Southeast Asian Regional Business Roundup
Brunei and Luxembourg signed an agreement in July to avoid double taxation and prevent tax evasion. The move was also designed to enhance economic and trade cooperation between the two countries.
Garment manufacturers have indicated they will reject demands for an increase in the minimum wage next year. Currently the minimum wage for a garment factory worker is the equivalent of US$128 per month, but talks a being held to raise this to around US$177 a month. A decision is expected in October.
The economy grew by a sluggish 4.7 percent in the second quarter, the slowest rate since 2009. The rupiah is at its lowest to the US dollar since the political turmoil of the late 1990s. President Joko Widodo has expressed disappointment at the failure of the government to spend billions of rupiah earmarked for key infrastructure projects.
Laos became the largest destination for outbound investment from Vietnam in the first quarter of this year. The Vietnamese Ministry of Planning and Investment licensed 47 overseas projects in 22 countries and territories, and the largest share of these went to Laos.
In July the government started to slowly depreciate the currency, the kyat, in an attempt to stabilise fluctuations and bring the official exchange rate into line with the prevailing market rate. Myanmar introduced a managed float of the kyat in 2012.
Voters will go to the polls on 8 November in what is being billed as the freest elections for more than 60 years with the ruling Union Solidarity and Development Party (USDP) and the main opposition National League for Democracy (NLD) expected to fight out the polls.
The local business conglomerate San Miguel said its first half profit dropped eight percent as a weak peso inflated debt costs, with interim net income dropping to 16.9 billion pesos from 18.4 billion pesos in the same period last year.
Although ranked as the Lonely Planet’s top destination for 2015, Singapore is experiencing a slump in tourist numbers, recording year-on-year declines in visitors in 14 of the past 15 months to May this year. With the Singapore dollar gaining against currencies such as Japan, Thailand, Malaysia and Indonesia, the city-state has become more expensive. The Singapore economy also contracted by 4.6 percent in the second quarter.
Plans are afoot in the second half of this year to lure more foreign investment into the Vietnamese stock market. The government plans to make account opening an easier and speedier experience for foreigners, cut trading settlements from three to two business days, and accelerate the listing process. Attracting both foreign institutional and individual investors are key government policies towards the local stock exchange.