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.

The reclusive businessman controls one of Malaysia’s most diversified conglomerates, including ports, power plants, rice distribution, logistics, transportation, infrastructure development and even the national postal service.

But this impressive build-up of assets in the last two decades has been fuelled by debt. The combined long-term borrowings in his listed and privately held entities are estimated at 34 billion ringgit (US$8.31 billion).

The debts have bankers and investors worried over the potential stresses that big conglomerates, such as Syed Mokhtar’s, could have on the banking system, particularly at a time when Malaysia’s economy is showing signs of weakness following the sharp fall in global commodity prices.

There is broad agreement among economists and bankers that the Malaysian banking system is in better financial shape today than during the regional economic crisis that began in mid-1997.

But there are potential trouble spots and several financial executives see the recent bailout of Proton as acknowledgement by the government of the deepening woes at the tycoon’s group.

Syed Mokhtar, 64, was born to a family of tradesmen with roots in Bokhara in present-day Uzekistan. An assiduous networker, he started business by forging links with Malaysia’s political elite and in the aftermath of the mid-1997 financial crisis emerged as the government’s partner of choice.

He is is the only surviving poster boy of the many ethnic Malay businessmen groomed by the government from the Mahathir era.

His businesses include strategic ports around Peninsular Malaysia which are grouped under publicly listed MMC Corp, independent power plants through recently listed Malakoff Berhad, and concerns involved in rice and sugar processing and plantations that form the core of Tradewinds Berhad. His group also has extensive interests in property development and hotels, auto assembly and distribution and infrastructure development.

Under the deal struck last week, the Najib administration has agreed to inject 1.25 billion ringgit by subscribing to new preference shares in the carmaker, a wholly owned subsidiary of Syed Mokhtar’s flagship corporate vehicle DRB-Hicom group.

Should Proton fail to repay the soft loan, the government will be able to convert the shares and wrest control of Proton.

The carmaker has bled more than US$600 million since it was taken over by DRB-Hicom four years ago, due to slumping sales, weak cash flows and the high inventory levels of unsold cars. “From a purely market standpoint, there is no reason why a private company should be bailed out. But the government is clearly looking at the troubles Proton is causing for vendors and dealers that rely on the company,” says Jason Chong, chief investment officer at Manulife Asset Management Services in Kuala Lumpur.

The lanky, pale-complexioned businessman – Malaysia’s eighth- richest man, according to Forbes – shuns the media and could not be reached for comment.

Senior executives in his stable of companies who spoke to The Straits Times on condition of anonymity dismissed the growing perception that Proton is being bailed out and the debt concerns swirling around the group.

Of the group’s debt burden, a senior executive of DRB-Hicom acknowledges that the “absolute numbers do look huge” but he says the debt levels are manageable.

“Many of our businesses require huge capital outlays and our infrastructure projects are largely project-finance debts that are ring-fenced by cash flows,” he says.

A senior executive of a state-controlled commercial bank with exposure to Mr Syed Mokhtar’s businesses concurs. “Compared to a decade ago, he is in a far better situation and we are comfortable as lenders to the group,” says the banker.

Still, concerns over the businessman’s debt burden persist for a number of reasons.

For starters, Syed Mokhtar is widely seen as a product of the corporate patronage system that featured the intertwining of business and politics. Politically well-connected businessmen were favoured in the award of lucrative contracts and long-term concessions, such as toll roads and the right to operate independent power plants.

But this economic model is packed with spectacular failures and often involved public bailouts to protect the banking system, such as the takeovers of Malaysia Airlines and the controversial Port Klang Free Trade Zone that have gobbled billions of dollars in taxpayer funds.

There are fears that Syed Mokhtar’s group could face a similar fate should the Malaysian economy slip into a major recession.

The businessman’s secretiveness adds to the reputational risk, say bankers and financial executives.

“He has the reputation of injecting his private businesses into his listed assets at the expense of minority shareholders and that is why his stocks don’t have a strong following and trade at a discount,” says a head of research of a bank-owned stockbroker.

Raising new capital is becoming a major challenge for his businesses as banks grow increasingly skittish about extending new loans to heavily indebted groups in a slowing economic environment.

“Our focus will be consolidation and streamlining our asset base to generate value over the next three years,” says a chief executive of a diversified holding company in the Syed Mokhtar corporate empire.

(US$1 = 4.09 ringgit as of 6/15/2016 via oanda.com)

The ministry said its actions under the country’s Transboundary Haze Pollution Act (THPA) was aimed at deterring and prosecuting entities that are responsible for transboundary haze pollution.

“The THPA was drafted with advice from experts in international law and complies with international law,” added the spokesman. “It is not directed at any individual nor company based on nationality.”

Kalla said that Singapore cannot take action against its citizens responsible for last year’s forest fires, while Siti accused the republic of not exercising “mutual respect” by invoking the THPA.

She said the Asean agreement on transboundary haze pollution is a multilateral one, and not a bilateral pact between Singapore and Indonesia. As such, “Singapore cannot step further into Indonesia’s legal domain”, she added.

Siti also said the THPA remains a “controversial” law that is still being debated among Asean officials from Singapore, Brunei, Indonesia, Malaysia and Thailand.

That is why she feels that Singapore’s action under the law against errant firms in her country is not a show of “mutual respect”.

MEWR, however, said the key driver of the recurring transboundary haze is commercial. It said companies’ blatant disregard for the environmental and social consequences of the haze, which affects millions of people in the region, should not go unchecked.

“The phenomenal amount of greenhouse gases also emitted during the burning of peatland will have a profound effect on climate change that the world is battling to slow,” said the spokesman.

“This is therefore not an issue of sovereignty or national dignity.”

The ministry emphasised that Singapore respects Indonesian sovereignty and it is for that very reason that Singapore has repeatedly requested local authorities to share information on companies suspected of illegal burning in Indonesia.

Fires burning on concession land owned by private companies are said to have caused the haze crisis which affected many countries in Southeast Asia.

The smoke from fires last year sent air pollution to record levels, resulting in at least 19 deaths from haze-related illnesses and more than half a million Indonesians suffering from respiratory infections.

The World Bank estimates that the fires and haze caused at least US$16 billion in economic losses for Indonesia alone.

Indonesian officials, however, do not expect a repeat of the crisis this year, though that may be due more to favourable weather than progress in addressing the underlying causes of the blazes, reported Bloomberg News yesterday.

Satellite imagery detected about 730 hot spots so far this year, down from more than 2,900 in the first six months of last year, according to government data.

Raffles Panjaitan, the Environment and Forestry Ministry official tasked with overseeing fire prevention, said integrated fire patrol teams have been deployed in villages where forest fires are an annual occurrence.

“Normally forest fires are quite rampant in February and March, but there are no fires in villages where patrols are deployed,” he said.