You are on page 1of 1

16 theSun | TUESDAY OCTOBER 13 2009


Scrap solicitors remuneration
order, urges Rehda
Moody’s changes IOI’s outlook
KUALA LUMPUR: The Real Estate and Housing
Developers’ Association (Rehda) is urging the
government to abolish the current Solicitors Re-
muneration Order.
Rehda president Datuk Ng Seing Liong said the
abolition will enable Malaysia to compete interna-
tionally and grow competitively.
to stable from negative
The Singapore government recently liberalised KUALA LUMPUR: Moody’s Investors exchange derivative transactions and with any challenge to its business in the
its fee guidelines for the conveyance of property Service has affirmed the ‘BAA1’ issuer maintaining currency and interest rate next 12 to 18 months.
titles. rating of IOI Corp Bhd as well as the swaps that hedge its borrowings. Choy said while IOI’s ratings were
“It is timely that solicitors and clients negotiate senior unsecured bonds and loans is- He said the group had strength- supported by the favourable long-term
freely on a legal fee that is fair and reasonable with- sued by IOI Ventures (L) Bhd which are ened its management of credit sales outlook for palm oil demand, these
out being governed by any regulation and order,” he guaranteed by IOI. to minimise its bad debt which had could be tempered with among others,
said in a statement yesterday. In a statement, the rating house said it helped support the change in its ratings by both the commodity and cyclical
Ng also said that such a move will help lower had changed the outlook for the ratings outlook. pricing character of palm oil.
cost of acquisition and will spur greater buying to ‘stable’ from ‘negative’ which would Choy said with the global economic “The possibility of upward rating pres-
interests in the market. – Bernama have an effect on its bonds worth about downturn appeared to have bottomed, sure on IOI’s ratings in the near term is
US$500 million (RM1.7 billion) and and the main palm oil-importing mar- limited, given the volatility in the palm oil
Low Yat eyes RM55mil rent loans of ¥21 billion (RM779.1 million). kets – India and China – continued to and property markets,” he said.
IOI is involved in oil palm planta- post resilient economic growth, IOI He said, however, upgrade pressure
from Rivercity project tions and resource-based manufactur- business was expected to stabilise over could emerge over time if IOI were to
KUALA LUMPUR: Low Yat Group expects to rake ing, including olechemicals, as well as the medium term. further reduce its overall debt.
in RM55 million in rent from its Rivercity project in specialty oils and fats. He said IOI has maintained a strong Meanwhile, the last rating action
Jalan Ipoh, Kuala Lumpur within five years. It is also a property development liquidity profile – with debt maturities with regard to IOI was taken on March
Its deputy general manager (property develop- and investment group. well spread out, and supported by 2, 2009, when the company’s issuer
ment), Leow Sian Hiong, said the 162,000 sq ft Moody’s vice-president/senior undrawn committed banking facilities and debt ratings outlook was changed
refurbishment project, with a rental price of be- credit officer, Peter Choy, said IOI had and abundant cash of RM2.4 billion, as to negative following its release of its
tween RM4-RM8, was expected to be completed improved its management of currency of June 30, 2009 – thereby providing first-half results for financial year 2009.
by year-end. risk by terminating structural foreign it with a buffer robust enough to cope – Bernama
“The project, which started this year, comprises
seven blocks of mixed development (block A-H) and Heskey
a block for the Low Yat headquarters. seeks

Financial crisis and global
“With an investment of RM7 million, the new
look will transform one of Kuala Lumpur’s oldest
Villa exit
and bustling areas into a vibrant landmark,” she pg 31
told a media briefing yesterday.

energy investment
Leow said the company targeted 90% occupancy
rate with a good tenant mix by the first quarter of
2010. – Bernama

AirAsia gets 60% boost in sales Dr Kee-Kuan Foong also have to confront a lag of around five to 10
higher debt servic- years. Hence, current weak
from ‘Low Fare Madness’ drive ing charges due demand will result in a rise
THE global financial
KUALA LUMPUR: AirAsia’s “Low Fare Madness” crisis has severely to ongoing global in spare production capacity.
campaign has helped the low-cost airline record a weakened invest- financial volatility. In contrast, sustained lower
more than 60% increase in sales. ment on energy Some of these trou- energy investment will lead
Due to the good response, the promotion period resources. Across bled producers may to capacity shortages, which
from Oct 5-11 has been extended to Oct 18 for the the world, energy commodities. face bankruptcy would push up energy
travel period of Oct 19 to Nov 19 this year. investment fell because of Energy companies are without financial support prices in the future. Rapid
It applies to all seats and flights from Malaysia lowered end-demand for drilling less oil and gas wells from the relevant national economic progress without
but excluding that of AirAsia X. energy, tougher financing, or cutting back expenditures authorities. There is a prob- adequate investment in
“Customers have also responded positively to and poor corporate cash on pipelines and refineries. ability that the power sector energy infrastructure might
our GoHoliday packages with guests being offered flow conditions. For instance, Similarly, households and will shift towards less-capi- derail the path of global
exclusive last-minute hot deals and fantastic op- statistical evidence from the enterprises are spending tal intensive feedstock, such economic performance.
tions on ground tour arrangements including free industrialised countries has less on energy consuming as coal or gas-fired plants Supply restriction will lead
rooms at over 180 Asia Pacific hotels online at shown sharp falls in demand appliances. While this has compare with capital-in- to higher cost of production,” Kathleen Tan, the regional for energy. In turn, this has fostered increasing use of en- tensive alternatives, such and inflation expectations
head of commercial for AirAsia Group said in a contributed to sharp decline ergy-efficient appliances, the as renewable and nuclear. across all economic sectors.
statement yesterday. – Bernama in world prices of energy credit crunch has not made This is true, especially if Second, current eco-
this new form of investment the global financial crisis nomic slowdown will lead
attractive. As a result, this prolongs beyond 2010 and to less greenhouse gas
has slowed deployment of global energy prices remain emissions in the near term.
more efficient production of depressed. However, the ongoing finan-
machinery tools. In addition, According to industry ex- cial turbulence may curtail
equipment manufacturers perts, investment in the coal investment in clean energy
will lower investment in sector is anticipated to fall by technology and thereby lead
research and development. 40% in 2009 due to high base to greater emissions in the
Lower international effects in previous years. medium to longer term
prices in energy as well as Prior to 2008, coal producers through the use of fossilised
restricted corporate cash made huge profits and paid fuel energy commodities.
flow positions have stymied generous dividends to their Concomitantly, risk adverse
massive capital outlay and stakeholders. In addition, investors will divert funding
project cancellations in the high margins producers also for clean energy projects to
oil and gas market. The In- rely less on external finance proven technologies in at-
ternational Energy Agency for the expansion purposes. tractive markets. It is worth
(IEA) estimates that invest- However, smaller and noting that once the global
ment budgets for global less profitable ones will face economy recovers, any
upstream oil and gas sector higher financing terms for short-term emissions benefit
have fallen by around 21% ongoing operations, and will will be negated.
(or around US$100 billion) have to cutback large capital Third, weakened energy
in 2009. outlays. This constitutes the investment might limit poor-
In terms of power sec- large part of the contraction er people’s access to various
KUALA LUMPUR tor investment, the IEA witnessed to date. forms of modern energy.
estimates that global elec- Similarly, the investment There are nearly 1.6 billion
Saturday - 24 Oct 2009 Saturday - 14 Nov 2009
11am - 1.30pm 11am - 1.30pm tricity consumption will in renewable power projects people around the world
Venue : Plaza Pantai, KL Venue : Plaza Pantai, KL fall by around 3.5% in 2009. is expected to fall by 38% in without access to electricity.
According to figures avail- 2009. In 2007, investment Financial difficulties will im-
Admission is FREE (KL) able for the first quarter of in renewable energy as- pede poorer households the
but strictly by registration only due to limited space. 2009, electricity demand in sets rose by 85%. However, ability to connect to electric-
the OECD sagged by 4.9% due to the global financial ity or other forms of energy.
year-on-year, while China turmoil from 2008 onwards, Hence, cutbacks in modern
shrunk by 4%. investment fell as sources of energy investment will
Notably, severe demand finance became tighter. stymie poverty eradication
contraction has led to less What are the implica- efforts around the world.
new capacity additions on tions of falling investment
part of the power generators, in major energy products
Website: and less production of more around the world? Dr Kee-Kuan Foong is
energy-efficient equipment First, investment in Senior Research Fellow with
by manufacturers. Highly energy infrastructure will the Malaysian Institute of
geared power producers will only affect capacity with Economic Research