APRIL – JUNE 2007
QUARTERLY
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Malaysian Tin Products
MANAGEMENT COMMITTEE
FOR YEAR 2006/2007
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PRESIDENT MR. MAMORU KAWASAKI(ALTERNATE – MR. LOH YOON SOON) SELAYANG SOLDER SDN BHD
VICE-PRESIDENT MR. TEOH LAY HOCK NIHON SUPERIOR (M) SDN BHD
HON. SECRETARY MR. C.S. LIM METAL RECLAMATION (IND) SDN BHD
TREASURER MR. JASON LEE HENKEL (MALAYSIA) SDN BHD |
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Letters to the Editor are
welcomed. We appreciate your feedback
to further improve our editorial content. Please address your letters to: The Editor The Malaysian Tin Products Newsletter P O Box 12560 50782 KUALA LUMPUR. |
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COMMITTEE MEMBERS MR. CHEN TIEN YUE ROYAL SELANGOR INTERNATIONAL SDN BHD EN. AB. PATAH MOHD PERUSAHAAN SADUR TIMAH MALAYSIA (PERSTIMA) BHD MR. KOJI TSUBONO SENJU (M) SDN BHD |
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SECRETARIAT ADDRESS The Malaysian Tin Products Manufacturers’ Association (MTPMA) 8th Floor, West Block Wisma Selangor Dredging 142-C, Jalan Ampang 50450 KUALA LUMPUR. |
EDITORIAL SUB-COMMITTEEMR. LOH YOON SOON
MR.
TEOH MR. C.S. LIM
MR.
JASON LEE MR. CHEN TIEN YUE TN. HAJI MUHAMAD NOR MUHAMAD En. Faizul Azri Azizan
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Tel: 03
– 21616171 Fax: 03
– 21616179 Email: mtpmasec@mtpma.org.my The Malaysian Tin Products Newsletter is published
quarterly by the Malaysian Tin Products Manufacturers’ Association (MTPMA).
The opinion and statements expressed in the Newsletter are not necessarily
those of the MTPMA or the Editorial Sub-Committee and neither endorsement nor
confirmation are intended or implied. |
Dear Members,
We have successfully concluded our 17th AGM on 25th June 2007 whereby I was re-elected the Association’s President for the second term. I wish to extend my deepest thanks and gratitude to members of the Association and the Management Committee for placing their trust in me to lead the Association in the new term. I certainly look forward with great enthusiasm to serve and to work hard for the good of the Association.
With continuing support from Association members and invaluable assistance from Secretariat staff, I do believe that we can move further forward in advancing the interests of the Association and also of the tin-based products manufacturing industry.
For the benefit of members who did not have the opportunity to attend the last AGM, I reprint below the Presidential Address given at that meeting:
“Ladies and Gentlemen,
The Association’s 2006 Annual Report, which has been circulated to you earlier, provides a general overview of the Association’s activities during the past year. In this Presidential Address, I will touch on the current and future development and prospects of the tin based products manufacturing sector, including the direction and trend expected to emerge for the domestic economy and for the Association in the near future.
The Malaysian economy recorded a strong growth during 2006. Real GDP grew to 5.9 per cent from 5.3 per cent in 2005. The country’s exports for the year were sustained due to continued strong demand for primary commodities, as well as good growth in exports of manufactured goods. The expansion in exports of manufactured goods resulted from the strong performance in selected resource-based industries, as well as continued growth in exports of electronics and electrical products.
The local electronics and electrical sector again benefited from the cyclical global semi-conductor upswing, particularly during the first half of 2006. The global semi-conductor recovery was broad based supported by demand for all product segments, including computers, consumer electronics, telecommunications and automotives. Multinational companies located in Malaysia took the opportunity to produce new products incorporating new technological advancements.
Although the global electronics and electrical sector slowed to a more moderate pace towards end of 2006, this is expected to be transitory as the current global electronics and electrical upcycle is expected to continue well into 2008.
The prospect for the Malaysian economy in 2007 remains positive. According to Bank Negara Malaysia, the economy should register a solid growth of 6.0 per cent this year supported by sustained global growth and resilient domestic demand.
Again, your Association has been undertaking its activity programmes diligently. The publication of the Association’s Newsletter called “The Malaysian Tin Products” continued to be improved in form and substance. The Newsletter remains the principle organ and medium of communication for the Association. It not only disseminates information and data but also carries views and opinions with regards to the industry. It provides a platform for exchanging ideas, knowledge and expertise towards the enhancement and development of the value-adding, resource-based products manufacturing industry. It doubles-up as a publicity and public relations media for the Association, as well.
The support given by members of the Association to the Newsletter has so far been encouraging, in terms of taking-up advertising space and providing relevant articles for publication. I believe more can be done to further improve the Newsletter. So, I would like to urge more Association members to support and partake in this invaluable publication as it certainly offers an excellent medium to advertise your company, your products and services at low cost.
As is customary in this annual Presidential Address, let me on behalf of the Association offer our gratitude to those Ministries and Government Agencies that have continued to lend us support. Our thanks to the Ministry of Natural Resources and Environment, the Ministry of Human Resources, the Ministry of International Trade and Industry, and the Ministry of Home Affairs for their co-operation and understanding. Also, our grateful thanks to the Tin Industry (Research and Development) Board for providing invaluable secretariat assistance and administrative support ever since the Association's formation in 1990.
At this opportunity, may I personally thank each and every member of the Association, especially the Management Committee and its various Sub-Committees, for their understanding and support given to me during my first year in office. As a freshman, there is certainly a lot to learn, and I stand ready to be appropriately guided by you all in the stewardship of this Association. May I also express my gratitude and sincere thanks to the Secretariat staff for their unrelenting hard work, dedication and commitment in servicing our Association.
Finally, may I wish everyone a prosperous and productive year ahead. And as always, please continue to give your pro-active support to the Association and its activities.”
With best regards.
Mamoru Kawasaki
President
ELECTRICAL & ELECTRONICS NEWS
E&E Sector to Continue Leading Role
The electrical and electronics (E&E) industry will continue to be the largest contributor to Malaysia’s manufacturing output and attract various key players especially multinational companies for investments. Malaysian Industrial Development Authority (MIDA) electronics industry division director Ong Wah Teng said the country’s success in attracting multinational companies to set up base and further expand has played a great role in forging strong global linkages and boosting growth in the industry.
He said over the last three decades, the country has developed into a major global manufacturing base for the electronics industry. “A total of 1,446 E&E projects have been approved valued at RM65.6 billion,” Ong told Business Times in Kuala Lumpur recently. He noted that numerous supporting companies, including home-grown Malaysian companies that have sprouted to support these large manufacturers, have also evolved into world class supporting companies.
Ong said the E&E industry continued to be the largest contributor not only to the country’s manufacturing output but also to sales, export and employment in 2006. Sales value of the E&E industry increased by 10.8 per cent to RM195.7 billion 2006 compared with RM176.7 billion in the previous year. “The production index of the E&E industry last year expanded by 8.7 per cent. In tandem with the growth in the global semiconductor market, the production of semiconductors and other electronics components expanded by 10.4 per cent to RM506.9 billion,” Ong said.
He said strong global demand, driven mainly by consumer electronics, allowed the country to sustain its export growth in E&E products. The trend is expected to continue, boosted by demand for telecommunication devices, consumer electronic products and increased application of ICT by industries. “There is also a strengthening trend towards more extensive application of electronics in the products and services of all industries. This has affected rapid development of ICT which is expected to provide ample growth potential for the electronics industry in Malaysia,” Ong said.
MIDA, which is the first point of contact for investors who intend to set up projects in the manufacturing and services sectors in the country, will be organising a national seminar on global linkages and opportunities in the electronics industry from June 19-20 at the Kuala Lumpur Convention Centre in conjunction with Nepcon 2007 exhibition. It will provide a platform for industry players to network and share views among themselves and at the same time seek potential businesses.
“Industry players will have the opportunity to be updated on the latest in technology, business opportunities, issues and challenges in the electronics industry,” he said. More than 250 people are expected to attend the two-day seminar. As for the exhibition, so far 358 companies from 25 countries like Japan, US, Germany, Korea, Taiwan, China, France, UK and Canada have confirmed participation. MIDA will also set up a booth at the Nepcon exhibition and companies can continue to register despite the closing date on June 11.
(Source: New Straits Times, 13 June 2007)
US Electronics Firms Revise Forecast
American electronics firms expect their sales growth to moderate to seven per cent this year due to price pressures and uncertain market conditions, said the Malaysian American Electronics Industry (MAEI). “With the change in market conditions and the Semiconductor Industry Association’s revised growth forecast from 10 per cent to 1.8 per cent, MAEI is also cautiously forecasting a revised growth of about seven per cent (RM78.3 billion) in export sales for 2007,” said MAEI chairman Datuk Wong Siew Hai.
In its annual survey conducted in March, it had forecast sales to total about RM80.9 billion, registering a 10.5 per cent growth. Wong said the figure was forecast three months ago and the market conditions have since changed. The MAEI is the electronics industry committee of the American Malaysian Chamber of Commerce and is made up of 17-member firms covering both the semiconductor and non-semiconductor sectors.
He expects the second half of 2007 to perform better due to seasonal sales and companies introducing new products. “Consumer confidence seems to have held up and spending on electronics products will continue to increase due to lower prices, higher performance and functionality,” he added. On the impact of the strengthening ringgit, Wong said so far the currency has a minimal impact on sales. “Most of the companies have been working hard on improving their productivity, cost-reduction programmes and innovative ideas to offset costs. At the RM3 to the US dollar level, these companies can still manage but if it were to strengthen further, they may have to be more radical in their programmes,” he added. MAEI members employed over 54,000 workers in 2006. About 7,000 are engineers.
(Source: New Straits Times, 20 June 2007)
ECONOMIC NEWS
Ringgit Extends Rally to 9-Year High
The ringgit traded at its strongest since February 1998 on speculation overseas funds investing in domestic stocks and bonds will underpin strength of the currency. Government bonds advanced. “The ringgit is benefiting from fund inflows into the market,” said Awaluddin Shariff, a currency trader at EON Bank Bhd. The ringgit was among the 15 most-actively traded Asia-Pacific currencies to advance against the US dollar this week as equity indices reached records in South Korea, China and Singapore.
The ringgit climbed 0.3% for the week to 3.449 against the greenback as of 5.15pm in Kuala Lumpur, according to data compiled by Bloomberg. The KL Composite Index has risen 2.6% this month to a near 13-year high, adding to a 13.7% advance in the first quarter, its best start to the year since 2000. Foreign investors raised their holdings of ringgit-denominated bonds to RM15.8bil in January from RM14.6bil in December, the most since at least 2001, according to data published by Bank Negara on its website on March 28.
The ringgit pared gains from as high as 3.4460 on speculation the central bank would stem the advance to protect exporters. “We can expect the authorities to be in the market to slow the pace of appreciation,” EON’s Awaluddin said. “They don’t want to see the ringgit going up that fast.”
Three-year Government bonds gained, pushing the benchmark yield to the lowest since November 2005. The yield on the 3.869% note due April 2010 fell three basis points to 3.38%, according to Bank Negara data. “Expectations of a stronger ringgit will bring more liquidity and drive bond yields lower,” said Lum Meng Seng, a fixed-income analyst at TA Investment Management. “Overseas money is still coming in.”
(Source: The Star, 7 April 2007)
Manufacturing Sector Sales Increase 2pc in April
The sales value of the manufacturing sector in April 2007 rose 2 per cent year-on-year to RM40.94 billion, attributed to the rise in the electronic valves and tubes and other electronics components and basic chemicals groups. In a statement, the Statistics Department said the sector’s sales for the month was 6.7 per cent lower against the RM43.87 billion reported for March 2007.
Economists said the figures reflect the weak performance of the manufacturing sector in the first quarter of this year, attributed to the drop in electrical and electronics (E&E) sub-sector. All is not gloom, however, as economists are optimistic of the sector’s performance in the second half of the year. “The outlook will hinge on the performance of the external economy in the second half. Expectation is that demand will pick up following better performance of the US economy as well as other economies,” RAM Consultancy Services chief economist Dr Yeah Kim Leng said.
According to Statistics Department, the number of employees engaged in the manufacturing sector grew 2.6 per cent to 1,084,853 for April 2007 and was 0.1 per cent or 1,228 more than the total workers in the sector during March 2007. The total salaries and wages rose 0.3 per cent to RM1.95 billion in April from March 2007, and was 6.8 per cent more than the RM1.82 billion paid to workers in April 2006.
For the first four months of 2007, the manufacturing sector posted a cumulative sales value of RM162 billion against RM157.1 billion registered a year ago. This represented an increase of 3.1 per cent or RM4.9 billion. Total salaries and wages paid out to the employees in the sector for the period rose 7.2 per cent to RM7.85 billion against RM7.33 billion previously.
(Source: New Straits Times, 19 June 2007)
May Inflation Rises 1.4pc Year-On-Year
Inflation as measured by the Consumer Price Index (CPI) in May rose 1.4 per cent year-on-year, its lowest increase in three years. The Statistics Department said compared with the same month last year, the CPI increased from 103.6 to 105.1. And when compared with April it rose by a mere 0.1 per cent.
Inter-Pacific Research economist Anthony Dass, who is expecting the inflation level to average between two and 2.2 per cent this year, said he does not see cost push factors as inflationary risks. “The strengthening ringgit will also help cushion imported inflation and the costs will come off somewhat. With the GDP expected to grow at our projected 5.8 per cent this year, we also don’t expect demand pull inflation,” Anthony said.
The downside risks to inflation may come through oil should global oil prices rise beyond US$67 per barrel, on condition that the Government decides to raise the pump prices, he added. Anthony, who had expected Bank Negara to cut the benchmark interest rate by 25 to 50 basis points in the second half, now feels that chances of the central bank relaxing its monetary policy also looks dim this year.
The US Federal Reserve, he said, looks more likely to raise rates than cut rates. Bank Negara kept its benchmark policy rate unchanged at 3.50 per cent for the ninth straight meeting last month. DBS Bank’s economist Irvin Seah said the strong ringgit and the high base last year are the key contributing factors to the low inflation reading.
“However, inflation could hover around this level for the next few months before creeping back to the 2.5 per cent level as inflationary pressure in the economy starts to build up. Oil price induced imported inflation, the effect of the expansionary fiscal budget feeding into the system, a tighter labour market and a wage increase are some of the inflationary risks to keep an eye on going forward,” he added.
(Source: New Straits Times, 21 June 2007)
Exports to Rise in Q2, says Nor Mohamed
Malaysia’s exports should pick up in the second quarter after slowing US growth weighed on demand in the first three months of the year. “Indications are that exports are doing better in the second quarter,” Second Finance Minister Tan Sri Nor Mohamed Yakcop said in an interview yesterday. “From anecdotal indications, they should be doing better. We’re not worried”.
Malaysia’s economy expanded at the slowest pace in six quarters in the first three months of this year as exports fell in February and March. Malaysia, whose biggest market is the US, is counting on rising demand for electronics and commodities to revive overseas sales. Economic growth in the second half should beat first-half expansion, Nor Mohamed said at the World Economic Forum on East Asia conference in Singapore. The Government has forecast 6% growth this year.
The US economy expanded at a 0.6% annual rate in the first quarter, the slowest pace in more than four years, the Commerce Department said May 31. Nor Mohamed also said the Government had “no problems” with the value of the ringgit. The currency’s gain this year was due to weaknesses in the US dollar and the Japanese yen, he said.
The ringgit has gained 1.9% against the dollar and 6.1% against the yen this year. Malaysia’s inflation unexpectedly eased in May to 1.4%, the lowest in almost three years, as the effects of a fuel-price increase last year faded and a strengthening currency reduced import costs. Inflation averaged 2.2% in the first five months of this year. Inflation was “benign,” Nor told reporters.
(Source: The Star, 26 June 2007)
RM25.5b for Manufacturing
The manufacturing sector attracted RM25.5 billion in investments in the first five months of this year, said International Trade and Industry Minister Datuk Seri Rafidah Aziz. Last year, investments in this sector totalled RM46 billion. Of the 379 projects approved in the first five months, 244 were new projects totalling RM9.4 billion and the rest being mostly expansion or diversification projects.
“Most of the approved projects were for petroleum, and electrical and electronic products,” she said when releasing details of the Malaysia International Trade and Industry Report 2006 yesterday. Major sources of foreign investments were the Netherlands (RM2.3 billion), Japan (RM1.8 billion), Singapore (RM1.3 billion), the US (RM1 billion) and the Cayman Islands (RM892 million). The focus for investments this year would be on developing specific measures to ensure that strategies under the Ninth Malaysia Plan and the Third Industrial Master Plan (IMP3) are implemented.”
In the first year of implementation of the IMP3 last year, investments in the manufacturing sector reached 11 per cent of the total target of RM412 billion during the 15-year period of the plan. Rafidah also said her ministry was now better placed to promote exports and investments in the services sector through its services development divisions. She urged the business community to use the services to boost capacity and capabilities for export and for export-ready companies to take advantage of the incentives offered to export their services.
Last year, RM2.6 billion investments were approved in distributive trade, RM2.4 billion in tourism services, RM155 million in healthcare services and RM75.1 million in education and training. To further develop the private services sector, the government set up the Malaysian Services Development Council and the Malaysian Logistics Council last year.
The services trade balance continued to be in deficit. It was RM6.92 billion last year compared with RM8.66 billion in 2005. This was because it remained reliant on imported freight and business services. Last year, Malaysia’s total trade clinched the RM1.07 trillion landmark figure, mostly through its top five trading partners – the US, Singapore, Japan, China and Thailand.
(Source: New Straits Times, 30 June 2007)
MEMBERS' NEWS
New Trophy to Mark 50th Year of Independence
In commemoration of Malaysia’s 50th year of independence, the Sepang International Circuit (SIC) has commissioned Royal Selangor to design a new winner’s trophy for the annual Formula One Petronas Malaysian Grand Prix. The new design reinterprets the iconic form of the previous trophy, also designed by Royal Selangor, in a sleek, modern and undeniably stylish evolution of design. “The significance of this independence year is an opportunity to present something reflective of a 21st century Malaysia,” Royal Selangor International General Manager Yong Yoon Li said. “We feel the new design embodies not only the spirit of Formula One but also a vibrant nation proud of its heritage, confident in its present and excited about its future.”
Derived from the star on the national flag, 14 spokes, representing each state in the Federation of Malaysia, spiral gracefully upwards. Bold and streamlined, the trophy’s complex lines and curves suggest the idea of power, speed and excitement synonymous with the sport, whilst alluding to the many celebrated weaving techniques of Malaysian craft.
SIC General Manager Datuk Azmi Murad said: “Royal Selangor has been a close partner of the SIC since our establishment in 1999 and we are very happy and honoured to be associated with them once again in the design and production of the new Formula One trophy… We are very excited indeed with the outcome as we feel the new trophy captures the glory and spirit of this sport,” he added. The new trophy will be featured at the upcoming 2007 Formula One Petronas Malaysian Grand Prix, which will take place from April 6 - 8.
(Source: The Sun, 6 April 2007)
Ku – A Celebration of Malaysian Roots
In commemoration of Malaysia’s 50th year of Independence, Royal Selangor introduces the Ku collection. Ku celebrates the diversity and beauty of the nation’s heritage by incorporating traditional motifs from various Malaysian cultures into a contemporary range for the home and office. Comprising photoframes, platters, a cardholder, pen caddy and pen tray, this collection offers a modern twist on traditional designs associated with Kenyah art, batik, wau and wayang kulit.
A selection of the collection, called Naga, was adapted from tribal Kenyah artwork representing the mythical aso, the half-dog half-dragon creature which is often represented by extensively spiralled horns, claws and tails. The aso is believed to ward off diseases and malevolent influences. In recognition of a craft that has long been associated with Malaysia, the intricate triangular pucuk rebung and elegant pohon bunga floral motifs used in local batik designs are also featured in this collection.
The collection also showcases the beautiful foliate motifs featured on the Wau, traditional kites commonly found in the eastern and northern states of Peninsular Malaysia such as Kelantan, Terengganu, Kedah and Perlis. The fantastic wayang kulit is a traditional form of entertainment which combines the art of storytelling with that of shadow play performed throughout Southeast Asia including Malaysia. The elaborate decorations painstakingly painted on the wayang kulit puppets have also been adapted into Ku.
Ku embodies the importance of tradition and cultural roots as Malaysia continues to grow into a developed nation as she celebrates her 50th birthday. The Ku collection is available at all Royal Selangor outlets and authorised dealers as well as online at royalselangor.com.
(Source: Royal Selangor Press Release)
Eric Leong Designs New Asia for Royal Selangor
Malaysian interior design guru, Eric Leong, has channelled his creative genius to design an alluring pewter collection. Royal Selangor’s New Asia by Eric Leong presents lotus-inspired home and office accessories like tealights, dip tray, platter, cup, toothbrush caddy, soap dish, document rack, paperclip tray and letter opener.
The range showcases a modern take on the elegant lotus plant, a symbol common to and revered by many cultures across the Asian continent. Highly esteemed in China, the lotus represents purity, perfection and divinity. It is a favourite motif in traditional and decorative Chinese art, where it is also regarded as symbolising summer. Because the lotus grows out of muddy water, but emerges a beautiful untainted flower, the lotus is seen as a metaphor for the purification of the body and soul, and the attainment of enlightenment. Bold lines and simple curves are stylised representations of the grace and beauty of the lotus plant in this collection, with ornamentation kept to a minimum.
The New Asia collection is available at all Royal Selangor outlets and authorised dealers as well as online at royalselangor.com.
(Source: Royal Selangor Press Release)