25/03/2025

BIZ & FINANCE TUESDAY | MAR 25, 2025

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Sinopec’s 2024 net profit drops due to falling oil prices, EVs BEIJING: China Petroleum & Chemical Corp, known as Sinopec, reported a 16.8% decline in 2024 net profit, citing lower crude oil prices and the accelerated development of the new energy vehicle (EV) industry. The world’s largest oil refiner by capacity posted a net income of 50.3 billion yuan (RM30.7 billion), based on Chinese accounting standards, a Shanghai Stock Exchange filing showed on Sunday. “In 2024, international crude oil prices fluctuated downward, the domestic transportation industry accelerated the replacement of new energy ... (and) gross profit margin was significantly narrowed,” Sinopec said in the filing. “The company made every effort to expand the market and sales ... (and) continues to strengthen cost and expense control, and take multiple measures to cope with market changes.” The fall in net income compared with a decline of 9.9% in 2023, also on falling oil prices. The state oil and gas major’s gasoline sales fell 0.7% and diesel sales fell 4.8%. Aviation fuel sales rose 7.3%. The figures included both domestic sales and exports. Refinery throughput fell 2.14% to 252 million metric tonnes, equivalent to 5.04 million barrels per day. In a research note, Citigroup analysts said utilisation cutbacks on small, independent refiners may “incrementally benefit Sinopec’s refining/marketing segments” but a surge in EV penetration and LNG-trucking may continue to displace gasoline and diesel use. – Reuters Singapore core inflation rate at lowest in nearly four years SINGAPORE: Singapore’s annual core inflation rate eased to 0.6% in February, data showed yesterday, and an analyst said the lowest reading in nearly four years meant an easing was possible at the central bank’s policy review next month. The core inflation rate, which excludes private road transport and accommodation costs, was below the median forecast of 0.7% in a Reuters poll and January’s reading of 0.8%. It was lowest annual rate since 0.6% in June 2021, data from Statistics Singapore showed. Headline inflation was 0.9% in annual terms in February, matching economists’ forecasts. OCBC economist Selena Ling said a policy easing at April’s review was possible given the Monetary Authority of Singapore (MAS) has forecast core inflation at 1% to 2% this year, and there were downside risks to growth. “The inflationary impact spillover into the rest of the economies outside of the US is still unclear at this juncture given the frequent flip-flops of tariff announcements. “For now, central banks may prefer to err on the side of downside growth risks.” The MAS loosened monetary policy in January for the first time since 2020. A survey by the central bank published last week showed that economists expected Singapore to grow 2.6% this year, near the midpoint of the Trade Ministry’s estimate of 1% to 3%, and the median forecast for core inflation was 1.5%. – Reuters

Danantara Indonesia names ‘dream team’ o Ex-presidents to help chart strategy while Sachs, Dalio and Thaksin act as advisers support Indonesia’s sustainable development, and is without any compensation.” These advisers will offer

though Prabowo has said the fund could be audited anytime by anyone. Rosan said the appointments of professional executives would further secure market confidence. “When these names are received well, it could be a positive signal for the Indonesian economy, job creation,” he said at the same event, adding all of Indonesia’s state owned enterprises were now under the new fund’s management. Danantara’s team structure could potentially secure market trust as it is filled with global names who have credibility in the financial sector, Oktavianus Audi, an equity analyst at Kiwoom Sekuritas, told Reuters. Paramadina University economist Wijayanto Samirin, however, said the fund’s management must ensure that it could not be subject to political interference in future. Danantara’s directors include former officials from banks such as Bank Mandiri and HSBC, a former director at Indonesia’s central bank, as well as the former chief investment officer of Indonesia Investment Authority, the country’s first sovereign wealth fund. – Reuters

guidance on managing the impact of global risks from intensified financial volatility and geopolitical factors, Danantara chief investment officer Pandu Sjahrir said at the appointment ceremony. In its first wave of investment worth US$20 billion, Danantara will target projects in natural resources processing, artificial intelligence development, and energy and food security. The establishment of Danantara and concerns about the state’s substantive role in the economy were among the causes of a market selloff last week in Southeast Asia’s biggest economy, according to some analysts, when the main stock index fell as much as 7%, triggering a trading halt. Indonesian stocks tumbled yesterday to their lowest since August 2021, while the rupiah currency hit a three-week low as concerns over the country’s fiscal health and growth prospects linger. There have been concerns in financial markets over potential political interference in Danantara,

JAKARTA: New sovereign fund Danantara Indonesia unveiled yesterday what it called a “dream team” to chart its strategy, including ex-presidents as well as advisory roles for hedge fund manager Ray Dalio, economist Jeffrey Sachs and former Thai premier Thaksin Shinawatra. Danantara, launched last month, is Indonesian President Prabowo Subianto’s main vehicle to achieve his 8% economic growth target by 2029 by managing all shares of state owned enterprises and reinvesting the dividends in commercial projects. The fund is slated to eventually manage more than US$900 billion worth (RM4 trillion) of assets and has been described by officials as Indonesia’s version of Singapore’s Temasek. Former Indonesian presidents Joko Widodo and Susilo Bambang Yudhoyono were named members of the fund’s steering committee, while Dalio, founder of the world’s

largest hedge fund Bridgewater, will assume the advisory role alongside Thaksin, a billionaire who spent 15 years in self-exile avoiding jail for abuse of power and is the father of Thai Prime Minister Paetongtarn Shinawatra. Reuters could not immediately contact the Indonesian ex-presidents for comment while Bridgewater and Thaksin’s representatives did not immediately respond to requests for comment. Media reports said former British prime minister Tony Blair is also set to become an adviser to Danantara. When asked whether Blair will join, Danantara CEO Rosan Roeslani would only say that the fund will announce more names later. Sachs in an email told Reuters he had been appointed Prabowo’s special adviser. “And in this capacity (I) will serve on the advisory board of Danantara,” he said. “My work is entirely voluntary, to

The Nvidia headquarters in Santa Clara, California. – AFPPIC Malaysia to tighten semiconductor regulations: FT

LONDON: Malaysia plans to tighten regulations on semiconductors as it comes under US pressure to staunch the flow to China of chips crucial to the development of artificial intelligence, the Financial Times reported on Sunday. Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz said the US government is demanding Malaysia closely track the movement of high-end Nvidia

chips that enter the country over suspicions that many are ending up in China, according to the report. “(The US is) asking us to make sure that we monitor every shipment that comes to Malaysia when it involves Nvidia chips,” he told the newspaper. “They want us to make sure that servers end up in the data centres that they’re supposed to and not suddenly move to another ship.” Nvidia did not immediately

respond to a Reuters request for comment. The US is investigating if Chinese artificial intelligence firm DeepSeek, whose AI model’s performance rocked the tech world in January, has been using banned American chips. Malaysia is currently investigating if local laws were breached in the shipment of servers linked to a Singapore fraud case, as they may have contained advanced chips

subject to American export controls. Singapore prosecutors told a court earlier this month that the case in which Singapore-based firms have been accused of fraudulently supplying US servers to Malaysia involves transactions worth US$390 million (RM1.7 billion). Singapore media have linked the case to the possible transfer of Nvidia’s artificial intelligence chips to DeepSeek. – Reuters