From left: Oppstar chief financial officer Chin Fung Wei, independent non-executive director Datuk Mohd Sofi Osman, independent non-executive chairman Datuk Siti Hamisah Tapsir, executive director and CEO Ng Meng Thai, executive director and chief technology officer Cheah Hun Wah, chief operating officer Tan Chun Chiat, independent non-executive director Datuk Margaret Yeo and independent non-executive director Foong Pak Chee
Oppstar soars 225% on ACE Market debut
KUALA LUMPUR: Oppstar Bhd made its debut on the ACE Market of Bursa Malaysia at RM2.05 a share, a 225.4% premium over the issue price of 63 sen a share.
The stock was the most actively traded with 19.26 million shares exchanging hands.
The integrated circuit design service provider successfully raised RM104.25mil from the initial public offering exercise via the issuance of 165.48 million new ordinary shares.
Oppstar will utilise RM50mil to expand its workforce and RM25.00mil for the establishment of new offices both locally and regionally.
Meanwhile, another RM12mil will go towards research and development expenditure along with RM12.65mil for working capital.
The remaining RM4.6mil will be allocated for its listing related expenses.
“Our vision for the company is simple and clear and it is to show the global players that Malaysia is not only known for its back-end semiconductor value chain, but also has the capability to go into front-end semiconductor IC design.
"I am proud to say that we now serve clients in countries such as China, Malaysia, Japan, Singapore, as well as the USA.
"As we gradually progress, we continually ask ourselves what we can do to expand our business and continue to build up Malaysia’s profile in the front-end semiconductor space. This was where the rationale to go for a listing came about leading up to this today," said Oppstar executive director and CEO Ng Meng Thai said in a statement.
PETALING JAYA: Oppstar Bhd will focus on building its human resource capital post-listing, as the technology sector is set to grow from the opportunities presented by 5G, artificial intelligence and the Internet of Things.
The integrated circuit design service provider’s chief executive officer Ng Meng Thai said the bulk of the proceeds raised from Oppstar’s listing on the ACE Market of Bursa Malaysia yesterday would be used for the workforce expansion.
“At the moment we have 220 engineers and we have plans to increase that number to 500 in the next three years. With an enlarged workforce, we also hope to grow our revenue and profitability accordingly,” he said after the company’s listing yesterday.
The group is collaborating with various universities in the country to secure future design engineers.
“We started a programme in 2020 where we hire third-year university students for three months. They work part time for 20 hours a week and are paid RM1,500 a month. Upon graduating, they are required to work for us for a year. This is how we build our talent pool.
“When it comes to business, the multinational corporations (MNCs) are our customers. However these MNCs become our competitors when it comes to hiring. This is why other than fundraising, our objective in carrying out the listing exercise is also about hiring and retention,” said Ng.
Oppstar raised RM104.3mil from the public issue of 165.48 million new shares. The company made its debut in the market opening at RM2.05 per share, or a RM1.42 premium above the offer price of 63 sen per share.
The stock closed its maiden trading day up 285.7% or RM1.80 higher at RM2.43 a share. The share price hit a high of RM2.95 and a low of RM2 in intraday trade. Oppstar’s listing did not have an offer for sale of shares from its shareholders.Oppstar chief financial officer Chin Fung Wei said the group intends to implement a long-term incentive plan of up to 15% of the total number of issued shares of the company for its employees.
“Prior to our initial public offering (IPO), we already had more than 20 shareholders. In fact, every one of our employees, except for those that came on board after the IPO’s closing date, is a shareholder of the company. This is one of our remuneration methods for our employees, apart from their monthly salary,” he said.
Ng added the group’s listing showed Malaysia was not only known for its back-end semiconductor value chain, but also had the capabilities to go into front-end semiconductor integrated circuit design.
“We serve clients in countries such as China, Malaysia, Japan, Singapore, as well as the US. Our expansion plans will enable us to groom future talent and grow our geographical presence which will progressively help strengthen Malaysia’s front-end semiconductor ecosystem in line with our vision,” he said.
The group plans to payout at least 25% of its annual earnings as dividends. AmInvestment Research said the US-China trade war bodes well for Oppstar because China is compelled to develop its own semiconductor capabilities.
7 Mar 2023 — PETALING JAYA: Oppstar Bhd, which is en route to a listing on Bursa Malaysia's ACE Market on March 15, saw its initial public offering (IPO) ...
Southeast Asia, like much of the rest of the world, is losing patience with King Dollar.
The westernization of the world’s reserve currency, as through sanctions on those deemed bad actors — such as Russia for its war in Ukraine — has pushed even the typically diplomatic Southeast Asians to warn the US of the consequences.
In a conference in Singapore on Tuesday (Jan 10), multiple former officials spoke about de-dollarisation efforts underway and what economies in the region should be doing to mitigate the risks of a still-strong dollar that’s weakened local currencies and become a tool of economic statecraft.
“The US dollar is a hex on all of us,” George Yeo, former foreign minister of Singapore, said at the conference hosted by the ISEAS-Yusof Ishak Institute. “If you weaponise the international financial system, alternatives will grow to replace it” and the US dollar will lose its advantage.
While few expect to see the end of King Dollar’s global sovereign status anytime soon, Yeo urged that the risk of it happening be taken more seriously.
“When this will happen, no one knows, but financial markets must watch it very closely,” said Yeo, who is a visiting scholar at the National University of Singapore’s Lee Kuan Yew School of Public Policy.
After gaining 6.2% in 2022, the US dollar is down 0.67% in the first several days of this year, through the end of Tuesday, according to the Bloomberg Dollar Spot Index.
Yeo noted that in times of crisis, the US dollar rises further — as with levies on Russia that have left Russian banks estranged from a network that facilitates tens of millions of transactions every day, forcing them to lean on their own, much smaller version instead. That’s put more pressure on third-party countries, too, which have to unduly rely on US dollar use.
Following on Yeo’s remarks later in the conference, former Indonesian trade minister Thomas Lembong applauded Southeast Asia's central banks that already have developed direct digital payments systems with local currencies, and encouraged officials to find more ways to avoid leaning too hard on the greenback.
“I have believed for a very long time that reserve currency diversification is absolutely critical,” said Lembong, who’s also a co-founder and managing partner at Quvat Management Pte Ltd. Supplementing US dollar use in transactions with use of the euro, renminbi, and the yen, among others, would lead to more stable liquidity, and ultimately more stable economic growth, he said.
The 10 Asean countries are just too disparate to establish a common currency as with the euro bloc. But Lembong said he was “deeply passionate” on this subject of the US dollar as a global reserve currency.
The direct digital payments systems — which have boosted local currency settlement between Malaysia, Indonesia, Singapore and Thailand — are “another great outlet for our financial infrastructure”, he said.- Bloomberg
Russia said it is to resume foreign currency interventions with the sales of yuan starting on Friday, a move
signaling that the Chinese currency is playing an increasingly important role in stabilizing the ruble and Russia's domestic financial
stability amid closer bilateral trade connections, experts said.
New Prime Minister Datuk Seri Anwar Ibrahim has been welcomed by many like a breath of fresh air. But can he cleanse the nation of the many ills it now suffers? It remains to be seen.
MY retired brother called from Penang the other day. He had yet to get his pension and needed some cash. Why? I asked. “Anwar has won and I want to celebrate with my friends,” he cheered. He is just one of many who are anamoured of our new Prime Minister.
There is also this man in Bukit Mertajam, Datuk Seri Anwar Ibrahim’s hometown, who is buying everyone meals at restaurants around town.
Elsewhere, a large non-Muslim crowd gathered outside a mosque as Anwar prayed inside. And they mobbed him when he came out. Everywhere he goes, the PM is being cheered.
He’s probably the most welcomed Malaysian chief executive in living memory. It’s all quite exciting, but I think the celebrations are also a bit premature.
Yes, it has been a long wait for him, his supporters and those who have been rooting for him all these years. He has been the underdog, facing failure after failure, falling every time he believed he had reached the pinnacle.
It’s the kind of story that would touch any heart.
But it’s only the beginning. Now is not the time to put him on a pedestal. He has much to prove, and he could fall off that high horse any time, just as the last three prime ministers did.
The plotting is going on. Those who do not like the idea of him being PM will do their best to bring about his downfall.
It happened before in 2020 with the Sheraton Move; and even days after Anwar’s appointment, there was talk of a Tropicana Move.
That has been denied, but his performance will be under intense scrutiny. There will be little room for relaxation.
His first task just got done. He has named his full Cabinet, obviously done with much juggling, putting together a unity government that will keep everyone happy and yet meet his promise of a small Cabinet.
If that was hard, the really herculean task awaits now.
There is so much wrong with our country now – an economy in the doldrums, a ringgit that’s floundering, an education system that’s well off the mark, and a population that’s deeply divided.
There’s so much to do – or undo.
I say undo because Anwar himself may be responsible for some of those maladies. He was once Education Minister – way back in 1986 – and started a revolution in the system.
He is the man credited with Islamisation of our schools, and the growth of religious schools, while working with then Prime Minister Tun Dr Mahathir Mohamad.
Those actions have come back to bite him, say analysts. Two weeks ago, his daughter lost the Permatang Pauh seat, held by members of his family since 1980, to a tahfiz teacher.
Anwar, and his Angkatan Belia Islam Malaysia (Abim), were the driving force behind such schools.
The children in many of these schools are being taught to only vote for a certain party, and with Undi18 now law, there was a flood of such voters, the analysts say.
With the mushrooming of religious schools, the days when children of all races laughed, played and mixed in schools seem to be long gone.
Now, schools are divisive. Even the syllabus has been questioned with Malays themselves asking why there are so many religious classes and too few teaching modern-day living skills like English, science and technology, computer know-how and things like that.
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The Chinese and Indians are flocking to vernacular schools, leaving the national school system largely to the majority Malays. So many Malays are also migrating to these vernacular schools.
Already, there is a call for one stream of education for all. I think it’s too early for that too. We first need to make the national school system the one of choice. For that, a good Education Minister is needed, as is a revamp of the school syllabus. Fadhlina Sidek and Datuk Seri Khaled Noordin have a lot to do.
We have heard the perennial complaints – discrimination in matriculation places, the closure of canteens during Ramadan, children forced to eat in the toilet and odd corners, non-Muslim children being left to their own devices during agama classes ... the list is long.
Public universities too need to be places where a Malaysian identity can be forged, not where differences are reinforced.
A National Unity Minister who sincerely believes in his job could be a big help. Aaron Ago Dagang, a man from Sarawak, could be the right choice.
There is a lot we can learn from the Borneo states, which have retained much of the old-world charm that places like George Town, Klang, Johor and even Kuala Lumpur once had; the days when Chinese coffee shops housed nasi kandar stalls and people of all races sat together at the same table, eating and drinking together.
Even my mee jawa man had prawn and beef broth for his different clientele, each with a different wok.
Then there’s the minister for Religion. We have all heard about the one from Indonesia; his mantra is that he is a minister for all religions – Islam, Christianity, Hinduism or Buddhism.
It was not so the last time for the minister in Malaysia. He believed his job was only to cater to the religion of the federation.
What we need is a minister who looks at the similarities among religions, all of which preach peace and unity, not one who considers his religion superior and therefore untenable with the others.The Rulers have got it right. They have called for an end to all extremism, religious or racist, and for unity to be the main consideration. It is important that the government works towards bringing the bitterness to an end.
“I hope there are no more leaders who will raise racial or religious issues to provoke the people,” said Negri Sembilan’s Tuanku Muhriz ibni Almarhum Tuanku Munawir.
They also want the Rukun Negara, whose first tenet is “Belief in God”. It does not say which religion. The supremacy of the Constitution and the rule of law are also important.
Now, it is up to the new PM. He has his job cut out for him. The honeymoon with the voters and adulation of the supporters will be over real soon.
The work – and it’s a lot of hard work – will have to begin. The pitfalls and booby traps are many. His supporters have faith that he will make it.
Five years from now – if Anwar succeeds as a unifying PM – we can celebrate as a nation. For now, though, I am holding that champagne, or non-alcoholic beer as the case may be.
Anwar says he took Finance Ministry to bring new policies
PUTRAJAYA: Prime Minister Datuk Seri Anwar Ibrahim, who appointed himself Finance Minister in his new Cabinet, is hoping to
restore economic confidence through new policy approaches.
“I was not inclined (to take on the post), but I want to embark on new policy approaches and restore economic confidence among local traders as well as foreign investors.
“I
will be assisted by a strong team that isn’t only civil servants, but also a group of advisers who will not burden the government’s coffers,”
he said in announcing his Cabinet at Perdana Putra here yesterday.
In the follow-up press conference, Anwar said the Finance Ministry will be
assisted by several advisers led by former PETRONAS president and chief executive officer Tan Sri Mohd Hassan Marican.
Meanwhile, Anwar said the new Cabinet members will be sworn in at 3pm today.
“I
will have a special meeting with the ministers so I can convey several matters to them, such as new rules, direction, and new methods,” he
said.
Anwar said ministers should begin their duties soon and he advised them to avoid wastage, bribes and power abuse.
“I have made it clear to the Cabinet that the unity government prioritises good governance and the need to reduce the people’s burden, as well as stimulating the economy,” he said.
The Prime Minister said his Cabinet, which comprises 28 ministers, is a clear signal to the people that the unity government, together with the civil service, will ensure its promises to the people are fulfilled.
The last prime minister who also served as a finance minister was Datuk Seri Najib Razak.
Anwar had served as finance minister and deputy prime minister to then
premier Tun Dr Mahathir Mohamad before being sacked in 1998.
Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz announced on Friday (Oct 7) that RM372.3 billion will be set aside for Budget 2023 versus last year’s RM332.1 billion allocated in the previous budget.
In tabling Budget 2023, Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz said the government has allocated RM15.bil for the Higher Education Ministry and RM6.7bil for various Technical and Vocational Education and Training (TVET) activities.
Budget 2023: Income tax cut by 2% for RM50,000-RM100,000 taxable range
The personal taxation rate will be reduced by 2% on taxable income ranging from RM50,000 to RM100,000 for domiciled individuals.
In tabling Budget 2023 in Parliament on Friday (Oct 7), Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz said for the taxable income range RM50,001 to RM70,000, the rate will be reduced from 13% to 11%.
[LIVE] Tabling of 2023 Budget in Parliament
[LIVE] Special programme on 2023 Budget with former finance minister II Datuk Seri Johari Abdul Ghani and PKR deputy president Rafizi Ramli.
PETALING JAYA: Finance Minister Tengku Zafrul Aziz has tabled Budget 2023, announcing an allocation of RM372.3 billion.
This represents a RM40.2 billion increase compared to the RM332.1 billion allocated for 2022.
Around RM272.3 billion has been allocated for operational expenditure and RM95 billion for development.
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Here are the highlights of Budget 2023:
Education
RM55.6 billion allocated for education, the biggest in the budget for a ministry.
RM825 million in early school aid for students, with students receiving RM150 regardless of their parents’ incomes.
RM777 million for supplementary food programme (RMT), benefiting 800,000 students and 7,300 canteen operators.
RM2.3 billion to ensure students have a conducive and safe learning environment.
RM1.1 billion to repair and maintain all schools, including vernacular and religious schools.
RM430 million to construct five new schools in Sabah, Sarawak, Terengganu, Cyberjaya and Selangor.
RM20 million to improve facilities in special needs schools.
RM188 million to set up 10 Kemas daycare centres.
Development
RM1.5 billion for sustainable development.
RM562 million to implement the Sabo dam project.
RM510 million to improve road infrastructure to Pengerang.
Pan Borneo Highway to be completed by 2024.
RM11.4 billion for maintenance and repair of existing government buildings.
RM5.2 billion for maintenance of state roads.
RM150 million for the development of border towns near Thailand and Kalimantan.
RM3.7 billion for small and medium projects across the nation.
RM500 million on G1-G4 infrastructure projects.
Social Welfare
In total, Putrajaya will spend RM10 billion in welfare and Bantuan Keluarga Malaysia (BKM) aid.
RM2.5 billion in welfare aid benefiting 450,000 households.
RM2,500 in BKM aid for households earning less than RM2,500 monthly.
Up to RM1,250 BKM aid for singles and RM3,000 for single parents.
One-off RM500 incentive for female BKM recipients who give birth in 2023.
RM7.8 billion for BKM which will benefit 8.7 million people.
RM1 billion in welfare aid for the elderly.
RM1.2 billion to support disabled people to be financially independent.
RM10 million in e-hailing vouchers for the disabled.
RM8 million for social support centres.
RM734 million for MySalam programme. This will benefit 1.5 million people from the B40 group.
Voluntary Employees Provident Fund (EPF) contributions raised from RM60,000 to RM100,000 a year.
RM21 million in grants for operators of welfare homes.
Limits for Amanah Saham Bumiputera (ASB) and ASB2 savings to increase to RM300,000.
Government to provide incentives to establish more daycare centres for the disabled.
RM120 million for Kasih Suri Keluarga Malaysia programme, benefiting 200,000 housewives.
Security
RM431 million to procure new assets for the police.
RM42 million to upgrade police quarters.
RM118 million for the maintenance of armed forces homes.
RM28 million to upgrade prison staff quarters.
RM73 million to enhance cybersecurity.
The government will set up a national scam response centre.
Health
Total of RM36.1 billion allocated for the health ministry.
RM11 million for subsidies for mammograms and cervical cancer screening.
RM20 million to promote Malaysia as a medical tourism destination.
RM4.9 billion for public healthcare.
RM420 million to repair dilapidated hospitals and clinics.
RM1.8 billion to purchase new equipment for hospitals and clinics.
The government to set up a mental health centre of excellence.
RM10 million to purchase 3D printing machines for dental health services.
Allocations to treat rare diseases increased to RM25 million.
RM80 million for Socso health screening programme.
RM15 million for Agenda Nasional Malaysia Sihat programme to encourage healthier lifestyles.
RM80 million for the PEKA B40 programme.
Import duty and sales tax exemptions for nicotine replacement therapy products.
Economy
RM235 million to support the development of female entrepreneurs.
RM50 million for young trader scheme under Bank Simpanan Nasional.
2% reduction in income tax of micro SME operators.
One-off RM1 billion grant to all registered MSMEs and taxi drivers. To benefit one million recipients.
RM45 billion Semarak Niaga funds for entrepreneurs.
RM10 billion in funds from Bank Negara Malaysia (BNM) to automate and digitise SMEs.
RM200 million to boost income and productivity of smallholders.
GLCs and GLICs to invest up to RM50 billion in 2023.
Government-linked companies (GLCs) and government-linked investment companies (GLICs) to invest RM50 billion in 2023, including RM45 billion in direct domestic investments.
The government will provide incentives for multinational companies to establish operations in Malaysia.
RM100 million to support development of local technology companies.
RM10 million in matching grants allocated to help SMEs.
RM800 million to provide RM100 e-wallet credit for 8 million people in the M40.
Petronas will contribute RM2 billion to the National Trust Fund (KWAN).
RM1.4 billion to boost connectivity in the five main economic corridors.
Civil service
RM100 subsidy for civil servants for insurance coverage.
RM1.5 billion for RM100 increment for all civil servants between Grade 11 to Grade 56.
RM1.3 billion for one-off RM700 special aid for 1.3 million civil servants under Grade 56.
RM350 one-off aid for one million retired civil servants.
Aidilfitri aid for civil servants increased to RM600.
Special leave for over 500,000 teachers.
Higher education
RM15.1 billion allocated for the higher education ministry.
RM3.8 billion for scholarships and education loans.
RM6.6 billion for Bumiputera education loans.
RM6.7 billion for TVET training and education.
RM180 million to fund TVET training, benefitting 13,000 trainees.
Up to 20% discounts for PTPTN repayments from Nov 1 to April 30, 2023.
Environment
RM15 billion for flood mitigation initiatives.
RM2 billion to build retention ponds.
RM500 million to widen rivers in Kelantan.
RM3 billion for Green Technology Financing Scheme (GTFS).
RM150 million from Khazanah Nasional Berhad to support development of green projects.
RM165 million for Tenaga Nasional Berhad (TNB) to set up solar rooftops and EV charging stations.
Carbon tax to be introduced.
100 million trees to be planted by 2025.
The government will step up forest restoration projects.
RM100 million for ecological fiscal transfer (EFT).
RM36 million to support conservation of elephants and other endangered species.
RM216 million to clean rivers nationwide.
Job creation and community support
The MyStep programme will provide 50,000 jobs including 15,000 in the public sector and 35,000 in government-linked companies (GLCs).
RM750 million to upskill 800,000 workers.
RM100 million for Mitra to develop entrepreneurs.
Socso to provide incentives for employers to hire the disabled, Orang Asli, ex-convicts and women returning to work. The incentive worth up to RM750 a month will be given for three months per employee.
Socso will provide incentives for employers to hire jobless youths.
RM50 million to boost Bumiputera commercial property ownership.
RM20 million to set up new urban transformation centres (UTC).
RM11 million on mobile bank initiatives.
RM63 million for development of human capital.
RM50 million to support development of female contractors.
RM100 million for Khazanah’s Yayasan Hasanah to conduct various community initiatives.
Sabah and Sarawak
Total RM11.7 billion allocated for Sabah and Sarawak.
RM1.2 billion to improve the infrastructure in dilapidated schools in Sabah and Sarawak.
RM209 million to subsidise air travel to rural areas in Sabah and Sarawak.
RM1.5 billion to improve transport infrastructure in Sabah and Sarawak.
RM100 million to improve the water supply system in Sarawak.
RM250 million for expansion of the Sapangar Bay Container Port (SBCP).
Taxes
Personal income tax reduced by 2% for those earning between RM50,001 to RM100,000.
This will benefit over one million people in the M40.
Income tax exemptions of up to RM3,000 for Tadika and daycare fees.
Tax incentives to attract investors.
Government reiterates implementation of Tax Identification Number to widen tax base.
Tax incentives for local pharmaceutical companies will be extended.
Tax incentives and RM50 million to support development of aerospace components.
The government will provide special incentives for investors in the chemical and petrol chemical industry.
Import duties and sales tax exemptions for the purchase of film equipment.
Tax incentives for NGOs involved in sports at the grassroots level.
Tax incentives for green initiatives extended to Dec 31, 2025.
100% income tax exemption for manufacturers of EV charging parts.
Additional tax deductions for employers who hire former residents of juvenile institutions.
Government to introduce qualified domestic minimum top-up tax.
Tourism
RM200 million to promote tourism recovery.
RM90 million in grants to promote tourism activities.
New chartered flights to and from East Asia and the Middle East.
RM10 million to promote eco-tourism.
RM25 million in incentives to promote domestic tourism.
RM500 million in tourism financing from BNM.
RM10 million for the ThinkCity initiative in Kuala Lumpur.
Arts and Culture
RM50 million to support the local film industry.
RM102 million to support local artists.
RM5 million to strengthen national language programmes.
RM10 million to support preservation of local languages and cultures.
Commodities
RM200 million to subsidise the logistic cost for the distribution of essential goods.
The government will hold Keluarga Malaysia sales offering essential items at more affordable prices.
The government will continue measures to combat the illicit cigarette trade.
RM20 million in matching grants to support development of local products.
RM10 million to support the made in Malaysia campaign.
RM92 million for development of the halal industry.
Approved permit fees for import of EVs extended to Dec 31 next year.
RM256 million in monsoon aid for rubber smallholders.
Agriculture
RM1.8 billion in subsidies for farmers and fishermen.
RM228 million in aid for padi farmers. This will benefit 240,000 people.
The government will introduce an agriculture protection scheme.
RM1 billion to fund agrofood programmes.
RM56 million to support sustainable farming.
RM315 million for rubber planting programmes.
RM40 million to encourage smallholders to diversify their crops.
RM70 million to support the Malaysian Sustainable Palm Oil (MSPO) certification programme.
The government will support automation initiatives in the plantation sector.
Defence
RM17.4 billion for the defence ministry, including RM4 billion for the purchase of new military assets.
RM485 million for the maintenance of all MMEA ships and boats.
RM330 million for EV infrastructure.
Transport
RM180 million to improve bus services in Melaka, Kedah, Kota Kinabalu and Kuching.
Continuation of My50 RapidKL monthly pass to benefit 180,000 users.
RM16.5 billion for major transport infrastructure projects.
RM50.2 billion for the MRT3 project.
RM1 billion for the maritime and logistics industry.
Housing
Stamp duty discounts of up to 75% for houses worth between RM500,000 to RM1 million.
RM10 stamp duty for properties transferred between family members.
RM367 million to build people’s housing projects (PPRs), to benefit 12,400 new residents.
RM3 billion for housing credit guarantees.
RM40 electric bill subsidy to be extended.
Digital connectivity
Phase 2 of the Jendela project to involve RM8 billion in investments, including from industry players.
RM700 million allocated for Jendela to expand digital connectivity in 47 industrial areas and 3,700 schools.
Digital Nasional Berhad (DNB) to spend RM1.3 billion in infrastructure development to widen 5G internet coverage nationwide.
Youth and sports
RM305 million in loans for youths to start businesses.
The government will introduce a special internet package for youths at RM30 for three months.
RM400 million to continue the e-Pemula scheme, which will benefit two million youths aged 18 to 20.
The government will bear the costs of e-hailing, taxi, and motorcycle licences for youths.
RM145 million to improve sporting infrastructure nationwide.
RM154 million to develop the local sporting ecosystem.
RM20 million to develop a drag race circuit.
RM13 million to develop e-sports.
RM12 million to support disabled athletes.
Rural communities
RM305 million for the Orang Asli community.
RM2.6 billion for Felda, Felcra and Risda.
RM472 million to improve rural electricity infrastructure.
RM54 million to build 85 new bridges in rural areas.
Disaster management
Additional RM400 million in allocation for the National Disaster Management Agency (Nadma) to prepare for year-end floods.
RM100 million allocated for the national disaster relief fund.
RM20 million in grants for community associations to assist in natural disasters.
Others
RM1.5 billion for Islamic development.
RM150 million for the maintenance and repairs for educational facilities under Jakim.
RM364 million for research and development for higher education as well as science, technology and innovation ministry.
RM30 million to improve I-Saraan programme that will benefit 100,000 people.
All self-employed people will be required to contribute to Socso from next year onwards.
The government will introduce e-invoice similar to initiatives in France and Brazil.
The government will table a consumer credit bill in the second quarter of 2023.
Budget 2023 will offer assistance to all segments of society. Here are some of the highlights:
The government will be adopting a holistic approach to improve economic recovery and the rakyat’s wellbeing postpandemic.
Defence/ Home Ministry
Rm17.4bil for Mindef
> Rm4bil for Malaysian armed Forces assets procurement and maintenance.
> rm47mil for two additional field hospitals in Kluang and Kota Kinabalu as early measure for national disasters.
> Rm118mil for rumah Keluarga angkatan tentera (rkat).
> 50% off for 21,000 armed Forces and police veterans card holders on
all Prasarana public transport services in Kuala Lumpur, Selangor,
Pahang and Penang.
Rm18.3bil for Home Ministry
> Rm431mil for procurement and maintenance of police assets.
> Rm42mil for police quarters upgrades and repairs.
> Rm18mil for Prisons department to acquire body scanners and upgrade facilities at five correctional centres.
> Rm485mil for Malaysian Maritime enforcement agency (Mmea) ships and vessels maintenance.
Health
> Rm36.1bil to be allocated to Health Ministry.
> Rm4.9bil to step up capacity of healthcare sector (includes procurement of medicines, reagents and vaccines, among others).
> Rm420mil to repair dilapidated hospitals, clinics and replacing medical equipment.
> Rm80mil for Pekab40 Health scheme.
> Rm734mil for mysalam.
> Rm1.8bil for the construction of new hospitals, clinics and healthcare facilities.
> Rm34mil to set up mental health centres. Rm25mil to be
allocated for Hospital Kuala Lumpur and Hospital tunku azizah which will
be reference centres for rare diseases.
MALAYSIA’S economy is expected to grow by 4% to 5% in 2023 after posting a growth rate of between 6.5% and 7% this year.
“Despite a softening world economic growth and trade activities, the
economy is projected to grow between 4% and 5% in 2023, supported by
steady domestic demand, a vibrant services sector, implementation of new
and ongoing high multiplier infrastructure projects and sustained
exports.
“The government will continue to monitor global developments as well as
implement appropriate policies and reform initiatives to strengthen the
economy and fiscal position to withstand potential external shocks,
improve people’s livelihoods and enhance business resilience,” said the
Economic Outlook for 2023.
The global economy is projected to grow by 2.9% in 2023, albeit
moderately due to slower-than-expected growth in both advanced economies
as well as emerging markets and developing economies.
For Malaysia, the services sector is forecast to grow by 5% in 2023,
benefitting from the sustained domestic demand in spite of moderate
global economic growth.
Growth will continue to be mainly driven by wholesale and retail trade;
real estate and business services; information and communication;
transportation and storage; and food and beverages and accommodation
subsectors.
The manufacturing sector is forecast to grow by 3.9%, supported by
expansion in all subsectors. Output in export-oriented industries is
anticipated to increase despite a softening global trade, with the
electrical and electronic segment continuing to drive the industries.
In addition, the output of the rubber-based products segment is
projected to rise, mainly attributed to the increase in production of
tyres and tubes following buoyant global demand for motor vehicles.
For 2023, the agriculture sector is forecast to increase by 2.3%,
attributed to an improvement in labour supply within the sector. The oil
palm subsector is expected to expand on account of higher output
following an increase in fresh fruit bunch production and a better oil
extraction rate.
The price of palm oil is forecast to average at RM4,300 per tonne in
2023 compared with RM5,000 per tonne in 2022 and higher than the last
10-year average of RM2,685 per tonne, as supply of global edible oils
and fats is anticipated to remain tight.
The mining sector is expected to expand by 1.1% on account of higher
natural gas output as the completion of new pipeline projects in
Sarawak, namely the Kasawari, Jerun and Timi, is anticipated to boost
production, especially during the second half of the year.
Brent crude oil price is expected to record a lower average of US$90 (RM412) per barrel.
The construction sector is forecast to expand by 4.7% in 2023 following a
better performance in all subsectors. The civil engineering subsector
is anticipated to rebound, buoyed by implementation of new projects such
as the Mass Rapid Transit Line 3 Circle Line and acceleration of
ongoing infrastructure projects which include the Rapid Transit System
(RTS) Link, East Coast Rail Link (ECRL) and Light Rail Transit Line 3
(LRT3).
In addition, the approved investment projects in the manufacturing
sector are anticipated to come onstream and subsequently create greater
demand for industrial buildings.
The economy is expected to remain resilient, with domestic demand
continuing to drive growth amid a softening global environment. Private
sector expenditure is forecast to grow at 5.8% with the share to gross
domestic product (GDP) at 76.2%, while public sector expenditure is
projected to expand by 2% with the share to GDP at 17%. Hence, domestic
demand is envisaged to further expand by 5.1%.
Private consumption, which has been robust despite global
uncertainties, is anticipated to grow by 6.3%. The growth forecast will
be supported by continuous improvement in the labour market as well as
robust economic and social activities particularly the tourism-related
activities.
The special financial assistance in January 2023 to civil servants
and pensioners will support household disposable income and stimulate
private spending.
Private investment is projected to register a growth of 3.7%
attributed to an increase in capital spending in technology-intensive
manufacturing and services sectors, particularly Ict-related machinery
and equipment.
The continuation of large-scale transportrelated projects such as
ECRL, LRT3 and RTS Link will also provide impetus to public investment.
These initiatives are expected to help public investment increase by
2.1% in 2023. Public consumption is also projected to expand by 2% on
account of higher spending on emoluments, mainly due to special
additional annual salary increment for civil servants.
The share of CE (Employee Compensation) of GDP is projected to rise to 35.2% in 2023.
However, the share is still relatively lower than comparable peers
and advanced economies. Thus, in ensuring a more equitable sharing of
the growth benefit between employees and capital owners, there is a need
for a paradigm shift from the low-wage labour market structure towards a
more decent wage standard. Otherwise, insufficient wage increase from
the current level may deter the attainment of the long-term CE target of
40% of GDP in 2025 under the 12th Malaysia Plan.
In line with strong economic growth expectation supported by
continued efforts to prevent revenue leakages and strategies to
implement a wider tax base, income from indirect tax and non-tax revenue
on production and imports is projected to expand by 7.5%.
Meanwhile, with the expiration of the Covid19 Fund assistance,
subsidy expenditure is expected to decrease significantly by 50.2%.
Thus, income from taxes less subsidies on production and imports is expected to record a larger increase in 2023.
Gross exports are expected to moderate by 2.2% across all sectors,
supported by modest external demand due to lacklustre growth following
global uncertainties arising from prolonged geopolitical tensions,
supply chain disruptions and volatility in global commodity prices.
Gross imports are expected to increase marginally by 0.2% on
account of high demand for capital, intermediate and consumption goods
indicating sustained domestic demand and improvement in investment
activities.
Fiscal deficit at 5.5% to GDP
The Federal Government’s revenue collection in 2023 is projected to be
lower at Rm272.6bil or 15% of gross domestic product (GDP) due to lower,
anticipated non-tax revenue collection.
In the Fiscal Outlook 2023, it said the nontax revenue is expected at
Rm67bil, declining 23% from 2022 due to lower dividends from government
entities.
However, tax revenue remains the major contributor and is anticipated to
grow moderately by 3.7% to Rm205.6bil, in line with the projected
slower economic recovery.
In line with the targeted spending approach, total expenditure in 2023
is projected to be slightly lower at Rm372.3bil or 20.5% of GDP, mainly
due to the expiry of the Covid-19 Fund.
The allocation for operating expenditure is reduced to Rm272.3bil,
primarily due to lower allocation for subsidies following the expected
moderation in commodity prices and gradual move towards a targeted
subsidy approach.
Meanwhile, the development expenditure allocation is projected to
increase significantly to Rm95bil on account of higher allocation for
the 12th Malaysia Plan programmes and projects such as construction of
highways and railways, medical facilities as well as educational
institutions.
In addition, a sum of Us$3bil (Rm14bil) is provided for the redemption of 1Malaysia Development Bhd bond.
Moreover, a sum of Rm5bil is for outstanding payments of the Covid-19 fund commitments made in 2022.
Overall, the fiscal deficit is expected to reduce to 5.5% of GDP in line
with the government’s commitment towards consolidating the fiscal
position for a more sustainable public finance in the medium term.
Similarly, the primary deficit is estimated to reduce to 2.9% of GDP.
Guided by the medium-term fiscal framework (MTFF), the fiscal
consolidation will be accelerated once the inflationary pressure
dissipates and the economy fully recovers.
The MTFF 2023-2025 has been revised with underlying assumptions of
real GDP growth averaging 6%, crude oil prices at US$90 (RM417) per
barrel and stable crude oil production of 530,000 barrels per day.
These assumptions offer conservative estimates of revenue and prudent expenditure allocation during the MTFF period.
Total revenue in the medium-term is projected at Rm854.3bil or
14.7% of GDP, mainly contributed by non-petroleum revenue which is
estimated at Rm699.5bil or 12% of GDP.
Petroleum-related revenue is forecast at Rm154.8bil or 2.7% of GDP.
On the expenditure side, the total indicative ceiling for the
three years is estimated at RM1.1 trillion or 19.1% of GDP with OE
allocation projected at Rm842.8bil or 14.5% of GDP, and DE at Rm263.9bil
or 4.5% of GDP.
Overall, the fiscal deficit is expected to consolidate at a
gradual pace with the overall balance averaging at 4.4% of GDP for the
MTFF period.
Moving forward, the government is committed to improving the
credibility of the fiscal policy conduct and framework through holistic
reforms. The experience of other countries in reforming their fiscal
framework provides a valuable reference for the government in adopting
fiscal reform initiatives based on international best practices.
