21/07/2025

BIZ & FINANCE MONDAY | JULY 21, 2025

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Cradle launches initiative to drive M’sian SME innovation

policies, calling for a reduction in SST, a review of the fuel subsidy rationa lisation plan and immediate efforts to secure exemptions or reductions in the 25% US tariffs before the Aug 1 deadline, along with additional sup port measures to maintain resilience,“ the firm said. Meanwhile, weakening business sentiment and a fourth consecutive month of contraction in imports of intermediate goods signal softer manufacturing and export activities ahead. This slowdown is occurring despite an extended tariff reprieve until Aug 1, as signs of waning front loading activity continue, it said. “Given these headwinds, the export outlook remains cautious. While the full-year export growth forecast for 2025 remains at 3.8%, compared to 4.5% in 2024, it is subject to change depending on the trajectory of US trade policy and any retaliatory measures by other major economies,“ UOB Global Economics and Markets Research said. It noted that Malaysia’s gross exports fell for the second consecutive month in June, by 3.5% year-on-year compared to a 1.1% drop in May. Imports also slowed significantly, registering a modest 1.2% growth in June (May: +6.6%), resulting in a wider trade surplus of RMR8.6 billion compared to RM0.8 billion in May. For the second quarter of 2025, export growth eased to a five-quarter low of 3.4% year-on-year, down from 4.3% in the first quarter. Industry-endorsed digital property valuation platform makes debut KUALA LUMPUR: Technology solu tions provider Infomina Bhd has intro duced ValuationXchange, Malaysia’s first industry-recognised digital prop erty valuation platform, through a strategic collaboration with Geolytik Tech Sdn Bhd. Under the collaboration, a joint entity, Infomina Geolytik Sdn Bhd, has been formed to accelerate the digitalisation of property valuation and financing in Malaysia, while enhancing transparency, efficiency and trust within the sector. Endorsed by PEPS Ventures Bhd, the commercial arm of the Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector Malaysia, ValuationXchange is designed to promote greater adherence to Malaysian Valuation Standards among industry stake holders. Infomina CEO and managing director Yee Chee Meng said in a statment the platform addresses market de-mand for more trans parent and efficient valuation processes in financing decisions. The platform allows real estate agencies to pre-validate buyer credentials before submission to banks, helping to reduce loan rejection rates and shorten approval timelines. Home buyers benefit from greater certainty, while financial institutions can expect improved operational efficiency and fewer unqualified applications. – Bernama

o It enables small and medium enterprises to access expertise, tools and partnerships to scale and compete on global stage

PETALING JAYA: Malaysian Rating Corporation Bhd (MARC Ratings) has assigned a sub-sovereign credit rating of AA+ with a stable outlook to Perak, based on its sub-sovereign rating scale. The rating, although unsolicited, reflects the state’s prudent fiscal management, its strong commitment to strategic, development-focused spending and a notably low debt burden – all supported by healthy reserve levels. “The stable outlook reflects our expectation that Perak will continue to uphold disciplined fiscal practices, maintain high levels of development investment, and preserve its low debt and strong reserves,” MARC Ratings said in a statement. “The successful execution of its economic and social development strategies could further strengthen its credit profile over time.” Perak has consistently demon strated sound fiscal management, maintaining a near-balanced fiscal position even while allocating a significant portion of its budget – averaging over 30% between 2019 and 2023 – to development spending, the rating agency said. Over the same period, the state’s total revenue grew at a compound annual rate of 2.6%, slightly out pacing its operating expenditure growth by 0.2 percentage point. This enabled Perak to maintain a PETALING JAYA: Cradle Fund Sdn Bhd, the lead agency under the Ministry of Science, Technology and Innovation (Mosti), has launched Cradle Innovation Advisory – a strategic partnership initiative aimed at accelerating technological trans formation among corporates and small and medium enterprises in Malaysia. The initiative is designed to address long-standing structural challenges in the national innovation ecosystem, including insufficient post-grant support, weak commer cialisation pathways, fragmented connections between industry and startups, and limited SME involve ment in research and development (R&D) activities. Science, Technology and Inno vation Deputy Minister Datuk Mohammad Yusof Apdal said inno vation cannot thrive in isolation and emphasised the importance of colla boration and ecosystem building. “With Cradle Innovation Advisory, we empower SMEs – Malaysia’s economic backbone – to access the expertise, tools, and partnerships

balanced fiscal position while pursuing its development objectives. A key revenue driver has been the steady increase in tax collections, primarily from quitrent and royalties. In 2023, tax revenue accounted for 46.1% of total income, signi ficantly exceeding both national and peer medians. Perak contributed 5.3% to Malaysia’s real gross domestic pro duct (GDP) in 2023, positioning it as a mid-sized contributor to the national economy. The state’s GDP growth closely mirrored its revenue growth, averaging 2.5% annually from 2019 to 2023. Looking ahead, MARC Rating noted that while Perak’s financial management remains sound, opera ting expenses are expected to rise due to planned increases in civil servant salaries and pension adjust ments. In anticipation, the Perak govern ment has budgeted for a deficit in 2025. However, the state is ex panding its revenue-generating initiatives, which are expected to improve its fiscal standing over time. Perak maintains a conservative debt profile. It has not undertaken any new borrowings since 2016 and has maintained a solid debt servicing record. As of 2023, Perak’s outstanding debt stood at RM159.8 million, the third lowest among Malaysian states, they need to innovate, scale and compete on a global stage,” he said in a statement. “This marks a shift from simply offering support to enabling em powerment. By activating partner ships with universities, corporations, and global startup communities, we aim to create fertile ground where great ideas are not just developed, but launched into the market, with the potential to transform entire sectors.” Cradle Group CEO Norman Matthieu Vanhaecke said the initiative goes beyond introducing new frameworks – it is about building collaborative spaces for innovation. “This is about creating a space where startups can work closely with key corporate players, thereby strengthening SMEs, which are the backbone of the country’s economy. In this proof-of-concept phase, we will focus on refining and optimising the approach before scaling it nationally for greater, long-term impact,” he said. At the heart of the initiative is the Corporate Innovation Lab Pro

From left: Cradle vice-president of Super PMO and special projects Harmender Singh, Vanhaecke, Mohammad Yusof, Cradle chairman P’ng Soo Hong, chairman of Cradle and Cradle Innovation Advisory and Cradle special projects head Jae Shaun Tong. – MOSTI PIC/BERNAMA

to strategic services, including legal advisory and human capital planning. Aligned with national agendas such as Ekonomi Madani and the Malaysia Startup Ecosystem Road map 2021–2030, Cradle Innovation Advisory aims to strengthen the country’s overall innovation capacity and enhance its position as a globally competitive startup and SME eco system.

gramme, a structured platform that offers modular workshops tailored to the maturity and needs of partici pating organisations. Beyond workshops, Cradle will provide tailored advisory services, including innovation audits, the development of innovation road maps and support for R&D com mercialisation. Participants will also have access

UOB cautious on outlook for Malaysian export sector

Low debt and healthy reserves support AA+ for Perak: MARC Ratings

PETALING JAYA: Malaysia’s near-term export outlook remains clouded by ongoing global trade and tariff policy uncertainties, geopolitical risks and evolving domestic policy reforms. According to a UOB Global Economics and Markets Research report, US President Donald Trump’s tariff announcement over the past two weeks (from July 1) with an extended deadline to Aug 1 for further negotiations, has cast a shadow over Malaysia’s export outlook for the remainder of 2025 and into 2026 as the country has been notified of a higher US reciprocal tariff of 25% (against 24% announced on April 2). “Reciprocal tariff aside, the Trump administration’s AI-related restrictions and sector-specific tariffs under Section 232 remain unclear and fluid as of now,“ the research firm said. Further, UOB Global Economics and Markets Research noted that risks to Malaysia’s trade and business environment are mounting, with global uncertainties – including a re escalation of US tariffs – posing serious threats to supply chains, investment flows and export competitiveness. At the same time, domestic policy changes such as the expanded Sales and Service Tax (SST), revised electricity tariff structure, mandatory 2% Employees Provident Fund contributions for foreign workers and the rollout of e invoicing are adding pressure on businesses, particularly exporters. “In response, business leaders are urging the government to moderate

behind only Penang and Selangor. Between 2019 and 2023, Perak recorded an average debt-to-GDP ratio of just 0.2% and a debt-to revenue ratio of 17.3%, both of which are well below the national and peer medians. Meanwhile, the state’s conso lidated funds increased to RM1.5 billion in 2023, up from RM1.3 billion in the previous year. The reserves covered 126.2% of annual expen diture and exceeded the state’s outstanding debt several times over, offering ample fiscal flexibility and shock absorption capacity for future capital investments and economic initiatives. MARC Ratings also highlighted Perak’s political landscape, which has seen alternating ruling coalitions in recent elections. While smaller development projects can be completed within a single administrative term, larger, multiphase initiatives – such as the Lumut Maritime Industrial City and Silver Valley Tech nology Park – would benefit from greater political continuity. “Conversely, any significant shifts in development priorities or weak socioeconomic outcomes could introduce downward pressure on the rating,” the agency warned, empha sising the need for strategic con sistency and long-term policy focus to translate development plans into meaningful economic progress.