Singapore will make regulatory changes to facilitate the use of electronic payments, as the city-state aims to become a major centre for financial technology (fintech). The vision is to make Singapore an electronic payments society, a society that spurs innovation in payments technology, that gives consumers maximum convenience and confidence in making payments. MAS will streamline existing money changing, remittance and payment systems law into a single piece of legislation to govern both traditional and innovative payment businesses. to enhance the provisions for consumer protection and strengthen cyber security requirements.
M1 subscribers are set to get faster and steadier connections on their mobile devices in Spore, now that the telco is the first to launch a nationwide heterogeneous network (HetNet) that will seamlessly switch between different networks such as 4G and Wi-Fi, minimising disruptions and slow Internet-surfing speeds. Users in high-traffic areas will especially benefit, with the telco deploying small cells — essentially mini base stations — on top of the traditional macro ones, to boost coverage in crowded places and hard-to-reach areas such as carparks and basements.
Singaporean companies struggling to meet debt obligations as oil prices slump may get more support from the government if the economy deteriorates further, according to global auditing firm EY. UBS Group AG’s wealth management unit warns more defaults are possible. Singapore’s Finance Ministry foresaw troubles from the slide in commodity prices when it announced budget plans in March that included a loan assistance programme to help ease cash strains at smaller businesses. The situation has since worsened, with energy industry cutbacks leading to default at oil-services provider Swiber Holdings Ltd. About 28% of the S$18bn in corporate bonds due over the next 18 months are from industries facing structural headwinds.
Good things come to those who wait. This old saying needs to be pointed out to local capital market investors as they expect the almost impossible: high returns in a short period of time. Indonesian capital market investors expect gains of 12% on average per year, the second-highest after Russia among 28 countries surveyed by British multinational asset manager Schroders. However, they only spend 2.3 years on average on an investment product, the fifth-shortest period in the world, according to Schroders’ Global Investor Study 2016. This means that investors need to be educated to invest in the longer term. The public needs to invest more in the capital market as it gives higher returns rather than savings and deposits. Hence, purchasing power will improve faster. Indonesians are among the least capital market-literate investors in the region, with less than 1% of the country’s over 250m population investing in the stock market.
The Government is in discussions to formulate the 2017 budget. Some of the key highlights are:
1) Economic growth is 5.3%.
2) Inflation is 4.0%
3) Exchange rate of Rp13,300 per US$1.
4) Oil lifting 780,000 bopd and 1.15m bopd of gas per day with oil price assumption at US$45 per barrel.
5) Tax revenue is budgeted to decline by Rp47.2t from Rp1,318.9t to Rp1,271.7t.
6) Non oil and gas income is budgeted at Rp1,271.7t for 2017, broken down into income tax of Rp751.8t (down by Rp67.7t from Rp819.5t in 2016). Others components include VAT tax and property tax (discussed in the following points).
7) VAT tax is budgeted to rise to Rp489.3t from Rp474.2t. 8) Property tax is expected to be slightly down by Rp0.4t to Rp17.3t from Rp17.7t in 2016.
Mega Development is seeking funds of Rp420b to finance the mix-use development of Vivo Sentul in Bogor. The company estimates that it will need Rp600b to develop the mix-use. Since Feb 16, the company has begun the construction of Vivo Sentul Phase 1, which is expected to be completed in late-17. The company targets to achieve marketing sales of Rp500b this year.
Indofood Sukses Makmur reported net income of Rp2.23t in 1H16, up 28.9% yoy from Rp1.73t in 1H15. With 1H net income usually contributing 51-68% of full-year net income during 2012-15, 1H16 net income meets our and market expectations, accounting for 56.5% and 56.8% of our and market full-year forecasts respectively. 1H16 revenue increased 4.4% to Rp34.08t in 1H16 from Rp32.63t in 1H15. Branded consumer goods is still the main contributor of the revenue, accounting for 52% of total revenue, followed by Bogasari, agribusiness, and distribution with contributions of 23%,17% and 8% of total net revenue respectively. 1H16 operating income came in at Rp4.01t, up 4.2% yoy from rp3.85t in 1H15.
Indofood CBP posted net income of Rp1.98t in 1H16, up 13.9% yoy from Rp1.74t in 1H15. With 1H net income typically contributing 51-58% to full-year net income in 2012-15, 1H16 net income meets our and market expectations, accounting for 54.5% and 55.6% of our and market full-year forecasts respectively. 1H16 revenue came in at Rp18.18t, up 9.8% yoy from Rp16.55t in 1H15. The noodle business was still the main contributor, accounting for 64% of total revenue and followed by Dairy, Snacks, Seasoning and other with respective contribution of 19%, 7%, 3% and 7%. Operating profit increased 24.9% yoy to Rp2.74t in 1H16 from Rp2.19t in 1H15 which resulted in operating margin expanding from 13.2% in 1H15 to 15.1% in 1H16.
The concept of vending machine dining could soon pop up in more places in the heartlands and workplaces of Singapore, following the pilot launch of an unmanned vending machine cafe in Sengkang. At such cafes, using the Chef-in-Box machine for hot meals will start with a menu displayed on a touchscreen and selecting dishes such as Chicken Bolognese, Nasi Goreng Istimewa or Vegetarian Rice Noodle, for S$3.50 to $5.00. Consumers can pay by cash, Nets FlashPay or credit card. About three minutes later, the meals and cutlery are ready for collection. The first vending machine cafe, or VendCafe, was launched at Anchorvale Drive and is operated by JR Vending, the company behind Chef-in-Box machines. The year-long pilot project from Spring Singapore and the Housing and Development Board (HDB) is targeted at residents living within a 400m radius to provide them with more around-the-clock food options.
Indonesia immune to ‘the chills’ When China sneezes — ranging from a sharp devaluation of its currency or protectionist measures to defend local industries — Singapore, Taiwan, Vietnam, South Korea and Malaysia would be first to feel the chill, according to analysis from Natixis SA. By contrast, Indonesia, India and the Philippines are rather more immune, based on trade, tourism and investment links that were collated by the French Bank’s Hong Kong-based economists Alicia Garcia Herrero and Trinh Nguyen. For those with the largest exposure to China, trade ties are the biggest link. Tourism is another important factor linking the fortunes of Asia’s smaller economies to their regional giant. In 2015, the number of Chinese outbound tourists climbed 14.5% to 35.4m, according to the China Outbound Tourism Research Institute. They spent US$235bn (S$315bn) in 2015, Natixis said, and most Chinese tourists prefer to holiday in Asia with 60% of the trips to the region.