EPF Urges Employers To Utilize E-Caruman Facility

EPF Urges Employers To Utilize E-Caruman Facility

PETALING JAYA: The Employer Provident Fund (EPF) is urging all employers to start using its e-Caruman online payments facility as its manual system for EPF contributions by employers will be scrapped beginning January 2017.



EPF chief executive officer Datuk Shahril Ridza Ridzuan said all employer transactions with EPF will be done online going forward and instead of manual submission of the Form A. The EPF e-Caruman was launched in 2013.


The pension fund has launched e-Caruman contribution payment transformation programme which is an initiative to encourage employers to make monthly EPF contributions online.


According to the EPF, the integration with FPX would allow employers to make online payments directly from the e-Caruman portal and mobile app at zero transaction charges.


"This programme is in line with EPF's objectives to reduce dependence on counter services, expedite mobile transaction and to improve overall experience in dealing with the EPF. Employers will find that using the FPX system will make processing EPF contribution payments easier and more secure. Since its roll-out in January 2013, the e-Caruman facility has been well received and as at September 2016, more than 95% of employers utilized the facility every month," Shahril said during the launching ceremony on Monday.


"Since they are already comfortable using e-Caruman, we now urge them to advance towards making payments using FPX embedded in the e-Caruman system," he added.


As at September 2016, a total of 414,411 active employers have utilized the e-Caruman facility to submit their Form A online, involving RM4.4bil.


However, only 20.2% or 98,682 employers remit their contribution payments online, amounting to RM1.57bil.

Budget 2017 A Tiny But Good Step For Third Sector

Budget 2017 A Tiny But Good Step For Third Sector

THE potential of the non-profit sector is not always recognized. Most of the time, when the term non-profit is mentioned, what comes to mind are cheaply operated charities doing not very sexy work.

Many are unaware of the potential of the third sector to provide public services. The third sector is frequently under-appreciated and misunderstood.




In reality, non-profit organizations can play important roles in the delivery of public services. Some of the existing ones are superior to both the private and public sectors.

Globally many schools, universities and hospitals are non-profit non-government entities. Harvard University and Eton College are examples of the more popular educational institutions. In many countries around the world, the concept of social entrepreneurship is also gaining ground.

In Malaysia, we have some good examples too. In central Kuala Lumpur, there is the Tung Shin Hospital that was founded in 1881 by Kapitan Yap Kwan Seng.

The story of Yap Kwan Seng is a fascinating one. He migrated to Malaya in 1846 and started off working in a tin mine. He gradually built his wealth and political clout, earning the trust of the people around him, which eventually enabled him to rise up to be a Kapitan Cina.

He donated his wealth to various charitable causes, and it was this generosity that led to the establishment of the Tung Shin Hospital. Until today, Tung Shin remains a hospital whose objective is to provide free medical treatment to the poor and to assist their destitute in-patients.

In the recent Budget 2017 speech, Prime Minister Datuk Seri Najib Tun Razak announced that almost RM25bil is allocated for healthcare purposes. Of this, a tiny fraction of RM20mil is allocated for loans to charitable organizations running nonprofit hospitals, to help them buy hospital equipment.

This is just a tiny amount relative to the overall budget. But, to me, the Government’s acknowledgement that charities can run hospitals is the more important issue. This is one more step in the right direction.

Now that the recognition has been given, I hope there will be more partnerships between the Government and the non-profit sector to provide healthcare as well as other services.

But if the Government is serious about getting more non-profit organizations to deliver public services, providing funds or contracts is not the first step that needs to be taken.

The prerequisite is to create an environment that is conducive for non-profit organizations to grow and flourish. That means looking at our regulatory environment first and foremost.

Malaysia’s regulations for non-profit organizations are, forgive my language here, ridiculous verging on stupid.

Registering a charity is, to say the least, cumbersome. It is not clear which ministry or agency looks after the registration. In fact, it is not even clear what legal entity you need to register as.

For example, just take any charity that you know out there. At first glance, do you know whether they are a trust, a company limited by guarantee, or a society? Do you even know the difference between these legal structures?

If you don’t, then welcome to the first hurdle in registering a non-profit entity in Malaysia. You need to decide what legal structure you want to be, and making that decision alone is enough to stop you from setting one up. You will also need to deal with multiple agencies or ministries, in addition to answering the multiple queries that will come one question at a time.

Then comes the issue of fundraising. You would expect that if you raise donations for your charity, those donations would be tax-exempt.

You are wrong. Being a registered charity in Malaysia does not necessarily mean you are tax-exempt. For that, you need to deal with the Inland Revenue Department, and this process is completely separate from the registration.

If Inland Revenue feels that you don’t deserve to be tax-exempt, you will have to pay corporate tax for any surplus that you make. That means, in simplified terms, if your donors give you RM1, 000 for a project but you spend only RM500, Inland Revenue will punish your fundraising success, or your success to cut costs, by forcing you to pay corporate tax on the RM500 surplus.

Budget 2017 saw a good step taken by the Government to recognize the potential held by the non-profit sector to deliver public services. As I said earlier, the amount allocated is tiny but the important thing here is not the amount but the recognition.

We must create an environment that encourages the non-profit sector to assist the Government in public service delivery. Non-profit sector can do much more, and at lower costs too. For this to happen, we need to change our regulations so that it is friendly to the third sector.

I urge the Government to consider the establishment of a Charities Commission. This will require a detailed study and the Government can start by setting up a working group to research this idea.

Only if we have a full-fledged Charities Commission will the potentials of the third sector be fully realized.

Malaysia Downplays Foreign Worker Controversy

Malaysia Downplays Foreign Worker Controversy

The Malaysian government has clarified reports that it had entered into an agreement with Bangladesh to bring in 1.5 million workers into the country over the next three years. 

KUALA LUMPUR: Malaysia insists it is not bringing in 1.5 million Bangladeshi foreign workers into the country amid a backlash over the purported move. 


Human Resources Minister Richard Riot held a press conference on Friday (Feb 19) to clarify the issue. 


"The figure of 1.5 million Bangladesh workers is actually the number of workers registered with the Government of Bangladesh through the Ministry of Expatriates' welfare and Overseas Employment for the purpose of employment to 139 countries in the world, including Malaysia, Singapore, UAE and Saudi Arabia," he said. "The perception that 1.5 million workers will be brought in from Bangladesh to Malaysia to work is not true."


Later on Friday, Deputy Prime Minister Ahmad Zahid Hamidi told a crowd in Kuching that the government was placing a freeze on all foreign workers. 


Last week, reports emerged alleging that the Malaysian government would be entering into an agreement with the Bangladeshi government to bring in 1.5 million foreign workers into the country over three years.


This sparked uproar by groups worried about the impact such a move would have on the local labour market and questioning the government's motives for doing so. Some more extreme reactions came from NGOs linking foreign workers to disease and rape.


Officially, Malaysia has 2.1 million registered migrant workers – 282,287 of whom are Bangladeshi. 


But the government estimates there are an additional 1.7 million undocumented foreign workers – using the estimate of seven undocumented workers for every 10 legal foreign workers.


Before the announcement by Mr Ahmad Zahidi, Mr Riot told reporters that the government was taking care to regulate the number of migrant workers according to demand from employers, capping the number at 15 percent of the total workforce or 2.3 million foreign workers in a total workforce of 15.3 million. 


"Any recruitment of Bangladesh workers shall be in accordance with Malaysia's policy, which is based on actual demand of employers from the various sectors that are allowed to hire foreign workers subject to the principle of demand and supply," he said in a statement to the the media. 

Global Property Market Outlook 2016

Global Property Market Outlook 2016

DEVELOPMENTS in the global economy and currency markets will determine the performance of property markets across developed and emerging markets alike for 2016.


FXTM chief market analyst Jameel Ahmad shared that year 2015 saw emerging currencies challenged by a resurgent US dollar rising alongside the US economic recovery. There were additional concerns over how a slowing China economy would impact general sentiment towards emerging markets. These developments added to challenges faced by emerging economies linked to commodities amid a global slowdown in oil and gold prices. 


Ahmad said, “The results were a clear downward trend for emerging currencies and we continued to highlight emerging market currency weakness as a global phenomenon throughout 2015. The emerging market currencies that were the most heavily crushed during the year were those that belonged to economies dependent on commodity exports.”


Ahmad added that concerns surrounding the China economy entering a deep slowdown was another contributor behind losses in emerging market currencies. “A slowing down China economy was not a problem for China itself, but for all those economies reliant on trade with China.”


Knight Frank global head of research Liam Bailey and Knight Frank international residential research Kate Everett-Allen shared that the scale of the slowdown in China and the speed of further US interest rate rises will determine the performance of property markets across developed and emerging markets alike over the next 12-18 months.


They expect the strongest and weakest performing prime markets to be separated by around 20 percentage points by the end of 2015. They expect this figure to slip to 15 points in 2016 as price growth converges.


The pace of price growth in Sydney is expected to slow from 15% year-on-year in 2015 to 10% in 2016. Australia’s economic slowdown, weaker stock market performance in recent months and the introduction of foreign investment fees explain the lower rate of growth in 2016.

Hong Kong is forecast to overtake Singapore as the weakest performing luxury residential market in 2016. A number of new developments are due to enter the market in 2016. This new supply, together with a strengthening HK dollar, will see prime property prices soften.


The price decline seen in Singapore’s prime residential market is expected to persist at least until the end of 2016, following the government’s assertion that it has no plans to relax its property market cooling measures.


Ahmad commented that the major turning point for all the emerging currencies will in some ways be in response to higher interest rates from the United States. While falls in emerging market currencies were due to external factors, such factors could transform into internal and domestic pressures, such as reduced spending power and reduced budgets that might lead to jobs being lost.


The continued depression in commodity markets is also going to limit potential for a recovery in fortunes.

Ahmad said, “Slowing growth will continue to occur in China and will likely be a threat to India, although it is possible that the proactive easing of monetary policy from the Reserve Bank of India might encourage borrowing domestically and help drive growth. It is worth remembering that the central banks in China and India have been actively intervening to shore up their own economies through monetary easing. There will be some hope that this could help drive industry growth. As commodity importers, the lower import costs should help create budget for investment elsewhere.”


Colliers International head of UK research and forecasting Mark Charlton, Colliers International senior research analyst EMEA (Europe, Middle East and Africa) and forecasting EMEA Bruno Berretta, and Colliers International director of UK research and forecasting Walter Boettcher cited in Colliers International’s Global Investment Outlook (GIO) that investors, globally, still wish to invest in real estate.


Transaction volumes across regions are expected to increase, with fewer investors expecting to be net buyers. Allocations to direct property by multi-asset funds will continue to increase globally.


The most liquid markets, found in gateway cities such as London, New York and Tokyo, will continue to appeal to cross-border investors. Increasingly, investors are looking to partner with local expertise to provide greater confidence in overseas diversification.


Macroeconomic and political threats, such as further interest rate hikes in the US, or Chinese economic uncertainty, as well as geopolitical risks, will see investors curb their risk appetite in some markets. More investment decisions will be made on a long-term basis. Hence prices for matching assets will rise further, especially in safe haven markets.


They concluded, “While the next 12 months will pose macro challenges for investors, the overall positive mood shown by most respondents offers a compelling case for supporting direct real estate investment’s continued growth.”

Ringgit Among Best Performing Asian Currencies

Ringgit Among Best Performing Asian Currencies

PETALING JAYA: A combination of yuan appreciation, crude oil prices coming off their lows and shrinking likelihood of US interest rate hike this year contributed to the rise of the ringgit as one of the best performing Asian currencies.



Ringgit Among Best Performing Asian Currencies


With foreign capital returning to emerging Asian markets in search of higher yields, the ringgit gained 0.97% to close at 4.1310 against the US dollar.


This was in line with the rebound in Malaysia’s equity market, which saw its benchmark FTSE Bursa Malaysia KL Composite Index (FBM KLCI) rising 0.38% yesterday to close at 1,649.96, off an early high of 1,661.34, even as the country’s bond market continued to attract foreign inflows over the last five months.


Year-to-date, the Malaysian currency has gained about 4% against the greenback, making it the top performing currency in Asia, excluding Japan. This was in contrast to the ringgit being the worst performer in the region last year.


According to economists, the strengthening of the ringgit yesterday was in tandem with the rebound in regional capital markets, as the risk of China devaluing its currency eased and crude oil prices remained steady in recent days.


Working in the ringgit’s favour, they noted, was also the weakening of the US dollar, which was driven by a downgrade in market expectations over the pace of future interest rate hikes in the world’s largest economy.


“The recent strengthening of the ringgit is a result of China’s currency move, as much as it is a reflection of the improvement in crude oil prices,” AllianceDBS Research chief economist Manokaran Mottain told StarBiz.

“It is also attributable to the weakening US dollar, following weak economic data and hints from the US Federal Reserve that there might not be any rate hike in the near-term,” he explained.


The People’s Bank of China (PBOC) yesterday set the average yuan exchange rate higher by 0.3% – which was the biggest increase in three months – at 6.5118 against the US dollar. This drove the yuan, which is still allowed to move to a maximum of 2% on either side of the reference rate, to close 1.23% higher at 6.4945 against the greenback.


Over the weekend, PBOC governor Zhou Xiaochuan was quoted as saying that there was no basis for the yuan to keep falling.


Zhou also said that China was committed to keeping its currency stable against a basket of other major currencies, while managing the daily volatility of the yuan against the US dollar.


Besides China’s policy action, the strong rebound in global crude oil prices since last Friday also contributed to the improvement in investor sentiment, which drove regional capital markets higher.


Brent crude, which is the international oil benchmark, has jumped by about 10% since last Friday to trade at the US$33-per-barrel level on renewed hopes of a production cut by the Organisation of the Petroleum Exporting Countries. This helped ease concerns over Malaysia’s declining revenue from oil and gas sources.


“As long as crude oil prices do not go below the US$30-per-barrel level, the ringgit will remain relatively steady amid the reversal in the outlook for the US dollar,” Singapore-based head of foreign-exchange research at Malayan Banking Bhd Saktiandi Supaat said.


In its fixed-income report, BIMB Research said: “We believe that external developments, with the Bank of Japan’s adoption of negative rates and a dovish US rates market, supported flows into higher yielding regional currencies of which the MGS (Malaysian Government Securities) benefited as well.”


As at end-January 2016, foreign ownership of MGS rose to RM164.4bil, or 47.9% of total outstanding MGS, from RM162.1bil, or 47.7%, in December 2015.

Meanwhile, the ringgit also traded higher against other major currencies yesterday.


It rose 1.1% against the Singapore dollar to 2.9536; 1.6% versus the Japanese yen to 3.6264; 1.5% against the euro to 4.6238; and 1.1% against the British pound sterling to 5.9870.

Global Halal Market Growing Bigger

Global Halal Market Growing Bigger

KUALA LUMPUR: The halal economy — encompassing everything from banking and finance to food and beauty products — is on the rise. Halal refers to what is permitted or lawful in Islam, and it is used in reference to food and lifestyle products which include clothing, pharmaceutical items as well as cosmetics and personal care.



According to a Thomson Reuters report, State of the Global Islamic Economy 2014-2015, the global expenditure of Muslim consumers on food and lifestyle sectors grew 9.5 per cent from previous years’ estimates to US$2 trillion (RM8.3 trillion) in 2013 and is expected to reach US$3.7 trillion by 2019, at a compound annual growth rate of 10.8 per cent. “The customers of Islamic economy are universal with shared values. At the highest level, values-based customer needs that are driving these Islamic economy sectors include Islamic/ethical financing, lawful and pure food, modest clothing, family-friendly travel, gender interaction considerations, and religious practices. “These needs also extend to business practices that seek Islamic business financing, investment and insurance services (takaful),” the report said. According to the Malaysia External Trade Development Corporation Halal Unit, Malaysia’s total halal exports in the first half of last year was valued at RM19.5 billion, an increase of 3.6 per cent from the first half of 2014.


The contribution of halal products to the country’s overall exports during the period stood at six per cent. “Halal food and beverage as well as cosmetics and personal care were the only segments that reported an increase in exports during the period while halal ingredients, palm oil derivatives and industrial chemicals recorded a decrease,” it said. Many well-known and established international brands are now considering adding halal cosmetics and personal care into their line, as the global market for the segment totals RM695 billion, according to Halal Industry Development Corp (HDC). The Thomson Reuters report said global Muslim spending on cosmetics increased one per cent to US$46 billion globally in 2013. This spending was 6.78 per cent of the global sector expenditure and is expected to reach US$73 billion by 2019. “Top countries with Muslim cosmetics consumers are the United Arab Emirates (US$4.9 billion), Turkey (US$4.4 billion), India (US$3.5 billion), and Russia (US$3.4 billion), based on 2013 estimates,” it said. The report added that Malaysia, Egypt and Singapore lead a combined halal pharmaeuticals and cosmetics indicator that focuses on the health of the halal pharmaceutical and cosmetics ecosystem a country has relative to its size.


HDC chief executive officer (CEO) Datuk Seri Jamil Bidin said halal cosmetics and personal care companies have started to actively promote their products as Muslim consumers are more aware of alternatives and non-Muslims are attracted to safer and “ethical” products. “After halal food and banking, Muslims have begun to look for halal cosmetics and personal care products. Muslim consumers, with global population of nearly two billion, are increasingly aware that some cosmetics contain ingredients derived from animal origins and are thus concerned about the halal status,” he told Business Times. SimplySiti Sdn Bhd founder Datuk Siti Nurhaliza Tarudin said there is a huge demand for halal cosmetics given the huge Muslim population worldwide. “That is why SimplySiti has ensured that all our products get halal certifications,” she said. Beyond that, any manufacturer which wants its products to be successful needs to go the extra mile to ensure that consumers have the best offering.


“A brand must stand on its own for something beyond the halal positioning,” Siti Nurhaliza added. There are more than 100 halal certified companies selling cosmetics and personal care products in Malaysia, including SimplySiti, Johnson & Johnson Sdn Bhd, Wipro Unza (M) Sdn Bhd and Southern Lion Sdn Bhd. “Local companies should also start looking at overseas markets as this segment has high growth potential,” said Jamil. The export value for halal cosmetics and personal care products in the first three quarters of last year stood at RM1.73 billion, or 5.6 per cent of the country’s total exports. “Local companies cannot depend on the domestic market as the Muslim population in the country is only around 16 million,” he said. Jamil urged local companies to look to Indonesia (196 million Muslims), India (133 million Muslims), Pakistan (125 million Muslims), Bangladesh (104 million Muslims) and China (133 million Muslims).  


He acknowledged that exporting halal cosmetics and personal care products may pose a new challenge to local companies due to stiffer competition, especially with the bigger brands in the global market. “Consumers are attracted to international and prominent brands, so special attention needs to be paid to packaging, labelling and promotion,” Jamil added.  Siti Nurhaliza has also expressed confidence in expanding her business abroad, particularly in Indonesia. “After five years of building and investing in the brand, we believe SimplySiti is now poised to be among the main cosmetics brands in the country and abroad.” Another local entrepreneur, Vida Beauty Sdn Bhd CEO Datuk Seri Hasmiza Othman, knows all to well about promoting her brand. In an interview with Bernama, Hasmiza, who is better known as Dr Vida, said: “I am promoting my own products, so I need to make it catchy and memorable. “This ‘bling-bling’ persona is necessary to help sell my products, so that they will remember who Vida is and the products from her company.”