management in construction ii present

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BCM634 MANAGEMENT IN CONSTRUCTION II


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An evaluation of economic, social, political and technological

trends in Malaysia.

Malaysia BackgroundCapital City : Kuala LumpurPopulation : 28.3 millionPeninsular Malaysia : 22.6 millionSabah : 3.2 million

Sarawak : 2.5 millionW.P. Labuan : 0.1 millionPopulation Growth Rate % : 1.3 %Life Expectancy at Birth : Male - 71.9 Female - 77.0Age Structure : 0 -14 years - 7.8 million

: 15-59 years - 18.3 million

: > 60 years and above - 2.3 million


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ECONOMIC

Malaysia economic overview

registered a

stronger

growth of

5.4% in the

second

quarter of

2012 (Q1

2012:

4.9%)

Services

growing 6.3%

manufacturin

g growing

5.6% (Q1

2012: 5.3%;

4.4%),

construction

sector

22.2% (Q1

2012:

15.5%)

mining

sector 2.3%

(Q1 2012:

0.3%)

agriculture

sector 4.7%

(Q1 2012:

2.1%)


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1. Vibrant domestic activities

Factors effecting gross domestic product

Domesticeconomicactivity - double-digit growth of

13.8% (Q1 2012:9.7%) strongconsumerspending andhigher capitaloutlay by the

private sectorand Non-Financial PublicEnterprises(NFPEs)

imports ofconsumptiongoods and salesof motor vehicle

- 11.1% and16.2% (Q1 2012:20.3%; -13.8%)

consumptioncredit and creditcard - positivegrowth of 7.5%

and 4.6% (Q12012: 7.8%;6.6%)

higherexpenditure onsupplies andservices for

maintaining andimproving thepublic deliverysystem


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Gross Fixed

Capital -

robust growth

of 26.1% (Q1

2012: 16.1%)

- by public

sector capitalspending and

private

investment

activities

Public

investment

registered -

growth of

28.9% -

mainly in

transport

equipment

and oil and

gas

industries

private

investment -

24.6% led by

investment in

the

construction,manufacturin

g and

services

sectors.

investment

indicators -

imports of capital

goods and bank

lending to

businesses -27.3% and 14%

(Q1 2012: 21%;

13.4%).


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Services spearhead growth

The servicessector - ,increasing6.3% in thesecond

quarter of2012 (Q1 2012:5.3%) andcontributing3.4 percentagepoints to

overall GDPgrowth

Theintermediateand finalservices groupsgrew 7.2% and

5.5%(Q1 2012:5.1%; 5.7%) -wholesale andretail trade,finance andinsurance, and

real estate andbusinessservices sub-sectors.

The wholesaleand retail tradesub-sector grew5.9% (Q1 2012:6.4%)

retail tradesalesincreased9.3% toRM70.2

million (Q12012: 10.5%;RM69million)

retail sales innon-specialisedstores which rose13.5% (Q1 2012:10.6%).


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Lower plantation output

Value-added of the agriculture sector contracted 4.7% (Q1 2012: 2.1%) dueto lower production of the plantation sub-sectors, particularly oil palm,forestry and rubber Value-added of the oil palm sub-sector declined sharply by 17.5% (Q12012: 3.5%) , value-added of the rubber sub-sector was lower at 2.1% (Q1 2012: -9.4%)

The forestry sub-sector declined 2.1% (Q1 2012: 5.4%) due to slowerlogging activities in Peninsular and Sabah value-added of the livestock sub-sector grew 7.7% (Q1 2012: 11.0%) backedby higher output of poultry, cattle, goats and swine the other agriculture sub-sector strengthened 9.6% (Q1 2012: 3.8%)supported by higher output of fruits, vegetables and paddy

fishing sub-sector improved with a smaller contract ion of 0.2% (Q1 2012:-4.4%) on account of higher output of aquaculture


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Strong crude oilproduction

Value-added of the mining sector grew 2.3% (Q1 2012: 0.3%)supported by higher production of crude oil The production of crude oil (including condensates)

rebounded strongly by 5.7% to 554,930 barrels per day (bpd) (Q12012: 0.2%; 612,640 bpd), production of natural gas contracted 4.4% to 5,495 mmscfd(Q1 2012: -0.2%; 6,258 mmscfd).


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Government budget balance

referred to as general government balance, public budget balance, or public fiscalbalance budget balance is the difference between government revenues (e.g., tax) andspending data for Malaysia from 1996 to 2010 average value for Malaysia during that period was -3.16 percent with a minimum of-6.13 percent in 2009 and a maximum of 2.92 percent in 1997 budget balance in Malaysia and other countries is calculated as the differencebetween the taxes collected by the government and the government spending Most governments try to keep their deficits below 3 percent of GDP


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Robust construction activities

The construction sector continued to register a second consecutive quarterof double-digit growth of 22.2% (Q1 2012: 15.5%) With 3.4% share to GDP, the sector contributed 0.7 percentage point to realGDP growth in Q2 2012. The civil engineering sub-sector expanded 39.8% (Q1 2012: 15.5%)

the residential sub-sector posted a strong growth of 20.1% (Q1 2012: 24.1%)supported by higher housing starts non-residential sub-sector continued to grow strongly by 11.7% (Q1 2012:14%)


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Prices

Headline inflation, as measured by the annual change in the Consumer PriceIndex (CPI), abated further to 1.7% in the second quarter of 2012 (Q1 2012: 2.3%) Prices in the food and non-alcoholic beverages group continued to ease andrecorded a smaller growth of 2.7% (Q1 2012: 3.6%), contributing 0.8 percentagepoint to the CPI increase. The slower increase in food prices was attributed to the decline in the prices of

vegetables (-3.9%) and meat (-1.9%) subgroups, following improved marketsupplies the fish and seafood sub-group increased 7.6% due to weather-induced supplyshortage prices in the food at home and food away from home categories increased 2%and 4%, respectively (Q1 2012: 3%; 4.6%).

The slower pace of the CPI increase - the housing, water, electricity, gas andother fuels (1.6%); miscellaneous goods and services (2.3%), and restaurants andhotels (3.1%) groups (Q1 2012: 1.9%; 2.9%; 3.9%). Collectively, these three groupscontributed 0.6 percentage point to the CPI.


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The transport group recorded a marginal increase of 0.5% (Q1 2012: 1.5%) -moderation in global oil prices and contributed 0.1 percentage point to the CPI. As in the previous quarter, the increase in inflation continued to be partly

mitigated by price declines in the clothing and footwear, and communicationgroups at 0.4% and 0.6% (Q1 2012: -0.4%; -0.6%), respectively, due to marketcompetition among the retailers. [Inflation eased further to 1.4% year-on year in July 2012 (June 2012: 1.6%). The moderation in inflation was attributed to lower price increase in the foodand non-alcoholic beverages, and housing, water, electricity, gas and other fuels

groups by 2.6% and 1.5%, respectively. Following the downward adjustment in the pump price of petrol RON97 by 20cent on 5 July 2012 to RM2.60 per litre, the transport group declined marginallyby 0.2%, the first time since December 2009. Consequently, the inflation for the first seven months of 2012 was lower at 1.9%(January July 2011: 3.1%)]


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The Producer Price Index (PPI), which measures changes in the prices ofcommodities charged by domestic producers and those paid by importers,registered a marginal increase of 0.8% in the second quarter of 2012 (Q1 2012:

3.8%). This was on account of slower price increase in local production and importcomponents, with both recording an increase of 0.8% (Q1 2012: 4.8%; 1.4%).The lower index in the local production components was mainly attributed to theslower price increase in the mineral fuels, lubricants group of 7.4% (Q1 2012: 27.1%),which contributed 2 percentage points.

In terms of stage of processing, the intermediate materials, supplies andcomponents, and the finished goods stage recorded an increase of 1.5% and 0.8%,respectively. The lower PPI for import was mainly due to the price decline in four groups withthe animal and vegetable oils and fats declining the most, by 5.4%. However, the lower import price was partly offset by the 3.8% increase in the price

of the mineral fuels, lubricants group (Q1 2012: 11%).


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Malaysia Consumer Spending

Consumer Spending in Malaysia decreased to 97077 MYR Million inthe fourth quarter of 2012 from 99812 MYR Million in the thirdquarter of 2012. Historically, from 2005 until 2012, MalaysiaConsumer Spending averaged 77514.48 MYR Million reaching anall-time high of 99812 MYR Million in August of 2012 and a record

low of 56768 MYR Million in May of 2005.


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Malaysia Bank Lending Rate

Bank Lending Rate in Malaysia decreased to 4.69 percent in January of 2013 from4.70 percent in December of 2012. Bank Lending Rate in Malaysia is reported by theCentral Bank of Malaysia. Historically, from 1996 until 2013, Malaysia Bank LendingRate averaged 7.02 Percent reaching an all-time high of 13.53 Percent in May of 1998

and a record low of 4.69 Percent in January of 2013. In Malaysia, the bank lendingrate is the average rate of interest charged on loans by commercial banks to privateindividuals and companies.


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Malaysia Interest Rate

The benchmark interest rate in Malaysia was last recorded at 3 percent. InterestRate in Malaysia is reported by the Bank Negara Malaysia. Historically, from 2004until 2013, Malaysia Interest Rate averaged 2.92 Percent reaching an all time highof 3.50 Percent in April of 2006 and a record low of 2 Percent in February of 2009.In Malaysia, the interest rate decisions are taken by The Central Bank of Malaysia(Bank Negara Malaysia). The official interest rate is the Overnight Policy Rate. Thispage includes a chart with historical data for Malaysia Interest Rate.


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Malaysia Unemployment Rate

Unemployment Rate in Malaysia remained unchanged at 3.30 percent in January of2013 from 3.30 percent in December of 2012. Unemployment Rate in Malaysia isreported by the Department of Statistics Malaysia. Historically, from 1998 until 2013,Malaysia Unemployment Rate averaged 3.33 Percent reaching an all time high of 4.50Percent in March of 1999 and a record low of 2.70 Percent in August of 2012. InMalaysia, the unemployment rate measures the number of people actively looking

for a job as a percentage of the labour force. This page includes a chart with historicaldata for Malaysia Unemployment Rate.


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Population and Health, (Lit, 2012) Later marriages and smaller families More spending per child Working women and childcare issues More divorces Rural to urban migration and growth of cities More Malaysians living and working overseas: BrainDrain Illegal immigration Better health Ageing of the population Change in disease patterns to more chronic diseases Challenge of paying for healthcare for the aged More demand for services for the aged

Social


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The number of people living in Malaysia - 28 million - includes an estimated 1million foreigners . Population growth has slowed down in Malaysia as the people begin to marry at

older ages, have children later in their marriages and also have fewer children perfamily. People marry later and postpone having children because they spend more yearsin school nowadays and also because they wish to spend more time on building uptheir careers. This is especially true of women who are highly educated .


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People have fewer children - the difficulties of balancing a career outside the

home with the domestic duties of being a good wife and being a good mother tothe children. As women become better and better educated and they begin to rise higher andhigher in the working world, their work responsibilities would increase and theirworking hours would also get longer and longer. easier on a career woman if she has only one or two kids rather than a large

number of kids. Another reason - people are having fewer children - people migrate from thecountryside and the small towns to live and work in the big towns and cities, itbecomes more and more expensive to bring up their children.


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Labour force Employment

Labour market remained stable

Despite the challenging external environment, the Malaysian labour marketremained stable in the second quarter of 2012. The number of unemployed personsin the economy increased 2.2% to 386,300 in the second quarter of 2012 (Q1 2012:1.1%; 385,500), while the labour force increased 3% to 12.9 million (Q1 2012: 2.4%;12.8 million). Accordingly, the unemployment rate remained stable at 3.0% duringthe same period (Q1 2011: 3.0%)


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The favourable labour market conditions - reflected in the number of vacanciesreported to Jobs Malaysia, which increased further to 419,636 in the second quarter of2012 (Q1 2012: 316,016). The manufacturing sector reported the highest number of vacancies with 163,664jobs, followed by the services (96,642) and agriculture (83,784) sectors. In terms of job categories, elementary occupations accounted for the largest shareof vacancies at 258,610 (61.6%). job seekers registered with Jobs Malaysia increased slightly to 347,873 as at end-June2012 (end-March 2012: 346,877).

number of retrenchments declined to 1,516 workers (Q1 2012: 3,388) mainly from theservices (788), followed by manufacturing (694) and construction (23) sectors.


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PoliticalMalaysia political overview

The Federation of Malaya - established on 31 August 1957. 16 September 1963 theFederation was enlarged by the accession of the states of Singapore, Sabah (formerlyBritish North Borneo) and Sarawak. The name Malaysia was adopted from that date.Singapore left the Federation on 9 August 1965. federal constitutional monarchy and a parliamentary democracy- Head of State is theYang di-Pertuan Agong (King) - Head of Government is the Prime Minister/head of the

Cabinet. 9 of the 13 states have hereditary rulers - who share the position of King on afive-year rotating basis. The Kings functions - constitutional amendments in 1993 and1994. Legislative power - federal (bicameral) / state (unicameral) legislatures.House of Representatives has 222 members elected for five year terms in single seatconstituencies. The governing Barisan Nasional (National Front) coalition comprises the United MalaysNational Organisation (UMNO), the Malaysian Chinese Association, the MalaysianIndian Congress, plus a number of other parties including some based in East Malaysia.In 2009 Mr Badawi steps down as prime minister and is replaced by his deputy, NajibAbdul Razak.


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Political Environment in Malaysia

Malaysias political stability- main attraction for foreigners to invest in the countrysince independence. independent for 54 years. Malaysia is still governed by the National Front Party. Despite a Strong Showing Bythe Opposition in the Last Elections, The Country Remains Free of Public Unrest &Trouble. Political Stability is a Critical Factor to Consider as You Would not Want Policies

Affecting Your Business To Change Every Few Years.The Government of Malaysia has given a slogan to their peoples SATU MALAYSIA - UNITED MALAYSIA and the peoples of Malaysia follow this slogan accordingly.Peoples live with harmony and mutual respect with a freedom of speech that opensthe door for discussions and negotiations for any sort of problems if there is any.


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Politics - affect businesses on a variety of levels. The main area tolook at is the tax benefits. On one level some politicians may offertax incentives to companies while others may increase their burden. Politicians may go against party beliefs to benefit a business if theythink their constituents will be harmed. Pollution and product safetyare also areas where politics can favour or hurt a business. It depends

on the party and their stance but politics always affects business.

Effect politic in business


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Value-added of the manufacturing sector increased 5.6%(Q1 2012: 4.4%). Output expanded at a stronger pace of5.7% (Q1 2012: 4.6%) supported by both domestic-oriented (7.5%) and export-oriented industries (5.1%)

during the quarter. The encouraging performance was alsoreflected in the sales of manufactured goods whichexpanded 6.8% to RM157.1 billion (Q1 2012: 6.6%; RM153.6billion) and higher overall capacity utilisation rate at82.8% (Q1 2012: 82.3%).

Technological trendsStronger manufacturing activities


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Production of export-oriented industries expanded 5.1% (Q1 2012: 3%)led by higher output of chemicals and chemical, petroleum and woodproducts as well as an improvement in the E&E sub-sector. output of chemicals and chemical, petroleum and wood products grew

strongly by 10.4%, 11.6%, and 6.2%, respectively. Similarly, production ofE&E improved further to 2.8% during the quarter, with semiconductordevices registering a stronger growth of 17.3%. In contrast, off-estate processing contracted 15.5% due to weather-related factors which affected palm oil production. output of domestic-oriented industries continued to increase 7.5% (Q12012: 10%), with most sub-sectors registering favourable growth. Transport equipment surged 12.1% following higher production ofmotor vehicles (22.7%). In line with robust construction activities, output of the non-metallicmineral and fabricated metal sub-sectors expanded 4.7% and 7.4%,respectively. In addition, output of food, beverages and tobacco also posted ahealthy growth of 11.3%, 4.1% and 20.9%, respectively.


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C P fil


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Company Profile

Johawaki Group of company was setup in aconstruction business with the formation of HawakiEnterprise on April 1, 1979. Located at WISMA

JOHAWAKI Lot 3669, Jalan Batu Tiga-Sungai Buloh,

Section U6 Shah Alam Selangor, 40150 Malaysia.Through hard work and entrepreneurial dynamismunder the stewardship of Dato Johari Bin Mat and

Dato' Abdul Rahim Bin Ahmad, this reputable Class A

contractor grew steadily in tandem with theMalaysian growing economy. Three years later, thecompany was converted into Johawaki Sdn Bhd on

September 6, 1982.
http://localhost/var/www/apps/conversion/tmp/scratch_4/prof%20dr%20ismail%20rahmat/Johawaki%20Group.docxhttp://localhost/var/www/apps/conversion/tmp/scratch_4/prof%20dr%20ismail%20rahmat/Johawaki%20Group.docx


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Johawaki GroupVisionTo be a respectable and ethical leading organiasation by providing sustainable quality

products.MissionTo provide good quality product and professional services consistent with passion

and dedication.To be the worlds premier project management company.Customers and partners will see us as integral to their success. We will anticipate

their needs and deliver on every commitment we make.Employees will be proud to work at Johawaki Group of Companies. We will create

opportunities to achieve the extraordinary, and we will reward success.Communities will regard us as responsible and responsive. We will integrate globaland local perspectives, promote sound management of resources, and contribute to a

better quality of life.By aspiring to be the most respected company in Malaysia and Asia renowned for:excellence;

leadership; and

unsurpassed value.
http://localhost/var/www/apps/conversion/tmp/scratch_4/prof%20dr%20ismail%20rahmat/Johawaki%20Group.docxhttp://localhost/var/www/apps/conversion/tmp/scratch_4/prof%20dr%20ismail%20rahmat/Johawaki%20Group.docxhttp://localhost/var/www/apps/conversion/tmp/scratch_4/prof%20dr%20ismail%20rahmat/Johawaki%20Group.docx


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