Malaysia-Canada Trade Surges 41% Amid Strengthening Economic Ties, as Malaysia Explores New Free Trade Deals to Mitigate Geopolitical Risks

1. Malaysia and Canada are deepening their economic ties, with bilateral trade reaching RM8.05 billion as of August 2024, marking a significant 41 per cent increase year-on-year, according to the Ministry of Investment, Trade and Industry (MITI).

2. MITI reported that bilateral trade surged by 25 per cent following Canada’s accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which also facilitates duty-free access for goods, eliminating tariffs on Canada’s key exports.

3. “This growth was driven by a 68.1 per cent surge in Malaysian exports to Canada and a 16.8 per cent rise in imports from Canada, with key sectors such as clean technology, agriculture, and aerospace fostering closer trade relations,” the ministry said in a statement to Bernama, here.

The Future Of Manufacturing: Technology Trends For 2025 And Beyond

1. The manufacturing sector is undergoing a technological and sustainable revolution. Industry 4.0 technologies like AI, IoT, and digital twins are enhancing efficiency, resource optimization, and eco-friendly practices. 

2. By 2025, software innovations will focus on carbon neutrality, energy efficiency, and cloud solutions, significantly reducing environmental impacts. AI drives smart production, while IoT transforms production lines into intelligent systems. 

3. Decentralized manufacturing and microfactories increase supply chain agility, despite challenges. The electrification of vehicle fleets and the integration of digital ecosystems in cars highlight mobility sector trends. However, manufacturers must address cybersecurity and balance cost-efficiency with innovation to adapt to global challenges

4. Here are FORBES and Forrester’s prediction for manufacturing in 2025 

Bắc Ninh: Vietnam’s Top FDI Location and Emerging Industrial Real Estate Hub

1. In the first nine months of 2024, Bắc Ninh province has established itself as a frontrunner in attracting foreign direct investment (FDI) within Vietnam, achieving over US$4.2 billion in investments.

2. This notable influx is largely credited to a robust investment climate characterized by advanced infrastructure and a skilled labor force, which positions Bắc Ninh as a highly appealing destination for foreign investors. 

3. The provincial Department of Planning and Investment reported that foreign investors committed US$1.56 billion to 339 projects, marking an impressive year-on-year increase of 82.2% in total investment and a 28.4% rise in project numbers.

4. Further reinforcing its investment appeal, Bắc Ninh saw 147 FDI projects adjusting their capital expenditures over the same period, leading to an additional allocation of US$2.68 billion. This flexibility demonstrates the province’s proactive approach to fostering business growth and optimizing the operational environment for foreign enterprises. 

Pakistan’s Battle for Gulf Investments: Economic Crises and India’s Growing Influence

1. Pakistan’s economic situation is teetering on the brink as the country is facing a perilous financial crisis, scrambling to secure external financing to meet growing obligations. The country has received only temporary relief from a US$7 billion staff-level agreement with the International Monetary Fund.

2. Pakistan’s financing need for the 2023–2024 fiscal year is estimated at US$25 billion. To bridge this gap, Pakistan has turned to its traditional allies — Saudi Arabia, the United Arab Emirates (UAE) and China — to seek additional financial support, debt restructuring and foreign direct investment (FDI). Pakistan aims to re-profile US$12 billion in bilateral debt, with US$3 billion owed to the UAE, US$4 billion to China and US$5 billion to Saudi Arabia. The goal is to extend the repayment of these loans over the next three to five years, providing Pakistan with a more stable financial foundation.

3. Pakistan has opened the door to Gulf countries, especially Saudi Arabia and the UAE, through the Special Investment Facilitation Council — a platform to attract FDI in key sectors such as agriculture, mining, energy and infrastructure. FDI increased to US$1.9 billion in 2023–2024 fiscal year compared to US$1.6 billion in 2022–23 fiscal year, a 17 per cent increase. Although China remains the largest contributor, there has been an increase in FDI from Saudi Arabia and UAE, rising from US$1 million to US$10 million over the 2022–2023 fiscal year.

4. Saudi Arabia and the UAE have shown interest in agriculture and mining, sectors where significant investment opportunities exist. These investments align with their broader strategies — Saudi Arabia’s Vision 2030 and the UAE’s post-oil economy strategy — to diversify their economy away from oil dependency and expand their global influence. By investing in Pakistan, both nations seek to strengthen their diplomatic ties and economic presence in South Asia, tap into new markets and expand their geopolitical reach.

UAE Sees 33% Surge in Greenfield FDI Capital Inflows in 2023 and takes second place globally in new FDI projects at 1,323

1. The UAE ranked second globally in greenfield FDI projects in 2023, with 1,323 project announcements, showing a 33% rise compared to 2022, according to the UNCTAD 2024 World Investment Report.

2. FDI inflows into the UAE reached $30.688 billion in 2023, marking a 35% year-on-year increase, while FDI outflows decreased to $22.328 billion.

3. Key sectors driving the growth of greenfield investments included business services, software, and IT, contributing to a 7.5% rise in jobs and a 37% increase in capital inflows, according to UAE Ministry of Investment officials.

McKinsey : Supply chains: Still vulnerable

1. Supply chain disruptions keep on coming. From missile attacks on commercial shipping in the Red Sea to automotive production delays following floods in Europe, global supply chains continue to experience instability. Meanwhile, trade tensions are choking the movement of semiconductor products, manufacturing equipment, and critical materials.

2. The latest McKinsey Global Supply Chain Leader Survey suggests that problems like these remain the norm, not the exception, with nine in ten respondents saying they have encountered supply chain challenges in 2024 (see sidebar, “About the research”). More worryingly, there are signs that, when it comes to supply chain resilience, companies are taking their foot off the gas. The survey results identify considerable gaps in the ability of organizations to identify and mitigate supply chain risks, with few new initiatives aimed at addressing those weaknesses.

3. The biggest gap could be the one at the top of the organization. Few surveyed supply chain executives believe that their boards have an in-depth understanding of supply chain risk. Only a quarter have formal processes in place to discuss supply chain issues at board level. All this could leave companies dangerously exposed to future disruptions.

Sino-EU cooperation

1. The European Union's competitiveness report released by Mario Draghi, a former European Central Bank chief.

2. The report, in a way, is an acknowledgement of China's phenomenal transformation over the past decade toward a more sustainable and innovation-driven economy. The sheer fact that China is mentioned many times in the report and that the EU now sees a huge gap not just with the United States but also with China is telling, especially because many Europeans still see China as a country providing cheap labor — although that is no longer true, according to the Draghi report.

3. A decade ago, when China announced its strategic shift, from investment-driven quantitative economic growth to innovation-led high-quality development, not many people took it seriously. Today, China has become a global leader in research and development, renewable energy including solar and wind energy, and electric vehicles (EVs).

4. China is catching up fast with the industrialized world, partly by learning from the EU and other developed economies, but more importantly through massive investments in R&D. Who would have thought just a decade ago that China's robot density would rank fifth in the world, trailing South Korea, Singapore, Germany and Japan but ahead of the US and the average EU member state?

Southeast Asia to outpace China's GDP growth and foreign investment

1. Southeast Asia is likely to outpace China’s economic growth and inflow of foreign direct investments over the next ten years, a new study led by a Singapore-based think tank showed, as the region benefits from growing demographics and a global supply chain shift.

2. The Southeast Asia Outlook 2024–2034 report, which was released on August 1 by Angsana Council, US consultancy Bain & Company, and Singapore’s DBS Bank, projected the gross domestic product of six regional economies: Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam.

3. According to the study, GDP for the six key economies is expected to increase by an average of 5.1% annually until 2034, outpacing China’s projected growth of 3.5–4.5%.

4. By country, Vietnam is expected to lead with 6.6%, followed by the Philippines with 6.1%, while Singapore—the slowest among the six—is expected to manage 2.5%.

Meteor Lake Shortages Prompt Intel's Costly Ireland Ramp-Up Amid Apollo Deal

1. Buyout firm Apollo Global Management (APO.N),  will acquire a 49% equity interest in a joint venture related to Intel's (INTC.O),  new manufacturing facility in Ireland for $11 billion, the companies said on Tuesday.

2. Apollo will acquire the stake in the Fab 34 joint venture in Leixlip, Ireland, the U.S. chipmaker's first high-volume location for its Intel 4 manufacturing process using extreme ultraviolet lithography machines.

3. The deal, expected to close in the second quarter, would allow Intel to redeploy parts of its investment in the project to other parts of its business, the company said.

Fastest-growing countries in Southeast Asia and FDIs Embracing Innovative Technologies

1. A report titled "Navigating high winds: Southeast Asia Outlook 2024-34" was released on August 1, compiled by the Development Bank of Singapore, consulting firm Bain & Company, and Angsana Council.

2. The report forecasts the expected growth of the six largest Southeast Asian economies of Vietnam, Singapore, Malaysia, the Philippines, Indonesia, and Thailand.

3. According to the report, over the next decade, Southeast Asia will likely grow faster than the previous decade, with higher GDP growth and higher total foreign direct investment (FDI) than China. Southeast Asia’s growth will be driven by stronger domestic economies and a resurgence in investment catalysed by China + 1 supply chain shifts.

4. Specifically, Southeast Asia is predicted to grow GDP by 5.1 per cent, on average, in the next decade. Vietnam and the Philippines are expected to be the faster-growing countries, with Vietnam remaining in front.

5. "Vietnam is forecast to maintain a GDP growth rate of 6.6 per cent in the 2024-2034 period and its export-oriented economy is well-positioned to capture China + 1 opportunities," the report said. "The country also boasts a highly diverse source of FDI, productive interprovincial competition, and high-quality workforce and education levels."

6. To grow faster than the forecasts, Southeast Asia should invest in new growth sectors, foster tech-enabled disruptors, expand capital markets’ breadth and depth, and accelerate the green transition, the report added. The region should also commit to growth-friendly multilateral initiatives, including the Regional Comprehensive Economic Partnership, the Belt and Road Initiative, and a transnational electricity grid.

Predictive Maintenance

Predictive maintenance (PdM) is an increasingly popular strategy for facility management leaders. Learn why and learn how to set up a successful PdM strategy.

Understanding WTO Rules on Subsidies: The Agreement on Subsidies and Countervailing Measures

 1. The World Trade Organization (WTO) plays a crucial role in regulating international trade, including the use of subsidies by governments. The Agreement on Subsidies and Countervailing Measures (SCM Agreement) sets the legal framework for how subsidies can be used and challenged to ensure fair competition in global markets.

2.  In this post, we will explore the key aspects of the SCM Agreement, including prohibited and actionable subsidies, countervailing measures, and special rules for agricultural subsidies.

Five Tips For Maximizing Productivity As A Small-Business Owner

1. Small-business ownership can be a challenging and rewarding journey. From keeping track of finances and operations to overseeing employees and making critical decisions, the demands on a small-business owner’s time and energy are never-ending, and it’s no wonder that many small-business owners struggle to stay productive and efficient. But in a fast-paced and competitive business world, maximizing productivity is essential to success.

2. Whether you are looking to grow your business, increase your bottom line or simply reduce stress and improve your work-life balance, productivity is key. In the 20-plus years that I’ve been helping small-business owners and mentoring individuals, I’ve discovered that having the ability to systematize and create processes around productivity is so important. Before I implemented these simple steps, my company ran in a constant state of chaos.

3. From tried-and-true time management methods to cutting-edge technology, there are many ways to improve your productivity and achieve your goals.

Why closing the small business productivity gap can create enormous value for economies

1. Micro, small and medium-size enterprises (MSMEs) play an underappreciated and outsized role in the global economy. They account for 90% of all businesses, half the value added, and more than two-thirds of business employment. In Indonesia, for example, they account for almost 90% of employment and two-thirds of value added. Small businesses also inject dynamism into economies.

2. Many large companies of today were MSMEs not long ago. About one in five of today’s very large companies – defined as having a market capitalization of more than $10 billion in the United States and equivalent values in other economies – were MSMEs at some point after 2000 and have since powered their way to large company status.

3. Yet small businesses struggle with productivity in comparison with large companies. Raising MSME productivity has long been an aim of governments who recognize their central role in economic growth and employment.

The Changing Face Of FDI

1. As recent history has consistently demonstrated, there is nothing more certain than uncertainty. A pandemic, geopolitical tensions, trade frictions and even armed conflict have complicated the landscape for global foreign direct investment, leaving business leaders with no clear signals as they set priorities and make critical investment decisions outside their borders.

2. Adding urgency to the matter, there are now signs of a revival in FDI after a couple of years of decline. But the picture that is beginning to sort itself out is distinctly different from the past. Manufacturing shows promising signs of recovery while nearshoring and friendshoring in new markets are becoming stronger trends.

3. At an estimated $1.37 trillion, global FDI flows grew by a modest 3% year-on-year in 2023, according to preliminary figures from the United Nations Conference on Trade and Development (UNCTAD). But the top-line numbers obfuscate an enormously mixed picture beneath the surface.

4. Most strikingly, once a few European conduit economies are removed from the equation, global flows declined by some 18%. In the European Union, for instance, FDI jumped from negative $150 billion in 2022 to positive $141 billion in 2023, according to UNCTAD, but largely on the back of significant swings in Luxembourg and the Netherlands. Excluding these two countries, inflows to the rest of the EU fell 23%. North America saw zero growth, while other countries saw declines. Flows fell by 9% in developing countries to $841 billion.

Malaysia's industrial output up 5pct in June

1. Industrial output rose 5.0% compared to the same month of the previous year in June, which followed May’s 2.4% increase. The notable pickup was partly driven by faster growth in manufacturing output. In addition, mining and quarrying output rebounded.

2. As a result, the trend improved sizably, with the annual average growth of industrial production coming in at 2.0%, up from May’s 1.4% reading.

3. On a monthly basis, industrial output increased 0.7% in seasonally adjusted terms in June, which was below May’s 1.7% expansion.

Unveiling the SEA Green Economy Index: Tracking Decarbonization Progress in Southeast Asia

1. To better help Southeast Asian markets track their decarbonization progress, the report unveiled the region’s first SEA Green Economy Index which examines how each country is progressing across five metrics with varying weightage totaling 100% – ambition (20%), progress (25%), roadmap (20%), accelerator (25%), and investment (10%).

2. “The index helps provide an objective snapshot of how each country is performing year-on-year and relative to peers. It shows an overview of areas they are doing well and recognizes where progress is being made. It is important to note that this index is constantly evolving as the region continues to tweak initiatives to fit respective markets’ needs,” said Hardcastle.

3. The index shows that Southeast Asia has made some encouraging moves to reduce greenhouse gas emissions, with Singapore and Vietnam making the most progress over the last year. Eight out of 10 countries have net zero targets, and while they have remained the same as the previous year, more than half of the region’s top emitting corporates have set net zero or emission reduction targets, 15 more compared to 2023. In addition, seven countries have shown progress in adopting renewable energy and electric vehicles, preserving forestland, and enhancing health of cropland soil.

4. Translating ambition to action and results will take time. Southeast Asia is still in early adoption and has the opportunity to capture proven and the most cost effective decarbonization initiatives. In 2024, the region needs to double down on the top 13 investable ideas, leverage on the key accelerators to unlock these ideas and ensure better cooperation among governments, corporates, and investors.

"Optimizing Universal Access and Service (UAS) Projects: Strategic Disbursement, Grant Management, and Effective Monitoring"

1. Effective disbursement strategies are crucial for the success of Universal Access and Service (UAS) projects, ensuring that funds are allocated efficiently to bridge connectivity gaps. 

2. The International Telecommunication Union (ITU) outlines various methods for making and managing disbursements & monitoring in UAS initiatives.

China’s shrinking FDI and what it means for its economy

1. FDI into China in 2023 increased by the lowest amount since the early 1990s amid growing disinvestment and concerns about the country’s sluggish economic recovery.

2. According to data released by the State Administration of Foreign Exchange on Sunday, China’s direct investment liabilities – including foreign companies’ retained earnings in the country – reached $33bn (237.53bn yuan) in 2023. The measure is 82% lower than the 2022 level and the lowest recorded since 1993, one year after private business ownership gained full legal status in the country.

3. In November 2023, Chinese officials reported a $11.8bn drop in direct investment liabilities during the third quarter of 2023, showing how growing tensions between Beijing and the West impact the country’s investment climate.

4. Despite the swift economic recovery following Covid, FDI inflows into China slowed in 2022 as a result of the government’s Zero Covid policy – in place until the end of that year – coupled with economic policy uncertainty.

5. At the same time, Beijing has stepped up its crackdown on foreign companies. In January 2024, Beijing launched an anti-dumping investigation into French brandy imports. The announcement came a few weeks after the EU Commission began investigating allegations of biodiesel dumping from China into the EU market and three months after Brussels said it was looking into claims that China was illegally subsidising its electric vehicle market.

6. The Chinese tech sector, however, has seen the most significant drop in market valuation, as continued pressure from the Chinese authorities wiped $1.1trn off China’s major tech companies between 2021 and 2023, according to Refinitiv data cited by Reuters.

7. The US Department of State warns that China’s market remains a “relatively restrictive environment for foreign investors” because of prohibitions on investment in key sectors, as well as unpredictable regulatory enforcement.

8. For that reason, many companies have diversified their investments away from China, instead announcing expansion plans in other Asian nations such as India, Malaysia, the Philippines and Vietnam.

Singapore's Smart Nation 2.0: Advancing AI Leadership and Resilient Digital Infrastructure

1. Singapore has announced plans to inject around £740m (S$1.2bn) into AI development over the next five years,

2. In 2023, Silicon Box, a semiconductor integration company, announced the launch of its $2bn semiconductor manufacturing foundry in Singapore.

3. Located in Tampines, the chip factory is expected to create more than 1,000 jobs with the backing from the Singapore Economic Development Board (EDB).

4. Silicon Box’s facility marks a step forward for Singapore’s ambition to expand its manufacturing industry by 50% by 2030.

5. It is also expected to increase Singapore’s appeal as a desirable location for AI, as semiconductor businesses look to diversify their manufacturing supply chains amid rising geopolitical concerns.

6. Singapore was among the first countries to publish an AI plan in 2019. In December 2023 it launched an updated version of the strategy, outlining ways to harness and use AI for economic empowerment.

7. The city-state took a proactive stance in AI governance by introducing AI Verify in May 2022 – the world’s first AI governance testing framework and software toolkit for companies.

8. Companies like Google, Meta, and Microsoft have already tested the AI Verify tool and provided feedback, demonstrating a collaborative effort towards promoting responsible AI use.