The Business Magazine of the Malaysian-German Chamber of Commerce and Industry

malaysia.ahk.deJanuary/February 2016

Vol 22, No.1 KDN PP 8818/3/2013

FINANCIAL SERVICESINSURANCE INDUSTRY

Grow your Business with Green Finance

Insurance Industry: Key Financial Pillar of Malaysia

Malaysia 2015 – 2016 Market Sentiment

ECONOMICS

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6FEATURE

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EDUCATION AND TRAINING

EVENTS

GERMAN INSTITUTIONS

MEMBERS

TRADE FAIRS

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MGCC PERSPECTIVESis published six times p. a. by theMalaysian-German Chamberof Commerce and Industry.

PUBLISHERDatuk Muhammad Feisol bin Haji Hassan.

It is distributed free of charge tomembers and qualified non-membersin Malaysia and abroad.

MALAYSIAN-GERMAN CHAMBEROF COMMERCE AND INDUSTRY (171131-U)Supported by the Federal Ministry of Economic Affairs and Energy based on a resolution of the German Bundestag.

Suite 47.1, Level 47, Menara AmbankNo. 8, Jalan Yap Kwan Yap Kwan Y Seng50450 Kuala Lumpur, r, r MalaysiaTel: 603-9235 1800Tel: 603-9235 1800TFax: 603-2072 1198homepage: malaysia.ahk.deemail: info@malfo@malf aysia.ahk.de

*All opinions expressed in aressed in ar rticles do notnecessarily reflect the views of MGCC.

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CONTENTS

by Sunita Devi, Devcom Trends

MALAYSIA 2015 – 2016MARKET SENTIMENT

INSURANCE INDUSTRY: KEY FINANCIAL PILLAR OF MALAYSIATHE GERMAN INSURANCE MARKET – STRONG HERITAGE, STRONG FUTUREMALAYSIA’S LIFE INSURANCE INDUSTRY – A HIGH POTENTIAL MARKET

GREEN FINANCING COLUMM

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GROW YOUR BUSINESS WITH GREEN FINANCE

LEGAL & INVESTMENTDATA PRIVACY: LATEST STANDARDS PROPOSEDUNDER THE PERSONAL DATA PROTECTION ACTNEW INVESTMENT INCENTIVE FOR HEAD-QUARTERS IN MALAYSIA: THE PRINCIPAL HUB INCENTIVE

EDITORIAL

BOARD OF DIRECTORS

THOMAS ZIMMERLEPresident

2015 – 2017

P. KANDIAHTreasurer

DATO’ ROBERT TEO KENG TUANVice President

DANIEL BERNBECKExecutive Director

DATUK MUHAMMAD FEISOL HJ. HASSAN

FRANCIS LEE

IR. LEE SWEE ENG

LIM KHIANG HUA

MARTIN METZGER

PETER LENHARDT

PHILIPP KERSTING

WENDY LAU

WOLFGANG LAABS

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Dear Members and Readers,

Obviously we have stepped into a very interesting new year. The first few weeks of 2016

have provided more surprises than the months in previous years and if this goes on it

might be a very memorable year for all of us. The developments at China’s stock exchange

made billions dollars in market value on the stock markets around the world vanished

within a few days. The dramatic plunge of the prices for crude oil and natural gas to levels

that almost nobody expected to witness again leaves hardly a stone unturned. Project

calculations not only in the oil and gas sector worth billions of dollar have to be adjusted

around the world. Companies invested in the field of fracking suddenly find themselves

at the brink of bankruptcy and banks might have to write-off huge sums. Oil-rich states,

e.g. Algeria, Libya, Ecuador or Venezuela, are facing dramatic lack of income and liquidity.

Consumers fearing the loss of their job or simply the loss of their wealth on the stock

markets will react swiftly by cutting their spending. The results for the worldwide

economies as a whole is to be awaited. As if this was not already enough, the terrorist

attacks in Paris, Jakarta and elsewhere plus the constantly high numbers of refugees

crossing the borders into European countries make Europeans look with more concern

into the near future. Politically, this situation obviously leads to rising support for populist

parties and their leaders across Europe that seduce with promises of simple solutions and

drastic reactions. This forces the ruling parties into uncomfortable positions or even

completely reshaping the political landscape of many European nations.

At the end of 2016 we might be living in a world that is changed in many spheres.

But, in the business world every crisis is known to provide both risks and chances.

Therefore, the only question is how to cope with the challenges. First, should be to

closely watch the developments, and not become overanxious – and to make the best

out of the situation. One solution when it comes to cope with risks is certainly to look

for appropriate insurance coverage. Of course, not all risks can or should be insured

and it is also true that an ongoing and comprehensive economic crisis will not leave

the insurance sector unharmed. But, strong insurance partners can help reduce the risks

of everybody’s life and business by distributing and pooling them in the community

of the insured.

In this issue of MGCC Perspectives, we wish to shed some light on this sector of

services for the market of Malaysia and Germany. We also hope that you will find other

interesting topics in this issue. And above all we wish our readers a safe, healthy and

prosperous New Year!

YBHG TAN SRI DATO’ G.S. GILL

Daniel BernbeckExecutive Director,

Malaysian-German Chamber of Commerce and Industry

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Insurance Industry: Key Financial Pillar of Malaysia by Life Insurance Association Malaysia (LIAM)

With the strong support from 16 member companies, we work very closely with regulatory authorities and stakeholders to build a high standard of professionalism among our practitioners, instilling good business practices and upgrading the image of the industry through self-regulation.

The life insurance industry remains steady in the first half of 2015 amidst a challenging business environment. New Business weighted premiums (100% of regular premiums plus 10% of single premiums) declined marginally by 0.7% to RM2,024 million as compared with RM2,040 million achieved in the same period last year.

In terms of insurance protection, gross sum assured for all new individual policies recorded an increase of 8.1% to RM45.2 billion in 2015 compared with RM41.8 billion achieved in 2014. This increase in protection is contributed by Investment-linked plans which experienced a growth of 9.6% and traditional plans with a growth of 3.5%.

Our premium contribution is only 3.1% of the GDP in 2014 – much lower than Taiwan (15.6%), Hong Kong (12.7%), Japan (8.4%), and Singapore (5%), according to Bank Negara.

For the first half 2015, the life insurance industry paid out marginally higher claims this year compared with the year before. The industry as a whole saw a 1.3% increase in benefit payments in the first half of this year compared with the last. Benefit payments due to death, disability, medical, bonuses and others amounted to RM4.079 billion as compared with RM4.028 billion for the same period last year.

The increase in benefit payments mainly came from medical claims. The increase in medical insurance payments was due to the increased consumer awareness of the importance of medical insurance coverage.Medical inflation rate which has been

consistently higher than the overall inflation rate also contributed partly to the increase in the medical claims. With the advent of modern medical technologies, consumers are aware that it is more important than ever that they all have adequate medical insurance coverage as a lot of diseases considered terminal previously are now treatable with early detection.

Today, the insurance and takaful sector has a combined assets of RM209 billion, which is about 3% of Malaysia’s Gross National Income.

Currently, the life insurance and family takaful provides insurance protection to

56% of the Malaysian population. The Government has set the target to have at least 75% of Malaysians insured by year 2020.

The protection gap or underinsurance gap remains huge in Malaysia according to a study commissioned by LIAM and undertaken by Universiti Kebangsaan Malaysia in 2013. The study found that the average protection gap for families whose primary wage earner do not have life insurance protection is RM723,000 per family. The amount is the estimated sum needed for the family of the wage earner to sustain their current lifestyle for at least 5 years on the demise of the wage earner.

Measures to Improve Penetration Rate The current level of insurance and takaful penetration, at 56% compared to the 30 million population, still remains low. It also reflects the enormous untapped potential in the Malaysian insurance sector which requires an inspired leadership by the industry, to rise to the challenge in delivering value to stakeholders.

The market is growing at a steady pace despite the slow economic conditions affected by the change in oil prices, depreciation of Ringgit, etc. In fact the depreciation of the ringgit is not an issue as the need for insurance is always there as it is a long-term plan for Malaysians.

Over the past 4 decades, the life insurance industry underwent a transformation process along the way and adapted to regulatory changes. Today, we emerge as a stable and progressive industry, standing tall as a key financial pillar of the nation.

There is a growing demand for insurance products with

savings and investment elements but the level of awareness among Malaysians about

protection is low.

Looking at another perspective, the low figure in the penetration rate actually reflects on the bigger potential in the market to tap on; more prospects for the industry.

More efforts need to be done by the industry in addressing the life insurance protection gap in the country.

There is a need to develop suitable insurance products to meet the different life stage needs of customers and to introduce new delivery channels to reach out to the remaining 46%, of which a high percentage of the population could be concentrated in the rural areas. Additionally, insurers could also leverage on their existing customer base for upselling or cross-selling initiatives, given that even among those who have insurance coverage, in most cases were not adequate.

On top of that, there is also a need to look into suitable retirement products to complement the current EPF, one and only retirement solution for most Malaysians.

The life insurance industry has continued to innovate through new products and distribution channels. Other than through agencies, banks, telemarketers and financial advisers, insurance products are also easily

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available for the people on the streets where they could purchase insurance products at the post offices and bank branches throughout the country. Simple life insurance products can also be purchased via the internet. With this wider access of insurance sold through online channels and are affordable, we are confident that consumers who are IT savvy or the younger generation will find this mode of purchase an interesting option.

LIAM and the industry need to continue the efforts to raise the financial literacy of Malaysians. Initiatives such as educational programmes, advertorials or advertisements, radio and TV interviews are carried out by LIAM on an ongoing basis.

Through its consumer education programmes, LIAM engages with the mainstream media and social media to publish various educational articles on life insurance.

LIAM is also embarking on several youth engagement programmes with local universities and private colleges to target the young community. We believe the young need to be exposed to the importance of life protection as they are the next generation of leaders who would lead the country to greater heights.

Implementation of Life FrameworkIn Malaysia, we have dual protection systems which complement each other, namely conventional insurance and takaful (based on syariah principles). On 23 November 2015, Bank Negara Malaysia has released the much anticipated Life Insurance and Family Takaful Framework (LIFE Framework) to support the long-term sustainable growth and development of the life insurance and family takaful industry in Malaysia.

The Framework which will be implemented in phases aims to promote innovation, long-term growth and a more competitive market supported by higher levels of professionalism and transparency in the provision of insurance and takaful products and services.

Three specific initiatives introduced under this Framework include

a) Gradual removal of limits on operational costs to promote product innovation while preserving policy/certificate value;

b) Diversified distribution channels to widen outreach; and

c) Strengthened market conduct to enhance consumer protection.

The Framework is expected to spur the innovation of a wider range of both products and delivery channels to suit diverse consumer needs, based on individual risk appetites, financial goals and levels of financial capability. This in turn will contribute towards the broader objective of reducing the protection gap in Malaysia in line with the efforts to increase the penetration rate to 75% by year 2020. With the Framework, insurers and operators will have greater flexibility to manage their expenses. This encourages product innovation and is beneficial to consumers.

The LIFE Framework will:

Increase value proposition of products and services to protect against unforeseen circumstances. For example, the industry must introduce commission- free pure protection products relating to term, critical illness and medical coverage. This will lead to lower costs for consumers.

Strengthen transparency, professionalism and market practices by introducing a balanced scorecard for intermediaries. Currently, the intermediaries’ remuneration is based on their sales. With the scorecard, remuneration will take into account non-sales factors like suitability of advice, service quality and high ethical and professional conduct.

Improve product disclosure in sales illustrations.

Measures to Improve Penetration Rate

ETP’s Penetration Rate 2010 – 2020

The low penetration ratemeans more opportunities for insurers to reach out to urban, suburban and rural areas and

to double their efforts to achieve the Government’s aspiration of

insuring 75% of Malaysians by 2020.

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Increase access to more products and diversify distribution channels – especially direct channels (walk-in to head office/ branch premises or through websites).

A quick glance of the proposals and key performance indicators of the LIFE concept paper is indicated below:

• Increase Penetration Rate from 56% to 75% by 2020, while protecting consumer interest.

• Widen outreach and diversification of products and distribution channels.

• Liberalise industry to promote healthy competition and innovation of products for the benefit of consumers.

• Strengthening market conduct and instilling greater professionalism among intermediaries to enhance consumer protection.

• More professional services to ensure quality service to consumers.

• Continuous education and consumer awareness towards empowering consumers.

• Preservation of policy value to ensure consumers obtain value from their policies.

• Clearandtransparentproductdisclosure to ensure consumers understand the products and services purchased with no hidden costs.

• Availability of pure protection products via direct channels.

Key Success Factors of Life Insurers Below are some key factors that we believe will contribute to the success of life insurers in near future:

• Productinnovation The insurers need to come out with products that meet the changing financial needs of its customers e.g. offering more affordable coverage for retirement needs.

• The deployment of technology for ease and convenience of servicing the customers from the start of assessing their needs to offering financial solutions and payment of claims.

• Expansion of distribution channels to reach the different segment of consumers The agency force is still the main distribution channel in Malaysia, followed by bancassurance. The life insurance industry has about 85,000 agents and 20,000 bank executives registered with LIAM. Prior to registration, these agents and bank executives are required to pass the Pre-contract Examination and Certificate of Investment Linked Examination. Agents and bank executives undergo rigorous training and continuing professional development each year to maintain their contracts.

In raising the professionalism of the distribution channels, LIAM introduced examinations and Basic Agency management course for agents and advocated the code of ethics to inculcate the highest degree of standards and integrity among its practitioners.

Over the next few years, the revolution in mobile devices, internet usage and social networking may change the way consumers (especially Gen Y) connect, interact and transact with businesses. With the rising affluence and usage of mobile phones and the internet, there is a need to explore possibilities of adding these to a company’s multi-channel distribution for insurance.

• CustomerFocussed It is important to ensure that our products are sold based on needs of the customers. In addition, we need to train our intermediaries to provide appropriate advice to our customers so that they can make an informed decision of the insurance plan that they intend to purchase.

• IndependentFinancialAdvisers The role of Independent Financial Advisors in providing independent advice on financial matters to their clients and recommend suitable financial products from the whole of the market would provide customers a variety of choices to choose from. This direct channel would give them more options to decide on which products to fulfil their various needs.

Medical and Health Insurance/Takaful(MHIT)Many of us juggle daily between work and family commitments, with very little time left to care for our own health needs. Perhaps it is time to take a step back and look at what we are doing for our physical and mental well-being. Other than making the necessary effort to eat sensibly, exercise and take sufficient rest, there is also the financial care aspect on how to protect our savings in the event of a medical emergency.

Given that health care costs are likely to climb further, one financial care option worth considering is investing in Medical and Health Insurance and Takaful (MHIT) policy to help finance the unforeseen medical expenses.

MHITasafinancialsafetynetIn the early 70s, medical and health insurance in Malaysia was structured to provide basic cover for personal accidents, workmen’s compensation and was also included as part of our motor insurance to cover for third party bodily injuries.

Today, MHIT has evolved into a sophisticated, financial risk management tool that can be tailor-made to cover a diverse array of medical conditions and services. This evolution is necessary and in tandem with the needs of an increasingly affluent and knowledgeable community. Medical inflation has also driven many consumers to explore options to protect their financial nest egg if ever they are faced with a health crisis resulting from serious illnesses like cancer, stroke, or even from accidents.

The full article series of MHIT can be found in http://www.liam.org.my/index.php/library/consumer-education-series/english. Please refer to the website for more information.

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The German Insurance Market – Strong Heritage, Strong Futureby Thomas Ilka, German Insurance Association (GDV)

Moreover, the insurance industry is one of the major contributors to Germany’s domestic investments. With an amount of 1.45 trillion euros, the sum of investments by German insurers is more than four times higher than Germany’s annual federal budget. This makes German insurers an ideal partner for investments in various projects in different sectors, such as infrastructure.

A stable and reliable legal framework is not only essential to structure the market both for property and life insurers as well as insurers acting as investors, but also to enable sustainable investment projects on the national, European and global level.

DigitalisationasaDriveroftheInsuranceMarket Another key success factor for the industry is to identify and seize new opportunities. Digitalisation is a megatrend that serves as a platform to reach out to existing and potential customers. Collected (big) data will help to evaluate risks, identify the customers’ needs and improve the quality of service. Different types of insurance will be created to suit different market needs and the market will grow thanks to an increasing number of insured people.

However, digitalisation is also one of the biggest challenges for the industry due to data security. The industry’s major guideline is to match the needs of customers – e.g. through creating new apps and tariffs, new channels of communication or new ways of doing sales and underwriting. Insurers are pioneers in data security and actively develop mechanisms that ensure better data protection for their customers.

Throughout the insurance industry, a willingness to take up the challenges of digitalisation can be observed. A good example is motor vehicle liability insurance, where an increasing number of insurance providers decided to introduce telematics-tariffs starting from 2016, allowing to collect even more detailed data about customers to improve tariff calculation.

Digitalisation also provides an excellent platform for insurance companies to approach their customers in a more direct way to enhance the effectiveness of communication. The insurers will know more about their customers’ needs and

therefore be able to provide them with better advice and tailor-made products. It is a win-win strategy for both insurers and insured.

In order to retain customers and obtain new ones, trustworthiness is very important. Hence, insurers have to take the issue of data protection very seriously in order to strengthen consumer confidence. This is a basic requirement to make digitalisation a success.

MeasurestoEnsureDataSecurityThe German insurers have implemented a number of different measures to ensure data security: a Code of Conduct that regulates data security, an insurance-cloud that is certified by the Federal Office for Information Security, a Crisis Response

Centre for IT security and many otherinitiatives to secure the data. These show that the German insurers pay close attention to data protection and these efforts will be continued and strengthened in the future.

Insurance is part and parcel of our daily lives. We are insured when we are driving, because we purchased vehicle insurance; we are insured when we get sick, because we purchased medical insurance. We are insured, when we retire, because we purchased pension plans. Almost every aspect of our lives is related to insurance and that reflects the huge potential in the insurance market. According to statistics, the total population of about 80 million in Germany is holding 427 million insurance policies.

Germany’s insurance market developmentDevelopment of premiums

Source: German Insurance Association (GDV)

The economic environment is changing swiftly. The industry players have to adapt to the changes and facilitate new developments in a proactive way with strong market positioning, good supervision and excellent customer relations.

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Germany – No. 6 of the world’s leading insurance marketsShare of the global insurance premiums

Source: Swiss Re / Updated 2014Graphic: German Insurance Association (GDV)

Thomas Ilka has been a Member of the

Management Board of the German Insurance

Association (GDV) since 2014. Previously, he

worked as a State Secretary for the Federal

Ministry of Health. From 1999 till 2011,

Mr Ilka held various positions at the

Association of German Chambers of Industry

and Commerce (DIHK), including Director of

the DIHK Representation to the European

Union and Head of the Department

responsible for Europe, the Environment,

Energy and Consumer Policy.

RetirementPlanningRetirement planning is another key issue for both insurers and insured: On the whole, the German market for private retirement planning fulfils its functions very well. For instance, the German population of about 80 million people is holding more than 90 million life insurance policies. In addition to the public pension fund, insurers pay out 80 to 90 billion euros to the insured people through these life insurance policies every year. However, there are also some challenges in this sector. Recent studies have pointed out that a growing number of people tend to live in the here and now, with only minor considerations for the future or even retirement planning. This trend is particularly strong among young people, who tend to underestimate two important aspects: the significant increase of life expectancy and the persistent low interest environment in Germany and other European countries. Awareness needs to be raised to prevent people from postponing

their retirement planning for too long. In this regard, insurers have an important role to play by providing advice and solutions for individual retirement planning: Insurance companies are continually working on new products in order to match the clients’ changing needs and cope with the low interest rates.

ConclusionThe changing of customer needs, the low interest rates environment and stepping into the era of digitalisation are some of the trends and developments in the insurance industry that the relevant players will have to face today and in the future. Another challenge for the German insurance industry is the new European supervisory framework for insurers – the Solvency II Directive. It came into effect on 1 January 2016 and includes new regulations such as targeted risk management and tighter capital and reporting requirements.

Malaysia’s Life Insurance Industry – A High Potential Market

According to a news report by The Sun Daily in August 2015, Life Insurance Association of Malaysia (LIAM) stated that Malaysia is one of the countries in Southeast Asia region, which has the most attractive insurance markets because of the young population coupled with a low insurance penetration rate. Recently, MGCC has conducted an interview with Mr Rangam Bir, the CEO of Allianz Life Insurance Malaysia Berhad to share his opinion on the life insurance industry in Malaysia.

Rangam Bir, CEO Allianz Life Insurance Malaysia Berhad

Q: Allianz has set foot in Malaysia since 2001 and 2016 will be the 15th year in Malaysia. From your point of view, how has the insurance industry has developed throughout the years? The industry has come a long way. Over

the years, the life insurance industry has

seen a lot of progress. We have seen the

agency force grow significantly as well

as innovative and more sophisticated

products being offered to meet consumer

demands. Many insurers are focusing on

providing products that offer better health

coverage due to escalating medical cost in

the hope of protecting policyholders better.

Another trend that has been seen a lot is

mergers and acquisitions in the industry.

Market consolidation is unavoidable as

insurers need to manage their capital

efficiently and to operate in an efficient

and competitive manner.

Q: The Malaysian Government has set a target that at least 75% of Malaysians should be insured by 2020. Allianz is the fifth-largest player in the life insurance industry in Malaysia. How is the penetration rate of life insurance market in Malaysia currently? What are the measures taken by Allianz to improve the penetration rate?For life insurance, there is still huge

potential for growth as the current

conventional life and Takaful insurance

penetration in Malaysia is only around

54% (as per LIAM’s statistics published

in the Star on Feb 2015). There are about

12.4 million policyholders based on the

country’s population of over 30 million,

there is still a very big opportunity to

promote life insurance in Malaysia.

By 2020, Malaysia intends to increase

life insurance penetration to 75 percent

of the population. We expect to see

good growth as there is low penetration

of insurance products and at the same

time increasing awareness on the need

for insurance.

Allianz Life Insurance Malaysia Berhad’s

(“Allianz Life”) distribution channels are

based on 3 main pillars; agency,

bancassurance and corporate solutions.

Allianz Life is currently one of the top five

players in the industry with a market share

of nearly 8 percent. Despite the current

market and economic conditions, we have

managed to post positive results. We will

continue to strive to provide innovative

and relevant solutions for our customers

through our various distribution channels.

The One Malaysia Agency Project is aimed

at recruiting agents from the Bumiputera

and Indian background and nurture

them to become future agency leaders

through the Allianz Agency Entrepreneur

Development Program. We have also

identified potential growth areas including

Sabah and Sarawak and are planning to

develop these areas. We now have 10,110

agents (as at December 2015), making our

agency one of the largest in the country.

Government initiatives have also

supported the development of the

Malaysian life insurance industry especially

on retirement planning and healthcare

financial solutions. The industry is expected

to continue growing fuelled by the

government initiatives – to be supported

by the Financial Sector Blueprint (FSB),

Economic Transformation Programme,

and the 10th Malaysia Plan as well as tax

incentives for private pension plans.

In terms of products, Allianz Life launched

FlexiSaver in July last year, a new universal

life savings plan that provides a wide

choice of premium payment and coverage

term to suit different savings needs. The

plan is available for those between the

ages of 15 days old to 60 years of age,

and aims to help customers to instill the

habit of saving and reap potential benefits

for the future.

Diversity and inclusion are important values

at Allianz Malaysia. In our effort to promote

a more inclusive society, the Company

is now providing insurance solutions for

Persons with Disabilities (“PWDs”). Allianz

introduced three products that cater to

PWDs at Aloft Hotel, Kuala Lumpur last

year. These three products are Allianz

Ability Life, Allianz Care Individual and

Allianz Individual PA.

We will continue to offer the best value for

money and best value proposition to our

customers by introducing more innovative

products for the benefit of our customers

as the need arises.

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processing at key customer and partner

touch points such as for claims and

application submissions. We also provide

round the clock online information and

services, online visibility and branding

and the ability to provide personalised

services too.

Expanding Internet and social media usage

among the younger generation to reach

out to more customers is an area insurers

will be able to capitalise on. Allianz Malaysia

set up our Facebook page in mid-2011 and

today, Allianz Malaysia’s Facebook page has

more than 156,000 fans.

In the near future, Allianz Malaysia also

plans to launch several core insurance

services on the mobile application

platforms to keep pace with our

customer requirements of on-demand

service availability.

Q: Could you please share with us the 2016 outlook of insurance industry in Malaysia?We expect the slowdown of the economy

to dampen consumer spending and affect

demand for insurance products.

Growth in the general insurance operation

will be driven by sales contribution from

the retail and commercial segment while

growth in the life insurance operation

segment will continue to be driven by

the expansion and diversification of

distribution channels and launching of

new and competitive products.

Amid a weaker domestic and global

outlook, we expect it to be a challenging

year and growth in the insurance industry

to remain moderate.

As for expansion, Allianz Life is looking

to expand in two areas, specifically

according to the geographical coverage

and diversification. Location wise, we are

very successful in the West Coast, Klang

Valley, Johor Bahru and Penang. We also see

great potential in the East Coast and East

Malaysia too, where we are planning to put

in a lot of our resources into developing

our market share in future.

Q: What are the major challenges that the insurance industry are facing?The prevalent global economic uncertainty

and fall of the Ringgit puts a strain on

industries and in turn reflects on a slower

than anticipated real wage growth for the

average consumer. This leads to a lower

than expected increase in disposable

income which will affect life insurance

sales to new policyholders. The market will

be challenging but we remain optimistic

as the fundamentals of the economy

remain robust.

Other general challenges would be

managing the various regulatory changes,

shortage of human resources, specialist

and talent retention and to manage the

digitisation and social media in the best

and most effective way. Innovation of

distribution, service and products is key

as there is a clear trend that customers

get more sophisticated and informed and

require an easy access when dealing with

their insurance company and expect a

greater transparency of information.

For the life insurance sector, since health

insurance is becoming more expensive due

to the better medical equipment, tools and

services, we see inflation in health costs.

There is also the concern over the issue

of retirement. With falling fertility and an

increasing life expectancy, the Malaysian

population is aging. It is expected that the

share of people aged 65+ will rise from

5.3% to 17.8% in 2050. This emphasises a

greater concern on retirement planning.

People are living longer and the number of

retirees is increasing. However, there is still

insufficient financial education and lack of

awareness on this issue. The lack of social

safety net sees people not having enough

during their retirement. The Employees

Provident Fund (‘EPF”) is clearly a valuable

support during retirement; however,

statistics have shown that 50% of EPF

contributors exhaust all their EPF savings

within five years of retirement.

Other trends include increasing

competition with the global trend of

consolidation, competition from new

players such as asset managers and digital

disruptors, technological advances in

the industry that drive the demand for

specific and differentiated non-traditional

insurance solutions from very well-

informed customers.

Q: According to the 2015 Global Insurance Outlook by Ernst & Young, technology is accelerating mobile and web-based sales, advice and distribution opportunities in Asia-Pacific region which is the results of high levels of mobile device ownership and usage. What is your opinion about this growing trend? Will Allianz move to the mobile and web-based direction as well? For us in Allianz Malaysia, digitalisation and

the advent of social media are important

trends very much to look out for. Allianz

has made significant investments in this

area and will look into investing into

more digital propositions including our

distribution channels and in the delivery of

our products and services.

We have moved towards digitalisation

which allows seamless, straight through

14 FEATURE

Malaysia 2015 – 2016 Market Sentimentby Alexander Woo, IQI Holdings

During the last crisis in 2007, Malaysia did not feel the full effects until mid-2008 when the government could no longer afford to subsidise fuel prices and declared a drastic increase in petrol and diesel prices. That shocked the market and since almost everything is directly or indirectly related to fuel prices due to transportation costs, Malaysia experienced an over nigh inflation nearly across the board. Feeling the pinch, many people became more conservative in spending and this in turn brought the country’s economy into a recession. Fortunately this phenomenon did not last long. Having made a quick rebound from that downturn the Malaysian market quickly regained confidence in 2009 and this lasted till 2012 –2013 when speculation of property and economic bubble burst started to arise.

Up till 2015, nothing really drastic has happened. Despite the concerns, there has been no major crisis. There is a major lesson from the last crisis which is the “trigger point”, something that sparks off the panic and realisation that the market is in trouble. For Malaysia, it was the fuel prices that sparked off the inflation and slowdown; in the US, it was the defaulting of the financial market and instruments which snowballed into a crisis. Fundamentally, the market had weakened but yet the sentiment was positive. This artificially maintained a positive outlook unit until the trigger kicks in.

When such a trigger point kicks in during the peak of a market, it would fall quickly and steeply.

Despite that, there are some interesting happenings in Malaysia in 2015 that are worth looking at.

GSTIt was announced that Goods and Services Tax (GST) would be implemented in April 2015, at a rate of six percent (6%). Naturally it was expected that prices would go up. Six percent is not a whole lot considering that some essential items were exempted from this tax. However, the market sentiment was that inflation was coming. And unlike the fuel price increases which are announced just a day prior to implementation, the GST was announced back in 2014. This was meant to give everyone time to prepare and indeed much work needed to be done before implementation. But it also resulted in a “time bomb” whereby people were anticipating inflation and started to be more cautious on spending. Some people did last minute shopping prior to April 2015 and so to avoid or delay in having to purchase GST-subjected goods. Indeed there was a slowdown right after the implementation. While some people are still feeling a bit of a pinch, life goes on and most people are able to move on in life.

DownsizingSome major corporations trimmed down their operations and there definitely are more cases involving smaller companies which may have gone unreported. While it is a negative reflection of economic performance, negative news is usually overrated when it first emerges and subsequently gets sidelined. Even before the latest series of downsizing, people were complaining about the difficulty in getting a good job. While they might have phrased it as difficulty in getting “a job”, they really meant to say that “a good job” is hard to come by and

that they are not willing to settle for anything less just yet. In times of need, one may have to settle for a less-than-ideal job to pay the bills. And while it is a painful experience to be laid off, one would have to bite the bullet and do the needy, at least for the interim before securing the next “good job”. Overall the job market still offers ample opportunities to sustain the population.

Depreciation of the Ringgit2015 saw a huge drop in the Ringgit, resulting in higher costs of imports. This meant higher costs or less purchasing power by Malaysians. On a more macro level, foreign investments started to pull out of the country for fear of losses in currency exchange. This may not be the only reason to pull out but it certainly does not seem wise to hold a stake in a depreciating asset, be it a currency or stocks or other asset classes; if it is on a downtrend, let go and relocate funds elsewhere. Some point to the low oil prices (which impacts Malaysia as an oil exporter) or to the political governance of the country. Either way it did not go down well for Malaysia.

Political ConcernsOf late, there have been rumors regarding high profile individuals of influence in Malaysia. Social media has played a substantial role in the widespread of rumors, many of which have not been substantiated. However, people continue to share such information online causing much uncertainty as to which is true or fabricated. And because the market is driven by the masses from within and also by external investments, all of whom make decisions based on sentiment rather than full facts, allegations are sometimes enough to cause unrest. Among the issues include the management of funds in 1MDB resulting in a RM42 billion debt, of which certain losses have been recovered or minimised. Based on a 30 million population, if each person had to bear the losses it the amount per person would be RM1,400 (about USD$320 at the current exchange rate). The impact of GST

However if the market has already been cautious, like

Malaysia has been for the pasttwo years, it would be safe landing

before the next rebound.

15FEATURE 15

would easily amount to much more than that over a year or two. So again it is the sentiment and the market confidence in the economy and the government that impacts the most.

Political allegations and movement of funds are commonplace and have always been. One major factor in current times is the widespread use of social media. In the past no one other than those involved actually knew what was going on unless reported in the mainstream news. Nowadays, plenty of information, be it true or fabricated, are circulating on social media. While it is good to have a free flow of information, the authentication of it is hard to determine. Nevertheless it is sufficient to stir up a storm in any political arena, indirectly affecting the economic health. It even lead to a massive rally known as “Bersih 4.0”. The exact turnout is unknown and there are various estimates from tens-of-thousands to hundreds-of thousands of participants. It must be noted that this was a peaceful gathering to express concerns over certain issues. Social stability is strong and the country is stable. It is just that the people want more transparency. With such a strong message by the people to the government, it is certainly hard to ignore. Social media will definitely help to pressure all parties to be more accountable and more transparent, thus an expected increase in efficiency and productivity.

To sum it up, 2015 has not been the best year for Malaysia. Several factors have shaken the confidence of internal and external stakeholders. When the market reacts in a certain way it does not always truly reflect the fundamentals of that market but rather the overall perception and sentiment towards it. In such an instance, the market could recover rather quickly once the negativity has passed because the core of the country and economy are strong and poised for growth. Is Malaysia one such example? Let’s look at some predictions for 2016.

2016 OutlookTo be fair, 2015 was not all that bad for Malaysia. It could have been worse and somehow most people seem to be managing and are getting by without too much of a change in lifestyle. This shows that there is a strong foundation and that there is overall stability. As issues of the past are put behind and as people move on into the new year, some market sentiments are slowly forgotten.

Some facts remain, such as the exchange rates and the falling prices of crude oil, some noise in the political arena, and so on. At the moment there are no strong signals that the oil prices or the Ringgit will rebound just yet. However it is a matter of time before Malaysia regains ground because it has some important fundamentals in place.

Strategic HubThe Straits of Malacca is an important transportation route and Malaysia is strategically located along it. This has made Malaysia a prominent transportation hub with ports in Penang, Klang, Malacca, Johor and more. Due to availability of ports, ample infrastructure, reasonable cost of labour and energy, stable economy and governance, foreign firms have set foot in Malaysia. These factors are still valid and will continue to be as such. There will still be a strong and continued presence of foreign investment here. While it is true that some foreign investments have pulled out due to the depreciating currency, those were mainly investment funds that are optimised to the best markets. They were invested here because Malaysia had good potential; and they will be reinvested here when the market and currency is bullish again. This is a normal movement in investment. Big players such as manufacturing plants do not relocate operations just because of some minor market turbulence; the cost of relocation outweighs the potential saving of such a move.

Market CyclesSo when will the Ringgit rebound? And some people go so far as to question if that will even happen.

Malaysia is also blessed with natural resources which serves internal consumption and for export. The drop in crude oil prices has affected the country’s revenue but it is still an income for Malaysia, amongst other sources. Markets go up and down and it will definitely not go all the way down, not in this case. There are market cycles and it has been a bit slow here in recent years. Soon it will rebound. There are strong indicators that the market here is still healthy.

It is clear that the fundamentals are strong and that Malaysia’s

economy is healthy.

16 FEATURE

Important Numbers for 2016IQI Holdings Chief Economist, Shan Saeed, shared his expertise on this matter. He predicts a GDP growth of between 4.8% to 5.2% in 2016, citing a ballpark figure of USD$335 billion. This is a healthy growth with a steady increase from USD$245 billion in 2008. Inflation is expected at 3.0%; discount rate is at 3.25% and base rate will be between 3.5% to 4.0%. This will keep the cost of funds relatively low and will be an attraction to maintain and further attract foreign investments. He further predicts that the Ringgit will stabilise in the second half of 2016, also citing unemployment rate at a mere 3% as an indicator of a strong economy.

Stable GovernanceAs much as people may speculate, Malaysia has always been stable in terms of governance. Other than absolute monarchy or dictatorship, every other nation faces political changes from time to time. There will always be people who complain about

the government and it is not possible to satisfy everyone. Social media has given rise to widespread rumors and also transparency in governance. No matter how much any individual in government may have personal agendas, it is necessary to take into account the potential backlashes of social media. Therefore it is expected that fair and just policies are implemented to meet both local and international demands. No doubt there will still be dissatisfaction among some but it will be overall stable. The grass is greener on the other side; Malaysians compare ourselves to other countries and some choose to migrate, meanwhile there are foreigners opting to relocate to Malaysia.

Conclusion Internally and fundamentally, Malaysia is strong and stable. The market sentiment might warrant some caution but ultimately it boils down to the intrinsic strength of the country’s economy. It will soon rebound and while some people wait to see it happen,

some capitalise on the opportunity set foot or to expand influence in times like these. As long as the fundamentals are in place, market sentiment will become positive again and the economy will rebound.

Alexander Woo is the Vice President of Financial Education for IQI Holdings, an international investment company. His ability to translate academic knowledge into the business world is evident in his selection as a Finalist for the 2014 Ten Outstanding Young Malaysians (TOYM) award, in the category of Business, Economics, and Entrepreneurship. He has also been featured in the mainstream media, including: New Straits Times, Focus Malaysia, China Press and others.

18 GREEN FINANCING COLUMM

Grow your Business with Green Financeby Sunita Devi, Devcom Trends

Green Finance, Green Economy, the word “green” if replaced with the word sustainable, would connote similar objectives to the whole concept. For decades now business people, governments and academics have extensively debated on this topic of sustainable development. The paradox for most of these stakeholders is which should be priority, managing “business as usual” until the next board meeting or to set this topic as item No. 1 on the agenda.

Businesses struggle with high cost of operations due to accelerated change in pricing structures. Companies alter their books and numbers and figures until one day a news report gives negative press coverage for its numbers in the red. All these are common daily muses on print and digital media. The irony is that organisations were set up to deliver products and services to the consumers and clients with the intention to contribute to economic figures.

The differentiation factor for operating efficiently seems to be in a diversified nature of business. Diversification by economies of scale is impossible without appropriate funding options, whether through equity offers, angle investors, or

via a new segment of conceptualising the operations as sustainable. There is no cynicism at the mention of the word sustainable. As reported in the Guardian, UK in its Sustainable Business section, scandals and disasters, are basically a revelation of mistreated numbers. There is no mistake in its ‘fit for purpose’.

According to the steadfast Managing Director of International Monetary Fund (IMF) Christine Lagarde, “we (IMF) can identify the true purpose of financing which is to optimise resource use for the good of economic stability and full employment”. The smart way to manage micro economic questions is to gain perspective of the macro economy. In other words, investors must understand the green portfolio potential and to do this they should be given access to an assessment ranking of these portfolios by companies that are seeking to obtain financing. Business owners must realise that others have to understand the future and nature of their business and the purpose of the finance clearly.

In 2015, the Global Trends in Renewable Energy Investment report by the United Nations Environment Programme (UNEP)

had reported an increase in global investments for green energy. This in reality is common global sense, cost of energy will go up with fossil fuel dependence therefore alternatives must be sought. However, there are small medium industries and supporting business services that seeks financing for diversification purposes and are unable to articulate the needs and impact their business services creates in the market place, therefore failing in the bid for financing. The financial documents support such growth capacity in cash flow analysis, budget control sheets and all these are doctored documents which requires sound international standards and reports for substantiating its claims. Business owners who sweat out figures and numbers on these financial documents must have a clear understanding of thematic investments and risk appetites of investors. Not always a common industry will thrive, to give the same if not higher returns. New industries and services deserve more attention and weight in its portfolio development is the responsibility of business owners.

Many articles give definition on green financing and green investment. It is in simple terms giving money to a

must first comprehend a wide range of existing and evolving financing practices to leverage on the schemes in order to scale up their business wisely. Strategies must be reviewed to benchmark against international best practices in operations and management in order to qualify for funding and also maximise ROI on investments.

Green Financing can help any business grow if the portfolio is developed with a tinge of climate mitigation initiatives. This is an acquired skill. Therefore gaining full understanding of your business and its future potential is crucial for future planning. Managing your business as usual is no longer an accepted norm. Understand public policies that govern your business. Learn of the various institutional and private consortium type financing options. Well-designed risk mitigated portfolios for your business can help in sourcing for suitable investments.

No matter how much planning you put into your business, no new results can be achieved if business is still done the old fashion way. Numbers make a difference in a big way so should the overall contribution of your business. Take that leap make it a quantum leap in changing the future of your business, prepare yourself to enjoy the merits of green financing. Strengthen your industry presence implement the right business strategies so that your business enterprise will be a success.

19GREEN FINANCING COLUMM

business that is not operating under non-conventional terms which justifies the controversy and uncertainty. As Taleb in his book “Antifragility” stressed the rewarding experience of randomness in green finance is and not limited to conventional investment approaches such as SRI (socially responsible investing), ESG (environmental, social and governance investing), sustainable, long-term investing or any other similar concepts.

Therefore the rising investor interests in such initiatives. Green investments have been growing over the past years, mostly in renewable energy or clean technology adoption, green infrastructure and green services. Another challenge in the market is the rapid movements and tremendous amount of information inputs therefore the need for some basic knowledge on environment and also in employing environment related investment experts in order land on a good investment opportunity.

There is potential in climate mitigation initiatives. For businesses these potential is usually a dynamic mission which is somewhat supported by local government policies. However, there are several challenges that business people often face especially as Small Medium Entreprises (SMEs);

a) Low grasp of the “Green” concept by SME business owners.

b) Lack of financial options from local financial institutions.

c) Low on experience in financial analytics for managing new business /concepts.

d) Lack of knowledge on international financing options.

e) Low in competency assessments for business matching and collaborative efforts.

f ) Lack of macro perspectives of the current industry trends and achievements around the world.

g) Low impact updates on annual reporting/record keeping for SME businesses to keep up with international progress by industry.

Low carbon economy is a new way of industries getting together to do business by combating climate change. However strong the theories seem to suggest potential in this area, no business man will agree to embark on it unless they have sound knowledge, sufficient skill sets and empirical cases that has proven results.

In 2015 January EU drew up a report on Climate Finance insights of global countries especially Indonesia, Malaysia and Thailand. One of the key findings is that despite numerous schemes and large amounts of encashment provided, the lack of understanding of green business by commercial bankers coupled with poor financial reporting presentations followed by limitations imposed on local financing options have impeded several businesses from obtaining or even attempting to seek financing for growing their green business. Clearly, public resources are available and government agencies play a crucial role in catalyzing private investments towards green investments to catalyse structural changes in energy systems as engines of economic growth.

Businesses need help to understand, analyse and effectively leverage on financing options to develop their business. They need to build up knowledge on elements that make investments successful from financial, environmental, organisational, and political perspectives by gaining industry input from the world over. Employees need to be trained to produce sound business portfolios for bidding into various financing options that are available locally, regionally and internationally. They

As of the 3rd of January 2016, the green

technology financing scheme (GTFS) hotline

reported that the approved value for

under GTFS is RM2,395,371,877.00. There is

an available amount of RM1,104,628,123.00

untapped. This GTFS is available until

31 December 2017.

Sunita Devi is a Sustainable Development expert working on EU funded projects, where she assists in optimising ROI for Green investments via her training consultancy www.devcomtrends.com.my.

The concept greencame about due to the global attention on climate change,

resource efficiency.

This includes the requirement to obtain consent from the individuals (General Principle), to notify the individuals of the manner in which their personal data is or will be processed (Notice and Choice Principle), to limit the instances where the personal data may be disclosed to third parties (Disclosure Principle), to keep the personal data secure (Security Principle), to retain the data only for as long as required (Retention Principle), to provide the individuals with means to access and correct their personal data (Access Principle) and also to ensure that the personal data remains accurate (Data Integrity Principle).

The Proposed Standards distinguish between data managed electronically and data managed conventionally. Generally, the proposed standards require that personnel access to personal data is restricted and authorisation limits are set as required. A user log should also be retained and access to data limited. Electronically managed data must also be backed up with the latest anti-virus software. In respect of data retention, the proposed standards require that records of the disposal of personal data must be maintained and submitted when directed by the Personal Data Protection Commissioner, and all data collection forms are destroyed within seven days of acquisition of personal data from such forms unless retention is legally required. As for data integrity, companies are required to provide forms to customers for updating their personal data and also identify the appropriate supporting documents to verify the accuracy of the personal data.

20 LEGAL & INVESTMENT

Data Privacy: Latest Standards Proposed under the Personal Data Protection Act by Chew Kherk Ying, Chen Hong Sze, Wong & Partners

Generally, companies which collect, use or store personal data are required to comply with the

seven data protection principles which form the basis of protection under the PDPA.

The Standards, once finalised, would prescribe clear minimum standards that must be taken in order to comply with the Security Principle, Data Integrity Principle and Retention Principle.

Companies who process personal data must be mindful that the penalties for breaching the PDPA include the imposition of fines of up to RM500,000 and/or a term of imprisonment not exceeding two years. Directors, CEOs, COOS, managers or other similar officers have joint and several liability for non-compliance by the body corporate, subject to the due diligence defence. Companies who use the personal data are also responsible for compliance with the security standards by any third party it may appoint to process the personal data on its behalf.

With the enforcement of the Personal Data Protection Act (“PDPA”) in November 2013, Malaysia took its first step towards the protection of personal data. Although data privacy laws in Malaysia are still in its infancy and there have not been any reported cases of enforcement of the PDPA, the new security, data retention and data integrity standards (“Proposed Standards”) which have been proposed by the Personal Data Protection Department would provide data users in Malaysia some guidance on the minimum standards that need to be complied with in respect of the retention, security and the integrity of personal data.

Chew Kherk Ying heads the Intellectual Property and Dispute

Resolution practice groups with more than 27 years of experience

in IP matters, as well as in franchising and licensing, privacy and data

protection, advertising and media law. Her expertise also covers

telecommunications, pharmaceutical, and Internet regulatory issues.

Chen Hong Sze is an associate with the Intellectual Property and

Dispute Resolution practice groups, and is experienced in handling a

wide range of contentious intellectual property (“IP”) matters.

22 LEGAL & INVESTMENT

New Investment Incentive for Head-Quarters in Malaysia: the Principal Hub Incentive

In April 2015, the Ministry of International Trade and

Industry (MITI) announced the introduction of the

Principal Hub Incentive (“Principal Hub Incentive” or PHI)

on 1st May 2015 to attract multinational companies or

corporations (“MNC”) to establish their operational and

decision-making headquarter in Malaysia. Among the

expected achievements, the PHI seeks to encourage

MNCs to leverage on Malaysia’s competitive position in

order to expand in the ASEAN and the Asia Pacific

region. Under the PHI, a company incorporated in

Malaysia, providing qualifying services to its related

companies outside Malaysia, is entitled to tax and non-

tax incentives.

by Philipp Kersting and Julie Cheung, LL.M., Luther

WHAT IS A PRINCIPAL HUB?A Principal Hub (“PH”) is “a locally incorporated company that uses Malaysia as a base for conducting its regional and global businesses and operations to manage, control and support its key functions including management of risks, decision-making, strategic business activities, trading, finance, management and human resource.” 1

In other words, the PH embodies a control centre for strategic decisions and operational functions in Malaysia.

PRE-REQUISITES FOR PH STATUS In order to qualify for the PHI, an applicant company must comply with several requirements on local incorporation amongst others:

Minimum paid-up capital, carrying out qualifying services (strategic, business and/or shared services)2, minimum annual sales, to serve and control related companies overseas, to fulfil employment requirements, minimum annual business spending.

BENEFITS FOR PH COMPANIESAn approved PH company is qualified for the following tax and non-tax incentives:

•3-tieredcorporatetaxationrate: ranging from 0% to 10% for every income generated from the qualifying activity, a ratio of 30%/70% of the income sourced from inside/outside Malaysia must be complied with;

• Customs duty exemption for goods-based companies for raw materials, components or finished products brought into free industrial zones and other specified zones for production/repacking and integration before distribution to final consumers;

•Recruitmentofforeignworkers: relaxation in the application for expatriate posts;

•Nolocalequity/ownershipconditionisrequired;

• Acquisition of fixed assets by a foreign-owned company: more flexibility granted for foreign-owned companies for the purpose of carrying out the operations of its business plan.

DURATION OF THE INCENTIVE AND COMPLIANCE WITH MIDAA PH company is eligible for the incentive for 5 years upon approval by the Malaysian Investment Development Authority (“MIDA”). The duration may be extended for an additional period of 5 years, subject to the fulfilment of certain criteria, among others, to demonstrate evidence of training and development plans for Malaysians, a minimum of 30% increase in the business spending and 20% increase in the number of high value job positions. In order to stay under the scope of the PHI and to enjoy its benefits, such criteria must be complied with, by the PH company, within a prescribed period of time, and yearly reports must be submitted to MIDA. The PHI is granted for PH applications received by MIDA between 1st May 2015 and 30th April 2018. Luther Corporate Services Sdn. Bhd. works closely with MIDA and other authorities and will be pleased to assist with any further enquiries.

Incentives

3-tier tax incentive

5 years + 5 yearswithin each tier, subject to the ful�lment of certain conditions….

10% 5% 0%

Customs duty exemption subject to certain conditions, no local ownership requirement, more �exibility in the recruitment of foreign nationals and in the acquisition of �xed assets by foreign-owned companies.

Eligibility

RM2.5 million

RM300 million

15(3)

30(4)

50(5)

RM3 million RM5 million RM10 million

3 4 5

Strategic services +2 other services from any category

Regional P&L +2 other services from any category

Tier 3 Tier 2 Tier 1

Tax

DurationExtension

Non-tax incentives

Minimum annual sales (only applicable for goods-based companies)

Employment requirements:Creation of high value jobs(including key positions)

Local Annual business spend-ing

Countries served outside Malaysia

Qualifying services

Use of local ancillary services

1 From the date of implementation of the PHI, The Inter-national Procurement Centre, Regional Distributive Centre and Operational Headquarters incentives will be abolished. 2 More details on the qualifying services are available on MIDA website.3 Expatriate posts in accordance with business’ plan and subject to current immigration policies.

The following table is a summary of the PHI scheme:

Philipp Kersting is the Director of Luther in Malaysia. Before joining

Luther in 2014, he was partner of a specialised law firm consulting

clients in the music and entertainment industries across Europe.

He advises European SMEs and MNCs in Indonesia, Malaysia

and Southeast Asia regarding corporate, tax, investment and JV

strategies. Further areas of expertise include IP, copyright, media

and technology.

Julie Cheung joined Luther Malaysia in 2013 and studied international

business law in France and U.K. Before joining the Malaysian team, Julie

worked in law firms and legal departments in France and Hong Kong.

She mainly advises European SMEs and MNCs in Malaysia in relation to

corporate and investment strategies.

23LEGAL & INVESTMENT 23

24 ECONOMICS

Kreditvergabe und Zahlungsmoral – Malaysia

www.gtai.com

Kuala Lumpur (GTAI) - Malaysia’s five years plan from 2016 to 2020 stimulates an ambitious rate with 5 to 6 % economic growth. The main drive should come from the private sector. However, the public sector pushes the growth with large infrastructure projects, especially on the rail track. The aim is to become a high-income country by 2020 and thereby take the lower income groups up as well. This shall be helped by reinforced education and particular vocational training.

von Rainer Jaensch

Kreditnachfrageschwächtsichab/Vorkasseistüblich/VerlässlichesRechtssystem/VonRainerJaensch

Kuala Lumpur (gtai) - Mit der nachlassenden Konjunktur dürfte sich 2015 auch die Nachfrage nach Krediten verlangsamen. Die sind in Malaysia zu niedrigen Zinsen erhältlich. Die Zahl an lokalen und internationalen Banken im Land ist jedoch gering, obwohl die Regierung Kuala Lumpur zu einem globalen Finanzzentrum ausbauen will. Die Zahlungsmoral ist kein Problem, auch wenn es bei kleineren Marktteilnehmern ab und an zu Verzögerungen kommt. Unternehmen hilft ein verlässliches Rechtssystem. (Internetadressen)

Malaysias Finanzwesen geriet im Frühjahr und Sommer 2015 durch die Turbulenzen umdie verschwundenen Milliardenbeträge aus dem öffentlichen Investitionsfonds 1MDB indie internationalen Schlagzeilen. Hinzu kamen fallende Börsen- und Wechselkurse zusammen mit einem schwindenden Vertrauen in die politische Stabilität. Unterhalb desstaatlichen Bereichs scheint es jedoch mit dem Finanzgebaren privater Akteure nicht soschlecht bestellt zu sein. In Sachen Zahlungsmoral rangiere Malaysia zwischen dem “Saubermann” der Region, Singapur, und den anderen südostasiatischen Ländern, konstatierten deutsche Maschinenanbieter, Rechtsanwälte und Vertreter ausländischer Institutionen vor Ort gegenüber Germany Trade & Invest.

Schließlich sind auch die Rahmenbedingungen hierfür gegeben: ein verlässliches Rechtssystem, das auf dem britischen Common Law basiert, ein gut funktionierendes Bankensystem unter Aufsicht der renommierten Zentralbank. Letztlich ist sich die Öffentlichkeit - von der Politik bis zur Wirtschaft - der Bedeutung ausländischer Investitionen und Kooperationen mit internationalen Unternehmen bewusst.

KreditvergabeMalaysia ist anders als Singapur (noch) kein führendes Finanzzentrum in der Region. Die Regierung will jedoch Kuala Lumpur zu einem solchen machen und hat das Grundstück für den milliardenschweren Bau des Finanzdistrikts Tun Razak Exchange im Herzen der Stadt hergerichtet. Nur unglücklicherweise ist dieses ein Vorhaben des staatlichen Investitionsfonds 1MDB, der seit dem Frühjahr 2015 in den Strudel von verschwundenen Milliardenbeträgen und politischen Verdächtigungen geraten ist.

In Malaysia sind über 14 lokale und 24 internationale Banken ansässig. Dazu zählen auch 19 Kreditinstitute mit islamischer Finanzierung. In diesem Bereich hat sich der mehrheitlich islamische Staat - nicht zuletzt mit Hilfe staatlicher Unterstützung und guter Beziehungen zu arabischen Ländern - eine Marktnische mit internationaler Bedeutung herausgearbeitet. So tragen islamische Banken rund ein Fünftel zum Kreditvolumen bei. Insgesamt belief sich das Volumen der im 1. Halbjahr 2015 vergebenen Kredite auf 534 Mrd. malaysische Ringgit (RM; 121 Mrd. Euro; 1 Euro = 4,41 RM). Damit lag es 3,4% höher als im Vorjahreszeitraum. Im Gesamtjahr 2014 waren es 1.074 Mrd. RM gewesen.

Der Appetit auf Kredite und Darlehen hat sich im 1. Halbjahr 2015 im Tandem mit der Gesamtwirtschaft verstetigt, konstatiert der Leiter des Retail-Geschäfts einer führenden internationalen Bank gegenüber Germany Trade & Invest. In den letzten fünf Jahren gab es hingegen ein rapides Wachstum im Kreditgeschäft, angetrieben vor allem vom

Je kleiner der Kunde, umso mehr Vorsicht ist geboten. In der Regel sind es die kleineren Unternehmen, bei denen Zahlungsausfälle auftreten. Der häufigste Grund für Nichtzahlungen ist die Insolvenz, konstatiert eine deutsche Rechtsanwaltskanzlei. Die meisten Problemfälle fallen bei der Lieferung von chemischen Grundstoffen und Maschinen an.

Bonitätsprüfung von GeschäftspartnernWirtschaftsauskunfteien wie Credit Bureau oder Dun & Bradtstreet (D&B) beobachten den Zahlungsverkehr von Unternehmen. Sie analysieren die Transaktionen der Firmen, die in ihren Datenbanken erfasst sind und erteilen Bonitätsauskünfte. Es gibt jedoch eine ganze Reihe an lokalen und internationalen Bonitätsprüfern mit unterschiedlichem Datenumfang und Niveau. Als Richtschnur mögen international renommierte Firmen dienen oder das Unternehmen Basisnet, mit dem die deutsche AHK in Malaysia zusammenarbeitet. Für genauere Recherchen über die Liquidität und Zahlungsfähigkeit sollten jedoch Rechtsanwälte und Wirtschaftsprüfer konsultiert werden.

Bei Zahlungsverzögerungen oder -ausfällen sollte der Gläubiger als erstes den direkten und schnellsten Kontakt - entweder über Telefon oder E-Mail - mit dem Kunden suchen und nach den Gründen fragen. Der normale Postweg nimmt oft mehrere Wochen in Anspruch. Man sollte nicht zu lange warten und sich auch nicht zu lange vertrösten lassen. Schließlich sind die Verjährungsfristen im Auge zu behalten. Der nächste Schritt sind Mahnschreiben, entweder von einem Rechtsanwalt oder auch der AHK in Kuala Lumpur. Diese als offiziell angesehenen Schreiben führen bereits häufig zum Erfolg, ist von der AHK zu hören.

In den hartnäckigen Fällen muss aber der Rechtsweg beschritten werden. Hierbei raten Kenner der Rechtspraxis zu einem differenzierten Vorgehen. Ist der Streitwert nicht höher als rund 50.000 Euro, lohnt sich der Gang zum Kadi nicht. Denn 30% der Anwaltskosten muss der Kläger auf jeden Fall selber zahlen. Auch sollte sich der Kläger den Kontrahenten genau anschauen. Ist es ein großes lokales Unternehmen mit guten Kontakten zur Regierung oder gar ein staatlich angebundenes Unternehmen, hat es ein anderes Gewicht als eine kleine Firma. Gegen den malaysischen Staat zu klagen gilt normalerweise als No-go. Es gab aber auch Fälle, wo ein ausländisches Unternehmen gegen den Staat vor Gericht gewonnen hat, berichtete eine ausländische Rechtsanwaltskanzlei. Generell gelten jedoch staatliche Stellen und Unternehmen als verlässliche Zahler.

Die Größe des Gläubigers spielt auch eine Rolle. So kann ein multinationales Unternehmen, vor allem wenn es gleichzeitig ein wichtiger Investor und Arbeitgeber in Malaysia ist, ganz anders auftreten als eine kleinere “No-Name-Firma”. Wenn rechtliche Schritte erforderlich sind, helfen lokale, internationale und auch deutsche Kanzleien, die vor Ort vertreten sind. Über Kontakte zu diesen verfügen die deutsche Botschaft sowie die AHK.

ExportfinanzierungGeschäftsbanken und spezielle Finanzierungsinstitute bieten verschiedene Finanzierungsmöglichkeiten für Auslandsgeschäfte an. Die wichtigsten deutschen Kreditgeber im Exportgeschäft sind die Ausfuhrkredit-Gesellschaft (AKA) und die Kreditanstalt für Wiederaufbau (KfW).

25ECONOMICS 25

Immobiliensektor sowie Geschäften mit Öl und Gas sowie anderen Rohstoffen.

Mit dem Preisverfall bei Mineral- und Rohstoffen lässt in diesen Sektoren der Kreditbedarf nach. Banken in Malaysia sehen nun eher eine wachsende Nachfrage nach Krediten für Infrastrukturprojekte (Straßen-, Brücken- sowie Stadt- und Eisenbahnbauten) wie auch in den Wirtschaftszweigen Chemie, Logistik, Elektrotechnik und Elektronik sowie Gesundheit und Bildung.

ZahlungsmoralEin nicht unerheblicher Anteil der ausgezahlten Kredite wird von der Zentralbank als notleidende oder beeinträchtigte Kredite eingestuft. So waren es 2014 immerhin 272 Mrd. RM und damit 2,1% weniger als im Vorjahr. Im 1. Halbjahr 2015 ging das Volumen der faulen Kredite um weitere 2,5% zurück. Aufgrund der Unsicherheiten in den Währungsmärkten kann es jedoch im 2. Halbjahr wieder steigen, schätzen Bankenvertreter. Die Problemkredite fielen in der Vergangenheit vor allem beim Automobilkauf sowie im Immobilien- und Bausektor an, gefolgt von der verarbeitenden Industrie sowie dem Handels- und Gastronomiebereich. Demnächst könnten aufgrund des Rohstoffpreisverfalls unterkapitalisierte Unternehmen aus dem Öl- und Gas- sowie dem Plantagensektor Zahlungsprobleme bekommen. Somit beobachten Banken Unternehmen aus diesen Branchen etwas skeptischer. Bislang zeige aber noch kein Sektor Stressanzeichen, konstatierte ein Bankvertreter gegenüber Germany Trade & Invest.

Wichtig ist es, bei der Anbahnung einer Geschäftsbeziehung verlässliche Informationen über den Partner einzuholen. Hierbei solle man sich nicht auf eine zugesandte Kopie aus dem Handelsregister verlassen. Diese kann gefälscht sein. Bei Recherchen vor Ort hilft die deutsche Auslandshandelskammer (AHK). Über profunde Ortskenntnisse und Kontakte zu lokalen Firmen verfügen auch die deutschen Handelshäuser, die in Malaysia vertreten sind.

Finanzierung ist auch in Malaysia zu niedrigen Zinsen erhältlich. Nachdem die Zentralbank im Juli 2014 den Leitzins vorsichtig um 25 Basispunkte auf 3,25% angehoben hat, ist er seitdem auf dem Niveau gehalten worden. Angesichts der gedämpften Konjunkturlage wird auch vorerst mit keiner spürbaren Zinsanhebung gerechnet. Die aus politischen Gründen niedrig gehaltenen Zinsen führen jedoch zu Fehlallokationen von Kapital, verlautet es aus der Bankenbranche. Die Zentralbank warnt schon seit längerer Zeit vor der hohen Verschuldung der privaten Haushalte, die 2014 auf 88% des Bruttoinlandsprodukts gestiegen war.

Häufig ist es nicht Böswilligkeit oder Insolvenz, die zu einer Zahlungsverzögerung führt, sondern einfach Nachlässigkeit, konstatieren Landeskenner. Bei einem anderen Verständnis von Pünktlichkeit als in Deutschland lässt man sich mit der Bezahlung schon mal einige Monate Zeit. Wie in anderen asiatischen Ländern auch, verlangen die ausländischen Lieferanten in der Regel eine Vorauszahlung: 30 bis 50% bei Auftragsvergabe, der Rest bei Lieferung bis auf 10%, die bei einwandfreiem Lauf der Maschine gezahlt werden, erklärte der Vertreter eines deutschen Handelshauses. Bei guten Kunden wie multinationalen Firmen wird hingegen direkt gezahlt. Sie geben teilweise die Bedingungen vor. Zahlungsfristen von 30 bis 60 Tagen sind üblich und können bei großen Kunden auch auf 90 Tage steigen. Somit ist die Bezahlung eine Kombination aus Vorkasse und Akkreditiv.

In this setting, growth of 1.7% in Germany’s real gross domestic product (GDP) in 2015 could be followed by a rise of 1.8% in 2016 and 1.7% in 2017. The anticipated upturn in growth is masked by calendar effects. Adjusted for working-day variations, growth rates would stand at 1.7% in 2016 and 1.9% in 2017, following 1.5% in 2015. The expected rise in GDP thus significantly outstrips the estimated potential growth rate, which has been lifted slightly to 1.3% per annum for this and next year on account of the mass influx of refugees. Aggregate capacity utilisation can therefore be expected to climb distinctly and build up a widening gap over normal utilisation levels. Despite the expansionary effect which migration is having on the labour supply, the labour market will experience shortages to a growing extent, driving up wage increases. Germany’s general government budget is expected to record a more or less balanced fiscal outcome in 2016 and 2017 as mounting expenditure, inter alia on account of the influx of refugees, will more than offset favourable cyclical factors and the lighter interest payment burden.

Against this backdrop, consumer price inflation will accelerate as the dampening effect of crude oil prices on inflation gradually peters out. This should more clearly reflect the feed-through of rising domestic cost pressures in the price level. As measured by the Harmonised Index of Consumer Prices (HICP), inflation could rise from 0.2% in 2015 to 1.1% this year and 2.0% in 2017. Excluding energy, HICP inflation should climb from 1.1% in 2015 to 2.0% in 2017.

Compared with the June 2015 projection, expectations for economic growth have now been raised slightly for 2017, while the expectations for inflation have been pared back over the entire forecast horizon, notably in 2016. The adjustment to expected price developments largely reflects the renewed downturn in crude oil prices, which had not been expected in June. Downside risks to economic growth would arise if the current sluggish dynamics in a number of emerging market economies (EMEs) were to worsen. In addition, the scale of the expected refugee influx and the attendant macroeconomic and fiscal implications are subject to major uncertainty.

EconomicoutlookIndustrial output could continue to suffer into the first quarter of 2016 from the recent weak order intake, even though sentiment in manufacturing has already rebounded from its slowdown in the second and third quarters of 2015, according to the Ifo Institute’s surveys. The services sectors are expected to carry on growing robustly.

The German economy could gain additional momentum over the course of 2016 if exports, as assumed, recover from their sluggishness in the second half of 2015 and business investment also subsequently revives as capacity utilisation rises. A key prerequisite for this is that world trade expands at a faster pace. However, the quite steep growth in

Germany will continue to be largely driven by domestic demand and, in particular, by private consumption, which is reaping the benefits of low unemployment, distinct increases in real wages and rising government transfers. The influx of refugees is playing an important role in both government monetary transfers and in the comparatively large increase in government consumption expenditure.

Under these conditions, growth in seasonally and calendar-adjusted real GDP could be lifted to 2.0% over the course of 2016 and may almost maintain this pace in 2017 with growth of 1.8%.12 In terms of annual averages, this results in GDP growth, adjusted for seasonal and calendar effects, of 1.7% in 2016 and of 1.9% for 2017, after 1.5% in 2015. The shift from a positive calendar effect in 2016 to a distinctly negative effect in 2017 stemming from the different number of working days has the result that the unadjusted annual average growth rates paint a somewhat altered picture (+1.8% for 2016 and +1.7% for 2017, after +1.7% in 2015). For 2016, the same level of GDP growth is thus expected as in the June projection, whereas a slightly higher increase is now anticipated for 2017.

Overall, the German economy would expand significantly faster than potential output in 2016 and 2017. At 1.3% per year over the projection period, the expansion of potential output is now estimated to be marginally higher than it was in June, owing to the impact of the influx of refugees on the labour force potential (including a certain crowding-out effect on other net migration) and the indirect effects on productivity growth and fixed capital formation. The output gap, which is already slightly positive this year, would continue to widen, and the German economy’s production capacities would see considerably higher utilisation in 2017 than the long-run average.

26 ECONOMICS

Outlook for the German Economy – Macroeconomic Projections for 2016 and 2017

The German economy is currently growing primarily on the back of lively domestic demand. The main drivers are the favourable labour market situation and substantial increases in households’ real disposable income. Foreign trade, by contrast, is currently being hampered by frail demand from the emerging market economies, and this is making itself felt on industrial investment. With export markets outside the Euro area expected to rebound and economic growth within the euro area gaining a little more traction, the healthy underlying state of the German economy should stand out even more clearly over the next two years.

Source: Deutsche Bundesbank, Monthly Report December 2015 (access via https://www.bundesbank.de)

The Malaysian economy expanded in the third quarter(at constant 2010 prices)

1Q 2Q 3Q 4Q2012

1Q 2Q 3Q 4Q2013

1Q 2Q 3Q 1Q 2Q 3Q4Q2014 2015

5.6

Annual change (%)

0

1

2

3

4

5

6

7RM billion

0

50

100

150

200

250

300

4.9 4.7

27ECONOMICS

The global economy continued to expand at a moderate pace in the third quarter of 2015, with diverging growth momentum across economies. While the US and the UK economies registered moderate growth, economic activity in the Euro area and Japan improved at a more gradual pace. In Asia, growth was supported by the continued expansion of domestic demand amid weak export performance. Against a backdrop of moderate growth and low inflation, several major and regional central banks lowered policy rates. In addition, a number of economies in the region have also announced fiscal measures to support domestic demand activity.

Economic and Financial Developments in Malaysia in the Third Quarter Of 2015

The Malaysian economy expanded by 4.7% in the third quarter of 2015 The Malaysian economy recorded a growth of 4.7% in the third quarter of 2015 (2Q 2015: 4.9%), supported mainly by private sector demand. On the supply side, all economic sectors continued to expand during the quarter. On a quarter-on-quarter seasonally-adjusted basis, the economy grew by 0.7% (2Q 2015: 1.1%).

The private sector continued to be the key driver of growth during the quarter. Private investment grew by 5.5% (2Q 2015: 3.9%), driven by capital spending in the manufacturing and services sectors. Private consumption expanded at a more moderate rate of 4.1% (2Q 2015: 6.4%) as households continued to adjust to the implementation of the Goods and Services Tax (GST). Public investment turned around to record a positive growth due to the improvement in spending on fixed assets by both the Federal Government and public enterprises. Meanwhile, public consumption growth moderated to 3.5% (2Q 2015: 6.8%) following the slower growth in both emoluments and supplies and services expenditure.

On the supply side, all economic sectors continued to expand during the quarter. Growth was led by the construction and manufacturing sectors. Construction sector growth improved due mainly to a faster expansion in the civil engineering and specialised construction activities sub-sectors. Similarly, the manufacturing sector registered higher growth, supported in particular by an improvement in the export-oriented industries. The service sector registered lower growth due to a moderation in household spending and slower capital market activity. The mining and agriculture sectors expanded at a slower pace due to a moderation in crude oil and palm oil production, respectively. Inflation, as measured by the annual change in the Consumer Price Index (CPI), increased to 3.0% in the third quarter of 2015 (2Q 2015: 2.2%) largely reflecting the increase in prices in the food and non-alcoholic beverages category amid shortages in supplies arising from adverse weather conditions. The transport category also contributed to the increase in inflation following the higher domestic fuel prices during the quarter.

The trade surplus amounted to RM22.2 billion in the third quarter of 2015 (2Q 2015: RM20.4 billion). Gross exports turned around to register an expansion of 5.5%

(2Q 2015: -3.7%), supported mainly by the broad-based expansion in manufactured exports. Meanwhile, gross imports grew by 2.9% (2Q 2015: -5.2%), reflecting an improvement in most major import categories.

Domestic demandwill remain the keydriverofgrowthGoing forward, global growth is expected to remain moderate. While the major advanced economies continue to improve, the pace of recovery will be modest. In Asia, domestic demand is expected to continue to support growth. Downside risks to global growth remain high arising from the moderating growth momentum in a number of major economies, uncertainty surrounding energy and commodity prices and possible disorderly market conditions arising from policy shifts in major economies.

While downside risks to growth remain, the Malaysian economy is expected to expand within the region of 4 – 5% in 2016.

Source: Bank Negara Malaysia (accessed via www.bnm.gov.my).

In collaboration with:Organised by:

MalaysianSkillsAdvancedDiplomas

INDUSTRIAL MANAGEMENT(DLKM/NOSSLevel5)

LOGISTICS OPERATION MANAGEMENT

(DLKM/NOSSLevel5)

GermanDualVocationalTraininginMalaysia,ACombinationofTheoreticalandPracticalTraining

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with relevant competencies and skills paired with a sound theoretical

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Increase motivation and loyalty of the trainee to the company

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Information exchange with training companies; sharing

experiences and best practices

Coordinating examinations

German certification body in collaboration with the approved

Malaysian certification organization

Join us as a Training Company

Your benefits

Our contribution

Key elements

Forfurtherinformation,pleasecontact:Malaysian-German Chamber of Commerce and Industry (MGCC)

MsJohannaTheil(HeadofTrainingDepartment)Email: johanna.theil@malaysia.ahk.de

MrJosefTschoep(DualVocationalEducation&TrainingConsultant)Email: josef.tschoep@malaysia.ahk.de

Tel +60-3-9235 1800

Website: malaysia.ahk.de

Start:June2016Duration:3years

Trainingbasedonacontractbetweenthecandidateandyourcompany

75% practical training at the workplaceand 25% theoretical training atGerman-MalaysianInstitute(GMi)

Trainingmodel:9weekswiththetrainingcompanyand3weekswiththeeducationinstituteonarotationalbasis

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Coordinated and supported by theMalaysian-GermanChamberofCommerceandIndustry(MGCC)

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EVENTS30

MGCC Christmas Sundowner 2015

The lucky grand prize winner receiving the gift from Mr Thomas Zimmerle of Infineon Technologies (M) Sdn Bhd.

From l. to r. Neesha Visvirnathan (Senior Sales Manager, PARKROYAL Serviced Suites Kuala Lumpur), Ng Ca Ni (Account Manager, Renaissance Kuala Lumpur Hotel), Kang Huey Fenn (Account Manager, Renaissance Kuala Lumpur Hotel).

From l. to r. Luciana Penna (President, Malaysian-Italian Chamber of Commerce and Industry), Carlo Allaria (Executive Secretary General, Malaysia-Italian Chamber of Commerce and Industry).

From l. to r. Sherena Wong (Trade Fair Officer, MGCC), Felisya Woo (Assistant Sales Manager, Pullman Kuala Lumpur City Centre Hotel & Residences) and Michelle Lim (Senior Marketing Officer, MGCC).

From l. to r. Beatrice Lee (Marketing & New Business Development, Lufthansa German Airlines), Lawrence Lee (Sales Executive, Lufthansa German Airlines), Kiki Shum (Business Process & New Business Development, Lufthansa German Airlines).

From l. to r. Gabriel Gan (Corporate Manager, Allied Pickfords), KL Lau (Country Manager, RITTAL Systems Sdn Bhd).

From l. to r. Hans Heith (Procurement Director, Axiata Group Berhad), Amanda Woo (Managing Director, Asia Corporate Consultants PLT), Bernhard Schütte (Director, Happy Water Sdn Bhd).

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EVENTS 31

Thank You

On 11 December 2015, MGCC has brought our members and staffs a Christmassy and memorable Christmas celebration at the Sassorosso Restaurant. The event attracted more than 80 guests and it marked the end of 2015 events calendar.

Guests were presented with Lebkuchen specially flown from Nürnberg as door gifts. They also enjoyed taking instant print pictures at the “Nürnberg Christmas Market” photo wall.

Besides the Italian dishes served by the restaurant, some traditional German sweets such as Stollen and Christmas cookies were also served. The evening was further spiced upby the lucky draw session: 11 gifts were presented to the lucky draw winners.

We would like to thank all lucky draw sponsors for their support of this event. A big thank you and appreciation to Infineon Technologies (M) Sdn Bhd for sponsoring the grand prize.

From l. to r. Calvin Chan Guan Li (Manager, Global Business Development, TMF Group), Benjamin Ang (Corporate Manager, Santa Fe Relocation Services Sdn Bhd), Mrs Kandiah, Mr Kandiah (Managing Director, KASS International Sdn Bhd, MGCC Board Member).

From l. to r. Yap Peck Fah (Head of Accounts Department, MGCC), Selina Lee (Accounts Officer, MGCC), Heng Lee Huang (Head of Administration Department, MGCC), Victoria Chuah (Marketing Officer, MGCC), Jaclyn Chan (Accounts Officer, MGCC), Ivy Lee (Accounts Officer, MGCC), Patricia Chin (Head of Training Academy, MGCC).

From l. to r. Heng Lee Huang (Head of Administration Department, MGCC), Datuk Muhammad Feisol Hassan (Chairman, LCTH Corporate Berhad, MGCC Board Member), Linda Wong (Tea Lady, MGCC), Thomas Brandt (General Manager, MGCC), Thomas Zimmerle (Chief Financial Officer, Infineon Technologies (M) Sdn Bhd, MGCC President), Daniel Pans (CEO, DPO International.

EVENTS32

MGCC Bioenergy Symposium and Business Matching a Resounding SuccessUnder the banner of “renewables – Made in Germany”, a renewable energy export initiative supported by the Federal Ministry for Economic Affairs and Energy, Germany, the Malaysian-German Chamber of Commerce and Industry conducted a full-day Symposium with a focus on Biomass & Biogas as well as a subsequent 2-day business matching from 2 – 4 December last year. The event was held in Kuching, Sarawak, and successfully attracted participants from all over Malaysia. A German delegation which comprised of 8 company representatives and 3 expert speakers shared their knowledge and expertise with Malaysian industry captains, and explored the potential of cooperation.

Since 2002, the German government has been closely involved in supporting the global dissemination and transfer of technologies for renewable energies. The responsible authority, the Federal Ministry for Economic Affairs and Energy is thus making an active contribution to the global fight against climate change while promoting the worldwide acceptance and use of renewable energies. By showcasing Germany’s technical expertise in the field of renewable energy and organizing business trips to and from Germany, the initiative facilitates business contacts between German companies and those from abroad.

closing session, some participants were given opportunity to present topics from the breakout-sessions. The good participation of participants reflected the success of the conference and the aim of the conference which was exchanged ideas and experiences between the experts and audiences has been achieved.

Approximately 170 participants and players from the local renewable energy industry attended the Symposium on 2nd December Guest of Honour at the event was Y.B. Datu Haji Len Talif Salleh, Assistant Minister at Chief Minister’s Office (Promotion of Technical Education) and Assistant Minister of Environment (Ministry of Resource Planning & Environment), Sarawak. Esteemed project partners for the Chamber in this particular project were the Sarawak State Planning Unit, Agensi Inovasi Malaysia (AIM), Malaysian Biomass Industries Confederation (MBIC) and eclareon GmbH. At the Symposium, interactive panel discussions and Q&As also took place following presentations, displaying the deep interest of the participants to know more about German technologies and the possibilities of using these in the local conditions. A module on Renewables Financing & Hedging Facilities in the field of bioenergy was also introduced.

The 8 German delegates who represented private companies also attended a total of more than 70 business meetings on the 2 days following the Symposium with Malaysian companies keen on knowing more about their technologies, products and services. The meetings were arranged by the Chamber with pre-selected local companies based on requirements of both the German and Malaysian companies.

Malaysia has a huge potential in the biomass sector from its palm oil industry, as well as its wood industry and from its municipal waste resources. In the palm industry alone, a biomass potential of up to 80 million tons a year provides a tremendous potential for the production of storable bio-energy in form of pellets and briquettes.

With Malaysia’s large potential in the biomass sector, the German experience can serve as an excellent example and offer smart partnership opportunities.

Currently, about 25% of Germany’s electricity is supplied by renewable energy sources. In Germany, solid biomass has traditionally been used for heating. Today, around 11,600 GWh of electricity is produced from waste wood, sawmill waste, standing timber and landscaping materials. Biogas, produced by the fermentation of biomass, is utilised to supply energy in various ways. Thanks to their high-quality products and services, as well as many years of experience, German biogas companies are both market and technology leaders. Germany presently operates around 7,000 biogas & biomass plants.

The participants were required to choose between two breakout-sessions held by professional speakers from Germany and the UK during the afternoon session. The breakout-sessions aimed to enhance the interaction between speaker and participants to develop new ideas together for a sustainable future. During the

From l. to r. Dr. Wolfram Spelten (Economic Counsellor, German Embassy in Malaysia), Daniel Bernbeck (Executive Director, MGCC), YB Datuk Haji Len Talif Salleh (Assistant Minister at Chief Minister Office and Assistant Minister of Environment Sarawak), YBhg. Datu Haji Ismawi (Director of the State Planning Unit under the Chief Minister’s Department) and Thomas Brandt (General Manager, MGCC).

Interesting questions were asked by the audiences during the Q&A session.

34 GERMAN INSTITUTIONS

Traditionally the field of engineering and technology had been male dominant, as women were perceived as not suitable to take up this mentally and physically challenging profession. Thus women’s participation in the work force was only confined to the non-technical profession such as teachers, nurses and administrators. However, due to the equal opportunity for both genders in education in Malaysia, the participation and contributions of women in engineering field in the last few decades are invaluable. This is proven with today’s history made at GMi 21st Convocation ceremony where two female graduates emerged as best graduating graduates for both Production Technology and Industrial Electronics courses.

Both young ladies, Nor Dalila Sofia Binti Ahmad Satar and Nur Liyana Binti Othman were awarded the GMI Board of Directors’ Awards for Department of Production Technology and Department of Industrial Electronics respectively. Nor Dalila also received the GMI Prize Honor for Excellence 2015 and making her the Valedictorian for this year’s convocation. Nor Dalila who achieved an outstanding CGPA of 3.75 in Diploma in Product Design & Manufacturing will be pursuing her bachelor degree in Australia by March 2016. Her academic records complimented with her talent in leadership program such as being selected in Global Excellence & Leadership (GEL) Program is one of many talents she owns. GEL is a program that aims at nurturing and molding future leaders on a global platform. She is also active in co-curriculum and represented GMI in netball for Higher Education Sports Competition (SUKIPT) and MASISWA.

Meanwhile, the soft spoken Nur Liyana who achieved CGPA 3.77 in Diploma in Mechatronics mentioned she believed that is the ‘smallest step in the right direction ends up being the biggest step in her life’. This is because she never thought pursuing engineering technology field in GMI is so much fun and thus it helps her in achieving highest CGPA every semester.

Dalila and Nur Liyana with their awards.

GMI 21st convocation has created its own history as it recorded the highest number of graduates, 792 comparing to just 57 graduates in 1995. This is also a testimony for the Technical and Vocational Training (TVET) field as TVET is now the premier route for SPM leavers to pursue their studies. The graduates received their Diploma from Mr Carlsten Fischer, First Secretary for Head of Culture & Press Department to Embassy of the Federal Republic of Germany representing His Excellency Holger Wilfried Michael, Ambassador of the Federal Republic of German to Malaysia and GMI Chairman. Meanwhile, the special awards categories were presented by the guest of honour, Datuk Ibrahim Bin Ahmad, Director General of Majlis Amanah Rakyat.

The Guest of Honour, Datuk Ibrahim Ahmad, Director General of MARA mentioned in his speech that he aspires GMI to set up a new technical college university built-up on the strong foundation of GMI just like the many University of Applied Science (UAS) in Germany. This he says will enable the transfer of best engineering program from Germany to Malaysia via this establishment.

The convocation witnessed 12 best students for the year 2014 and 2015 receiving their awards sponsored by the Malaysian-German Chambers of Commerce (MGCC). Another 12 Best Final Year Project Awards were also sponsored by industries namely BASF, MTS Didactic, DMG Mori, YTL Power Services, LN Makmur, Elektrisola, Terra Logic, Festo, Gummi Metal, Flexspeed Technology, MTU Services and Munger Machine. The final year project is undertaken by GMI’s students as a team to inculcate teamwork and positive work values. The final year project involved various engineering competencies such as design, analysis, fabrication, trouble shooting and report writing.

More than 3000 invitees were presence at the GMI Hall in Kajang Selangor including graduates’ families, industries partners, government authorities and the German embassy officials.

Female Students Emerged as Best Graduating Engineering Technology Graduates for GMI 21st Convocation

The happy graduates of 2015.The happy graduates of 2015.

SpecialthankstothecompaniesbelowfortheirgenerouscontributiontowardstheMGCCAwardforExcellence2015:

35GERMAN INSTITUTIONS

Study and Research in GermanyGermany offers one of the world’s best research and education landscapes. There are about 390 state or state-recognised universities in Germany. 12% of the tertiary students (320,000) are international. They offer more than 18,000 degree programmes to choose from, among them about 1,300 international degree courses taught in English.

Studies are tuition-free at public German universities.

Start your search for study courses in Germany at www.study-in.de. Comprehensive information on all aspects relevant to studying and doing a PhD in Germany are available at www.daad.de. For scholarship offers check www.funding-guide.de. In Malaysia, the DAAD Information Centre offers free advice on studying in Germany at www.daadkl.org.

Come meet us during the European Higher Education Fair on 12 and 13 March 2016 at Kuala Lumpur Convention Centre (KLCC). University of Rostock.

36 GERMAN INSTITUTIONS

Parliamentary State Secretary Fuchtel on a Whirlwind Tour of South-East Asia

The Chair of the Asian Devleopment Bank’s Board of Governors, Mr. Hans-Joachim Fuchtel, visited Malaysia from 9 till 11 December 2015. During his stay Mr Fuchtel, who is Parliamentary State Secretary at the Federal Ministry for Economic Cooperation and Development, actively lobbied for a Malaysian delegation to attend the next ADB Annual Meeting in Frankfurt/Germany, taking place from 2 – 6 May 2016. The ADB’s policy was one of the topics that the State Secretary discussed with Finance Minister II H.E. Dato Seri Ahmad Husni Hanadzlah.

Mr Fuchtel’s delegation also included the CEO of DEG (Deutsche Investitions- und Entwicklungsgesellschaft) and representatives from Christoffel Blindenmission, an international Christian development organisation. The State Secretary participated in a meeting with the National Council for the Blind and addressed a closed-door event of Konrad Adenauer Foundation (KAS). Moreover, he visited the manufacturing site of the German company Jowat in Bandar Enstek, Negri Sembilan.Meeting with representatives from the National Council for the Blind Malaysia.

Meeting with Finance Minister II H.E. Dato’ Seri Ahmad Husni Hanadzlah.

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From left to right : MII Chief Academic Officer Dr Rusli Othman, CEO of the General Insurance Association of Malaysia Mark Lim, Allianz Malaysia Berhad CEO Zakri Khir, MII CEO Dato’ Syed Moheeb Syed Kamarulzaman and Allianz General Chief Underwriting Officer Rafliz Ridzuan take questions from the media.

Mr Yong Chee Seng, Head of Regional Marketing Architectural Coating presenting a topic on Flex-I;Clean / Comprehensive Solutions to Opacity to the delegates.

Allianz General Inks Landmark MOU with MII

BASF Malaysia recently connected with over 100 paint and coatings experts across ASEAN at a customer event in Kuala Lumpur. The showcase included the latest sustainable paint and coatings applications including resins, additives, polymer dispersions and pigments, as well as water-borne emulsion technology for interior and exterior coatings, and solvent-free additives for high end industrial and automotive coatings.

Driven by a theme of “Connecting People. Connecting Chemistry”, the event aimed to strengthen the synergy between BASF and its customers while demonstrating BASF’s multi solutions coating products from resin manufacturing, paint formulation to pigments. BASF solutions in coatings and pigments is aim to meet the growing consumer demands for sustainable, better product performance, high durability with the increase of production efficiency. Other highlights included technical presentations from BASF and external speaker followed by “the marketplace” which was designed to present BASF’s solutions in the area of construction, automotive and plastics manufacturing.

Eco Galleria is located in Iskandar Malaysia, in the vicinity of key commercial, educational, medical centres and business parks. It also enjoys easy accessibility from Johor Bahru city centre and Singapore. A high concentration of discerning expatriates and high net-worth individuals provides pent-up demand for lifestyle shopping in this area.

BASF Showcases Sustainable Paint andCoatings Solutions in Malaysia

Allianz General Insurance Company (Malaysia) Berhad (Allianz General) penned a historic Memorandum of Understanding (MOU) with the Malaysian Insurance Institute (MII) paving the way for Allianz employees to fast-track their way towards a Diploma with MII.

On 16 December 2015, Allianz Malaysia Berhad (AMB) Chairman Tan Sri Razali Ismail and MII Chairman Hashim Harun signed the MOU and was witnessed by AMB and Allianz General CEO Zakri Khir and MII CEO Dato’ Syed Moheeb Syed Kamarulzaman. The collaboration officially recognises Allianz General’s Professional Commercial Underwriters Certification (PCUC) programme, making Allianz the first insurer in Malaysia to be accorded the privilege.

As part of the agreement with MII, PCUC graduates will receive credit exemptions when pursuing the Diploma of Malaysian Insurance Institute (DMII).

This year, the programme attracted some 50 students from medium corporation businesses, underwriters and marketers.

38 MEMBERS

MEMBERS 39

Cyberview Wins MDeC Funding for Smart City Catalyst Project

Cyberjaya - A Smart City and Living Lab.

Crown Malaysia Wins Gold at HR Vendors of the Year Awards

From l. to r.: Urszula Thiagarasan, Mobility Consultant, Crown Worldwide Group, Natalia Navin, Country HR Director, Hewlett-Packard and Nivasini Jegatheesan, World Mobility Manager, Crown Worldwide Group.

Crown Malaysia has won the gold award for Best Relocation Company at the HR Vendors of the Year Awards 2015. The HR Vendors of the Year Awards is one of Asia’s largest award ceremonies to celebrate the achievements of organisations that serve HR professionals. Almost 120 organisations were shortlisted as the preferred vendors across 21 categories. The winners of each category were judged by senior regional heads of HR from a cross Asia. “Winning the award is a fantastic way to end 2015 for Crown Malaysia. In a year in which we’ve celebrated Crown’s 50th anniversary, everyone across Crown can be proud. We are delighted to be recognised as the number one relocation company in Malaysia, and I extend my thanks to the many fantastic people in Relocations and World Mobility teams, who continue to show true dedication and a fierce determination to exceed our customers’ expectations.” Leon Hulme Managing Director, Crown Malaysia.

In enhancing Cyberjaya’s Smart City development, Cyberview Sdn Bhd (“Cyberview”) recently secured a Smart City Catalyst funding from the Multimedia Development Corporation to implement a Smart Traffic Management System on the streets of Cyberjaya. This funding aims to promote the adoption of Smart Cities solutions in MSC Malaysia Cybercities and Cybercentres hence increasing the attractiveness of MSC Malaysia business locations to ICT investors and MSC Malaysia status companies.

The Smart Traffic Management System, also a collaboration with Telekom Malaysia Berhad, through its wholly owned subsidiary Intelsec Sdn Bhd, is aimed to increase the efficiency of public services and city living, improve the quality of life and create a safe city, and to improve the standard of environmental sustainability.

The Cyberjaya Smart Traffic Lights is the first project under the purview of Cyberview’s Smart City Infrastructure focus. Other focus areas under the framework includes Smart Environment, Smart Economy and Smart Social.

40 MEMBERS

Duty of Care – Moral and Legal Obligation to Protect Employees from Risks when Travelling Abroad

Line up of speakers and panellists in Duty of Care conference.

In today’s fast moving competitive world, companies are operating internationally to grow their businesses and are sending employees on international assignments to fuel business growth around the world. The global health and security landscapes are ever-changing and with threat of pandemics and terror attacks, employees need to be safeguarded when they travel overseas for work.

On 2 December 2015 at Aloft Kuala Lumpur Sentral, International SOS Foundation has pioneered and launched the first of its kind Malaysia Duty of Care framework on safety, health and security in a Duty of Care conference. This white paper is a strategic guidance for Malaysia companies to identify, mitigate and manage medical & security risks of their international business travellers and assignees.

The International SOS Foundation’s Duty of Care Conference aims to address the safety and well-being of your business travellers and international assignees and topics covered included: • DutyofCareandReturnonPrevention• LegalOverviewofMalaysiaEmployer’sDutyofCarewhenEmployeesTravel• ProactiveApproachtoTravelHealthandSecurityRisks

Infineon Technologies (Malaysia) Sdn Bhd marked another milestone in its history in investing RM1 billion in capacity expansion, innovation and upgrading of its manufacturing facilities. The investment forms part of Infineon’s planned capital expenditure this year to offer cutting-edge solutions making life easier, safer and greener. The expansion plans were announced at the opening of a new premise, linked to the ground breaking for further multi-storey production floors. The ceremony was officiated by the Chief Minister of Melaka, YAB Datuk Seri Ir. Hj. Idris bin Hj. Haron; His Excellency Holger Michael, German Ambassador to Malaysia; Yang Berhormat Datuk Haji Ahmad bin Haji Maslan, Deputy Minister of International Trade and Industry as well as the President and Managing Director of Infineon Melaka, Mr Lee Cheong Chee.

Infineon Invested RM1 Billion in Melaka

Md Ali, Deputy Chairman of Economic Planning, Investment and Industry of Melaka; Mr Hans-Martin Schweizer , Corporate Vice President & Chief Procurement Officer of Infineon Technologies AG and Mr Ng Kok Tiong, Corporate Vice President , Operation Backend, Infineon Technologies Asia Pacific.

As part of its long-term location strategy, Festo started developing the company headquarters in Esslingen with its technological fields of expertise and turning it into a high technology site. The first construction stage in the Zollberg area was completed last year with the AutomationCenter. The new building was officially opened, Friday 16 October 2015. Baden-Württemberg’s Minister for Economic Affairs, Dr. Nils Schmid, and Mayor of Esslingen, Dr. Jürgen Zieger, acknowledged Festo during the official ceremony as a “creator of impetus for the engineering city of Esslingen and the economy in the region”. Besides creating a landmark for the region, however, above all Festo’s new building provides a meeting place and modern space for future-oriented ideas and innovations.

Top Performance that Stands Out: AutomationCenter Opened

The AutomationCenter is opened. Besides creating a landmark for the region, however, above all Festo’s new building provides a meeting place and modern space for future-oriented ideas and innovations.

MEMBERS 41

The team at Jungheinrich Malaysia, featuring members of the local company’s executive management together with Hans-Georg Frey, Chairman of the Board of Management of Jungheinrich AG.

In April 2015 Jungheinrich Malaysian subsidiary and former external partner Jetcan MHE (JCM) merged to become Jungheinrich Lift Truck Malaysia Sdn Bhd. The objective of the merger was to capture an even bigger slice of the lucrative Malaysian market.

Based on a dynamic market presence for more than 10 years for German Industrial Trucks, JCM’s success in building up a comprehensive local network, in combination with Jungheinrich’s comprehensive resources, is now translating into prospects for the new company to make further inroads into Malaysia’s fast growing industrial truck market.

As a result of the merger, the number of Jungheinrich employees in Malaysia has increased from 29 to 70.

On March 30th the employees celebrated the merger at Sunway Hotel, together with Board of Management Chairman, Hans-Georg Frey, who also took advantage of his time in Malaysia to visit two key international accounts. The new merger has put Jungheinrich Malaysia in an excellent position to fulfill the relevant “Strategy 2020” targets.

Stark in Malaysia

K-Pintar Sdn Bhd and its change management specialist affiliate, PROSCI®, recently delivered a highly informative sharing session on Change Management to an extensive group of senior managers from large private and public organisations including MAMPU, Celcom, Bank Negara and CISCO, at the Pullman Bangsar Hotel Kuala Lumpur. Prosci Vice President of Global Business & Strategic Partnerships, Mark Dorsett, whose 25 years of management consulting specialisation, imparted practical, technical and substantial considerations on how to maximise on benefit realisation of a change management exercise amongst employees to minimise corporate risks and employee rejections. K-Pintar, as Prosci’s affiliate partner, launched the first sessions of the programme in December 2014. At the end of 2015, K-Pintar delivered six courses in Malaysia, with 116 individuals successfully certified in the Prosci® Change Management Certification programme. K-Pintar CEO, RA Thiagaraja, feels that corporate Malaysia is fast recognising the value of Change Management training.

Building a Change Management Capability for Sustainable Advantage

Mark Dorsett (right), Prosci USA Vice President of Global Business & Strategic Partnerships with primary sole affiliate in Malaysia, K-Pintar CEO, RA Thiagaraja.

With its “Black & White” theme, one would expect the KASS Annual Dinner to be a monochromatic event. But while that described the outfits (there was even a Santa Claus decked in black and white), it definitely did not describe the occasion!

With a scavenger hunt, candy counting conundrum, charades, random games that tested the KASS team’s knowledge of celebrities, and of course, the eagerly-awaited lucky draw segments, there were plenty of opportunities for the team’s colourful personalities to shine!

Held at Copper, a hidden gem of a modern European restaurant, the team feasted on succulent roast chicken with maple glazed apple and pear stuffing, smoked salmon and leek gratin, aglio olio with clams and more, before ending the night exchanging Secret Santa gifts.

It’s Black, It’s White…

Black, white, and everything in between.

42 MEMBERS

On 30 November 2015, PwC Malaysia announced the winners and finalists of their inaugural Building Trust Awards at an awards ceremony attended by industry captains and leaders of Malaysia’s top public-listed companies and regulatory bodies. Malayan Banking Berhad (Maybank) emerged as the Winner of the Building Trust Awards. Both Nestlé (Malaysia) Berhad and Sime Darby Berhad were named as joint Runners-Up for their efforts in building trust among their stakeholders. Out of Bursa Malaysia’s Top 50 companies, 10 were selected as finalists based on their excellence in corporate reporting. Then the companies’ public perception according to investors and customers were measured using a diagnostic tool developed by PwC UK. Finally, an independent judging panel comprising regulators and thought leaders in corporate reporting and building trust issues, selected the winners via a face-to-face deliberation.

PwC Malaysia’s Building Trust Awards – Celebrating Companies which are Taking Steps to Build Trust

Sir David Tweedie (Chief Judge) presenting the trophy to the Building Trust Awards 2015 Winner – Maybank together with PwC Malaysia Executive Chairman, Dato’ Mohammad Faiz Azmi and Managing Partner, Sridharan Nair (right).

Muehlbauer Technologies Sdn Bhd faced a huge challenge throughout 2015, where the demand of the semiconductor machine has doubled-up as compared to previous year. Hence, our team strived harder to fulfil customer demand and ensure all orders were delivered on-time. With the commitments and cooperation of all, we have achieved a successful year. To appreciate the team’s contributions, the Company held some programs in the last quarter of 2015, such as Internal Sports Competition (futsal, bowling and badminton) and Family Day for our employees. The responses of participation were overwhelming. All the participating teams competed to grab the Challenge Trophy. The prize giving ceremony was held on 17 December 2015. The Family Day 2015 was organised on 5 December 2015. It was a one-day trip to LEGOLAND. Total of 419 people (employees and family members) enjoyed the activities held by the Company.

Team Spirit at Muehlbauer

We are proud to announce that Lybase Sdn. Bhd. has been recently awarded with “Singapore Green Label” for our LED Street Light/Amenities/High Bay/Flood Light as “Environmentally Preferred LED” from Singapore Environment Council. It has been an honour for Lybase Sdn. Bhd. to be the 1st LED Street Lighting Manufacturer to receive the certificate. We also have been recently listed in the 4th edition of Green Pages Malaysia, publication by the Malaysia Green Building Confederation (MGBC).

Along with awarded certification of ‘MyHIJAU Mark’ received from Malaysian Green Technology Corporation (MGTC) and ‘SIRIM Eco-Label Licence’ from SIRIM QAS International Sdn. Bhd., Lybase Sdn. Bhd. is actively promoting Energy Efficient of Street Lighting to create a safe environment to society as well as achieving the vision to became a Green Community in future.

“Our Duty, Our Responsibility, to Build a Safe & Green Country, Create a Better and Competitive Environment for our Next Generation”

Lybase Sdn Bhd – Awareness Towards Green Community

From left: Dato’ Calvin Tan (Managing Director, Lybase Sdn. Bhd.), Y.B. Madam Elizabeth Wong Keat Ping (Selangor Chairman of Standing Committee – Tourism, Environment, Green Technology and Consumerism Affairs), Y.B. Madam Hajah Rodziah Ismail (Batu Tiga Assemblywoman) and Y.Bhg. Dato’ Haji Ahmad Zaharin Bin Mohd Saad (Mayor of Majlis Bandaraya Shah Alam) during International Conference “Shah Alam Towards A Low Carbon City 2030” at Hotel Holiday Inn Glenmarie on 19 October 2015.

Thorsten Killian Chef de Cuisine at Jala

On 5th November 2015, Schenker Malaysia celebrated the opening of its new facilities, Kuala Lumpur Logistics Centers 8 & 9 (KLC 8 & 9). This celebration marked a significant milestone in our achievement in Shah Alam U10 Logistics Park and will open new opportunities to mirror this success.

Strategically located within the new Shah Alam U10 Logistic Park, it is centrally positioned within Klang Valley and is only 12km away from Bukit Jelutong, Schenker Corporate Office. In total, both hubs are consists of over 200,000 square feet. The combined warehouse and office space is able to accommodate around 22,000 pallet positions for the company’s growing and potential customers.

With such a milestone, Schenker Malaysia continues its aggressive growth with a total more than 2.4 million square feet and 23 warehouses located throughout Peninsular Malaysia and is one of the largest 3PL service provider in the country.

Schenker Malaysia Opens New Facilities in U10 Logistics Park

Chef de Cuisine Thorsten Killian.

Kuala Lumpur Logistics Centers 8 & 9 (KLC 8 & 9).

MEMBERS 43

In July 2015, Malaysia became the first country in Asia Pacific to legislate equity crowdfunding (ECF), standardising activities and translating innovation into wealth.

Entrepreneurs who seek venture funding to grow their businesses can now promote their businesses and attract investors through the online ECF platforms.However, businesses that intend to use ECF to raise capital in Malaysia are required to appoint a licensed institution to hold and administer the funds during the crowdfunding offer period.

Due to this new legislation, TMF Group has been appointed as licensed trustees by the operators of the ECF platforms to manage the designated trust accounts for the funds raised during the offer period. This is to meet the requirements of placing funds with a licensed institution in Malaysia. Appointing a licensed trustee other than just a licensed institution provides additional value-added services for investors.

TMF Group can be contacted at malaysia@tmf-group.com.

Equity Crowdfunding Legislated in Malaysia

Malaysia became the first country in Asia Pacific to legislate equity crowdfunding, standardising activities and translating innovation into wealth.

Born in Thailand , Thorsten who is of Thai-German origin, has over 12 years of experience in the kitchen. His career as a chef, coupled with his East-meets-West ethnicity has given him the exposure to various ingredients and cooking methods from an early age already. With a career journey that encompasses experiences gained from his initial exposure in countries such as Austria, Switzerland, Ireland, Germany and Portugal to the exotic locale of the Middle East, his latest globetrotting adventures is sure to bring exotic epicurean creations to the shores of Langkawi.

In his new role as Chef de Cuisine in Jala, Thorsten hopes to elevate the gastronomical experience to a new level. ‘Cooking is art and it is of utmost importance to satisfy all our 5 senses in order to create a memorable experience for each guest’ says Thorsten.

44 MEMBERS

Volkswagen Selayang 4S Centre Launched!

Volkswagen Selayang 4S Service Centre officially launched.

In anticipation of dampened market conditions across Asia, the Firm held a Corporate and Debt Restructuring Seminar for more than 100 clients on December 1st 2015 at Le Meridien Hotel Kuala Lumpur. Partners from the Corporate & Securities, Banking & Finance, Dispute Resolution and Tax practices spoke on the theme of restructuring, by providing technical updates and a case study discussion, which was led by Brian Chia. The panel discussed the practical strategies that companies can employ in a restructuring exercise by examining capital raising, rights issues, regulatory and exchange control related issues in corporate reorganisations. The full day seminar also saw discussions on debt restructuring and refinancing, taxation tools that can be utilised during a restructuring exercise, and court mandated processes under Section 176 of the Companies Act, and the possible judicial management under the new Companies Bill. Attendees included in-house legal professionals, corporate advisors and senior management.

Volkswagen Malaysia and Goh Brothers Motor has launched the Volkswagen Selayang 4S Center which is also the country’s second Volkswagen Technical Service Centre.

Volkswagen Selayang is a full fledge centre that caters to the complete needs of owners from sales to after sales, covering quick & general service, diagnostics and major repairs. The build-up of the centre focuses on after sales where a dedicated three out of five floors make way for 20 work bays. This service centre also has 30 experienced and trained staffs from the Volkswagen network to diagnose issues efficiently, swifter and deliver quality service to customers. There is also a four-storey parts storage facility where 4,000 line of items are readily available for general service.

Volkswagen Selayang 4S Centre showroom operates from Monday – Sunday and after sales operates from Monday – Saturday from 8.30am to 5.30pm.

Wong & Partners Hosts Corporate and Debt Restructuring Seminar

Employees of Trienekens (Sarawak) Sdn Bhd in Kuching and Bintulu recently celebrated the company’s annual Health, Safety & Environment (HSE) Week, themed this year as “Team Up To Safety”. The event aimed to promote teamwork and remind team members that Health, Safety and the Environment is everybody’s business. Further highlighting the importance of continuously maintaining a strong Safety culture at work in order to preserve a workplace free from injuries and incidents, the week-long celebration culminated with special HSE Day events at the respective branches. Trienekens’ Projects General Manager, Alice Lee officiated the event in Kuching and later presented more than 20 special HSE awards to Trienekens’ outstanding groups and individuals for their past year’s HSE performance. The company organises and celebrates HSE Week annually to recognise, reinforce, improve and strengthen HSE knowledge, understanding and skills among employees.

Trienekens Teams Up To Safety

ONE TEAM... Trienekens’ 2014/2015 HSE Excellence Award Winners group together with other participants at the company’s HSE Day in Kuching.

NEW MEMBERS 45

MGCC Welcomes New Members

ShibataFenderTeam Ag TGSH Plastic Industries Sdn Bhd

Contact persons:

Mr Stefan HochsteinBoard Member

Tarpen 40 - Haus 1bD-22419 HamburgGermany

Tel : +49 (0) 40 20 90 764 74 Fax : +60 3 5101 2588Email : stefan.hochstein@fenderteam.comWeb : www.fenderteam.com

Contact persons:

Mr David AngBusiness Development Manager

Ms Joulyn ChuaCustomer Services

Lot 3232, Jalan Paya MengkuangPadang Lembu08330 GurunKedah

Tel : +60 4 468 8379Fax : +60 4 468 8110 Email : info@thongguan.com Web : www.thongguan.com

Fenders are the interface between ship and berth. They are the first and foremost a safety barrier to protect people, ships and structures. Good fender design encompasses many disciplines and textbook knowledge must complement the experience of real world shipping operations. ShibataFenderTeam meets this challenge with over 50 years of diverse experience in all aspects of fender design and applications.

ShibataFenderTeam is headquartered in Germany with regional hubs in the USA, Europe, Middle East, Asia and Australia. Our network of well-established and highly skilled local representatives spans all five continents.

Our Japanese mother company, Shibata Industrial Co. Ltd., has developed and manufactured a vast range of engineered rubber products since 1929, and have been pioneers in fender design and manufacture for over 50 years. ShibataFenderTeam owns and operates testing and manufacturing facilities in Japan, Malaysia and Germany.

ShibataFenderTeam combines these resources and skills whenever for every state-of-the-art fender system. Our design and application experience, the in-house manufacturing facilities and high-quality products at fair prices have earned ShibataFenderTeam a reputation as a dependable partner in the international port, harbor and waterways markets.

As an expert in the plastic industries, Thong Guan Industries Berhad has acquired plastic bags manufacturer Shuang Heng Plastic Industries Sdn Bhd in year 2011 to meet the demands and to further increase its line of products. The newly formed subsidiary company is called TGSH Plastic Industries Sdn Bhd (TGSH).

TGSH houses a focused recycling plant which recycles and reuses in-house wastes to practice sustainable environmental management.

Today, we have more than 200 employees and an operation plant with 70,000 sq ft covering seven production premises, two warehouses and a double storey office. To accommodate growing demand, we are able to produce more than 12,000 tonnes annually.

We are a full-service plastic bags manufacturer providing flexible packaging solutions. TGSH’s products span from t-shirt bag, printing bag, core/coreless bag-on-roll, individually-folded garbage bag, degradable bags as well as recycled resin.

Our market segments are in the following industry: -

• FoodPackaging• IndustrialPackaging• AgriculturalBagsandFilm• MedicalandHealthcare• BuildingandConstruction• RetailandDomesticUse

46 TRADE FAIRS

11 – 17 APRIL 2016: MUNICH, GERMANYWorld’s Leading Trade Fair for Construction, Machinery, Building Material Machines, Mining Machines, Construction vehicles and Construction Equipment

BAUMA IS YOUR HUB INTO ALL MARKETS

Formoreinformation,pleasecontact: MsSherenaWongMGCCTradeFairOfficerTel:+603-92351800Fax:+603-20721198Email:sherena.wong@malaysia.ahk.de

The 31st Edition of the World’s Leading Trade Fair bauma takes place in Munich from April 11–17, 2016. bauma is the leading platform for experts who deal with construction and building-material machines, construction vehicles, construction equipment and mining machines. Held every three years, this is the only trade fair in the world that brings together the industry for construction machinery in its entire breadth and depth. All branches of industry, all leading manufacturers, all important innovations: Those who have been here before always come back. This platform presents the highest concentration of innovations – making your visit an event to remember.

The event is set to be very diverse and international: more than 3,000 exhibitors from over 50 countries have applied to take part. Just how important bauma is to the international building and construction machinery sector is also reflected in the number of international country pavilions that are being organised. Nine countries in all are putting on dedicated presentations: Brazil, China, Czech Republic, France, Great Britain, Italy, Korea, Northern Ireland, and the US. The top ten countries of origin among the exhibitors are as follows (after Germany, as per current applications status): Italy, Turkey, the Netherlands, Spain, UK, US, Austria, France, Sweden and Switzerland.

Top themes in all the sections of the exhibition will once more be resource- and energy-efficiency. Johann Sailer, Chairman of the VDMA Association for Construction Machinery and Building

Material Machines, confirms that “in building material machinery and systems, the trend towards automation is continuing, and this is coupled with an increase in resource-efficiency.” At the same time, he observed, there is strong global demand for energy-efficient precast concrete components and building materials.

Besides, the bauma Innovation Award will be presented for the eleventh time at the upcoming bauma in 2016. The award is a joint initiative carried out under the auspices of the German Engineering Federation (VMDA), the German Construction Industry Association (HDB), the Central Association of the German Construction Industry (ZDB), the German Building Materials Association (BBS) and bauma. The awards are presented for promising developments that are future-capable, cost-efficient and offer a high practical benefit that contribute towards energy and resource-efficiency and/or humanization of the workplace.

This is where international key players meet. This is where significant new developments are presented. This is where suppliers and solutions come together perfectly.

TRADE FAIRS 47

16 – 19 MARCH 2016: NÜRNBERG, GERMANYThe Trade Show. Window. Door. Façade.

FENSTERBAU FRONTALE 2016

Formoreinformation,pleasecontact:MsMichelleLimMGCCSeniorMarketingOfficerTel:+603-92351800Fax:+603-20721198Email:michelle.lim@malaysia.ahk.de

FENSTERBAU FRONTALE is the leading international exhibition for windows, doors and facades. Window and facade builders, carpenters, architects and the trade meet in Nürnberg every two years to learn about the latest profile systems, building products, glass in architecture, fixing technology, safety technology, machines, installations and much, much more. The exhibition is complemented by a proven supporting programme.

The trade show is enjoying very strong demand before it opens its doors. The Exhibition Centre Nürnberg will again become the global industry meeting place from 16 to 19 March 2016, when the who’s who of the window, door and facade sector will display their innovations and trends in eleven halls. Visitor surveys bear out this positive impression: one exhibitor, Roto Frank AG, has found that 95 per cent of the customers that it surveyed rate the exhibition as important or very important to the industry.

The survey also revealed that trade visitors stayed an average of 14.2 hours or nearly two days at the exhibition, proving that they were very willing to enter into conversations and had a deep interest in the products and solutions on display. The main reasons for visiting FENSTERBAU FRONTALE were listed as the diverse offerings and the opportunity to make a direct comparison, gain a complete overview and meet all key industry players at the same time and place.

“The results of the survey once again underscore that FENSTERBAU FRONTALE holds the pole position in the market,” says event

organiser Elke Harreiss with NürnbergMesse. “Our leading role is primarily thanks to our exhibitors, who time and again make the journey to Nuremberg with exciting innovations to share so that they can develop the world’s leading exhibition with us. The survey proves that our strategy and our quality standards are spot on, and encourages us to maintain a high level of service and visitor satisfaction by coming up with new ideas.”

In conclusion, 85 per cent of Roto customers taking part in the survey said that they were pleased with their visit to the exhibition. Exhibitor surveys conducted by NürnbergMesse paint a similarly bright picture. Nearly 75 per cent of companies surveyed in 2014 confirmed that they had reached their most important target groups at the exhibition. Two-thirds managed to forge many or a great many contacts and nearly 90 per cent anticipated post-show business. “We expect the event to be popular again in 2016 given the high level of visitor satisfaction and strong interest from exhibitors,” Ms. Harreiss said in summary. About 109,000 trade visitors travelled to Nürnberg to attend the well-established exhibition duo HOLZ-HANDWERK and FENSTERBAU FRONTALE in 2014.

48 TRADE FAIRS

fairs&moreGo Global with US

January – February 2016

For further information on Trade Fairs, please contact MGCCTel: (+60)3 9235 1800 Fax: (+60)3 2072 1198

E-mail: info@malaysia.ahk.de

The Leading Trade Platform for Electric Components, Systems and Applications

15 – 17 March 2016(Shanghai, China)

World-Leading Trade Fair for Processing, Analysis, and Handling of Powder and Bulk Solids

19 – 21 April 2016 (Nürnberg, Germany)

The international trade fair for electronics development and production

15 – 17 March 2016(Shanghai, China)

12 – 14 April 2016(Indianapolis, Indiana, USA)

The international main exhibition for sport business

24 – 27 February 2016 (Beijing, China)

International Exhibition & Conference - Law Enforcement, Security and Tactical Solutions

2 – 3 March 2016 (Nürnberg, Germany)

High performance in target sports, nature activities, protecting people

4 – 7 March 2016(Nürnberg, Germany)

European Trade Fair for Machine Technology, Equipment and Supplies for the Wood Crafts

16 – 19 March 2016 (Nürnberg, Germany)