04/02/2025

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TUESDAY | FEB 4, 2025

ACCCIM cautiously optimistic on outlook for 2025

‘Malaysian glove, semicon players set to gain from US tariffs move ’ KUALA LUMPUR: Malaysian glove makers and semiconductor players are expected to benefit from the imposition of higher tariffs by the United States on imports of Chinese goods, said Kenanga Investment Bank Bhd. In a research note yesterday, it said local glove makers would benefit from the broadened average selling price (ASP) discount on Chinese glove imports in 2025 following the US imposition of an additional 10% tariff to the current 50% on China glove exports into the US. “For illustration purposes, a 50% plus 10% tariff hike is expected to raise Chinese glove producers’ ASP to US$27 US$29 (RM121-RM130) per 1,000 pieces (from an assumed base case ASP at US$17-US$19 per 1,000 pieces),” it said. Therefore, it said, this positions Malaysian glove makers’ ASPs of between US$18 and US$20 per 1,000 pieces at a steep 25%-32% discount versus the Chinese alternative. We keep our 2025 forecast ASPs at US$20-US$21 in our earnings model for now. “Any volume loss in non-US markets can be offset by higher demand from the US, which historically commanded higher ASP than non-US markets, and the US had historically accounted for 35%-40% of Malaysia’s total glove volume,” it said. The investment bank believes Hartalega Holdings Bhd is the biggest beneficiary because the US market typically accounts for 50% of its sales volume. Regarding the semiconductor benefit from US tariffs, it said Malaysia, as a key player in outsourced semiconductor assembly and test and back-end semi conductor services, would stand to benefit from supply chain diversification as global technology firms may accelerate the adoption of a more aggressive China+1 strategy to reduce reliance on China. “Over the medium term, Malaysian firms are well positioned to capitalise on the structural shift in global supply chains,” it said.

Ű BY JOHN GILBERT sunbiz@thesundaily.com

Period 4 and is proposed to be implemented starting July 1, 2025. The rise in electricity costs will have domino effects on the whole supply chain, potentially passing through to consumer inflation. “Given the bunching of addi tional operating costs, we sincerely urge the government to maintain electricity tariffs at current levels throughout 2025-2026 to ease the financial burden on businesses and mitigate inflationary pressures from increased operating costs,” Ng said, in expressing concern over the tariff hike that will potentially impact domestic in dustries. In response, Anwar said the rise of electricity tariffs is to improve the country’s education system and support the poor. He gave the assurance that the tariff increase would be manage able and is necessary, as prices must adjust over time. “How do I improve education? How do I assist the poor? How do I upgrade the roads? How do I enhance medical facilities? It is through a small tax increase. A slight increase is acceptable,” he added. Anwar said the development of digital transformation is crucial, requiring substantial funding for new faculties and specialised training. He said countries such as the United States, China and those in Europe have prioritised centres of excellence in this field, relying on government support and significant private sector investment. Moving on, Ng said ACCCIM remains positive about Malaysia’s investment prospects and will play a key role in fostering economic cooperation, promoting business collaboration and networking between Malaysians and foreign businesses. “Our investment in AI-driven tools is paired with a focus on ethical data practices and sustainability, ensuring solutions meet evolving regulatory and consumer expectations,” Sim said. The company remains optimistic about the industry’s future, predicting a greater reliance on AI blended with human insight. “Customisation, localisation, and transparency will define the next wave of market research,” she added. Looking ahead, with a clear roadmap for regional growth and technology adoption, Sim said, Central Force International is poised to shape the future of data solutions in Southeast Asia.

o High operating costs, cash flow issues pose challenges, says Associated Chinese Chambers of Commerce and Industry of Malaysia

KUALA LUMPUR: While re maining positive about Malaysia’s investment prospects, the Asso ciated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) foresees challenges in 2025, highlighting a sense of cautious optimism for this year’s economic outlook and business conditions. ACCCIM president Datuk Ng Yih Pyng said high operating costs, cash flow problems and increases in raw materials prices are the key factors affecting business performance in Malaysia. He said preliminary findings of an ACCCIM survey show that more than 30% of respondents anticipate better economic and business prospects for 2025, compared to below 20% for 2024. “Increasing business cost pressures are due mainly to govern ment policy reforms and regulatory

at the 2025 ACCCIM Chinese New Year Reception yesterday. Prime Minister Datuk Seri Anwar Ibrahim was the guest of honour at the event. Other key government ministers, distinguished dignitaries and ambassadors representing foreign missions also attended the gathering. Ng said the economic and subsidy reforms must be implemented gradually to prevent market disrup tions and safeguard businesses. “Of particular concern is that Tenaga Nasional Bhd base electricity tariff hike for Peninsular Malaysia will be 14.2% between 2025 and 2027 under Regulatory

requirements changes. “Domestic businesses, manu-facturers and exporters have to brace for disruptive trade and economic policy in the external business environment. “The business community hopes the government will adopt pragmatic policies to support businesses, especially micro, small, and medium enterprises in navigating through the challenges. These include providing some forms of export credit scheme to domestic SMEs, reducing import duties on raw materials, assisting in exploring new export markets, and diversifying supply chains,” Ng said

Anwar (second, left), Transport Minister Anthony Loke Siew Fook (left), Ng (third, left) and Housing and Local Government Nga Kor Ming (right) tossing yee sang at the 2025 ACCCIM Chinese New Year Reception yesterday. – BERNAMAPIC

However, Kenanga Investment Bank said Malaysia may experience varying degrees of impact depending on supply chain realignments, trade policies and broader geopolitical dynamics. – Bernama Central Force International charts bold Southeast Asia expansion plans

Ű BY AIMIE SHAZRIE sunbiz@thesundaily.com

with traditional qualitative research methods like focus group discussions and in-depth interviews. “For instance, the company’s human analysts recently uncovered critical insights into public transport usage in Malaysia, revealing genera tional preferences that AI alone could not discern. AI might tell us that older commuters favour public transport, but human insights revealed younger generations prefer e-hailing due to time and convenience,” she said. To maintain the company’s competitive edge, Central Force International is adopting a “test and validate” approach to integrating emerging technologies.

our solutions to the unique demands of each local market,” Sim stated, adding that the company is developing proprietary AI-powered tools and methodologies set for launch in early 2026. She said the innovations are designed to complement human expertise, ensuring insights remain both data-driven and culturally relevant. Sim emphasised that AI, while transformative, must be guided by human oversight. She pointed out risks of over-reliance on AI, such as biases from flawed data, cultural missteps and potential privacy breaches. “To address this, we employ hybrid approaches that blend AI efficiencies

“While AI offers incredible efficiencies, over-reliance can create blind spots. Human insights provide the cultural and contextual nuances necessary for actionable strategies, especially in diverse markets like Malaysia,” she told SunBiz . Building on its success in Malaysia, Singapore, and Brunei, she said, the company is set to open a regional sales office in Singapore by the end of this year. “Over the next five years, operations will expand to Thailand, the Philippines, Indonesia and Vietnam, with the aim of becoming a one-stop research hub in Southeast Asia. We are committed to tailoring

PETALING JAYA: Central Force International, a data solutions and market research player, has announced expansion plans and strategic innovations after winning recognition as “Best Small Medium Enterprise” at Talent Corp’s Life At Work Awards 2024. Central Force International chief operating officer Sim Siew Khoon highlighted the importance of balancing artificial intelligence (AI) advancements with human expertise in shaping the future of market research.