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Malaysian Reserve
2 days ago
- Business
- Malaysian Reserve
Malaysia stands firm on Bumiputera policy in US trade talks
by NURUL NAJMIN ABU BAKAR MALAYSIA will not compromise on its Bumiputera policy in ongoing tariff negotiations with the US, said Prime Minister Datuk Seri Anwar Ibrahim. While acknowledging the importance of trade and investment ties with the US, Anwar said the government has set clear boundaries in matters involving national policy. 'We have discussed this in the Cabinet many times. We have our position and we are ready to face the consequences,' he said as quoted on a news portal. He said the Bumiputera policy is not discriminatory as claimed, and reiterated that Malaysia will uphold the policies it has implemented, stating that no country should interfere with domestic decisions. Anwar, who is also the finance minister, said local procurement and opportunities for Malaysian businesses must be safeguarded during negotiations with the US. He added that Malaysia is committed to protecting its national interests while continuing to expand trade ties with global partners, including China and ASEAN. The discussions follow the US' decision to impose a 25% tariff on Malaysian goods effective Aug 1, citing barriers such as halal certification rules and Bumiputera equity requirements in key sectors. The US Trade Representative had earlier highlighted Malaysia's halal standards and the 30% Bumiputera ownership condition in sectors such as oil and gas (O&G), media and public procurement as issues affecting market access.
Malaysian Reserve
26-06-2025
- Business
- Malaysian Reserve
MBSB targets RM50b financing balance by 2026
by NURUL NAJMIN ABU BAKAR MBSB Bank Bhd is aiming to reach RM50 billion in total financing balance by 2026, underpinned by steady demand and portfolio realignment. MBSB Group CEO Rafe Haneef said the target aligns with the group's newly announced strategic plan, supported by ongoing restructuring of its loan book and introduction of new products. 'As at December 2024, our net loan book stood at around RM43 billion, after adjustments and write-offs from the RM43.7 billion recorded last year,' he said at the MBSB 55th AGM media conference. Rafe said the group remains optimistic about hitting its 2026 target, driven by enhanced offerings in both the commercial and consumer segments. He added MBSB has made notable progress in its three-year FLIGHT26 transformation plan, with 30 of 38 key programmes and 24 of 27 post-merger initiatives with Malaysian Industrial Development Finance Bhd (MIDF) successfully rolled out. 'The progress reflects strong operational integration, system upgrades and improved service efficiency,' he said. He added that FY2024 marked the first full year of MIDF's integration, contributing to a 31% revenue growth, led by a 27% rise in funded income and a 318% surge in non-funded income, excluding one-off gains from the 2023 acquisition. For FY2024, MBSB reported RM43 billion in total financing, while its current and savings account (CASA) ratio rose to 11.1%, crossing the double-digit threshold for the first time. Its cost-to-income ratio improved to 54.9%, with return on equity recorded at 4.2%. The bank also advanced its digital agenda with the upgraded MJourney platform and rollout of new solutions such as unit trust investment via iFAST, Vehicle Financing-i, WorksForMe salary solution, digital gold PrimeGold-i, and MShield takaful protection. In the commercial and SME segments, new offerings include the Retailer Dashboard, BAYO Pay platform, RM1 billion aerospace financing, and M-Property real estate financing. As part of its sustainability drive, MBSB has mobilised RM4.73 billion in green and transition financing, achieving 47% of its 2026 goal. It also recorded a 12% reduction in carbon emissions and contributed over 6,000 volunteer hours to community initiatives.
Malaysian Reserve
24-06-2025
- Business
- Malaysian Reserve
Energy Asia 2025: Malaysia at the forefront of ASEAN's energy transition
The region's growing energy demand and net-zero ambitions present both an urgent challenge and a strategic opportunity by NURUL NAJMIN ABU BAKAR & AKMAR ANNUAR ASEAN'S shift to a low-carbon economy calls for a coordinated push from governments, industries and capital markets with Malaysia positioning itself as a regional frontrunner through whole-of-nation efforts and financial innovation. Speaking at the Energy Asia 2025 conference recently, Malayan Banking Bhd (Maybank) president and group CEO Datuk Khairussaleh Ramli said the region's growing energy demand and net-zero ambitions present both an urgent challenge and a strategic opportunity. 'Seven out of 10 ASEAN countries have committed to net zero by 2050. Malaysia is guided by the National Energy Transition Roadmap (NETR). Institutions like Maybank are supporting not just through financing, but by guiding stakeholders on how to move forward,' he said. Citing the recent Petrovietnam-Sembcorp Industries Ltd agreement to export renewable energy (RE) to Malaysia and Singapore, Khairussaleh described the move as a positive example of cross-border collaboration. However, he cautioned that carbon capture technologies remain commercially not viable without blended finance mechanisms. He added that financial institutions must back both the expansion of renewables and the decommissioning of legacy assets to achieve real decarbonisation. Meanwhile, Bursa Malaysia Bhd CEO Datuk Fad'l Mohamed said Malaysia's energy transition would require RM220 billion in investment by 2030, with capital markets expected to play a central role. 'To support this, Bursa has introduced a RE sub-sector, updated listing requirements and launched a Centralised Sustainability Intelligence platform,' he said. Globally, sustainable investments reached US$3.2 trillion (RM13.98 trillion) in 2024, underscoring the scale of capital now moving into climate-aligned opportunities. Institutional investors are also stepping up. Permodalan Nasional Bhd (PNB) president and group CEO Datuk Abdul Rahman Ahmad said the group has committed RM5 billion to green assets and aims to reduce its portfolio emissions intensity by 30% by 2030. 'If companies show no credible progress, we are prepared to vote against their board leadership,' he said. On the ground, oil and gas (O&G) players are beginning to adapt — but not all are moving at the same pace. Malaysian O&G Services Council (MOGSC) president Syed Saggaf Syed Ahmad noted that while large companies are making strides, smaller firms still need support to align with environmental, social and governance (ESG) goals. To help bridge this gap, MOGSC signed a partnership with Petroliam Nasional Bhd (Petronas) during the conference, aimed at helping small and medium enterprises (SMEs) enhance their sustainability capabilities. Abdul Rahman says PNB aims to reduce its portfolio emissions intensity by 30% by 2030 (pic: MUHD AMIN NAHARUL/TMR) Energy Shift Remains Complex Regional and global energy leaders said Asia's energy transition will remain heavily reliant on fossil fuels despite accelerating investment in renewables. Speaking at Energy Asia 2025's 'Navigating the Multi-dimensional Transition' leadership dialogue, S&P Global senior VP and chief energy strategist Dr Atul Arya said the transition must reflect regional realities. 'The idea of a linear transition is no longer applicable globally,' he said. Meanwhile, Vitol Inc CEO Russell Hardy projected that oil demand will peak in the mid-2030s and stressed the importance of continued investment to offset declining fields. 'If prices are too low, we get an investment pause,' he said. While Asia is rapidly expanding renewables, Hardy warned that electric vehicles (EVs) powered by coal-fired electricity defeat the purpose of decarbonisation. Petronas senior VP for corporate strategy Marina Md Taib described Asia's transition as 'multi-speed', noting that up to 80% of the region's energy will still come from fossil fuels by 2040. She stressed the need to balance energy security, affordability and sustainability. Petronas is allocating 20% of its group capital expenditure (capex) to low-carbon ventures and is restructuring its portfolio to support its net-zero 2050 goal. Hardy said Vitol is investing in carbon capture in the UK, biofuels and liquefied natural gas (LNG) bunkering to decarbonise its energy supply chain. He also cautioned against over-reliance on regional power grids. 'Never forget about energy security,' he said. Marina added that strategic partnerships across governments, technology providers and financiers will be essential. Petronas is working with Japan's Ministry of Economy, Trade and Industry (METI), Ente Nazionale Idrocarburi (ENI) and Euglena CoLtd on hydrogen, carbon capture and storage (CCS) and bio-refinery projects to scale transition efforts. Hardy stresses the importance of continued investment to offset declining oil fields (pic: Bloomberg) Gas as Cornerstone Energy Security and Transition Meanwhile, energy leaders agreed that natural gas will remain central to Asia's energy mix as the region works to balance economic growth and decarbonisation. Executives from Petronas, Inpex Corp, PTT Exploration and Production Public Co Ltd (PTTEP) and Mubadala Energy pointed to South-East Asia's (SE Asia) strong demand, infrastructure readiness and political stability as key drivers for gas investment and long-term collaboration. Inpex president and CEO Takayuki Ueda said Asia's rising energy needs make localised production essential. He noted Malaysia's fiscal transparency and pipeline network as strategic advantages. Inpex holds six upstream blocks in Malaysia and is advancing the Abadi LNG project in Indonesia, which integrates CCS from the outset. PTTEP CEO Montri Rawanchaikul said Malaysia is now a growth focus, following its 2019 acquisition of Murphy Oil's assets. The company is monetising recent gas finds through 'grey-to-green' strategies and expanding across Thailand, Oman, the United Arab Emirates (UAE) and Algeria. 'Natural gas remains the most pragmatic transition fuel. It complements evolving grids and provides a reliable energy base,' he said. Mubadala Energy COO Adnan Bu Fatema said 70% of its portfolio is now gas-focused, with key assets in Malaysia and Indonesia. He cited SE Asia's demographic and economic weight and the urgent need to replace coal with cleaner alternatives. Petronas' Malaysia Petroleum Management senior VP Datuk Bacho Pilong noted that Sabah is a new growth area, with rising demand from green industries. He cited record production and investments in 2023 and efforts to attract investors through accessible geological data. Panellists agreed that regulatory stability, infrastructure and technology, especially CCS, are vital to unlocking SE Asia's gas potential. They also stressed deeper collaboration across governments, national oil companies (NOCs), international oil companies (IOCs) and service providers. 'If we are serious about energy security and transition, we must work together,' Bacho said. Malaysia needs a strategy that fits our context, not one forced by external pressure, says Che Khalib (Source: Malakoff Corp Bhd) Reindustrialisation Push Facing Hurdles Malaysia's reindustrialisation ambitions are at a crossroads as stakeholders warn of inconsistent policies, talent gaps and conflicting energy narratives that could stifle progress despite strong fundamentals in sectors like semiconductors. Khazanah Nasional Bhd MD Datuk Amirul Feisal Wan Zahir said Malaysia risks remaining in the 'middle-income trap' without bold steps to develop high-value industries, especially where it already has comparative advantages. 'Our semiconductor sector is among the best at backend packaging. But we need to go beyond being 'wire benders' — there is room for innovation in advanced packaging. We are producing limbs and bodies, but not the brains,' he said. He also cited the success of global players like Samsung Electronics Co Ltd and Taiwan Semiconductor Manufacturing Company (TSMC), who were supported in scaling up but were expected to be globally competitive. Malaysia's earlier experiment with Proton Holdings Bhd, he argued, was stifled by prolonged protectionism. Mid-tier companies, which contribute significantly to GDP, must also be incentivised to reinvest and expand. 'If you are already earning millions, why push harder?' Amirul Feisal said, highlighting the role of catalytic funds like Dana Impak to transform promising firms. But while capital is not a constraint — with over RM5 trillion in Malaysia's equity, bond and banking markets — structuring investments for long-term transformation remains a challenge. On another note, Malaysian Industry-Government Group for High Technology (MIGHT) president and CEO Rushdi Abdul Rahim said public-private partnerships must be clearly defined with built-in exit strategies 'The government must know when to take off the training wheels. We need foresight, a systemic approach and follow-through,' he said. Yet perhaps the most controversial remarks came from MMC Corp Bhd MD Tan Sri Che Khalib Mohamad Noh who strongly reminded that every energy transition needs to be gradual and realistic. He was particularly critical towards financial institutions for penalising coal plants while still relying on them for baseload power. 'Banks have always been seen as a dirty business. Today, they refuse to finance coal but hike rates instead. 'Who pays? The rakyat. Electricity from coal or solar is still an electron. Malaysia needs a strategy that fits our context — not one forced by external pressure,' he said. He warned that Malaysia's 70% renewable target by 2050 could be unattainable if policy contradictions persist, especially with energy-intensive investments like data centres. 'Industrialisation takes 30 to 40 years. We need stability, not goal-posts that keep moving,' he added. This article first appeared in The Malaysian Reserve weekly print edition
Malaysian Reserve
16-06-2025
- Business
- Malaysian Reserve
ASEAN power grid gains momentum amid infrastructure, policy gaps
by NURUL NAJMIN ABU BAKAR THE ASEAN Power Grid is moving forward as governments and energy companies push for stronger regional collaboration in renewable energy. However, experts warn that outdated infrastructure and regulatory gaps could slow progress. Masdar Clean Energy's head of business development (APAC) Fatima Al Suwaidi said Southeast Asia holds strong potential, but limited grid capacity could affect project viability. 'Renewables are growing rapidly, but without proper grid support, projects could become stranded. Our concern as developers is whether we can actually deliver the power we generate,' she said at Energy Asia 2025 on Monday. Masdar Clean Energy, based in Abu Dhabi, has over 51GW of clean energy projects globally and aims to reach 100GW by 2030. Southeast Asia is one of its focus regions, but Fatima said success depends on several enablers. 'Clear policies, reliable offtake agreements and strong local partnerships are critical for long-term viability,' she said. In Indonesia, the government plans to build 48,000km of transmission lines over the next 10 years, led by state utility Perusahaan Listrik Negara (PLN). The RM40 billion investment aims to improve national electrification and support green energy exports. A memorandum of understanding has already been signed with Singapore. Meanwhile, Pertamina New & Renewable Energy CEO John Anis said ASEAN must prioritise regional cooperation and boost government support to reduce risk in renewables, particularly in geothermal exploration. 'Each ASEAN country has its own strengths. Connecting these resources builds a more resilient power system for the region,' he said. The ASEAN Centre for Energy (ACE) said the power grid has become a key part of national climate strategies, with 18 cross-border interconnections identified as priorities. Nadhilah Shani, manager of power and interconnection department at ASEAN centre said Malaysia's National Energy Transition Roadmap includes the ASEAN Power Grid as a key pillar, while Thailand and Indonesia have also outlined cross-border energy trade initiatives. Fatima said project timelines remain a concern in the region. 'There is interest and capital, but slow licensing, outdated rules and limited digital systems are holding things back,' she said, noting that projects in Southeast Asia often take up to five years, compared to under a year in the Middle East. While regulatory frameworks for renewable generation are largely in place, panellists said transmission infrastructure still lacks the necessary support to attract private investment. Renewable energy certificates were proposed as a tool to encourage grid-related financing. The goal is a fully integrated and digitally managed ASEAN grid that delivers clean electricity from low-cost sources to high-demand areas, by 2035. Meanwhile, Anis noted that energy is the foundation of growth. 'With cross-border collaboration, we can speed up the transition and ensure long-term prosperity for the region,' he said.
Malaysian Reserve
16-06-2025
- Business
- Malaysian Reserve
Malaysia to table ASEAN power grid roadmap by year-end
by NURUL NAJMIN ABU BAKAR MALAYSIA will present the ASEAN Power Grid Roadmap by the end of 2025 as part of its efforts to accelerate regional energy integration during its chairmanship of ASEAN. Deputy Prime Minister Datuk Seri Fadillah Yusof said the roadmap will serve as a foundation for the Philippines, as the next ASEAN Chair, to begin implementing the initiative in 2026. He said the success of the ASEAN Power Grid hinges on three critical elements which are harmonisation of regulations, alignment of technical standards and viable business and financial models. 'We need to ensure the grid system is stable and interconnected to support clean and renewable energy (RE) sources across ASEAN. Without a reliable grid, energy cannot be distributed effectively,' he said during the Leadership Dialogue session at Energy Asia 2025 today. Fadillah, who is also the Minister of Energy Transition and Water Transformation, noted that ASEAN countries possess complementary renewable resources, including hydro in Vietnam and Laos, solar in Malaysia and ocean power in Indonesia. He said these varying sources require strong collaboration and integration through a shared grid network. He added that discussions are ongoing within ASEAN's energy committee to establish standardised regulations and potentially create a regional energy regulator to oversee cross-border coordination. 'The vision is to make ASEAN a major global RE hub and we need to attract investment in technology and infrastructure to realise this ambition,' he said. Fadillah said Malaysia's own National Energy Transition Roadmap offers a clear pathway to net-zero emissions by 2050, with 70% of power to come from renewable sources. He said achieving this requires RM635 billion in investmentsand Malaysia is actively inviting global partners to participate. He also stated that Tenaga Nasional Bhd (TNB) is investing over RM40 billion to upgrade the national grid in preparation for cross-border integration. In East Malaysia, the Borneo Grid led by Sarawak is already supplying electricity to West Kalimantan and will eventually connect to Singapore, Brunei and Peninsular Malaysia.
