. which has 80 per cent of its assets invested in the Philippines—could extend beyond the airport to other infrastructure projects like tollroads and even mass railway transits, Ang said.

On the proposed airport project, Ang said: “We will sit down and give him a presentation. We will decide from there what area of cooperation we can pursue like in Parañaque and Las Piñas.”

San Miguel is proposing a new airport to be built along CyberBay Corp.’s disrupted waterfront reclamation project along the Manila-Cavite Coastal Road, covering the cities of Parañaque and Las Piñas. The proposal was to make use of the 157 hectares of reclaimed land already finished by Cyberbay near the Entertainment City of Philippine Amusement and Gaming Corp. However, the entire project needs 1,600 hectares, thus requiring more reclamation based on the original master plan.

But Ang said it would be up to the new administration to determine the most suitable location. He said San Miguel and Pangilinan would still work together—for instance, bid for a contract under the public-private partnership (PPP) framework—wherever the government’s preferred site would be. However, he said Clark Freeport may be too far to be an alternative option.

Ang said it’s also possible for the new airport to be built in phases. The first phase could be worth $2 billion which would be good enough to accommodate 50 million passengers and become as good as the existing airport in Hong Kong.

The proposed airport will take about five years to build, he said.

The BOI also expected total government revenues under the highly ambitious CARS Programme to reach 408 billion peso in terms of import duties and taxes, while the direct purchases of raw materials for automotive parts making were seen to hit P63 billion.

On Wednesday, the BOI formally announced the approval of applications by Toyota and Mitsubishi.

Large body parts and components are currently imported, rendering local vehicle manufacturing uncompetitive.

The Commission is under the Office of the President and is the lead policy-making body of the government mandated to coordinate, monitor and evaluate state programs and ensure mainstreaming of climate change in national, local and sectoral development plans toward a climate-resilient and climate-smart Philippines.

“A comprehensive review of the government’s energy policy involves a whole-of-nation approach to achieve a low-carbon development pathway and national goals and targets for climate change mitigation and adaptation, disaster risk reduction and sustainable development,” the CCC said in a statement.

“With time running out to address climate change and prevent the worst effects of rising temperatures, countries must act fast and more decisively to cut down their respective greenhouse gas (GHG) emissions in order to keep global temperature rise to below 1.5C,” De Guzman said at the launch of the National Energy Policy Review at the Kalayaan Hall in Malacañang.

“One sure way to defuse the ‘ticking time bomb’ of global warming is to shift away from fossil fuels to renewable energy (RE), which is the main thrust of the most recent resolution issued by the Climate Change Commission and signed by no less than the President,” he added.

Aside from the CCC, other agencies called to participate in the energy policy review are the Department of Environment and Natural Resources, the Department of Energy and the National Economic and Development Authority.

De Guzman said the CCC strongly believes that “transitioning away from coal is a cost-effective path to a low-carbon economy for the Philippines.”

To ensure the success of the undertaking, De Guzman said the Commission would facilitate at least three meetings of the CCC Advisory Board, serving as steering committee; three sub-national business summits; 10 roundtable discussions; and 10 technical working group meetings throughout the six months of the policy review process.

He said the CCC and other key government agencies aimed to come up with concrete measures that would “lay the ground toward clearer procedures away from coal and on the faster way to enhance RE” like solar, wind, geothermal and hydroelectric.

“Our worthy task will allow us to fulfill our responsibilities, as public servants, to serve and protect our people from this global threat, and will inspire us, as human beings, with greater capability to sustain humanity,” De Guzman said.

While the Philippines was not a major emitter of GHG, he said, it could allow its economy to grow with the ways that triggers the climate crisis, which he said affects the country and other vulnerable nations.

“Let us send a message to the world that if a small country like ours could make a big difference, what more can be achieved with economic superpowers doing their share to ensure a low-emission and climate-resilient future,” De Guzman said.

“We cannot let humanity live in a world fraught with dangers to life and wellbeing,” he added.

De Guzman said bending further the global warming curve to below 1.5C was a “moral imperative” as it means saving the lives and livelihoods of hundreds of millions of people, upholding the human rights of the poor and the vulnerable, and ensuring the integrity of our ecosystems.

“Through a whole-of-nation approach for our energy policy review, I am confident that government agencies will work together to harmonize policies and regulations in accordance with the low carbon development pathway.”

“Rest assured that the CCC, with its leadership mandate, will ensure that efforts of government agencies on RE development are integrated and coherent, and that the country remains on track and on time in meeting its targets,” the CCC official added.

“Right now, we have 10 Yangon-Singapore flights per week, but starting in December, we will be increasing daily flights to twice per day to offer as many as 14 flights per week,” said assistant general manager Aye Mara Thar from MAI.

Aside from the two airlines, five more operate flights on the route including Silk Air, Jet Star, Myanmar National Airlines and Air Asia.

Malaysia is the only remaining Asean nation without an open visa pact with Myanmar.

“The ringgit will be computed based on the weighted average volume of the interbank US dollar/ringgit forex spot rate transacted by domestic financial institutions between 8am and 3pm. It will be published at 3:30pm daily,” the central bank said in a statement yesterday.

This means that the current system, where the exchange rate between the ringgit and the US dollar is fixed based on quotations by selected domestic banks, will be discontinued. Also, under the present system, the exchange rate is determined at about 11am.

The NDF market is settled in US dollars but traded offshore.

Currency analysts said that under the new system, the ringgit would not be influenced by the movements in the NDF market.

“This is because it is based on the volume traded between the banks. It is based on the actual supply and demand of the currency,” said the analyst.

The analyst said that the NDF market gives the view on the sentiments on the forward movements of the ringgit.

“Eventually, there could be a spread between the rates on the NDF and the domestic market,” he said.

Bank Negara said that the new methodology was more transparent and better reflected daily trades.

“The market transaction data is sourced from online reporting by domestic financial institutions to Bank Negara.

“The new methodology is more transparent and better reflects underlying trades during the day,” it said.

The central bank also said that the official closing hour for the onshore ringgit market will also be extended by an hour to 6pm effective on the same date.

Bank Negara said this would give businesses additional time to complete their foreign-exchange transactions.

“Nevertheless, the onshore market participants can continue to transact after the official closing hour,” it said.

The Kuala Lumpur USD/MYR Reference Rate will be published under a parallel trial on the Reuters page KLMYRREF starting from June 20, although it will be effective only from July 18. Bank Negara said this parallel period allowed for the market transition process.

On the effective date, the reference rate will assume the current PPKM-RM page on MYRFIX02 and continue thereafter.

Bank Negara and FMA said that they expected a smooth migration without any disruptions.

Bank Negara director of investment operations and financial market Adnan Zaylani said these enhancements in the Malaysian financial market infrastructure followed from the ongoing collaboration with the FMA, and were among the first few initiatives discussed at the Financial Market Committee, an inclusive forum for all financial market stakeholders to further develop and improve the Malaysian financial markets.

FMA president Lee K Kwan said the reference rate, which is based on market transaction data rather than the submission of quotations by selected banks in the previous methodology, represents comprehensively all interbank forex transactions conducted during the trading period.

“This initiative elevates the US dollar/ringgit FX benchmark rate setting process to global best practices, ensuring that the FX spot reference rate is well received domestically and internationally, contributing to the further development of the Malaysian financial markets,” he added.