03/10/2026

BIZ & FINANCE SATURDAY | OCT 3, 2026

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PETALING JAYA: The Malaysia Singapore Coffee Shop Proprietors’ General Association (MSCSPGA) is calling on the government to align the Sales and Service Tax (SST) rate for alcoholic beverages in Budget 2027 with that for food and other beverages, and to remove the most recent excise duty increase on beer imposed in the previous Budget. Emphasising that food and beverage (F&B) operators face higher overheads, intense competition and more cautious consumer spending, the association said the domestic F&B sector and the value chains it supports make a meaningful contri bution to the national economy. Vice-president Keu Kok Meng cited examples in Petaling Jaya where monthly shop rents had doubled since 2024, from RM6,000 to RM12,000. Such increases on lease renewal can put considerable pressure on small businesses, even in areas where footfall remains strong, he noted. “Behind these figures are real livelihoods. Many coffee shops are family-run operations, where owners work alongside long-serving staff who depend on the business staying open. “When costs rise faster than income, operators are left choosing between cutting workers’ hours, reducing headcount or shutting their PETALING JAYA: Mah Sing Group Bhd, through wholly owned subsi diary Garden Vista Development Sdn Bhd, has signed a non-binding and non-exclusive collaboration term sheet with Kinergy Advancement Bhd to provide technical advisory and explore power infrastructure solutions for proposed data centre developments at Southville City, Bangi, Selangor and Meridin East, Pasir Gudang, Johor. The collaboration brings together Mah Sing’s development and site planning capabilities with Kinergy’s experience across power generation, engineering, procurement, cons truction and commissioning (EPCC), and renewable and sustainable energy solutions. It is intended to support Mah Sing’s assessment of how reliable, scalable and sus tainable power solutions can be planned alongside the development of its digital infrastructure pipeline. Under the term sheet, Kinergy will act as technical adviser and provide preliminary technical and com mercial input on potential captive power plant (CPP) and power supply arrangements under the Corporate Renewable Energy Supply Scheme (Cress). The work may include assessing projected power requirements, technology and plant sizing, site suitability, regulatory considerations and potential project structures. Mah Sing Group CEO Datuk Voon Tin Yow said for large-scale data centres, power is as critical as land, connectivity and water. He said planning the energy infrastructure early can strengthen the readiness, scalability and long term competitiveness of a data centre development. “We have known Kinergy for close to a decade and have seen the development of their technical capabilities. This term sheet allows both parties to evaluate the oppor tunities together, while preserving

Mah Sing, Kinergy to explore power solutions for digital infra

doors,“ he said. The association noted that some operators in its network have already made the difficult decision to close, while others continue to trade at diminishing returns. “A busy street does not mean every coffee shop is doing well. Customers have more choices, and their spending is spread across more businesses. “Meanwhile, owners still have to pay rent, wages and suppliers. There is only so much they can absorb before having to review their prices,”said Keu, who is also honorary secretary of the Petaling Jaya Coffeeshop Association. According to the 2025 Economic Impact Assessment by Confederation of Malaysian Brewers Bhd, the brewing industry alone generated an estimated annual average of RM3.3 billion in tax revenue and supported an average of 52,400 jobs annually. Independent retail research firm Retail Group Malaysia reported a 4.6% year-on-year decline in cafe and restaurant sales in the first quarter of 2026, the category’s first contraction in nearly three years. Without relief from further cost pressures, more businesses risk closure, putting jobs and community livelihoods at stake. For many traditional coffee shops licensed to sell beer, this caution is flexibility for Mah Sing as the projects progress.” Mah Sing has been progressively building its digital infrastructure strategy around three complementary pathways – monetise, develop and own. This gives the group flexibility to selectively monetise development ready land, develop enabling infra structure and core-and-shell faci lities, and explore ownership of income-generating digital infra structure assets alongside experienced operators. The collaboration with Kinergy focuses on evaluating suitable CPP and Cress solutions for the Southville City and Meridin East sites. At this scale, ownership eco nomics are closely linked to securing power infrastructure that requires specialised engineering and energy capabilities beyond land develop ment alone. More importantly, direct ownership enables Mah Sing to o Collaboration focuses on proposed data centre projects at Southville City in Bangi and Meridin East in Pasir Gudang

higher or move their manufacturing process to a higher level. So we remain as a middle-income level nation,” he said. Sim said Malaysia has remained in the middle-income trap for more than 30 years. It needs to raise productivity, skill sets and economic complexity to move towards a high income economy. Government analysis of pro ductivity trends in Malaysia, South Korea and Singapore showed that the three countries followed similar trajectories in the 1970s and 1980s, with South Korea and Singapore recording stronger productivity growth in the 1990s. Sim said it is imperative to address this issue. Malaysia has to move towards high-income nation status and towards advanced tech nology for the people’s income level to rise, he said. Automation enables companies to operate with fewer workers, while raising the skill sets will improve wage levels. He said manufacturers should not wait until 2030 to automate. It is not that manufacturers are not doing their part to make that transition, but they are transitioning into auto mation too slowly. “Start doing it now. Do not wait until 2030,” he said. – Bernama power requirements and supporting a more coordinated approach to integrating renewable energy. “Importantly, the proposed cap tive power solutions are intended to complement the wider electricity system, providing an additional source of capacity and flexibility alongside conventional grid supply rather than replacing it,” he said. Kinergy’s capabilities span sus tainable energy solutions, EPCC and power generation. Its integrated engineering and energy platform includes experience in power infrastructure, renewable energy and independent power producer acti vities, providing relevant expertise for energy-intensive developments such as data centres. Kinergy’s experience in power generation, EPCC and renewable energy provides useful technical depth as Mah Sing assesses different approaches, in cluding captive generation and re newable energy supply, for pros pective data centre developments. Building on its capabilities in landbanking, master planning, development and infrastructure delivery, the group is expanding selectively into digital infrastructure to unlock additional value from its landbank and create new recurring income opportunities over time. The group’s digital infrastructure pipeline includes Mah Sing DC Hub @ Southville City, Meridin East in Pasir Gudang and MS Industrial Park @ Kulai.

also being felt in beverage sales. As customers cut back on dis cretionary spending, F&B operators are seeing softer beer demand, affecting an important income source that contri butes to everyday business expenses such as rent, wages and utilities. “When beer sales fall, F&B owners also feel the impact on their overall earnings. They still have to pay everyday expenses. “Further duty increases will translate into higher purchase costs, leaving operators with another difficult decision: absorb the increase and earn less, or raise prices and risk losing more sales,” said Keu. The association also raised concerns about competition from illicit beer. The MSCSPGA called for reduced excise duties alongside stronger enforcement against illicit trade to support licensed businesses and the wider legitimate distribution network. The association also said greater tax stability would provide more certainty across the legitimate beer value chain, including distributors, suppliers and retailers connected to licensed outlets. Reflecting these concerns, the association hopes Budget 2027 will take a more holistic approach to the pressures facing smaller businesses across the F&B value chain. Voon (left) and Lai at the signing ceremony. pursue competitive build-to-lease data centre assets supported by longer-term leasing arrangements, creating a potential recurring income stream while establishing a scalable digital infrastructure portfolio. Realising this model requires more than land and development expertise; it calls for the ability to plan, engineer and deliver the underlying power infrastructure, while addressing renewable energy sourcing and, where appropriate, dedicated generation. Kinergy group executive deputy chairman cum group managing director Datuk Dr Lai Keng Onn said

GEORGE TOWN: Malaysian manu facturers must accelerate the adoption of automation to boost productivity and reduce their dependence on foreign labour, said Deputy Investment, Trade and Industry Minister Sim Tze Tzin. He said the government has gradually reduced the foreign work force quota from about 20% pre viously to 15%. Foreign workers currently account for 13% of the total workforce. The government targets to further reduce this to 10% by 2030. This gradual reduction will give businesses time to do so but it is happening too slowly, he said. “Every sector is being informed about it. Everyone knows it’s going to be difficult. Businesses under stand this; we are not reducing it overnight but gradually,” he told reporters after launching the Malaysia Smart Manufacturing Awards 2027 here yesterday. This is necessary because excessive reliance on foreign workers may have the effect of discouraging companies from investing in auto mation and upgrading their manu facturing processes. “Industries will not automate when it is easy to get foreign labour. They do not push their capabilities the collaboration takes the group’s decade-long relationship into a new part of the infrastructure value chain. “By combining our complementary capabilities, we can explore how engi neering and energy solutions can support the next phase of data centre development and the growing demand for reliable, scalable power. “Our experience across electrical engineering, power infrastructure and generation gives us a strong technical foundation to assess how captive power can complement Mah Sing’s data centre development plans, including providing greater flexibility in meeting large and continuous

Local manufacturers told to speed up automation adoption

Coffee shop association seeks SST and beer duty relief in Budget 2027