Singapore: Government proposes new cybercrime laws
The Singapore government will include four major amendments to the Computer Misuse and Cybersecurity Act in view of growing cyber threats. Once the Bill is implemented, it will criminalize trading of personal information such as credit card details, medical information, and banking information, even if no hacking was involved to gain such information. Buying or selling of hacking tools and software with criminal intent will also be considered an offence. Overseas committed offences will also fall under the ambit of the amended Act. Any act that causes illness, injury or death, and disruptions to essential services, national security, and Singapore’s foreign relations will be considered an offence.
According to a new section in the bill, multiple unauthorized access to one computer for a period of 12 months or less will be treated as a single offence. Treating multiple unauthorized acts as a single offence will lead to a heavier penalty. The maximum penalty under the Computer Misuse and Cybersecurity Act varies from US$5,000 fine and two years’ imprisonment, to a US$100,000 fine and 20 years’ imprisonment depending on the crime. Last amended in 2013, the government plans to introduce a new Cybersecurity Act in the middle of 2017 after public consultations.
By: Dezan Shira & Associates
An Introduction to Doing Business in ASEAN 2017, the latest publication from Dezan Shira & Associates, is out now and available for complimentary download through the Asia Briefing Publication Store.
What happens in and around ASEAN is one of the key factors increasingly impacting upon China and India trade flows, as well as the rest of Asia. While the ASEAN trade bloc has been in existence since 1967, it has really shown its importance in trade and commercial business flows since the rise of China over the past three decades, and through its response to China’s changing domestic demographics. Those changes – an aging and increasingly consumer demanding China – have been skillfully adapted by ASEAN to place the future of global manufacturing, and where it takes place, firmly within its own orbit.
Simply put, free trade agreements that came into effect with China and India in 2010 changed the face of Asian trade and production, and are continuing to do so. For example, bilateral trade figures between China and ASEAN’s Big Five of Indonesia, Malaysia, Philippines, Singapore, and Thailand have multiplied by factors of 500 percent since the agreement was signed. With the smaller ASEAN nations of Cambodia, Laos, Myanmar and Vietnam coming into line with their own compliance of ASEAN customs duty reductions at the end of 2015, the entire bloc offers close to zero import-export tariffs for much of emerging Asia, including the giant markets of China and India, possessing some 500 million middle class consumers between them. ASEAN therefore represents a massive trade bloc possessing free trade agreements of global strategic importance. The question of accessing ASEAN for the benefit of North American, European and other global purchasing and manufacturing executives is a key function of this report.
An Introduction to Doing Business in ASEAN introduces the fundamentals of investing in the 10-nation ASEAN bloc, concentrating on economics, trade, corporate establishment and taxation. We also include the latest development news in our “Important Updates” section for each country, with the intent to provide an executive assessment of the varying component parts of ASEAN, assessing each member state and providing the most up-to-date economic and demographic data on each. Additional research and commentary on ASEAN’s relationships with China, India and Australia is also provided.
- An introduction to ASEAN
- Country profiles
- Case studies: ASEAN as a platform for Asian growth
Our practice, Dezan Shira & Associates, has taken giant steps into the ASEAN market through the establishment of offices throughout the region, in addition to the creation of a unique alliance of firms. That, coupled with our existing long experience of handling foreign investment into China and India, puts us in a unique position of truly understanding how Asia works and how to maximize its free trade benefits.
Asia Briefing Ltd. is a subsidiary of Dezan Shira & Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information, please email email@example.com or visit www.dezshira.com.
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Dezan Shira & Associates Brochure
Dezan Shira & Associates is a pan-Asia, multi-disciplinary professional services firm, providing legal, tax and operational advisory to international corporate investors. Operational throughout China, ASEAN and India, our mission is to guide foreign companies through Asia’s complex regulatory environment and assist them with all aspects of establishing, maintaining and growing their business operations in the region. This brochure provides an overview of the services and expertise Dezan Shira & Associates can provide.
An Introduction to Doing Business in ASEAN 2017
An Introduction to Doing Business in ASEAN 2017 introduces the fundamentals of investing in the 10-nation ASEAN bloc, concentrating on economics, trade, corporate establishment, and taxation. We also include the latest development news for each country, with the intent to provide an executive assessment of the varying component parts of ASEAN, assessing each member state and providing the most up-to-date economic and demographic data on each.
Human Resources in ASEAN
In this issue of ASEAN Briefing, we discuss the prevailing structure of ASEAN’s labor markets and outline key considerations regarding wages and compliance at all levels of the value chain. We highlight comparative sentiment on labor markets within the region, showcase differences in cost and compliance between markets, and provide insight on the state of statutory social insurance obligations throughout the bloc.
Malaysia: Exports in January register strong growth
Malaysia’s exports in January accelerated from the previous month due to high shipments and strong demand from China. Exports rose 13.6 percent with a value of US$15.76 million from a year earlier, according to the Department of Statistics. Analysts say that global trade is also strengthening, with demand for manufactured products from China, Singapore, Indonesia, Thailand, and South Korea. Electrical and electronic goods, which account for more than one third of Malaysia’s exports, increased 11.4 percent from a year earlier, while palm oil and palm based products climbed 23 percent.
Exports to China, Malaysia’s largest trading partner, increased to 31.6 percent year-on-year in January, followed by 18.8 percent to Singapore. Analysts believe that demand for electronics will lessen in the second half of the year, slowing the country’s growth. However, the country’s central, Bank Negara Malaysia, stated that it expects stronger exports and steady domestic demand to keep up with economic growth.
By Harry Handley
Malaysia, ASEAN’s third largest economy (after Indonesia and Thailand), is well on track to achieve its goal of becoming a high income economy by 2020. Despite modest GDP growth of 4.1 percent in 2016 (below the ASEAN average of 4.5 percent), Malaysia is one of the top performing economies in the region in terms of efficiency and business regulations. This competitive edge has been maintained by continuous reform efforts by the government.
Firms setting up companies in Malaysia are likely to experience higher business costs than in a number of other ASEAN states, caused by the country’s minimum wage, its newly implemented Goods and Services Tax (GST) and paid vacation allowances. However, an advanced infrastructure, highly educated and growing workforce and strong regulatory environment allow Malaysia to service high value add industries effectively and continue to entice overseas investors.
For incumbent firms and potential entrants alike, understanding Malaysia’s current investment trends as well as the factors which will shape its future are of utmost importance.
Malaysia: “Most attractive manufacturing market” status retained
Malaysia retains the top position as the most attractive manufacturing market of choice for future relocations according to the new Cushman & Wakefield “Manufacturing Risk Index 2017” report. The “Manufacturing Risk Index” is an annual survey of the manufacturing sector, which considers investment policies, costs, and risks including political, economic, technological, and environmental risks for their assessment. Malaysia’s ranking is attributed to its infrastructure quality, trade, and logistics performance.
The report also highlights Asia Pacific’s varying degrees of innovation such as automation and smart manufacturing which offers diversity for manufacturers. Almost half of the top 15 positions in the index are occupied by Asia Pacific countries. ASEAN countries such as Singapore, Thailand, Philippines, and Indonesia are ranked 12th, 14th, 19th, and 20th respectively. Based on the overall assessment, cost remains the most significant criteria for relocation currently, with further changes anticipated as the manufacturing industry moves to Industry 4.0, which incorporates automation and data exchange in manufacturing technologies.
By Alexander Chipman Koty
About 133.6 billion pieces of rubber gloves – 63 percent of the world total – came from Malaysia in 2016, as the Southeast Asian nation has carved a niche in the industry. Exports were worth an estimated RM 14.3 billion, continuing the country’s streak as the world leader in rubber glove production for over two decades running. 2016’s revenues represent 14 percent growth over the RM 12.1 billion accumulated in 2015.
The global rubber glove industry is expected to maintain strong annual growth of 8 to 10 percent over the coming years, including demand for an estimated 55 billion additional gloves over the next five years, primarily driven by increasing consumption in emerging markets. Malaysia could be the largest beneficiary of this increasing demand, as export revenue from rubber gloves is projected to reach RM 15.2 billion in 2017.
Philippines: Central bank tightens rules on money lending
In a move to fight money laundering, the Philippines’ central bank Bangko Sentral ng Pilipinas (BSP) tightened rules on money service businesses (MSBs). MSBs include remittance and transfer companies (RTCs), money changers, and foreign exchange dealers. As per the new rules, large payouts of more than US$10,036 (PHP 500,000) or its foreign currency equivalent in any single transaction with customers will only be allowed via check or direct credit to deposit accounts. Money changers and foreign exchange dealers will be allowed to sell foreign currency in an amount not exceeding US$10,000 and not exceeding US$50,000 per month per customer. Exemption will only be given once an application is made to the BSP depending on the nature of the business.
RTCs and MSBs will also need to notify the BSP when they commence operations as well as for new accreditation of remittance of sub-agents. The new rules will limit MSBs’ ability to transact in cash while also placing a cap on the amount of foreign currency that can be sold to money changers. The development comes after anti-money laundering investigators said that around US$81 million stolen from a Bangladesh central bank was transferred by a Philippines remittance company.
Indonesia faces shortage of engineers
Indonesia’s annual shortage of around 30,000 engineers is becoming a key obstacle to its infrastructure development plans. Currently, Indonesia has 57 million skilled workers but it would need 113 million by 2030 to meet the country’s requirements. Around 20 percent of Indonesia’s six million university and postgraduate students pursue Islamic studies, with most students ending up with unrelated jobs.
According to a 2015 national labor force survey, less than ten percent of Indonesia’s 250 million citizens have a university-level education. Of those, only eight percent choose an engineering study and more than half of these graduates work in different fields, such as banking. The government believes that the country needs a more skilled workforce if they are to keep up with other ASEAN countries and meet the Master Plan for Acceleration and Expansion of Indonesia’s Economic Development’s (MP3EI 2025) ambitious targets, which will be difficult to achieve with substantial infrastructure gaps.
Achieving Indonesia’s infrastructure development goals, which range from sea projects, airports, highways, and power plants, necessitates a technical workforce. The government is taking steps to establish more industry-oriented engineering colleges, technical institutes, and state-funded scholarships. The last few years have seen improvements, with 57 percent of Indonesians completing education after primary school in 2015, compared to 40 percent in 2002. Furthermore, the share of college-age Indonesians attending universities has risen from 20 percent to 25 percent over the last decade. However, economists believe that Indonesia still needs to do more to meet its infrastructure development goals by 2025.
Philippines: Policy on labor contractualization approved
The Philippines government approved a new Department of Labor and Employment (DOLE) regulation, Order No. 168 on contractualization, after it was submitted on December 29, 2016. The new law amends the provisions of the labor code and legalizes subcontracting or outsourcing labor through third party agencies. This will allow principal employers to hire contractual labor, but only through service providers. These providers will be responsible for regularizing workers rather than the employer. Higher financial requirements will be imposed on service providers to eliminate unreliable subcontractors and ensure payments for laborers. The government believes that the change will address issues of labor abuse.
Several labor groups have opposed the directives, believing the change will only further legitimize contractualization in a different form and not eliminate it. The groups are lobbying for direct hiring and to prohibit third party hiring by banning fixed-term employment. They have asked President Rodrigo Duterte not to implement the directive and to issue an order banning all forms of fixed employment contracts, thereby fulfilling his campaign promise of eliminating contractualization. In the first five months of Duterte’s term, the government regularized 25,000 contractual workers, which is less than 10 percent of the total workforce.
By Harry Handley
In recent years, the Malaysian government has worked tirelessly to achieve their goal of becoming a high-income nation by 2020. Through the government’s Economic Transformation Programme (ETP), a number of key service industries have been heavily promoted and subsidized in order to make this goal become a reality – one of which is e-commerce.
Despite almost 70 percent internet penetration in 2015, only five percent of Malaysian businesses had an online presence. Many leading experts believe that the Malaysian e-commerce market is at an inflection point and may be about to experience a serious boom period. Along with rising incomes, growing smartphone and internet penetration is expected to increase the proportion of online retail spend in Malaysia from 0.5 percent of total retail spending (2014) to five percent by 2020. This makes it an interesting time to assess the state of the market, in terms of government initiatives, consumer trends, incumbent players, and opportunities for foreign firms.