Moving from a Just-in-Time to a Just-in-Case

1. Just-in-Time or JIT inventory management is a lean procurement methodology originally invented in Japan. By only ordering what they need, when they need it, companies reduce waste such as obsolete or expired stock, drive efficiency, and reduce holding costs (warehousing). Importantly, JIT frees up operational cash flow.

2. JIT management requires a constant stream of robust data, such as having accurate and frequently updated sales forecasts and knowing your peak demand periods. It also requires a sophisticated inventory system to tell you exactly how much stock you have on-hand in real-time.

3. Unfortunately, JIT only works properly in a seamless, well-oiled supply chain. As we all know, COVID-19 brought this crashing to the ground all over the world. The pandemic caused shipping delays, port congestion, panic buying, and shortages of crucial medical equipment and PPE. Businesses everywhere rapidly ran out of stock and had to scramble for alternative sources of supply, pay higher prices, and wait for the global supply chain to recover.

Malaysia’s Ratification of CPTPP to Help Increase Trade

1. Malaysia’s ratification of the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership (CPTPP) looks set to provide indigenous businesses with expansion opportunities around the Asia Pacific and even further afield. The pact, deemed highly beneficial for the development of Malaysian trade, removes as much as 95 percent of tariffs between member states.

2. The Malaysian government officially ratified the CPTPP on September 30, 2022. The trade deal was signed in 2018 but required years of careful deliberation and consultation by Parliament for final approval.

3. The agreement – originally called the Trans-Pacific Partnership – was signed by 11 countries on the Pacific rim in 2018. Signatories included Australia, Brunei, Canada, Chile, Japan, Mexico, New Zealand, Peru, Singapore, and Vietnam. The pact removes 95 percent of tariffs between its 11 members.

4. Malaysia concluded in its “Cost-Benefit Analysis” that this free trade agreement would see the country’s total trade increase to US$655.9 billion by 2030 according to the government’s Statistics Department. Malaysia’s total trade stood at around 2.2 trillion ringgit (US$481 billion) in 2021.

Digitization vs. digitalization: Differences, definitions and examples, and Digital Transformation

1. In the case of digitization and digitalization, two letters make all the difference. This is not merely a matter of wordplay — it’s a matter of scope and potential value to your business. Understanding the distinctions between these two approaches is critical as the digital transformation gains momentum and businesses move toward digital technologies to enhance visibility and eliminate inefficiencies in their operations.

2. Here, we’ll give a straightforward explanation of both digitization and digitalization, offering examples of each. Then we’ll explore why we designed TruQC as a strategy for process digitalization.

Smart Container Market & E-Commerce Logistics Outlook & Forecast

1. The smart container market is projected to grow from USD 3.9 billion in 2022 to USD 9.7 billion by 2027, at a CAGR of 19.6% during the forecast period. Increasing focus on end-to-end supply chain visibility, high demand for monitoring and control of internal container conditions, and increasing adoption of IoT devices by shipping companies are the key factors expected to drive the growth of the smart container market in the next five years.

2. The global e-commerce logistics market is expected to grow from $476.34 billion in 2021 to $568.85 billion in 2022 at a compound annual growth rate (CAGR) of 19.4%. The Russia-Ukraine war disrupted the chances of global economic recovery from the COVID-19 pandemic, at least in the short term.

Product Spotlight - The Hydrogen Colour Spectrum

1. From green to pink hydrogen, we reveal the rainbow of hydrogen colours and the different types of technology used to produce each.

2. Green hydrogen, blue hydrogen, brown hydrogen and even yellow hydrogen, turquoise hydrogen and pink hydrogen. They’re essentially colour codes, or nicknames, used within the energy industry to differentiate between the types of hydrogen.

3. Depending on the type of production used, different colour names are assigned to the hydrogen. But there is no universal naming convention and these colour definitions may change over time, and even between countries.

4. Hydrogen is an invisible gas. So, despite their colourful descriptions, there is no visible difference between the different types of hydrogen.

5. In the future, some hydrogen colours may fade in importance and others burn brighter. What’s certain is that the hydrogen rainbow will play a significant role in reaching net zero, as we reduce our historical reliance on fossil fuels and look to green alternatives to power our homes, businesses and transport.

Halal Certification in Malaysia

1. Businesses looking to sell halal products in Malaysia must first receive a Halal Certificate from the government. A Halal Certificate lets consumers know that the product meets Malaysia’s standards for a halal product.

2. Home to some 16 million Muslims, Malaysia is a leading market in Southeast Asia for the production and consumption of halal products. Malaysia’s halal products have an annual export value of 35.4 billion ringgit (US$7.46 billion), or 5.1 percent of the country’s exports, as it is a key supplier for countries with large Muslim populations, such as Indonesia.

3. Halal certification is relevant to a variety of products that use animal products, including food products, cosmetics, and pharmaceuticals. Here, we look at how halal is defined in Malaysia and how businesses can receive a Halal Certificate.

Why UAE Businesses Should Establish a Principal Hub in Malaysia

1. Malaysia and the United Arab Emirates (UAE) began diplomatic relations around 1983, which has since developed into an important trade and investment relationship. The UAE is Malaysia’s largest trade partner in the Middle East with bilateral trade reaching US$5.4 billion in 2021, an increase from US$4.93 billion in 2020. Trade is almost evenly split with the UAE enjoying a small surplus of just under US$200 million.

2. Importantly for Malaysia, the country is competing with Singapore to serve as a principal hub for businesses in the UAE, particularly in manufacturing, logistics, information, and communications technology, and Islamic finances, seeking to enter the huge ASEAN market.

Thailand Adopts New Five-Year Investment Promotion Strategy

1. Thailand’s Board of Investment has approved the country’s next Five-Year Investment Promotion Strategy. The strategy aims to identify industries and sectors that are essential to Thailand’s long-term development and competitiveness. The strategy will take effect at the start of 2023 and run through 2027.

Employment Multipliers for the U.S. Economy

1. When it comes to the ripple effects that spread to the rest of the labor market, one lost dollar of economic output or one lost job is not the same as another.

2. Each industry has backward linkages to economic sectors that provide the materials needed for the industry’s output, and each industry has forward linkages to the economic sectors where the industry’s workers spend their income. 

3. Therefore, in addition to the jobs directly supported by an industry, a large number of indirect jobs may also be supported by that industry. The subtraction (or addition) of jobs and output in industries with strong backward and forward linkages to other economic sectors can cause large ripple effects.

4. This brief calculates employment multipliers by industry to illustrate the importance of these linkages, updating earlier work by Bivens (2003) and Baker and Lee (1993). Employment multipliers measure how the creation or destruction of output or employment in a particular industry translates into wider employment changes throughout the economy.

EVT (Engineering Validation Test), DVT (Design Validation Test), PVT (production validation testing) & NPI (New Product Introduction)

1. Explain the differences between EVT, DVT and PVT, or the engineering validation process.

2. Manufacturing overseas adds additional complexities and risks as geographic, communication, and cultural barriers can sabotage the product launch process.

3. This is where a New Product Introduction (NPI) team can make a substantial impact on commercializing a new product.  

Product Spotlight - Data Center Tiers Explained

1. Data center tiers are established rankings for the performance of servers which house data and information.

2. Data centers are ranked from I to IV, with I being the worst-performing of the four and IV being the best-performing.

3. The Uptime Institute’s Tier Certification is the independent measure through which ratings are judged. It determines the criteria for each tier and lists several values that collectively make up what constitutes the standards of data center tiers. 

Global Supply Chain Pressure Index (GSCPI) & Supply Chain Pessure in September 2022

1. The Global Supply Chain Pressure Index (GSCPI) is a new measurement of supply chain conditions, created by the Federal Reserve Bank of New York. The index combines variables from several indices in transportation and manufacturing, such as those related to delivery times, prices, and inventory.

2. The index is meant to help policymakers, businesses, and consumers understand the state of global supply chains.

Product Spotlight - Current Sensors and Industry 4.0: What do engineers need to know & Selection Criteria

1. A lot of the current buzz in electronic systems development is about “smart” products, and the ability to oversee the performance and functionality of these solutions. Between competition and consumer expectations, a product on the market today must perform its functions almost perfectly, or as close as can be achieved through modern technology and processes. 

2. Short battery life, poor RF connections, bad thermal management, and other non-critical aspects of performance are also make-or-break parameters when operating in the real world.

3. The explosion in the growth of the electronics marketplace at every level is challenging the industry at every level. From new semiconductor materials to advanced solutions like artificial intelligence, new technologies and approaches are creating new application spaces while rejuvenating old ones. All of this is being driven by the migration to integrate data technology into every aspect of electronics.

4. All of this is creating a disruptive period of demanding growth, which places additional pressure on system designers to ensure the product created is safe, efficient, reliable, and cost-effective (especially that last one). 

China’s Big Plan to Boost Data Center Computing Power

1. As China’s digital businesses continue to grow and as traditional sectors continue to digitize, there will be greater demand for data center infrastructure and high computing capacity.

2. The “Eastern Data, Western Computing” plan was first introduced at the end of 2020 when the National Development and Reform Commission (NDRC), the Cyberspace Administration of China (CAC), the Ministry of Industry and Information Technology (MIIT), and the National Energy Administration (NEA) jointly released the Guiding Opinions on Accelerating the Construction of a National Integrated Big Data Center Collaborative Innovation System (the “guiding opinions”). These guiding opinions first proposed the construction of a nationwide integrated data center system. 

Product Spotlight - MEMS (Microelectromechanical Systems) AND Global Market Forecast

1. MEMS or Microelectromechanical Systems are microsystems with both electric and mechanical functions. Built with the same advanced techniques that make today's integrated circuits, MEMS are everywhere around us. The tech is miraculous but the industry has long struggled with several significant economic issues. 

2. Global Micro-Electromechanical Systems (MEMS) Market Report 2022: Market to Reach $16.9 Billion by 2026 - Consumer Electronics Segment is Expected to Account for $10.3 Billion

Malaysia Makes Amendments to its Patent Act: Key Highlights

1. On March 18, 2022, the Patent (Amendment) Act 2022 [Act A1649] (the “Act”) and accompanying implementing regulations went into effect, updating the law originally created in 1983. The Act, which Malaysia’s upper parliament passed in December 2021, brings Malaysia’s patent regulations in line with a number of international agreements the country is a party.

2. Major international agreements reflected in the Act include the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the Regional Comprehensive Economic Partnership Agreement (RCEP), the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), and the Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent Procedure (the Budapest Treaty).

Is the US’s Position as a Global Leader for Data Centres Changing?

1. Of the world’s ten largest data centre companies, six are US multinationals and two are Japanese. Many are questioning, however, whether this crop of data centre corporates will maintain their dominance of the industry’s cross-border investment and global footprint – and what does this mean for companies planning corporate expansions overseas?

Robotic Process Automation (RPA) Costs & Return on Investment (ROI)

1. As of 2020, 72% of companies surveyed by Deloitte had already implemented RPA tools. Improved compliance and quality topped the list of benefits reported by RPA pioneers. At the same time, 59% of enterprises registered a significant RPA-related cost reduction, with the median payback period for RPA projects spanning less than 12 months. 

2. However, only 3% of companies succeed in scaling their digital workforce, while up to 50% of initial RPA projects fail. Given that robotic process automation costs for a single software bot may range from $5,000 to $15,000, your business might end up spending millions of dollars to achieve company-wide automation. 

3. Before making the investment, most production and operations managers will need to provide sufficient evidence to company leadership and stakeholders that automated machinery would be a profitable venture throughout the lifecycle of the equipment.

4. What are the key factors behind the presumably high robotic process automation cost? Most importantly, what should your company do to realize RPA’s full potential without breaking the bank? 

How Manufacturers in Less Developed Regions Accelerate the Adoption of Industry 4.0?

1. The manufacturing industry is well aware of the benefits Industry 4.0 technologies can offer. Connectivity, AI/ML, IoT, AR/VR and other technologies are available to provide data and streamline processes and improve manufacturing across diverse industry segments.

2. Yet whilst awareness is broad, uptake is less so. Industrial digitalisation in the UK can be London-centric, leaving regional manufacturing hubs further behind in the adoption of new technologies. The likes of Make UK and Innovate UK are making great strides in broadening adoption, but there is further to go.

3. Part of the challenge lies in regional skills gaps and talent shortages, with businesses outside of city hubs unable to realise the full benefits of Industry 4.0 technologies. There is a lot of incredible technology out there to integrate into manufacturing operations – but it is not always accessible. Regionally, there needs to be equal access to technology alongside abilities to upskill staff and train talent regionally.

Impact of service level agreements on a manufacturing organization & ISO 27001

1. Managing a service level agreement (SLA) is a continuous process and should be constantly monitored, updated, and improved to meet the business needs of the manufacturing organization.

2. A service level agreement (SLA) with a cloud service provider (CSP) is a live document that must be well-understood and negotiated between the cloud service customer (CSC) and the CSP so the manufacturing organization (CSC) can manage and satisfy all security and regulatory compliance requirements in the cloud. When the manufacturing organization signs the SLA as a legally binding agreement with the CSP, it should not stop here because things are not done. They are actually never done.

Malaysia 2Q2022 Vistage-MIER CEO Confidence Index

1. The CEO Confidence Survey is a monthly survey of 100 chief executive officers (CEOs) from a variety of industries in the U.S. economy. The survey is conducted, analyzed, and reported by the Conference Board and it seeks to gauge the economic outlook of CEOs, determining their concerns for their businesses, and their view on where the economy is headed.

2. A reading of the survey index with a value above 50 indicates that the CEOs surveyed are more bullish than bearish on their economic outlook. The Conference Board's CEO Confidence Survey is seen as a leading economic indicator and it competes with Chief Executive magazine's CEO Confidence Index.

IoT Is Changing the Semiconductor Industry; and How Big Data is Applied in Major Industries

1. The IoT semiconductor industry is in continually high demand, especially as people look for increasingly advanced and feature-filled connected devices. However, the specific reasons for the chip’s rise are more complex than some might think. Here’s a closer look at some of them.

2. On the other hand, there are some major big data applications where it has become a game-changer for increasing efficiency, enhancing customer service, reducing costs, making better products, and much more:

Key Trends in Food Processing & Strategies for Food Tech Companies

1. The impact of COVID-19  on the food supply cannot be overstated. The virus is widely believed to have originated in the food supply in China in 2019. It’s therefore not surprising that the resulting global pandemic has changed the food production industry forever.  

2. With on-going quarantines, lockdowns, restaurant closures and work-from-home, consumers had more time to research how their food is being produced and where it is coming from. From the place of origin of food products, to ingredients, to packaging and food safety, American consumers have drastically altered their perception of what a desirable, safe, and delicious food product is. 

3. There are six key trends that U.S. food producers are reacting to. 

4. BCI Global has defined four strategic directions for innovative food tech companies with clear international ambitions to establish the right manufacturing and supply chain footprint for the future. They are as follows:
• Differentiating between short-term capacity development and longer-term strategy
• Creating the right ecosystem
• Selecting the optimal location for new operations
• Footprint risk management.

Can FDI fix the semiconductor supply chain?

1. Global semiconductor supply chains dramatically broke down during the Covid-19 pandemic, and everyone agrees this must never happen again. Could FDI fix this problem?

2. While China and the US represent the two largest buy-side markets for semiconductors, they only rank fourth and fifth, respectively, in the manufacturing of chips, according to the Centre for Strategic and International Studies (CSIS).

3. The next decade will see both countries prioritising their onshore manufacturing capacity to enable economic growth and avoid the severe global chip shortage seen in 2021 after the Covid-19 crisis. On 28 July 2022, US Congress passed the Creating Helpful Incentives to Produce Semiconductors for America Act, colloquially known as the Chips Act, which includes $52bn of incentives designed to onshore semiconductor manufacturing capacity. 

4. Although the passing into law of this congressional act is momentous for the future of the global semiconductor industry, it is just one moving part in a global reshuffle in which foreign direct investment (FDI) will play a critical role.

Digital Twin - Dynamic Virtual Copy

1. A digital twin is a dynamic virtual copy of a physical asset, process, system or environment that looks like and behaves identically to its real-world counterpart. A digital twin ingests data and replicates processes so you can predict possible performance outcomes and issues that the real-world product might undergo.

2. The power of digital twins comes from connecting real-world assets with real-world data, so you can better visualize them. Digital twins enable cross-functional teams to collaboratively design, build, test, deploy and operate complex systems in interactive and immersive ways. They help companies understand the past, view present conditions, and prevent future problems. They inform decision-making through sales and marketing insights, analysis, 3D visualization, simulation, and prediction.

Malaysia is expected to be the largest beneficiary from Regional Comprehensive Economic Partnership (RCEP)

1. As the Regional Comprehensive Economic Partnership agreement entered into force for Malaysia on Friday, China and Malaysia began to impose RCEP tariffs on each other, which will bring new economic cooperation opportunities.

2. Within ASEAN, Malaysia is expected to be the largest beneficiary of the agreement in terms of gains in exports, with a projected $200 million increase, according to the country's International Trade and Industry Ministry.

3. Under the RCEP agreement, the two countries commit to expanding market opening on the basis of China-ASEAN Free Trade Area Agreement, and some goods can enjoy new tariff preferences.

CPTPP Partner : Malaysia & Canada

1. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is a trading block that represents 495 million people with a combined gross domestic product of CAD $13.5 trillion – a full 13.5% of global GDP. Through the CPTPP, Canada has preferential access to half a billion consumers in some of the world’s most dynamic and fast-growing markets, which will strengthen Canadian businesses, grow the economy, and create more well-paying jobs for middle class Canadians.

2. The CPTPP entered into force for the first six countries to ratify the Agreement – Australia, Canada, Japan, Mexico, New Zealand, and Singapore – on December 30, 2018, for Vietnam on January 14, 2019, and for Peru on September 19, 2021. For the remaining signatories (Brunei, Chile, and Malaysia), the CPTPP will enter into force 60 days after that country ratifies the Agreement.

Key Differences Between Automation & robotics and How Robotics Solving Labor Shortages

1. Here are the key differences between automation and robotics and how to use them to your advantage.

2. Robots have emerged as the top solution to labor shortages. Persistent labor shortages have since debunked the idea that robots are somehow stealing jobs from humans. On the contrary “ robots are enabling humans to go after the jobs they truly want.

Transfer Pricing & Witholding Tax in Malaysia

1. Transfer pricing generally refers to intercompany pricing arrangements for the transfer of goods, services and intangibles between associated persons. Ideally, the transfer price should not differ from the prevailing market price which would be reflected in a transaction between independent persons. However, business transactions between associated persons may not always reflect the dynamics of market forces.

2. Transfer pricing affects the amount of corporate tax businesses pay, as such it has become an area of focus internationally, and is today a key focus of Malaysian tax authority. Therefore, it is important to be able to show that intra-group transaction prices are at arm’s length and not used to artificially inflate spending.

3. Withholding taxes are withheld by the party making payment (payer) on income earned by a non-resident (payee) and paid to the Inland Revenue Board of Malaysia (LHDN). Withholding taxes are taxes that are deducted from the source. The source would usually be other countries. 

4. Withholding taxes are withheld by the party making payment (payer) on income earned by a non-resident (payee) and paid to the Inland Revenue Board of Malaysia (LHDN). Withholding taxes are taxes that are deducted from the source. The source would usually be other countries.

Future of Supply Chains 2025

1. This primer provides a new way of thinking about the future of supply chains—bringing together the top procurement priorities of leading global businesses and the key forces of change reshaping the very business models that have given rise to global supply chains—to enable supply chain leaders to envision and manage future-fit supply chains.

2. Deepening our understanding of both sets of drivers and their potential implications for supply chains creates a powerful lens through which to reimagine the ways that all parties to global supply chains create value and contribute to a more just and sustainable world. 

3. Supply chain leaders, and the organizations with which they work, should seize this moment of significant change to design and implement new supply chain management models. This primer sets out five specific recommendations to help supply chain leaders build future-fit supply chains that both drive progress on top procurement priorities and advance the sustainable business agenda.

4. To design a supply chain that is fit to flourish in 2025, supply chain leaders should anticipate how key forces of change will impact their supply chains and look to evolve their supply chain management approaches accordingly. This inflection point is an opportunity for forward-thinking supply chain leaders to build future-fit supply chains that both drive progress on top procurement priorities and advance the sustainable business agenda.

IoT and Big Data: Understanding the relationship between these two technologies

1. The IoT: definition - The Internet of Things (IoT) is a concept that connects physical or virtual objects to the internet. The technology very often used is the sensor, allowing to link a physical object such as a watch, a drone or even a speaker, to the internet. 

2. If for a long time the few objects connected to the Internet were the telephone and the computer, this is no longer the case today and every year new types of objects incorporating IOT technology are born.

Creating an Environment to Attract Advanced Manufacturing - Part 2 - Primary Considerations in Choosing a Site

1. For all site selection projects, the four primary considerations in choosing a site are:
i.  The availability of sites and buildings,
ii. Workforce quality and availability,
iii. Ongoing costs (including tax and incentive implications), and
iv. The overall quality of life and risk characteristics of the region.

2. For an advanced manufacturing project, the overall considerations also include these four areas. But what is different is the emphasis on certain areas within these primary considerations.

3. Here are a few areas that economic development agencies should consider when positioning their region for advanced manufacturers.

Creating an Environment to Attract Advanced Manufacturing - Part 1 - Meta Chains

1. For traditional manufacturing projects, the timing of siting a new facility is a fairly rapid process, normally occurring approximately one year from project identification to final decision. 

2. The forces driving the decision primarily are born from actions to meet rising demand, expanding into new markets or to reduce overall distribution costs. For these rapidly moving projects, companies tend to limit their search to identify areas whose attributes include a close proximity to raw material suppliers, an existing building or pad-ready site, and an adequate labor market that can be utilized to the corporation’s advantage.

3. With advanced manufacturing organizations, the essence of their operating model is to capitalize on the explosive growth curve of new technology, creating disruptive change. This change could be for existing companies in their particular industry, or in some cases, creating entirely new industries. 

4. Their technological breakthroughs have taken many forms. Innovation can stem from areas such as the fabrication of new materials, for instance composites and ceramics, additive manufacturing via 3D printing, robotics, micro-manufacturing and clean room production. These are only a few of the descriptors for what many people now define as “advanced manufacturing.”

Malaysia National Trade Blueprint (NTBp)

1. The NTBp is a blueprint commissioned by the Ministry of Trade and Industry (‘MITI’) and developed by the Malaysia External Trade Development Corporation (‘MATRADE’).

2. The NTBp outlines a 5-year (2021-2025) development strategy and initiatives to enhance Malaysia’s competitiveness in the export of merchandise. The NTBp framework is guided by four strategic priorities, three strategic themes and eight strategic thrusts with 40 recommendations to improve and enhance Malaysia’s trade competitiveness.

3. Based on statistics by the World Trade Organisation, Malaysia has slipped from 23rd place in 2015 to 26th place in 2019 in the global export rankings; having been overtaken by our ASEAN neighbours, Thailand and Vietnam.

4. According to the Executive Summary, the contribution by Small and Medium Enterprises (‘SMEs’) to total exports has stagnated in the past five years, with the average growth being slower as compared to the country’s overall export growth and exports by non-SMEs.

5. Hence the NTBp was developed to provide clear directions and initiatives to enable the country to regain its competitiveness in trade, even as global trade becomes increasingly complex and competitive.

Thailand Issues New Incentive Package for EV & Indonesia to Build Electric Vehicle Battery Plant

1. In February 2022, Thailand released new government incentives for its electric vehicle (EV) industry as part of its ambitious plan to transform 50 percent of its total auto production to EVs by 2030 and become a production base for cleaner vehicles in Southeast Asia. The new incentive package includes significant exemption in import duty and excise tax for a wide range of EV models.

2. Indonesia is set to build its first electric vehicle (EV) battery plant and aims to begin production by 2023. 

Indonesia’s Omnibus Law Looks to Support the Aviation Industry & Enhance the Shipping Sector

1. Indonesia’s Government Regulation 32 of 2021 (GR 32/2021), an implementing regulation of the Omnibus Law, aims to support the recent liberalization of Indonesia’s aviation industry.

2. In the country’s new positive investment list, domestic air transport is open to a maximum of 49 percent foreign ownership whereas airports and airport supporting services are now open to 100 percent foreign investment.

3. GR 32/2021 provides a simplified process to obtain aircraft licensing and registration in Indonesia, as well as reduces the minimum number of aircrafts an operator must own and operate/possess.

4. Indonesia’s Government Regulation 31 of 2021 (Reg 31/2021) — an implementing regulation of the Omnibus Law — amends several aspects of the country’s shipping law.

5. The Indonesian government hopes the enactment of the new shipping regulation will attract more foreign investors into the country’s shipping industry, particularly as President Joko Widodo intends to transform Indonesia into a global maritime axis.

Thailand Issues New Incentives to Attract Foreign Investors, Professionals, and Retirees & Amendments to Thailand’s Public Limited Companies Act

1. Foreign investors, professionals, and retirees will be able to enjoy a number of new incentives in Thailand, as the government seeks to attract high-earning overseas residents to help the country’s COVID-19 recovery.

2. Thailand’s cabinet passed a resolution on September 14, 2021, introducing immigration, tax, and land ownership incentives aimed at foreign investors and skilled professionals. The incentives are part of an effort to stimulate Thailand’s economy which has been badly impacted by the COVID-19 pandemic.

3. According to a government spokesperson, the government expects the incentives to attract over a million foreign investors and professionals within five years, contributing over 1 trillion baht (US$30 billion) to the economy.

4. The incentives come in three categories: immigration, tax, and real estate.

5.  In May 2021, Thailand’s Cabinet approved the draft amendments to the country’s Public Limited Companies Act in a bid to modernize the corporate process.

The Philippines Amends its Foreign Investment Act & Retail Trade Liberalization Act to Attract Foreign Investment

1. On March 2, 2022, President Rodrigo Duterte signed Republic Act No. 11647 (Act 11647), which amends the Foreign Investment Act (FIA), also known as Republic Act No. 7042. The amendments aim to promote and attract foreign investments by allowing, for the first time, international investors to set up and fully own domestic enterprises (including micro and small enterprises) in the Philippines.

2. Further, another amendment includes the establishment of an Inter-Agency Investment Promotion Coordination Committee (IIPCC) tasked with integrating the promotion activities to encourage foreign investment.

3. On December 10, 2021, the President of the Philippines approved the final amendments to the Retail Trade Liberalization Act (RTLA), or Republic Act No. 11595. The bill reduces the minimum paid-up capital requirements for foreign retail enterprises, removes the requirement for a certificate of pre-qualification to the Philippine Board of Investments (BOI), and lowers the investment requirements for each store owned by a foreign enterprise.

4. These measures are aimed at attracting greater foreign investment in the retail sector, which before the pandemic, accounted for 23 percent of the total services industry with a total gross value added of PHP 1 trillion (US$ 20 billion). Full recovery of the Philippines consumer and retail sector is expected to occur in 2022, with growth predicted in 2023.

The Impact of the RCEP on Singapore 2022 Inbound Investment Flows via Special Purpose Acquisition Company (SPAC)

1. The RCEP (Regional Comprehensive Economic Partnership) is a free trade area that includes China, all ten ASEAN nations, Japan, South Korea, Australia, and New Zealand. Collectively, this includes 30 percent of the world’s population and 30 percent of its GDP. The agreement came into effect on January 1, this year.

2. There were in fact extraordinary developments in the country during Q4 2021, prior to the January RCEP launch. Singapore introduced a number of actual and planned changes to its stock exchange, saw numerous leading financial services players form hubs, the formation of a regional COVID vaccine JV launched, and its regulators tested in the crypto segment. 

Rules for Tax Incentive for Manufacturers of Pharmaceutical Products Scheme Gazetted

1. The Income Tax (The Incentive for Manufacturers of Pharmaceutical Products Scheme) Rules 2022 [P.U.(A) 34/2022] (‘Rules’) were gazetted on 17 February 2022 and are deemed to have effect from the year of assessment 2021.

2. https://lom.agc.gov.my/ilims/upload/portal/akta/outputp/1723693/PUA34_2022.pdf

Predictions for the Manufacturing Industry in 2022 by OpenText, IFS, & Themanufacturer

Manufacturing predictions for 2022 from OpenText, IFS, & Themanufacturer.

Establishing a Representative Office in Malaysia & Indonesia

1. In Indonesia, Opening a representative office (RO) is the fastest and simplest way of establishing a legal entity in the country. This setup is a temporary arrangement – ROs are not allowed to engage in any commercial activities, issue invoices, sign contracts, or earn any revenue. Foreign investors, however, can own 100 percent of this business entity and don’t have to contribute the same paid-up capital required by PT PMAs.

2. Establishing a representative office (RO) in Malaysia is often the fastest and most cost-effective way to have a legal entity and study the local market before determining viable opportunities. However, the RO is prohibited from earning any revenue and is limited to mainly market research, information gathering, and developing trade contacts in Malaysia.

Malaysia is top country in emerging Southeast Asia for foreign investment: Milken Institute

1. Malaysia ranks No. 1 in emerging Southeast Asia as the country with the most potential to attract foreign investors, according to the 2022 Milken Institute Global Opportunity Index. This annual assessment, created to help inform investor and policymaker global investment decisions, evaluates an economy’s investment landscape using variables such as macroeconomic outlook, access to financial services, the potential for future innovation and development, and more.

2. The 2022 Global Opportunity Index includes a report focusing on emerging Southeast Asia, a region where an influx of capital could lead to increased innovation, job creation, and competitiveness.

Boosting European Rail Freight - Part 1 - Transformation Required, Steady Decline in Western Europe

1. Europe’s big aspiration to reverse the decline of its rail freight industry will require significant effort, with substantial investment and smart thinking. Governments and industry players can help to achieve this goal, as there are examples of success to draw on and some key levers to pull.

2. The European freight rail industry has seen a steady decline over the past 70 years. Freight rail’s modal share has decreased from around 60 percent in the 1950s, and 30 percent in the 1980s, to roughly 15 percent today, driven mainly by large industry shifts.

3. This prompted a vicious circle of increasing fixed costs, leading to loss of competitiveness and loss of volume, and consequently increasing fixed costs again—with little hope for a thriving future. The rise of new small and agile entrants worsened the situation for freight rail incumbents that were left with unhealthy structures and often faced political pressure to maintain unprofitable businesses.

4. The European Union has set a bold ambition to reverse this trend. It plans to double freight rail’s modal share by 2030, both to reduce the transport sector’s CO2 emissions and to ease the congestion of major road connections.2 Achieving this ambition would see freight rail volumes grow by around six percent a year in ton-kilometers (tkm).

5. A massive shift in trajectory would be required to achieve this ambition. A European strategy to transfer a large proportion of transport from road to rail could focus on several key elements, including major long-distance freight flows, key connection points such as ports, and new industries that can replace volumes lost in declining sectors. Regulators and operators could also play a role in rethinking the regulatory model and reorienting the industry to become more customer focused, and more profitable.

Gain on Disposal of Real Property in Malaysia – Capital Receipt or Revenue Receipt?

1. Those real property owners who are looking at cashing out now will see a substantial gain upon disposal of their real property. Now the question is this: is the gain on disposal of real property a capital receipt or a revenue receipt?

2. A layman’s answer to that question would be capital receipt. Generally, Malaysia does not impose tax on capital receipts except in certain situations where the receipt arose from the disposal of real property or shares in a real property company, which is taxable under the Real Property Gains Tax 1976 (RPGTA), or where the capital receipt is treated as a revenue receipt.

3. Many of us are familiar with the RPGTA that imposes real property gains tax (RPGT) on gains arising from the disposal of real property in Malaysia or shares in a real property company. The RPGT rates vary from five per cent (5%) to thirty per cent (30%), depending on the holding period of the real property.

4. However, not many are aware that the gain on the disposal of real property in Malaysia could be treated as a revenue receipt and hence, subject to income tax under the Income Tax Act 1967 (ITA) at the prevailing individual income tax rate [i.e. up to twenty eight per cent (28%)] or corporate income tax rate [i.e. twenty four per cent (24%)]

5. Now, the next question is, under what situation will the gain on the disposal of real property be treated as a revenue receipt instead of a capital receipt.

Indonesia’s Omnibus Law: New Protection and Empowerment Measures for Small Businesses

1. Indonesia’s Government Regulation 7 of 2021 (GR 7/2021) — an implementing regulation of the Omnibus Law — looks to provide greater protection and empowerment to Indonesia’s cooperatives, micro, small, and medium-sized enterprises (MSMEs).

2. GR 7/2021 provides several facilities to encourage the growth of local MSMEs, such as mandating regional governments to provide at least 30 percent of the total land area for commercial areas for the promotion and development of MSMEs. In addition, the regulation has made it easier for MSMEs to obtain a business license, tax reductions, and reliefs, and are exempt from paying the provincial or the regency/city minimum wage.

3. MSMEs are considered the backbone of Indonesia’s economy, contributing to over 60 percent of GDP and employing more than 100 million people (97 percent of the domestic workforce). 

4. Developing these small businesses into scalable ones will be essential for Indonesia’s economic growth and achieve its goal as the world’s seventh-largest economy by 2030. 

5. However, the majority of MSMEs are in the informal sector and thus face major obstacles to access financing, and the managerial and operational capacities to grow.

Malaysia Issues Tax Exemption for Foreign Sourced Income

1. The Malaysian government has decided to provide a tax exemption on foreign-sourced income for individual taxpayers, backtracking from their earlier proposal made in the 2022 budget to tax Malaysian residents on their income sourced from abroad. 

2. The categories of foreign-sourced income that are exempt from income tax are the following:
- Dividends received by companies and limited liability partnerships; and
- All types of income received by individual taxpayers.

3. The income tax exemption is effective from January 1, 2022, until December 31, 2026.

4. The Chartered Tax Institute of Malaysia has said that the tax exemption on dividends will encourage more investments to be remitted to Malaysia and improve the country’s standing as a destination for regional HQs.

Big Data Analytics: What It Is, How It Works, Benefits, And Challenges

1. Big data analytics describes the process of uncovering trends, patterns, and correlations in large amounts of raw data to help make data-informed decisions. These processes use familiar statistical analysis techniques—like clustering and regression—and apply them to more extensive datasets with the help of newer tools.

2. Big data has been a buzz word since the early 2000s, when software and hardware capabilities made it possible for organizations to handle large amounts of unstructured data. Since then, new technologies—from Amazon to smartphones—have contributed even more to the substantial amounts of data available to organizations.

3. With the explosion of data, early innovation projects like Hadoop, Spark, and NoSQL databases were created for the storage and processing of big data. This field continues to evolve as data engineers look for ways to integrate the vast amounts of complex information created by sensors, networks, transactions, smart devices, web usage, and more. 

4. Even now, big data analytics methods are being used with emerging technologies, like machine learning, to discover and scale more complex insights.