Highlights:

  1. PM announced slew of political, economic and administrative changes
  2. 2019 budget to be based on average oil price assumption of US$70 per barrel
  3. Economy to be reinforced, attract investment and innovation – Tun M
  4. MPM asks government to get more SMEs to pay tax
  5. UOB sets up Southeast Asia’s first Engagement Lab to meet the banking needs of the region’s booming digital generation

Two terms limit for Prime Minister, Menteri Besar, Chief Minister
Prime Minister Tun Dr Mahathir Mohamad announced today that the term of office of the Prime Minister, Menteri Besar and Chief Minister will be limited to two terms only as an immediate measure to reform the political system. He said the Prime Minister would also not be allowed to hold another portfolio. The move was part of a new priority and emphasis to reform the governance towards enhancing transparency and efficiency of public services. Dr Mahathir said the role of the Attorney General and Public Prosecutor would also be managed by two different individuals to improve the check and balance mechanism at all levels. To improve the electoral system, the prime minister said the age limit for voting would be reduced to 18 years and the law on political financing would be introduced. He said the Parliament’s autonomous power would be enhanced by reintroducing the Parliamentary Service Act 1963. “A selection committee system will be created. This committee will recognise the appointment of major posts at the Malaysian Anti-Corruption Commission (MACC), the Election Commission (EC), the National Audit Department and the Judicial Appointment Commission. Certain commissions such as the MACC and the EC will also be directly responsible to Parliament,” he said. In strengthening the delivery system of public services, he said, a special task force would be established to evaluate the roles and functions of various entities including statutory bodies and government-owned companies.

2019 budget to be based on average oil price assumption of US$70 per barrel
Prime Minister Tun Dr Mahathir Mohamad said the 2019 Budget allocation would be based on an average crude oil price of US$70 per barrel, although the benchmark Brent crude oil was nearing US$80 per barrel currently. He said allocation for the country’s development would be reduced, as it was unavoidable, but the operation budget would be maintained. The Prime Minister told this to reporters in Parliament after presenting the Mid Term Review of the 11th Malaysia Plan. Dr Mahathir reiterated that the reduction in development budget had to be done as the government was obligated to service the RM1 trillion debts inherited from the previous government.

Economy to be reinforced, attract investment and innovation
In presenting the Mid Term Review of the 11MP, Tun Dr Mahathir said the government would continue to stimulate the country’s  economic activities with focus placed on knowledge-intensive service sectors, accelerating innovation and technology adoption. “The economic growth momentum will be reinforced by spurring economic activity and promoting private investment. “Focus will be given to strengthening the fundamentals of the economy based on innovation, creativity and high-value added activities towards enhancing productivity and industry competitiveness,” he said. The prime minister also said the services sector would be the main driver of the country’s economic growth, as such, knowledge-intensive service sectors would be enhanced. Strengthening economic growth is one of the six pillars outlined by him as the government’s main priority and new emphasis for the 2018-2020 period. Dr Mahathir also said the transition of the manufacturing sector towards the production of high-value, diversified and complex products would be greatly encouraged. “Manufacturing sub-sectors with high potential growth, namely aerospace and medical devices, will also take precedence. “The industry needs to increase productivity by accelerating the use of robotics, automation and innovation, conduct research and development besides implementing sustainable production practices,” he added. The government, the prime said, was aware of the pivotal role small and medium enterprises assumed in the national economy. As such, efforts to create a resilient and sustainable SME sector will continue to be implemented. The goal is to increase SME contribution to Gross Domestic Product (GDP) to 41 per cent in 2020, he said. “SME contribution to exports will also be enhanced through the internationalisation of initiatives and export promotion,” he added.

MPM asks government to get more SMEs to pay tax
The Malay Consultative Council (MPM) has proposed the introduction of a short-term measure to increase revenue in Budget 2019 by getting more companies, especially small and medium enterprises (SMEs) and mid-level companies, to become eligible corporate taxpayerIt said the move would enable the government to have a new source of revenue to increase corporate tax collection following a reduction in revenue with the replacement of the Goods and Services Tax with the Sales Tax and Services Tax. Focus should be given to efforts and methods to turn as many SMEs and mid-level companies as possible into productive corporate taxpayers in line with the Ministry of Entrepreneur Development’s (MED) effort to encourage the younger generation to go into business, it said in a statement today.

UOB sets up Southeast Asia’s first Engagement Lab to meet the banking needs of the region’s booming digital generation
United Overseas Bank (UOB) today announced the launch of its pan-regional Engagement Lab (eLab), which will enable the Bank to personalise the way in which it converses and serves its Digital Bank customers. UOB’s eLab is the first dedicated unit set up by a bank in Southeast Asia focused on using the latest technology and behavioural insights to deepen customer engagement. The Bank will set up eLabs across its network of ASEAN countries such as Indonesia, Malaysia, Singapore, Thailand and Vietnam. UOB’s Digital Bank, which will be launched in Southeast Asia, has been modelled such that digital interactions with the customer are designed to deepen the Bank’s relationship with them. It will use artificial intelligence to identify individual transaction patterns from its huge volumes of transaction data. This will enable the Digital Bank to understand more deeply the individual banking needs and habits of its customers, to anticipate their needs and to be proactive in helping them achieve better money management. The eLab is core to this. Through the eLab, the Bank will use the insights drawn to design, to test and to trial ways to encourage customers to save and spend more wisely. The eLab team of specialists from a range of various disciplines including data analytics and behavioural and decision sciences will ensure that digital conversations with customers are relevant, familiar and intuitive to them. Given ASEAN’s cultural and linguistic diversity, these conversations will be in the customers’ own mother tongue.