Singapore’s three top banks – DBS, OCBC and UOB – are significant funders of coal projects in the region, an analysis of their investments showed, putting them at odds with a growing number of global banks shunning the financing of polluting coal-fired power stations and mines.

Coal is a major source of carbon dioxide, the main greenhouse gas blamed for heating up the planet.

All three banks have adopted sustainable financing guidelines and said they carefully considered each investment with regard to the environmental impact versus the need to bring electricity to millions of people.

Yet Market Forces, the Australian financial green group which conducted the study, said coal lending is at odds with the need to cut greenhouse gas emissions and the rapid growth of affordable renewable energy.

Market Forces said DBS Bank, OCBC Bank and United Overseas Bank had financed 21 coal project deals since 2012 worth US$2.29 billion, (Bt72.92 billion) more than half of which were for coal-fired power stations, mainly in Indonesia and Vietnam.

Market Forces analysed data from IJGlobal, a leading online energy and infrastructure finance data service, relating to the deals.

OCBC was the top lender, participating in coal deals worth $1.14 billion since 2012. This included $195 million for the 2,000MW Tanjung Jati B coal-fired power plant in Indonesia last year.

DBS was involved in deals worth $885 million, five of which also involved OCBC. This included a $160 million loan to a consortium to buy Australia’s Port of Newcastle, a major coal shipment hub, and a $140 million loan to partially fund building of a 1,900MW power plant in Central Java.

UOB participated in deals worth $262 million, its largest loan being $92 million to finance the 2014 expansion of the Newcastle Coal export terminal.

DBS has also been named as part of a loan syndicate funding the construction of four 1,200MW coal-fired power plants in Vietnam, the report said, and is a financial adviser for a number of large power plants planned for Indonesia.

Singapore has declared 2018 the year of climate action and was an important player in the reaching of a deal for the 2015 Paris climate agreement, in which nearly 200 nations agreed to limit global warming to less than 2 degrees Celsius. To achieve this, nations need to rapidly cut greenhouse gas emissions by shifting to cleaner sources of energy for industry, power generation and transport.

Green groups, including Greenpeace, said major investment plans in Southeast Asia to build dozens of coal-fired power stations could send global carbon dioxide emissions soaring, risking the Paris “below 2 degrees C” goal and increasing local air pollution.

The Market Forces report commented: “Banks justify coal investments by rightly pointing out that communities need energy.

“However, with a rapidly improving economic outlook for wind and solar, including renewable energy already being cheaper than coal in many countries, investments in coal power serve little more than the companies seeking to build their old, dirty technology.”

Other banks have cut back on coal investments. HSBC last year announced that it would no longer finance coal mines or new coal power plants in rich nations. Australia’s four big banks have also sharply curbed lending to coal projects since 2015.

Dependent on coal

A DBS spokesman said: “According to the International Energy Agency, while Southeast Asia is taking steps towards adopting low-carbon energy, by 2040, coal will still account for 40 per cent of the generation mix.

“Many of our neighbouring developing countries are dependent on coal as part of their energy mix to deliver economic growth, and the financial system has a responsibility to ensure that the transition to renewables happens in a sustainable manner.”

OCBC Bank chief risk officer Vincent Choo said: “The financing of energy sector projects, where environmental impact is mitigated in compliance with national and local laws and regulation, enables local communities to gain access to electricity and opens up employment opportunities.

“We believe that sustainability is a journey. We continue to strengthen our responsible financing practices over time and seek to positively influence our customers’ behaviours by engaging them in adopting appropriate sustainable practices.”

A UOB spokesman said the bank was committed to supporting sustainable development and mitigating environmental, social and governance risks in its lending.

The spokesman said it was bank policy to conduct enhanced due diligence for companies in potentially high-impact industries, including the energy sector, for which the bank advocates using appropriate technologies, such as carbon capture and storage, to mitigate potential environmental impacts.

“Across our network, we also finance and support renewable energy projects, in areas such as solar power and hydropower, that comply with local environmental requirements,” the spokesman added.

“Indonesia and Bangladesh are aware of the great trade potential that can be explored,” said the Trade Ministry’s international trade negotiation director-general, Iman Pambagyo, who led the Indonesian delegation in the IB-PTA pre-meeting in Jakarta last Wednesday.

“As a country with a growing economy and a large population, Bangladesh has an opportunity to become a major trade destination for Indonesia,” Iman said in a statement.

The other topic agreed to during the meeting was the completion of the terms of reference (ToR) for the trade negotiating committee (TNC) for the second IB-PTA pre-meeting.

The meeting on the IB-PTA was a follow-up to a meeting between Indonesia President Joko “Jokowi” Widodo and Bangladesh Prime Minister Sheikh Hasina on the sidelines of the Indian-Ocean Rim Association (IORA) Summit in Jakarta in March, 2017.

During the meeting, the two heads of state agreed to strengthen trade cooperation between the two Asian countries through establishing a Preferential Trade Agreement (PTA).

According to the Central Statistics Agency (BPS), trade between the two countries reached US$1.33 billion (Bt42.35 billion) in 2016 with Indonesia enjoying a significant surplus of $1.19 billion.

During the period between January and October, 2017, Indonesia’s trade with Bangladesh reached $1.31 billion, while Bangladesh’s exports to Indonesia totalled $60.4 million.

Indonesia mainly exports palm oil, coal, pulp and paper to Bangladesh, while Bangladesh exports garments, lady’s bags and sacks to Indonesia, among other items.

Female students, for one, are more likely to complete their tertiary studies compared to the boys; and when it comes to the workforce, more women take on higher-paying positions compared to men.

Even the gender pay-gap in the Philippines is considered to be smaller than that of more developed nations.

Let’s not forget, too, that we’ve had two female presidents and vice presidents since the end of the Marcos dictatorship.

Still, there is something lacking, which the study highlights: that of greater female representation in some of government’s and industry’s highest positions, or the posts which allow them to be directly involved in making important decisions and setting directions.

“In the government, these positions include elective and appointive positions across the legislative, executive, and judicial branches. In the industry, they include chief-level positions, board memberships and director positions,” stated the report penned by University of the Philippines College of Mass Communication professor Clarissa David, PIDS senior research fellow Jose Ramon Albert, and PIDS research analyst Jana Flor Vizmanos.

Citing the senate as one example, which has had three to six out of 24 female senators since 2001, the report states that since the 12th Congress in the same year, only Loren Legarda has served in a leadership position. The report further states that no woman has ever been senate president or house speaker.

Women are also underrepresented in local elective offices – and it paints a “particularly alarming” picture, according to the report.

“In 2013, only 11 per cent of elected local officials were female, a sharp decline from 20 per cent in 2010, 18 per cent in 2007, and 17 per cent in 2004. At the barangay level, specifically, women only occupied 19 per cent and 27 per cent of all barangay captain and councilperson posts, respectively,” the report reads. This doesn’t mean people aren’t voting for women; it’s because fewer women are running for office.

As for Cabinet positions, the report finds that this has been a male-dominated arena since 1986. The usual posts women get are also those more associated with being “female”, such as health, tourism and social welfare. Meanwhile, they are less represented in agencies concerning economics, budget and management, finance and foreign affairs.

“The Department of Social Welfare and Development, in particular, has had only female secretaries since 1986. Not surprisingly, no woman has ever headed the agriculture, defence, interior and local government, and public works departments, which are traditionally male-dominated offices,” the report states.

As for female representation in industry leadership positions, the PIDS report finds that women, in the last 15 years, have occupied around 40 to 43 per cent of management positions. When it comes to ownership participation, however, the number has stagnated at 69 per cent. The Philippine scenario isn’t far from the experience of other Asean countries such as Indonesia, Malaysia, Vietnam and Laos PDR, the report states.

“In a survey of businesses across different countries, the Philippines ranks among the highest in the proportion of senior management team roles held by women at 40 per cent (Grant Thornton 2017).

However, the evidence of equity in the promotion process ends at supporting roles in the senior management level (e.g., human resource officer and chief financial officer). Unfortunately, the proportion drops at the level of corporate executives and memberships in boards,” reads the report.

Citing World Bank data, the report’s authors found that between 2009 to 2015, the proportion of companies with females as top managers dropped from 32.7 to 29.9 per cent.

Firms that do have women in top-level positions such as president or chair are usually in the retail, food and pharmacy sectors, and, usually, the same person occupies multiple positions, the report states, making examples of Teresita Sy-Coson (president and chair of the board of both SM Mart and SM Retail, Inc) and Robina Gokongwei (board member of four Robinsons-owned companies).

Based on these data, the PIDS report’s authors have a few recommendations to improve female representation both in government and industry:

Set a target of 40 per cent representation across high-level government offices.

Place more incentive schemes which will encourage women to run for office, as well as make political systems and workplaces less hostile – which could be done by the Commission on Elections.

For appointees in certain government posts, adopt “soft quota and specific affirmative-action-type policies” which will ensure that a fair proportion of these appointees are women.

Create more in-depth research on the constraints women face in their respective workplaces, particularly issues surrounding culture, childcare, family-related benefits and gender stereotypes, which will allow businesses to decide what kinds of strategic interventions they need to do.

Policy review: for government, a review of existing regulations is needed to make political participation and leadership more inclusive; for industry, policies concerning equity in hiring, retention and promotion should be reviewed, taking into consideration women, especially working moms.

In 2017, registered foreign direct investment (FDI) in Vietnam rose 44.4 per cent, with 44.2 per cent of total inflows going to manufacturing and processing. Off the back of a successful Apec meeting last year, the government will focus on attracting high-tech and environmentally friendly projects. Investment will be encouraged in renewable energy projects, high-tech agriculture and smart cities, said Savills Vietnam, a listed real-estate service provider.

“We’re seeing growing investor interest in the industrial market, directly into industrial zones as well as a rise in those seeking income-producing industrial assets, build-to-suit opportunities and logistics-based warehousing opportunities,” said Neil MacGregor, managing director of Savills.

He said up to two-thirds of Japanese enterprises hoped to expand the scope and scale of business in Vietnam. Meanwhile, many enterprises said that there was a tendency to move factories from China and India to Vietnam, opening great opportunities for industrial real estate.

Vietnam has 325 industrial parks with a total area of 94,900 hectares. HCM City, Bac Ninh, Thanh Hoa are leading in attracting investment to these parks. Hanoi has also attracted foreign businesses, especially to many industrial parks in suburban regions.

Under the development plan for Hanoi, the city will have nine more industrial parks on a total area of 2,360ha by 2020, an increase of 132 per cent against current supply.

Besides connecting factories to main roads to attract more investors and increase the occupancy rate in industrial parks, localities need to find solutions on promoting development of residential and commercial areas around the parks, Savills said. The development of urban and commercial areas around industrial parks would meet the demand for workers’ homes.

Expert Dang Hung Vo said Vietnam’s industrial real-estate segment had developed well and had suffered less impact from the market than other property segments.

Meanwhile, JLL Vietnam said more than 1,300ha for developing industrial parks were expected to enter the southern market in the next year, mostly from extended phases of existing projects.

JLL said occupancy and rental growth rates were both expected to go higher due to active occupier demand and positive economic prospects. Good-quality ready-built space and related services in industrial parks was likely to experience a strong increase in demand.

To support the trend, Savills launched an industrial services wing in January to support industrial clients in market entry, portfolio diversification, expansion, acquisition/disposal and strategic leasing.

It will introduce opportunities in a variety of locations, including Tan Thuan Export Processing Zone, Vietnam-Singapore IP I, Hiep Phuoc Industrial Park, Nhon Trach II Industrial Park, Chau Duc Industrial Park, Phuoc Dong Industrial Park and Loc An Binh Son Industrial Park.

JLL Vietnam said at it quarterly report on the HCM City property market in the fourth quarter of 2017 that the Southern industrial supply in the second half of 2017 was relatively constant compared to that in the first half, with a total leasable land area of about 24,000ha.

Of the total, Binh Duong and Dong Nai remained the leading markets, accounting for nearly 60 per cent, given their better accessibility to transportation infrastructure.

The vacancy rate in the operating IPs stood at about 25 per cent at end-2017, down 1.8 per cent from the fourth quarter of 2016 and driven by healthy demand.

A healthy performance was observed in existing ready-built factories, which recorded more than 85 per cent occupancy rate, given the strong demand and limited leasable stock.

The Indonesian government plans to facilitate the import of salt in order to boost investment in related businesses, Trade Minister Airlangga Hartarto said on Friday.

“The supply of salt cannot be disrupted, according to Government Regulation No. 41/2015. So we will facilitate the import of salt for [various] industries,” Airlangga said after a meeting on the issue held with Coordinating Economic Minister Darmin Nasution in Jakarta, as reported by kompas.com.

He was referring to the regulation on the development of industry resources.

Airlangga did not explain the details of the plan but said the government would coordinate with those agencies that were authorised to issue recommendations for salt imports.

The requirement to obtain a recommendation from various institutions to import salt has discouraged investors from putting their money into the sectors that need salt, he added.

“Meanwhile, we need investment to boost [economic] growth, which is targeted at 5.4 per cent this year,” he said, without disclosing how much salt the government would have to import.

Each relevant sector would be required to submit a report on the amount of salt it required, he said.

Indonesian Salt Farmers Association (APGRI) chairman Jakfar Sodikin said that Indonesian salt production was estimated to have reached 1.2 million tonnes by early November, an amount that could fulfil the country’s needs until next month. This year’s harvest time, however, is estimated to not arrive until June.

He added that certain industries could not use local salt due to its lower content of sodium chloride. – The Jakarta Post

Foreigners flock to Malaysia for treatment

Medical tourism generated 5 billion ringgit (Bt40.5 billion) of income for Malaysia last year with more than 920,000 foreign tourists from various countries seeking medical treatment there, said Deputy Finance Minister Lee Chee Leong. The availability of halal food, mosques, medication and other factors enabled Malaysia to overtake Thailand in this sector, even though the country’s medical tourism industry had yet to be fully developed.

More than 921,500 foreign tourists received medical treatment in Malaysia, generating an income between 4 and 5 billion ringgit, Lee added.

Foreign tourists from Indonesia, Bangladesh, China, India, Japan and the United Kingdom underwent medical treatments in Malaysia, said Lee, while the number of tourists from Saudi Arabia and UAE was also increasing.

Lee said the government had allocated 30 million ringgit for the Malaysia Healthcare Travel Council to help shape Malaysia into an Asian hub in fertility treatment, in vitro fertilisation (IVF) and heart ailments. Medical tourism programmes had been launched to attract foreigners and private hospitals were also offering incentives.

The government had also extended the 100 per cent tax exemption for medical tourism until December 31, 2020. Dental treatments and outpatient treatments receive double rebates on certification, he said.

The International Living portal has ranked Malaysia’s medical system 3rd in the world.

“This is because our healthcare services are the best and affordable,” said Lee.

Since 2011, healthcare industry in Malaysia have expanded substantially, with 16 per cent to 17 per cent growth each year. – Sin Chew Daily

Jokowi calls on banks to expand credits to small businesses

Indonesian President Joko “Jokowi” Widodo has called on banks to diversify their loans business to micro, small and medium enterprises (MSMEs) to help them expand their businesses.

“I see that the debtors [of banks] are the same people over the years. I want more people to have access to banks,” he said at a Financial Services Authority (OJK) gathering event in Jakarta.

According to an OJK report, in 2017 the loan disbursement only grew 8.35 per cent year-on-year while the third-party fund grew 9.35 per cent.

Jokowi said by providing MSMEs with more access to banks, they were expected to be able to upgrade themselves to become bigger business players. “We have to put forth extra effort to help them from micro to medium businesses, etc,” Jokowi said.

He stressed that several government programmes had paved the way for low-income families to have access to banks.

He cited the non-cash social assistance that required the recipients to have bank accounts to receive the assistance, and the land certification programme that provided free land certificates to people.

The programme would help people obtain bank loans by using the certificates as collateral, Jokowi added.

Meanwhile, University of Indonesia economist Andi Fahmi Lubis said it was not easy for the banks to find loan-worthy MSMEs, particularly in rural areas.

He said many banks were too “lazy” to find deserving recipients of the government’s microcredit program, known as the People’s Business Credit (KUR) – The Jakarta Post

Ride-hailing app Grab signs MoU with anti-corruption body

Ride-hailing giant Grab has signed a Memorandum of Understanding (MoU) with the Cambodian government’s Anti-Corruption Unit (ACU), agreeing to immediately report any future incidents of corruption or bribery to the state body.

The MoU between Singapore-based Grab and the ACU comes less than a month after the company entered the Cambodian market, and the agreement complements the company’s existing anti-corruption policies, according to Wee Tang Yee, Grab’s head of operations in Cambodia and Thailand.

Kheang Seng, vice president of the ACU, presided over a ceremony that also saw law firm Tilleke & Gibbins sign an MoU with the body. During his prepared remarks, Seng said the two companies’ MoUs brought the total number of agreements signed with the ACU to 88.

“These companies clearly have a strong will to fight against corruption, and now these companies are protected by the law,” he said, urging more companies to sign similar agreements.

The ACU launched in 2010 with Om Yentieng, a long-time adviser to Prime Minister Hun Sen, as its head.

In the most recent Corruption Perception Index report published by global anti-corruption watchdog Transparency International in January 2017, Cambodia ranked 156 out of 176 total countries, the worst ranking for any country in the region. – The Phnom Penh Post