ASEANREGIONAL

CARI CAPTURES • ISSUE 123

The 22nd ASEAN Summit opened

on Wednesday evening under the

theme “Our People, Our Future

Together” . All ASEAN member

countries were represented by

their Heads of Government except

Malaysia, which sent Senate

President Abu Zahar Ujang as

the country is in campaign mode

for upcoming General Elections.

Major issues discussed at the

ASEAN summit were: stability

of theKoreanPeninsula,South

ChinaSeadisputesandeconomic

integrationinASEAN

The Chairman of ASEAN, in a

statementissuedbytheMinistry

ofForeignAffairsandTrade,said

that ASEAN encourages the

Democratic People's Republic

of Korea to comply fully with

itsobligationstoalltherelevant

UnitedNationsSecurityCouncils,

and to its commitments under

AN ASEAN FUTURE TOGETHER01

the 19 September 2005 Joint

StatementoftheSix-PartyTalks

ASEANreaffirmsitsfullsupport

for all efforts to achieve the

denuclearisation of theKorean

Peninsulainapeacefulmanner

andtheearlyresumptionofthe

Six-PartyTalks

Lastyear,ASEANmemberstates

had different views on how to

handledisputeswithChinaover

theSouthChinaSea,butASEAN

leaders have been focused on

rebuilding unity during this

week'stalksinBrunei

PhilippinePresidentAquinosaid

hewashappy thatASEANwas

now at least united in trying

to ensure the disputes did not

"becomebloody"

Another key issue is ASEAN’s

efforts in pushing for deeper

economic in tegrat ion and

fully implementing the ASEAN

EconomicCommunity(AEC)

About77%oftheAECblueprint

first laid out in 2007 has been

agreed upon, according to a

confidentialdraft statement to

beissuedafterthesummit

However, overcoming the

remainingbarriersmightprove

tobedifficultbecauseofcertain

protectionist measures in the

highlysensitivesectors

Agriculture is one of the most

difficultsectorstoliberalise,as

manyASEANgovernmentswant

toprotect the largenumberof

farmers in their country that

dependonagriculturefortheir

livelihood

Phi l ippine Trade Secretary

GregoryDomingoalsosaidthere

are challenges in a framework

toliberalisetheservicessector

suchasbanking,insuranceand

telecommunications

While concluding the ASEAN

summit, officials say ASEAN

together with China, Japan,

South Korea, India, Australia

and New Zealand wil l start

talks in May to create the

16-nationRegionalComprehensive

EconomicPartnership(RCEP)

ASEAN

Xin Hua News (23 April 2013)Inquirer Business (26 April 2013)

Aljazeera (25 April 2013)Business Times (25 April 2013)

China Economic (24 April 2013)

29 APRIL 2013

CARICAPTURES

THE 22 ND ASEAN SUMMIT

2 5 TH AP RI L 2 0 13

KEY ISSUES ADDRESSED CONSENSUS

STABILITY OF KOREAN PENINSULA FULL SUPPORT FOR PEACEFUL MANNER OF ACHIEVING DENUCLEARISATION OF KOREAN PENINSULA

SOUTH CHINA SEA DISPUTE ASEAN UNITES VIEWS ON DISPUTES WITH CHINA

ECONOMIC INTEGRATION IN ASEAN 77% of AEC Blueprint Achieved, remaining might be difficult due to protectionist measures in sensitive sectors

RCEP Talks for a ASEAN+6 free trade area planned in May

CARI CAPTURES • ISSUE 123 29 APRIL 2013

DISCLAIMER: The news articles contained in this report are extracted and republished from various credible news sources. As such, CIMB ASEAN Research Institute (CARI) does not make any guarantee, representation or warranty, express or implied, as to the adequacy, accuracy, completeness, reliability or fairness of any such information and opinion contained in this report. Should any information be doubtful, readers are advised to make their own independent evaluation of such information.

BILLIONAIRES FIGHT FOR SIAM MAKRO

DHANIN CHEARAVANONTNET WORTH US$14.3 billion

CHAROEN SIRIVADHANABHAKDI

INDUSTRY FOOD INDUSTRY DRINKS

RECENT HIGH PROFILE AQUISITIONPing An Insurance, US$9.4 billion, Feb 2013

RECENT HIGH PROFILE AQUISITIONFraser & Neave Ltd., US$11.2 billion, Jan 2013

FINANCING BANKS UBS, HSBC FINANCING BANKS SOURCING FOR FUNDING

MAINCOMPANY CP GROUP MAIN

COMPANY THAI BEV

NET WORTH US$11.7 billion

AMOUNTOFFERED

FORSIAM

MAKRO

Gulf Times (23 April 2013)

ACTING FINANCE MINISTER TO CONTINUE EXPANSIONARY POLICY04

Indonesia’s new acting Finance

Minister Hatta Rajasa has pledged

to stick to the pro-growth, low-

debt fiscal policies already put

in place by predecessor Agus

Martowardojo easing market

fears.

Chief Economic Minister Hatta

Ra jasa was appo in ted to

the post by President Susilo

Bambang Yudhoyono after the

incumbentFinanceMinisterAgus

Martowardojoisduetotakeover

as head of the central bank in

lateMay

The appointment had created

unease as Rajasa, on top of

havingfamilytiestoYudhoyono,

only possesses an engineering

background, and is not a

technocratwithstrongeconomic

or financial background as is

usuallyrequiredforthisposition

Speculation has been rife that

INDONESIA

SIGNIFICANT GROWTH IN BIMP-EAGA02

The ASEAN Summit in Brunei over

24-25 April 2013 saw discussions

and progress on the 9th Brunei-

Indonesia-Malaysia-Philippines

East ASEAN Growth Area (BIMP-

EAGA).

The BIMP-EAGA mechanism

attempts to improveeconomic

integrationamongthecountries

and has a shared vision of

establishing it as a regional

INDONESIA MALAYSIA PHILIPPINESBRUNEI

GMA News Online (26 April 2013)NZ Week (26 April 2013)

food basket and ecotourism

destination through enhanced

connect iv ity for trade and

investment, whilst ensuring

sustainablemanagementofthe

environment

Theleadersofthefourcountries

i s sued a jo in t s ta tement

reporting that the total trade

valueofBIMP-EAGAgrewby75%

fromUS$100billion in2009to

US$170billionin2011,andduring

the sameperiod foreigndirect

investment in the BIMP-EAGA

countries grew by 124%, from

US$24billiontoUS$55billion

Thediscussionsshowedpromise

with the initiativebeinga step

towardrealisingthe2015goalof

anASEANEconomicCommunity

and yielded next steps, one of

which is the establishment of

the BIMP-EAGA Facil itation

Centre (BIMP-FC) by the next

Wall Street Journal (23 April 2013)Wall Street Journal (24 April 2013)

Bloomberg (25 April 2013)

BILLIONAIRES FIGHT FOR SIAM MAKRO03

Thailand’s richest man Dhanin

Chearavanont has offered US$6.6

bil l ion to buy Siam Makro, a

local discount store chain that

he had a stake in until 2005.

Fellow Thai billionaire Charoen

Sirivadhanabhakdi is sourcing

for funding to overbid Dhanin.

While Dhanin Chearavanont

facedfinancialstressin2005,he

soldhisstakeinSiamMakroat60

baht(US$2.06)ashare

Dhanin is now offering US$

6.6 bil l ion through CP ALL,

a subsidiary of CP Group, to

acquireSiamMakro,equivalent

toUS$27.50pershare,whichis

13 times the price he sold it 8

yearsago

CP ALL’s possible purchase of

SiamMakrowillbelargelyfunded

by debt, with UBS and HSBC

involvedinfinancingthedeal

THAILAND

CP Group has plans to expand

MakrothroughoutSoutheastAsia

andalsointoPakistanandChina

Thailand’s third richest man

Charoen Sirivadhanabhakdi is

nowtappingbanks for funding

in an attempt to launch a

counterbidforSiamMakro

Buying into Siam Makro would

extend Mr. Charoen's footprint

inThailand'sretailsector,where

heisalreadyheavilyinvolvedin

selling consumer products like

beer,tissuepaperandsoftdrinks

Meanwhi le , Thai land Stock

Exchangewillinvestigatesome

irregularit ies in the trading

activitiesthattookplacebefore

the announcement of Dhanin’s

bid

Rajasa is being primed to run

for presidency next year when

Yudhoyono steps down after a

decadeinpower,withtheacting

Finance Minister already head

of the National Mandate Party,

a moderate Islamistparty that

ispartoftherulingcoalition

Apartfromcontinuingalongthe

direction set by Martowardojo,

Rajasa isalsotogiveattention

tocuttingheftygovernmentfuel

subsidiestoavoiddeepeningthe

fiscaldeficitsthecountryfaces,

allayingfearsofaspendingspree

beforenextyear’selections

MinisterialMeetingtoeffectively

coordinate and monitor them

through a ful ly-functioning

centralsecretariat

CARI CAPTURES • ISSUE 123 29 APRIL 2013

DISCLAIMER: The news articles contained in this report are extracted and republished from various credible news sources. As such, CIMB ASEAN Research Institute (CARI) does not make any guarantee, representation or warranty, express or implied, as to the adequacy, accuracy, completeness, reliability or fairness of any such information and opinion contained in this report. Should any information be doubtful, readers are advised to make their own independent evaluation of such information.

PHILIPPINES

THAILAND MISSES EXPORT GROWTH TARGETS DUE TO STRONG BAHT05

Thailand’s strong economic growth and

attractive investment environment has led

to an inflow of foreign funds and appreciation

of the baht, causing lower export growth

than expected.

ForeignfundscontinuetoflowintoThailand

aftertheThaistockmarketwasupgradedto

astatusofanadvancedemergingmarketlast

November,leadingtoanappreciationofthe

baht

This year, the baht has gained 5.02%, a

relativelyhigh increasecomparedwith the

0.74%riseoftheChineseyuan,0.69%riseof

theIndianrupeeand0.1%riseoftheMalaysian

ringgit

TheBankofThailandhasreviseditsexport

growth projection down from 9% to 7.5%,

becausetheriseofthebahtismakingThai

exportslesscompetitive

Despite a strong currency, Thai exports

reachedUS$56.97billioninthefirstquarter

of this year which is an increase of 4.26%

yearonyear

Thegovernmentaimstorepay40-50billion

bahtofexternaldebtinanattempttoease

theupwardspressureonthebaht

Theprivatesectorisdemandinggovernment

assistanceduetothevolatileexchangerate

Thegovernmentisplanningonofferingloans

toexporterstobuyrubberinanattemptto

increasefallingprices,andhelpoutaround1.3

millionfarmerswhorelyonrubberproduction

fortheirlivelihood

Fruit farmers in the north and on the east

coastarealsoexpectingtoreceiveassistance

fromthegovernmentduetolowfruitprices

Business Standard (25 April 2013)Pattaya Mail (24 April 2013)

Bangkok Post (23 April 2013)Fresh Plaza (22 April 2013)

Bangkok Post (19 April 2013)

THAILAND

PHILIPPINES STRONG IN DEBT AND EQUITY MARKETS

PHILIPPINES AND VIETNAM LEAD IN RECEIVING REMITTANCES

06

07

Following a recent upgrade in the Philippines’

credit rating, funds are pouring into its capital

markets, making it one of the hottest Asian

markets lately.

The Philippines has become one of Asia’s

hottest markets for share and bond sales,

thanks toaboomingstockmarketand the

country’srecentupgradetoaninvestment-

gradecreditrating

The World Bank released its latest report

on migration and development, showing

that Philippines ranked third in the world in

receiving remittances while Vietnam ranked

ninth.

Accordingtothe19Aprilreport,Indiaison

thetopofthelist,receivingatotalofUS$69

billion worth of remittances in 2012, while

ChinarankedsecondwithUS$60billion

The Philippines received a total of US$24

billiontorankthirdandVietnamrankedninth

withUS$10billion

Just fourmonths into the year, companies

owned by tycoon Lucio Tan and blue-chip

giantSanMiguelCorp.have raisedbillions

ofdollarsintotal

More deals are coming up, such as the

US$500millionInitialPublicOffering(IPO)

ofTravellersInternationalHotelGroup,ajoint

venture between casino operator Genting

HongKongLtd.andPhilippineconglomerate

AllianceGlobalGroupInc.

AccordingtotheWorldBank,officialstatistics

showed that overseas remittances flowing

intodevelopingcountriesincreasedby5.3%,

reachingUS$401billionin2012

This figure is expected to increase by an

averageof8.8%annuallyoverthenextthree

yearstohitUS$515billionin2015

Trading activity has hit new records on

WednesdaywithatotalturnoverofUS$655

million, more than triple the average daily

turnoverforthefirstquarter

Foreign capital accounts for an estimated

40%ofthesetradingactivities

Wall Street Journal (24 April 2013)Wall Street Journal (25 April 2013)

Reuters (23 April 2013)

Vietnam Net (22 April 2013)

ASEAN

1 234 56782012 REMITTANCE FIGURES

PHILIPPINES VIETNAM THAILAND MALAYSIA INDONESIA CAMBODIA LAOS MYANMAR

24.453

96

BILLION USD

population (millions)87.3

population (millions)67.8

population (millions)27.5

population (millions)230

population (millions)14.8

population (millions)6.3

population (millions)50

population (millions)

10.0BILLION USD

4.124BILLION USD

1.272BILLION USD

7.207BILLION USD

0.257BILLION USD

0.117BILLION USD

0.566 BILLION USD

4.5population abroad

(millions)

2.23population abroad

(millions)

0.81population abroad

(millions)

1.481population abroad

(millions)

2.5023population abroad

(millions)

0.3504population abroad

(millions)

0.3666population abroad

(millions)

0.514population abroad

(millions)

• WHY IT MATTERS •

Remittances are an important inflow of foreign funds into a country especially in developing nations as they form a significant contribution to the development of the home country’s economy; remittances also build up foreign exchange reserves and help to stabilise exchange rates. It is impor-tant to note that official figures for remittances are often a major underestima-tion since many foreign workers do not send their money home using official banking transactions. While inflows of foreign funds into the home economy are usually a good thing, a large amount of remittances received might indicate severe ‘brain-drain’ problems faced by the country with underlying costs often difficult to estimate

World BankRemittances Gateway

Source: World Malaria Report 2012, World Health Organisationhttp://www.who.int/malaria/publications/world_malaria_report_2012/en/index.html

W . H . O A S E A N M A L A R I A

R A T E 2 0 1 2

10%

20%

30%40%50%

60%

70%80%

90%

PERCENTAGE OF POPULATION AT R ISK OF MALARIA INFECTION

C O U N T R Y W I T H L O W E S T R I S K

* B R U N E I & S I N G A P O R E R A T E S U N A V A I L A B L E

M A L A Y S I A4 % I N F E C T I O N R A T E

C O U N T R Y W I T H H I G H E S T R I S K

PHILIPPINES8 0 % I N F E C T I O N R A T E

CARI CAPTURES • ISSUE 123 29 APRIL 2013

DISCLAIMER: The news articles contained in this report are extracted and republished from various credible news sources. As such, CIMB ASEAN Research Institute (CARI) does not make any guarantee, representation or warranty, express or implied, as to the adequacy, accuracy, completeness, reliability or fairness of any such information and opinion contained in this report. Should any information be doubtful, readers are advised to make their own independent evaluation of such information.

SINGAPORE

MALARIA STILL OF CONCERN IN ASEAN10

In conjunction with World Malaria Day on April

25th, the World Health Organisation (WHO)

has released a statement which reports that

about 1.3 billion people in the WHO-classified

South East Asia region continue to be at risk

of Malaria.

The WHO-classified region comprises 11

countriesbeingBangladesh,Bhutan,South

Korea,India,Indonesia,Maldives,Myanmar,

Nepal,SriLanka,ThailandandEastTimor

WHO statistics put the figure of people in

ASEANcountriestobeatriskofmalariaat

291,943,000people,withoutcountingBrunei

andSingaporeforwhichnodatawasoffered

Within the reportable ASEAN countries,

Malaysiahadthelowestrateofmalariaat4%

withPhilippinesinthenon-enviousposition

ofleadingASEANcountrieswith80%oftheir

populationatrisk.

The WHO says more funds are needed to

furthercontrolthediseasethroughequipment

suchasinsecticidalnetsanddiseasedetection

devices,newresearchanddrugdevelopment,

andthatalthoughnumberofreportedcases

anddeathshavedropped,newchallengesof

resistancetoArtemisinin,themosteffective

drug,areagrowingthreat

MYANMARMONITOR08

ECONOMY

The president ’s off ice returned toparl iament a draft of a law whichwould make Myanmar’s Central Bankautonomous.Thelawwillberesubmittedwhen parliament meets again in June.Meanwhile,domesticbanksarepreparingforjointventureswithforeignbanksbutthey will have to wait until the law isenacted.“TheCentralBankwillapproveforeignbanksinfourstages:representativeoffices, joint ventures, subsidiaries andwhollyownedbranches,”aCentralBankspokespersonsaid,“...ownershipratiowillbe up to the companies to determine,”headded.

There are 24 representative officesregisteredwiththeCentralBank,mostlyfrom Southeast Asian nations but alsofromJapan,SouthKoreaandIndia.

The Irrawaddy (24 April 2013)The Myanmar Times (23 April 2013)

Authoritiesaredistributing350,000newlow-cost SIM cards by public lotteriesall over the country. SIM cards usedto cost between US$250-3000 butthe price of the new SIM card is onlyUS$1.70andisonlyavailabletocitizens,despitethegrowingnumbersofforeignbusinesspeopleinMyanmar.AnotherSIMcardofferingistotakeplacenextmonth.

The Irrawaddy (24 April 2013)

Malays ia ’s Bank Negara s igned aMemorandum of Understanding (MoU)with the Central Bank of Myanmar forthe development of banking servicesin Myanmar. Bank Negara will focus itsassistanceontechnologyknowhowandhumanresourcesdevelopment.LastJune,the Central Bank of Myanmar signed aMoUwithBankofThailand,butMyanmaris seeking help from regional banks tomeetASEANstandards.

Eleven Myanmar (22 April 2013)

POLITICS

Myanmarfreedatotalof93prisonersinitslatestamnestyon23April,ofwhichatleast59arepoliticalprisonersandthreeforeigners.AccordingtotheAssistanceAssociationforPoliticalPrisoners,over200politicalprisonersremainimprisoned.

Channel NewsAsia (23 April 2013)

The Human Rights Watch (HRW) saidin a report released on 22 April thatMyanmar has waged a campaign ofethnic cleansing against the RohingyaMuslims,citingevidenceofmassgravesandforceddisplacement.Thereportsaidthat HRW had uncovered evidence offour mass-grave sites in Rakhine state,anditaccusedsecurityforcesoftryingtodestroyevidenceofcrimes.

Channel NewsAsia (22 April 2013)

President Thein Sein was honouredwith the Pursuit of Peace Award bythe International Crisis Group (ICG) inNewYorkon22April,forthesignificantprogress the country has made sincehisgovernmenttookoverinMarch2011.Lastweek,opposition leaderAungSanSuuKyiwasvotedTIMEmagazine’smostinfluentialpersonofthedecade.

Mizzima (23 April 2013)Mizzima (19 April 2013)

Editorial Team: Sóley Ómarsdóttir, Oh Joo Ken , Lim Zhi Bang Designer: Hizzad Dinno Consultant Editor: Tunku ‘Abidin Muhriz

World Malaria Report 2012, World Health Organisation

THAILAND VIETNAM

The Hindu (25 April 2013)World Health Organisation (accessed 25 April 2013)

SMALL DOMESTIC APPLIANCES FIGURES BODES WELL FOR CONSUMER DISPOSABLE INCOME09

Findings show sales of Small Domestic

Appliances (SDA) across Singapore, Malaysia,

Indonesia, Vietnam and Thailand grew by 6%

in the last 12 months.

The report by GfK Retail and Technology

AsiashowstheSDAmarketacrossthefive

ASEAN countries totalled to over US$804

million,inthelast12months

JasmineLim,AccountDirector forHome&

LifestyleinGfKAsia,saidtheuptrendforSDA

showsastrongpositiveperformanceleading

toanoptimisticoutlookforthissectordriven

bysustainedgrowthmomentum

According to the findings, Thailand had

the strongestgrowth of the five countries

recording 12% incremental value growth

followedbyIndonesiaat8%,withricecookers

beingthemostpurchasedapplianceofthose

trackedbyGfKAsiaselling13.8millionunits

inthelast12months

The increasing affluence of households is

alsoleadingtoescalatingsalesofhigher-end

productsbeingan indicationofconsumers

having greater purchasing power and are

switching from buying basic models to

the more sophisticated product ranges, as

observedbyJasmineLim

Why it matters:Whilst theproductsbeing

tracked by GfK Asia may not encompass

a comprehensive basket of goods, these

findings provide some sort of measure of

consumerdisposableincomewithitstanding

toreasonthatconsumerswouldonlyspend

onSDAgoods if inacomfortable financial

position. As such, this bodes well for the

regionandisinlinewithgrowthexpectations

andinvestorsentiment.

Campaign Asia (24 April 2013)GfK Retail and Technology Asia (23 April 2013)

INDONESIA MALAYSIA

ASEAN