April – June 2003
MALAYSIAN
TIN PRODUCTS
MANAGEMENT COMMITTEE
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PRESIDENT MS. GAY LEONG ROYAL SELANGOR
INTERNATIONAL SDN BHD VICE-PRESIDENT MR. MAMORU KAWASAKI (ALTERNATE – MR. LOH
YOON SOON) SELAYANG SOLDER SDN BHD HON. SECRETARY MR. JASON LEE HENKEL (MALAYSIA) SDN
BHD TREASURER MR. KOJI TSUBONO SENJU (M) 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. C.S. LIM METAL RECLAMATION (IND)
SDN BHD MR. EDWARD WONG E.M.I.S. SDN BHD EN. AB. PATAH MOHD PERUSAHAAN SADUR TIMAH
MALAYSIA (PERSTIMA) 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. |
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EDITORIAL SUB-COMMITTEE MS. GAY LEONG MR. EDWARD WONG EN. AB. PATAH MOHD MR. C.S. LIM MR. JASON LEE |
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Tel: 03
– 21616171 Fax: 03
– 21616179 Email: mcom@mcom.com.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,
Congratulations to Messrs
Henkel (Malaysia) Sdn Bhd for being elected as the President of the Malaysian Tin Products Manufacturers’
Association for Year 2003/2004 at the 13th Annual General Meeting on
26 June 2003. We extend Mr Jason Lee our best wishes and support as he heads
the new Management Committee 2003/2004 comprising Messrs Selayang Solder Sdn
Bhd (Vice President), Metal
Reclamation Industries Sdn Bhd, (Honorary
Secretary) and EMIS Sdn Bhd (Honorary Treasurer), with the invaluable assistance of Secretariat.
At this time, the MTPMA has
found it appropriate to review its role and evaluate members’ needs and
requirements of the Association. Many are aware of the survey conducted among
members, and we appreciate all who have taken the effort to respond.Findings
are presently being analysed and the new committee will be able to advise the
results and future courses of action shortly.
The 13-year old Association
has certainly had a long history encouraging, promoting and protecting the
interests of the tin products manufacturers in the country and facilitating the
exchange of views between related industries locally and internationally, among
other things. It has been an honour for
me to serve the MTPMA for the last 3 years,
and I am grateful to the Committee and the Secretariat for their support
and guidance. I wish the new Management Committee 2003/2004 the very best as
they take on the Association’s new challenges.
Gay Leong
President
Producers of Computers, Electronic Goods Operating Normally
Flextronics International Ltd and other companies that manufacture computer-related goods in Asia say they've dodged the impact so far of a deadly respiratory illness that has hit airlines and hotels. Factories that churn out much of the world's computers, cell phones, consumer electronics and other devices in countries such as China, Malaysia and Singapore are operating normally, according to companies and analysts. About 60 per cent of the world's notebook computers and 80 per cent of motherboards, which hold chips in place for desktop computers, are made in Taiwan and China. The absence of a major disruption leaves computer companies such as Hewlett-Packard Co, Flextronics's biggest customer, and others that have increasingly shifted production to Asia untouched for now.
"People are assuming that there will be a supply-chain impact and a business impact and I don't think any of that has materialised at the moment," said Jeff Weir, a spokesman for Santa Clara, California-based National Semiconductor Corp, which packages and tests chips in Singapore and Malaysia. The illness, called Severe Acute Respiratory Syndrome or SARS, has killed at least 104 worldwide and caused travel industry sales to fall because tourists and companies such as drugmaker Novartis AG have curtailed trips to affected areas, including China, Hong Kong, Vietnam and Singapore. The biggest risk posed by the illness for manufacturing companies is that they may have to shutter assembly lines if a worker were to become infected with the disease, analysts said.
Motorola Inc closed the night shift at a Singapore cell phone factory for one day when one of its employees became ill, and more than 300 workers on the shift had to be quarantined until April 4. The plant is operating normally now and no other workers contracted the disease. Because electronics companies rely so much on factories in China and parts produced there, if the outbreak were to worsen and result in the closure of all travel links, it would mean "nuclear winter" for the computer-related industries, said Russell Craig, analyst with Aberdeen Group, a technology consultancy. So far, analysts say that's not happening. LG International Corp, the parent of South Korea's second-biggest electronics maker, has handed out masks to employees in southern China, who are taking morning doses of a Chinese herbal remedy to prevent colds, said Jee Sung Eun, head of the company's offices there. While manufacturing seems to have been uninterrupted, sales and marketing efforts may be hurt because executives have cut back on travel. Collaboration between employees in different countries may also be hampered, analysts said. Microchip Technology Inc based in Chandler, Arizona recently put part of the blame for a profit shortfall on difficulty in reaching customers because of the disease, which it says has delayed purchasing decisions. Microchip Technology makes chips used in phone-related products and cars.
(Source: Business Times, 10
April 2003)
Electronics manufacturing services company Solectron Corp will lay off 180 people in Penang as part of its global restructuring programme. The company will maintain about 7,200 employees at its four sites in the Prai and Bukit Minyak industrial estates. The company, which had seen a dip in business over the past year, said recently the decision to reduce its non-production staff in Penang was market-driven and was not a reflection of the performance of its Penang workers.
"In the last few months, the local management team had carefully analysed the situation to manage the business load to an optimal level," Solectron Asia/Pacific operations senior vice-president Joe Tang said. "Despite all measures taken, the continuing decline in business has left Solectron Penang with excess capacity and resources. A number of other options were looked at and considered, but unfortunately, they were not viable under current market conditions," he added. Tang said Solectron, which will be paying out RM2.7 million in retrenchment benefits to affected staff, will comply with applicable Malaysian labour laws and provide outplacement assistance. "We will also work with the local community leaders and appropriate government agencies to help retrenched employees find new jobs," he added.
Solectron, the world's second biggest contract manufacturer established its first offshore site in Malaysia in 1991, which remains the Milpitas, California-based company's largest manufacturing plant in Asia. The company has five plants in Penang and one in Johor. In Malaysia, Solectron provides customised, integrated manufacturing services, ranging from pre-manufacturing, manufacturing to post-manufacturing to the world's leading electronics original equipment manufacturers. When announcing its first quarter fiscal 2003 results last month, Solectron said it would take restructuring charges of US$300 million to help drive the company's return to profitability. The move will see Solectron shedding some three million sq ft of manufacturing space and cut some 12,000 jobs. After the reductions, Solectron said it would have 13 million sq ft of manufacturing space and about 62,000 employees.
(Source: Business Times, 29
April 2003)
Despite the global economic slowdown, it is business as usual at Kulim Hi-Tech Park (KHTP) in Kedah, which has not experienced any adverse impact, while efforts are underway to attract new foreign investors. Kulim Technology Park Corp Bhd chief executive officer Ahmad Shukri Tajuddin said although KHTP had not registered any increase in its total investments of RM15.8 billion so far, the 33 companies located there continued to conducted their operations on normal scale. "None has closed shop so far. They are able to continue and sustain their operations despite the global economic slowdown," he said. The foreign companies from the United States, Japan, Taiwan, Canada and Germany operating at KHTP continued to export their goods. Shukri told Starbiz. Of the companies at KHTP, 16 are in the manufacturing sector and 17 in services.
Shukri said there was no major retrenchment by foreign or local companies at KHTP. "Some are even recruiting more personnel for research and development," he said, adding that there were now 12,000 people working at KHTP. Although foreign direct investments into KHTP had slowed down, the high tech park would continue to woo investments from abroad, mainly from Japanese and American companies that had earlier forwarded their proposals for new ventures, he said. "There are several foreign companies which are still keen to invest in the country, especially at KHTP. They have put things on hold because of the economic slowdown," Shukri said. He added that 86 per cent of the total investments in Kedah were in KHTP.
(Source: The Star, 2 May 2003)
Worldwide semiconductor sales in February slumped 3.3 per cent to US$11.8 billion from the US$12.2 billion in revenue reported in January this year, the Semiconductor Industry Association (SIA) said recently. "The recovery in the semiconductor industry that has been under way for more than fifteen months appears to have stalled in February," said SIA president George Scalise. The drop in semiconductor sales pushed the Kuala Lumpur Stock Exchange's 17- member technology index down 0.76 per cent to 36.29 points, 2.08 points short of the index's historical low of 34.21 points. The index's historical high of 166.05 was recorded on May 19, 2000.
Analysts say Malaysian Pacific Industries (MPI) Bhd and Unisem (M) Bhd, the two largest publicly traded chipmakers could come under chilling selling pressure, as a knee-jerk reaction to the data released by the California-based SIA. "Demand has softened in the markets that drove growth throughout the past year, including PCs, global wireless and consumer. The traditional seasonally flat first quarter has been further impacted this year by geopolitical uncertainty," Scalise stated. He went on to say that although capacity utilisation at the leading edge is a strong 89 per cent, excess capacity at the trailing edge is exerting pricing pressure and impacting revenue across the market at this time.
(Source: The Malay Mail, 1
April 2003)
Motorola Inc's plan to trim its workforce by 3,000 worldwide will not affect the US technology giant's workers in Penang. Instead, the world's number two mobile phone company, which on Wednesday, April 16, lowered industry-wide growth expectations for cell phones and chips this year, is set to maintain and enhance the existing capabilities and competencies developed by the company in Malaysia, despite the current global challenges.
"At this point in time, no further reductions are planned," Motorola Penang vice-president and managing director Robin Seo told Business Times. Motorola Penang's investment history can be traced back to 1974. The company currently has a headcount in Penang of 3,000. According to Seo, Motorola consolidated manufacturing operations into its integrated manufacturing, research and distribution centre in the Bayan Lepas Technoplex Industrial Park in December last year. "With this consolidation, greater work synergy has been achieved and operating costs have optimised. Plans to streamline our operations for greater efficiency by reducing redundancies in specific functions that have been outsourced have also been successfully implemented," he said.
Seo was asked to comment on a news report that said the Chicago-based Motorola planned to save US$3 billion more in costs in 2003 and 2004 by improving production processes, lowering purchasing costs of materials and services, and improving the quality of its operations, hardware and software. The company also said it had reduced about US$4 billion in costs in 2001 and 2002 through restructuring actions. Following the release of its first-quarter earnings, Motorola said on Wednesday that it now expects to reduce its workforce to about 90,000 by the end of the year versus its previous estimate of 93,000. It added that the cuts would come from attrition, previously announced plans to outsource information technology and human resources, and "selected workforce reduction". Motorola has slashed its workforce by more than a third from its peak of 150,000 in August 2000.
(Source: Business Times, 18
April 2003)
National Semiconductor Believes SARS Will Have Greater Impact Than Iraq
War
The Severe Acute Respiratory Syndrome (SARS) outbreak, if prolonged will have more detrimental effects on the semiconductor industry than the war in Iraq, or what some industries called 'Iraq-nophobia'. National Semiconductor Sdn Bhd managing director Wang Choon Seang said initially industries in the integrated circuits industry were worried before the start of the war. He said industry experts believed that the Iraq war could delay recovery in the chip sector. However, as it turned out, the industry did not suffer major setbacks due to the war compared to SARS.
"National Semiconductor Malacca believes that the SARS impact would be larger than that of the Iraq war. There is a possibility that operations may be disrupted and this is already happening to some of the semiconductor companies. Supply chains will be disrupted leading to an imbalance of inventory since the region's impact of the virus and the region's manufacturing electronics and semiconductor are the same," he told Business Times. Wang said a number of semiconductor events had been postponed indefinitely. The Semiconductor Equipment and Materials International group recently decided to cancel a trade show which was earlier scheduled in May in Singapore.
He said despite the gloomy scenario National Semiconductor, an American based firm, has taken necessary precautionary measures to safeguard its employees as well as business. "The company has set up contingency plans with regard to suppliers, and how we can support our customers due to the outbreak," he said. Wang said the company, set up in Malacca in 1972, has invested more than RM1.2 billion in its Malaysian operations. For the past five years, the company had spent RM100 million annually in its new wafer level processing operation and new wafer level packages. "These additional investments have created more than 200 new jobs using highly skilled employees and knowledge workers in line with the country's drive to utilise K-economy," he said. Wang added that the company had grown fourfold in the last six years with automation and productivity improvements, had seen the company employ 2,500 employees. He said its new processes include wafer level processing operations and wafer level packages and leadless chip scale packages. "The company would also continue with its investments in new package development and test developments," he added.
(Source: Business Times, 22
April 2003)
Intel Technology Sdn Bhd will undertake the assembly and testing of the Intel Pentium M processor, one of three essential components of the newly launched Intel Centrino mobile technology, in the 2nd half of this year. Site general manager Gurshel S. Grewal told a press briefing that the company's plant in Penang was currently assembling and testing the Intel 855 chipset family and the Intel PRO Wireless 2100. "In the 2nd half, the plant will also carry out the assembly and testing of the full range of key components for Intel Centrino mobile technology," he said. Launched in March, the Intel Centrino mobile technology, which features extended battery life, thinner and lighter notebook designs, and outstanding mobile performance, is the company's most significant product since the introduction of the Intel Pentium processor more than a decade ago.
According to Gurshel, Intel's plants in the Philippines and China also carried out assembly and testing for either one or two of the key components of Intel Centrino mobile technology. He said that the Penang plant was selected over the Intel operations in the US to design and develop the Mobile Input/Output Controller Hub 4 used in the Intel 855 chipset family owing to its proven track record. "Over the years, the operation in Penang has proven to have a team of quality logic, circuit and layout designers, design automation engineers, system validation engineers, microarchitects, as well as product development engineers," he said.
(Source: The Star, 29 April 2003)
AIC Corp Bhd, the country's second largest chip assembler, sees good growth this year as the global semiconductor industry continues its recovery. AIC's sales eased 22 per cent to RM72.84 million in the first quarter ended March 31 2003, versus RM92.89 million recorded in the fourth quarter. This leads to a net loss of RM 4.4 million, reversing the RM1.17 million net profit previously. But with the global industry expected to expand 7 to 12 per cent this year, things look brighter for AIC in the coming months, president and chief executive officer Mohamad Ariff Puteh said. Sales in the current April-June quarter have so far increased 30 per cent against the first three months, he said.
"Last month, we produced 50 million chips, the highest in our history," said chairman Datuk Sarip Hamid. "Traditionally, sales are ramping up in the subsequent months," he added. But strong sales will not translate into big profits as margin shrinks because of price erosion undermined by excess capacity worldwide, Ariff said. Hence, AIC expects profits quarter-on-quarter for the April-June period to be slightly better, at best. Margin is expected to remain steady in the near term, he added. According to Semiconductor International Association, global semiconductor revenue grew marginally by 1.3 per cent to US$140.7 billion in 2002. Despite the small growth, the sector has recovered from the 32 per cent slump in 2001. The recovery in chip sales was largely driven by the wireless segment, led by higher sales in cell phone units as well as expansion in new mobile subscribers in Asia. Asia-Pacific, where AIC exports most of its output; emerged the only region to post positive growth last year, up by 23.5 per cent to US$51.2 billion.
AIC made a RM2.69 million pre-tax profit on a 25 per cent increase in revenue to RM403 million last year, driven by its distribution arm in Singapore. Exports accounted for 84 per cent of total revenue. Ariff said the Singapore subsidiary, Nucleas Electronics Ltd, had made inroads into the strategic North Asian markets of China and Hong Kong last year. The venture paid off as Nucleas, 55 per cent-owned by AIC, saw revenue doubling to RM246 million in 2002. "We are making more revenue from the distribution arm than our test and assembly activities," he said, noting that the latter operation generates about RM90 million. AIC has just operated a new RM20 million test and assembly plant adjacent to its existing facility in Kulim, Kedah. "The new plant can churn out US$12 to US$14 million worth of business. We are running its capacity at 10 to 20 per cent at the moment," Ariff said.
(Source: Business Times, 23 May
2003)
Listed
chipmaker Unisem (M) Bhd is cautiously optimistic of a better second half in
2003, said chairman and managing director John Chia Sin Tet. For the financial year ended December 31
2002, Unisem posted a higher net loss of RM12.50 million compared with RM10.05
million in 2001. The poorer performance
was partly due to lower profit margins as a result of a fall in average selling
prices.
Chia
said Unisem believes that the worst is probably over for the semiconductor
industry. He said the recovery will be
gradual starting from the second half of 2003.
"It is quite risky to give absolute values as business visibility
remains poor. Our customers are a
little more optimistic in their forecast for the second half of this
year," he added. Low inventory
levels of customers are another factor that would boost demand for
semiconductor packaging and testing services in the coming months. Chia said the recovery would see most
subcontracting semiconductor houses benefitting from more outsourcing
businesses from integrated device manufacturers.
Meanwhile,
Chia said in keeping abreast with the needs of the industry, Unisem has plans
to release new packaging products and testing services. However, he declined to reveal the upcoming
products.
(Source: Business Times, 31 May 2003)
4.1pc Economic Growth in Q1 Seen
Malaysia's
economy probably grew in the first quarter at its slowest pace in three
quarters after AIC Corp and other semiconductor assemblers sold fewer computer
chips overseas. Gross domestic product
(GDP) probably expanded 4.1 per cent in the March quarter from a year earlier,
compared with 5.6 per cent in the three months through Dec 31, according to the
median forecast of 15 economists surveyed by Bloomberg News. Bank Negara Malaysia will release the report
on May 27. Growth in Malaysia's US$95
billion economy, South East Asia's third largest after Indonesia and Thailand,
is slowing after the war in Iraq disrupted shipments and a faltering US economy
hurt demand for electrical and electronics goods. Manufacturing accounts for about a third of Malaysia's GDP.
(Source: The Malay Mail, 28 May 2003)
MEMBER NEWS
The mere mention of the names Sipadan or Ligitan conjures up images of long stretches of unspoilt beaches and azure seas. Yet beneath the serenity of the waves is life running riot in a brilliant profusion of colours, shapes and sizes. It is hardly surprising that the islands have earned international recognition for their marine life, particularly Sipadan, which is reputed to be one of the best diving locations in the world.
The islands of Ligitan and Sipadan are
both located in the Celebes Sea, off the north-east coast of the island of
Borneo, and lie approximately 15.5 nautical miles apart. Ligitan is a very small island lying at the
southern extremity of a large star-shaped reef. The island consists of mostly sand and is home to low-lying
vegetation and sparse trees. Although
it is not permanently inhabited, fisherman from the surrounding islands
frequent it.
Sipadan is Malaysia's only oceanic island, formed by living coral growing over the pinnacle of an extinct undersea volcano, 10km south of the continental shelf. With a lush forested core fringed with white sandy beaches, Sipadan is internationally renowned for its spectacular marine life, which has been rated to be on par with Australia's Great Barrier Reef in terms of species diversity. Drop-Off is merely steps away from the beach at the northern end of the island, where the shallow sea drops abruptly to 600 meters deep.
Until the recently, the sovereignty of these two island had been claimed by both Malaysia and neighbouring Indonesia. On December 2002, in a welcomed decision by the International Court of Justice at The Hague, sovereignty was finally awarded to Malaysia, ending over 30 years of dispute.
Especially for this issue, Royal Selangor, in collaboration with Pos Malaysia Berhad, has crafted Special Edition First Day Covers featuring pewter and niobium replicas of the entire miniature sheet comprising both the RM0.50 stamps of these beautiful islands.
The extra large cachets are finely crafted to meticulous detail and are great value for money particularly if you favour the niobium cachets. In addition, two of the four stamps included are embossed, making this issue truly collectible.
The covers are cancelled with the Philatelic Bureau's postmark dated 28th June 2003, the stamp issue date and are limited to only 5000 pewter and 2000 niobium serialised pieces worldwide. Each piece comes with a certificate. These limited edition covers are priced at RM30 for the pewter edition and RM125 for the niobium edition and are available through www.coverclub.com. Please call the Cover Club at 03-4149 5100 for more information.
(Source: A Press Release from Royal Selangor International Sdn Bhd)
Man's fascination with time extends deep into history. So has the idea of decorating buildings with timepieces. Beyond being purely ornamental, clock towers have served as keepers of time and guardians of history. Often found in the centre of town, they form familiar landmarks and some places are renowned for their charming structures.
Across the ages and around the world, it is not uncommon to find beautiful clock towers constructed to commemorate special events. It is no different here in Malaysia. The Sungai Petani Clock Tower was erected in 1936 to pay tribute to the Silver Jubilee of King George V and Queen Mary. However it was later turned into a memorial as he passed away before its completion. Sarawak's Council Negeri Monument was built to mark the centennial of Malaysia's first and oldest state legislative assembly that was held there in 1867.
Each clock tower has its own distinctive architectural style. The Christ Church Clock Tower in Malacca with its unmistakable red hue was erected in 1650. Its fine Dutch architecture is testimony of the city's rich past. In contrast, the Teluk Intan Clock Tower has an oriental pagoda style structure. This tower was originally used as a covered water tank. The Jubilee Clock Tower in Penang on the other hand proudly flaunts its distinctive Moorish designs.
The grandest and most famous clock tower can be found rising above the Sultan Abdul Samad building. Standing at 41.2m high, it is surmounted by a copper dome that is in turn topped by a copper chatri. Construction of this building started in 1894 and was completed in 1897 at the cost of 152,000 Straits Dollars. This building was built in the 'Mahometan' or the 'Neo-Saracenic' fashion, inspired by similar styled buildings in India. The clock chimed for the first time during Queen Victoria's birthday parade in 1897. The building previously housed the administrative offices of the colonial British government. Today it seats the nation's judiciary.
Royal Selangor, under exclusive agreement with Pos Malaysia, has crafted a set of Special Edition Pewter and Niobium First Day Covers featuring Malaysia's Clock Towers. Each cover is decorated with a beautiful cachet of the Sultan Abdul Samad building clock tower, arguably the most famous clock tower in Malaysia. The covers are cancelled with the Philatelic Bureau's postmark dated 24 May 2003 and are limited to only 5000 pewter and 2000 niobium pieces, every one accompanied by a certificate. These limited edition covers are priced at RM30 for the pewter edition and RM125 for the niobium edition and are available through www.coverclub.com. Please call the Cover Club at 03-4149 5100 for more information.
(Source: A Press Release from Royal Selangor International Sdn Bhd)
Spurred by the success of the wine funnel that garnered three international awards, leading pewter manufacturer Royal Selangor has come up with more innovative wine funnel designs. Taking inspiration from Greek and Roman mythology, the new funnels from Royal Selangor's Vinifera are essentially organic in form and are designed to facilitate maximum aeration when decanting.
The Archimedes funnel is named after the famed Greek inventor who discovered a way to raise and direct water through a screw pump. Comprising a glass body with a pewter helix, the Archimedes funnel allows you to see wine spiralling down. Besides being an interesting sight to behold, the vortex flow actually exposes a greater surface area of the wine to the atmosphere hence improving the aeration.
Bacchus was the Roman god of wine and revelry. Derived from the Greek god Dionysus, he was often associated with wine, dancing and merry-making. Royal Selangor's Bacchus wine funnel is meticulously sculpted with the face of Bacchus. Crowned with clusters of grapes, his beard tapers down to the tip of the funnel. When wine is poured into the funnel, it sieves the fine sediments and comes out at the side, through the 'mouth' of Bacchus. This gives the impression of Bacchus blowing out the wine onto the wall of the decanter to enable a gentle descent.
Pools, fountains and spas were very much part of the Roman tradition. This has inspired Royal Selangor to produce the Cascade wine funnel. Designed with a row of weep holes around the funnel, the wine exits through these holes and cascades down the outside walls of the funnel to create a pretty candy cane effect. The tip is slightly curved to make contact with the decanter wall, allowing the wine to gently descend into the decanter.
The three new wine accessories
are now available at all Royal Selangor outlets and online at royalselangor.com.
(Source: A Press Release from Royal Selangor International Sdn Bhd)