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Big-hitting American stars will get no favors at Ryder Cup course

SAINT-QUENTIN-EN-YVELINES, FRANCE — Big-hitting American stars may have to adjust their games when they defend the Ryder Cup against Europe in September on a tight, punishing course at Le Golf National just outside Paris.
All 12 Europeans are certain to be familiar with the quirks of the French set-up designed to favor strategic play, while American long hitters like world number one Dustin Johnson, Bubba Watson and even possibly Tiger Woods will have to put away their drivers on the majority of holes.
The Americans regained the Ryder Cup two years ago at a Hazeltine track with forgiving fairways and slick greens, but will find a totally different proposition awaiting them in France as they look to win the trophy on European soil for the first time in 25 years.
Course director Paul Armitage, watching the Americans at the Albatros course during a Ryder Cup practice session in mid-July, said the Europeans will have a head start at the Sept. 28-30 contest.
“The Europeans know the course better. It’s a real advantage,” said Armitage.
He said that even three-time major champion Jordan Spieth was finding out the hard way and had hit two iron shots into the water in succession.
“There is only one way to play some holes and if you don’t know that, or don’t do that, holes like the famous (par-three) 16th will eat you,” he added.
US Ryder Cup captain Jim Furyk brought five US team hopefuls including two-time Masters winner Watson and Spieth over to France for a weekend ahead of the British Open.
Only two other Americans, Phil Mickelson and world number three Justin Thomas, have already played the course this season.
Furyk said they will share their knowledge with other potential team members who can’t make the trip before the Ryder Cup.
The message from Furyk will be to keep the driver in the bag, shoot for accuracy rather than distance, and prepare for a showdown on the greens of the par-71, 7,331-yard championship course.
“It’s a placement golf course. They are not going to hit a lot of drivers, they’re going to hit a lot of three woods, and lot of irons off the tee. It’s a second-shot golf course,” said the 48-year-old.
“You have to be very precise off the tee. Hit the ball accurately, maybe not that far but accurate. “
Armitage said if you gamble, you can win but you have to play with “brains rather than brawn.”
“Americans love the driver, they love to hit 250-300 meters off the tee. You can’t do that here. You can’t attack this course. I think what bothers them is that you have to use strategy rather than muscle.”
‘SECOND-SHOT COURSE’
Watson agreed that the course was a second-shot layout but insisted that better knowledge won’t win the trophy for Europe.
“It’s not really about knowing the course more, it’s about hitting shots,” he said.
“We are all going to have to make 10-footers, we are all going to have to hit good iron shots, hit good tee shots, fight the nerves off.”
Spieth described it as a “pick your shot, pick it apart” course “with a lot of people playing from the same spot.”
“So it will be kind of wedges, short iron control, then a putting contest — which will be very exciting.”
The last four holes are the toughest with the 16th an exciting par-three with water down the right-hand side, while the treacherous 18th is surrounded by an amphitheater that can hold 50,000 spectators.
“There’s a lot that can happen on 15, 16, 17, 18,” said Furyk.
“It’s an amazing amphitheater. I am trying to grasp how many fans will be wrapped in this one area. It will probably be the biggest stage we have ever had in any golf tournament just in those four holes.” — AFP

A nice fight

8th HDBank International
Army Hotel, Hanoi, Vietnam
March 10-15, 2018

Final Top Standings
1. GM Sandro Mareco ARG 2635, 7.5/9
2-4. GM Murali Karthikeyan IND 2592, GM Alan Pichot ARG 2558, IM Le Tuan Minh 2489, 7.0/9
5-8. GM Wang Hao CHN 2713, GM Le Quang Liem VIE 2736, GM Tran Tuan Minh VIE 2522, GM Wen Yang CHN 2608, 6.5/9
Total Participants: 129 players
Time Control: 90 minutes for the entire game with 30 seconds added to your time after every move starting move 1
The HD Bank International is the largest annual GM tournament in Vietnam. Its previous seven editions were held in Ho Chi Minh City but this year it was moved to Hanoi. The total prize fund is $55,000, with $15,000 for first place.
This year a total of 29 International Grandmasters, 11 Woman Grandmasters, 33 International Masters and five Woman International Masters took part. The top seeds were GM Le Quang Liem VIE 2736, GM Wang Hao CHN 2713, GM S.P. Sethuraman IND 2649 and GM Sandro Mareco ARG 2635.
The Argentinian GM Sandro Mareco rode on his four-game win streak in the middle of the event and a last round victory vs GM Leandro Krysa to finish solo first half a point ahead of his closest pursuers.

Santiago, Yago De Moura (2473) — Mareco, Sandro (2635) [E11]
8th HD Bank Cup 2018 Hanoi VIE (5.5), 12.03.2018

Sandro Mareco is the type of player who has a deep style — I find him similar to Russia’s Peter Svidler. You think he is behind in the position but as the game wears in it turns out he knows the nuances of the position very well and starts taking over. Before long it occurs to you that you are losing and there is nothing you can do about it.
1.d4 Nf6 2.c4 e6 3.Nf3 Bb4+ 4.Nbd2 0–0 5.a3 Be7 6.e4 d6 7.Qc2 Nbd7 8.Be2 c5 9.d5 exd5
Black goes for a Benoni formation without having fianchettoed his king bishop. Anyway, no matter as Black has an “improved Benoni” in mind — the bishop will be going to the a1–h8 diagonal with Bf6 and with his g-pawn still on g7 this gives one of his knights the opportunity to go to g6.
10.cxd5 Ng4 11.0–0 Bf6 12.Nb1 Re8 13.Nc3 a6 14.Nd2 Nge5 15.f4 Ng6 16.Nc4 Bd4+ 17.Kh1
This bishop becomes very powerful on d4. White can’t get rid of it with 17.Be3 because Black’s pieces then explode into action with 17…b5! 18.Bxd4 cxd4 19.Nxd6 Qb6 20.Nxc8 Raxc8 White is losing a piece.
17…Nf6 18.f5
[18.Be3 still doesn’t work for the same reason: 18…b5]
18…Ne5 19.Nxe5 Bxe5 20.Bf3 b5 21.Ne2 h6 22.Bd2 a5
White has lost the queenside battle and now goes all-in for a kingside attack.
23.Rf2 Ba6 24.Rg1 b4 25.g4 Nh7 26.Be3
[26.g5 Nxg5 27.Bxg5 hxg5 28.Rfg2 doesn’t work because the dark-squared bishop protects g7. White needs more wood behind the attack]
26…Rb8 27.a4 Ng5 28.Bg2 b3 29.Qb1 Bxe2 30.Rxe2 Rb4 31.Bd2 Rxa4 32.Qe1 Nh7 33.h4 Bxb2 34.g5 Ra1 35.Qg3 Rxg1+ 36.Kxg1 Bd4+ 37.Kh1 b2 38.Re1 Be5 39.Qe3 a4 40.f6 hxg5 41.hxg5 Qb8 0–1
The next game is the most exciting one in the tournament. White is 16-year-old IM Nguyen Anh Khoi who has won world championship titles in the Under-10 (2012) and Under-12 (2014) categories. He is currently the most promising young player of Vietnam. Stanislav Bogdanovich is a 25-year-old International Grandmaster from Ukraine. He is known as an aggressive tactician as the following game will demonstrate.

Nguyen, Anh Khoi (2435) — Bogdanovich, Stanislav (2560) [A54]
8th HDBank Masters, Hanoi (3.5), 11.03.2018

The line used by Bogdanovich first came up in 1953, in a Candidates’ Tournament no less. I will show you the Keres vs Boleslavsky game in the notes.
1.d4 d6 2.c4 e5 3.Nc3 Nd7 4.Nf3 Ngf6 5.Bg5
In David Bronstein’s famous book on the 1953 Candidates he remarks that “with this move White prevents Black from obtaining the modern form of the King’s Indian (he means the main line now where Black fianchettoes his king bishop) since 5…g6 6.dxe5 dxe5 7.Nxe5 costs a pawn. He continues “Black, of course, could play 5…Be7 but that sort of development for this bishop grates on a King’s Indian player.” How true!
5…h6 6.Bh4 g5
Bronstein: If the bishop retreats again the e-pawn rushes to the third rank, with the well-known idea of retarding White’s kingside development: 7.Bg3 e4 8.Nd2 e3.
7.dxe5 dxe5
Keres vs Boleslavsky continued 7…gxh4 8.exf6 Qxf6 9.Nd5 Qxb2 (Bronstein: Some pieces in the King’s Indian appear on a ‘special price’ list; the darksquare bishops are at the top of that list. This means that Black has achieved something, in removing White’s bishop while retaining his own, even at the cost of shattering his own pawns. With his last move, Black initiates his previously prepared sharp attacking line, sacrificing a rook for the attack) 10.Rb1 (Bronstein: “Boleslavsky had mainly considered the following line: 10.Nxc7+ Kd8 11.Nxa8 d5 12.Rc1 Bb4+ 13.Nd2 Nc5 14.Rc2 Qe5” etc. etc., Black is already better. By the way, there is a flaw in this analysis as instead of 12.Rc1 White has 12.Qc1 which basically refutes the whole line) 10…Qxa2 11.Nxc7+ Kd8 12.Nxa8 Nc5 (Keres is already clearly better and dutifully reeled in the whole point) 13.Ra1 Qb2 14.Qd4 Qxd4 15.Nxd4 Bg7 16.e3 Re8 17.Be2 Bxd4 18.exd4 Nb3 19.Rxa7 Nxd4 20.Ra2 h3 21.Rg1 Rg8 22.g4 1–0 (22) Keres,P-Boleslavsky,I Zuerich 1953.
8.Bg3 e4 9.Nd4 Bb4
The maneuver Bronstein described on move 6 with 9…e3 works here as well but Bogdanovich had something in mind.
10.Qb3?!
The critical line is 10.Ndb5! and after 10…0–0 11.Nxc7 e3! 12.Nxa8 Ne4 13.Rc1 Qa5 14.fxe3 Ndf6 Black is a rook and two pawns behind but has a strong attack. Nguyen Anh Khoi avoids this as obviously it is a prepared line.
10…Qe7 11.a3 Nc5!? 12.Qxb4
If White does not take then he has to contend with 12.Qc2 Nd3+ etc. But why shouldn’t he take the bishop on b4?
12…a5 13.Qb5+ Bd7
Surprisingly the queen is trapped. Or is it?
14.Nf5 Qf8 15.Nd6+ cxd6 16.Qb6 Ra6 17.Qc7 Rc6 18.Qxa5?
Objectively the best continuation is 18.Qb8+ Ke7 19.Qxf8+ Rxf8 20.e3 with an equal position. But who wants equality after all those tactics?
18…Nb3 19.Qa8+ Rc8 20.Qxb7 Nxa1 21.Nb5 <D>
POSITION AFTER 21.NB5
With the killing threat of Nxd6+ which was the idea behind the whole 18.Qxa5 thing. Problem is that Black had seen deeper. White should have played 21.e3 to secure his king position and finally start bringing out his kingside pieces.
21…e3!! 22.Nxd6+ Qxd6! 23.Bxd6 Rxc4
Threatening 24…Rc1 mate.
24.fxe3 Ne4 25.Qb8+ Rc8 26.Rg1
[26.Qxc8+ Bxc8 leaves Black a piece ahead but also White’s kingside is so undeveloped that he cannot hope to save the game. For example 27.Be5 f6 28.Bd4 Rh7 (with the same idea Rh7–c7–c1 checkmate) 29.Kd1 Nf2+ 30.Ke1 Nxh1 White should resign]
26…Rxb8 27.Bxb8 0–0 0–1
White did not want to suffer the indignity of 27…0–0 28.Be5 Ba4 29.g3 Rd8 30.Bd4 Nc2+ 31.Kd1 Nxd4+ 32.Kc1 Nb3+ 33.Kc2 Rd2+ 34.Kb1 Rd1+ 35.Ka2 Ra1#
I always look up the games of Wang Hao. No sophisticated maneuvering games for him — He is a 2700+ player whose style is simple, strong and aggressive. Try not to get a passive position against him.

Wang, Hao (2713) — Saduakassova, Dinara (2479) [A18]
8th HD Bank Cup 2018 Hanoi VIE (4.5), 12.03.2018

Here we see another Flohr-Mikenas Attack. Black needs to play actively in this system or get crushed.
1.c4 Nf6 2.Nc3 e6 3.e4 d5 4.e5 d4 5.exf6 dxc3 6.bxc3 Qxf6 7.d4 c5 8.Nf3 cxd4 9.Bg5 Qf5 10.cxd4 Bb4+
The BW reader should be familiar with this idea: 10…Nc6 is bad because of 11.Bd2! Nb4 12.Rc1 Nd3+ 13.Bxd3 Qxd3 14.Rc3 Qe4+ 15.Re3 Qc6 16.Ne5 Qc7 17.0–0 Bd6 18.Qg4 0–0 19.Rh3 White has a very strong attack. Nachon Menendez,G-Acebal Muniz,A (2280) Asturias 1996 1–0 32.
11.Bd2 Qa5
[11…Bxd2+ 12.Qxd2 Nc6 13.Bd3! Qf6 14.Be4 leaves White much better]
12.Bd3 Nc6 13.Rb1 Bxd2+ 14.Qxd2 Rb8 15.Rb5 Qxd2+ 16.Kxd2
Queens are off the board but White’s better developed pieces are still a problem for the second player.
16…b6 17.d5 Nd8 18.Rhb1 Bd7 19.Ra5 Rb7 20.Ra3 Ke7 21.Ng5 f6 22.Ne4 exd5 23.cxd5 Nf7 24.Re1 Rc7 25.Ng5+ Ne5
[25…Kf8 26.Nxf7 Kxf7 27.d6 Rb7 28.Re7+ Kf8 29.Ba6 is hopeless]
26.f4 fxg5 27.fxe5 1–0
 
Bobby Ang is a founding member of the National Chess Federation of the Philippines and its first Executive Director. A Certified Public Accountant, he taught accounting in the University of Santo Tomas for 25 years and is currently Chief Audit Executive of the Equicom Group of Companies.
bobby@cpamd.net

James-less Cavs

LeBron James
LeBron James of the Los Angeles Lakers attends a quarterfinal game of the 2018 NBA Summer League between the Lakers and the Detroit Pistons at the Thomas & Mack Center on July 15 in Las Vegas, Nevada. — AFP

For all the tumult the departure of erstwhile top dog LeBron James created, the Cavaliers had no choice but to reaffirm their commitment to lone remaining All-Star Kevin Love. With Quicken Loans Arena undergoing a costly $140-million upgrade and such notables as the Celtics, Raptors, and Sixers slated to contend at the top, they had to show all and sundry that they weren’t in any mood to go the rebuilding route, hence their designation of a cornerstone moving forward.
No doubt, the Cavaliers explored all available avenues prior to re-upping with Love; they would have been remiss in their duties if they didn’t at least go through the motions. That said, it wouldn’t have taken them long to point to the move they made as their best option post-James. To begin with, his stock had been falling since he was acquired from the Timberwolves in 2014, and not simply because he was asked to take on a supporting role. More importantly, his propensity to be injured effectively placed an asterisk on his contributions. Since being drafted fifth overall in 2008, he has never had a regular season in which played the full 82 games; last year and the year before, he saw action in only 59 and 60, respectively.
It bears noting that Love does hold no small measure of trade value, with the likes of the Blazers, the Heat, and the Hornets inquiring about him at various points throughout the Cavaliers’ tumultuous 2017-2018 campaign. He could have pressured them for a change of address, especially when, in the middle of January, he became the subject of a contentious locker-room meeting, during which he was called to task for his decision to leave the bench with a game in progress. That he didn’t, and that the top brass of the wine and gold are now all in with him, speaks volumes of their relationship.
Perhaps the Cavaliers would have been better off blowing everything up and starting from scratch. Then again, perhaps they would have been consigning themselves to an indefinite period at the bottom of the standings. In any case, they’ve made their choice, and given Love’s unique skill set, rookie Collin Sexton’s revelatory performance in Summer League, and the rest of the roster’s determination to show that the new James-less dispensation isn’t as hopeless as projected, they may yet raise eyebrows and prove that a great team is better than a team of great players.
 
Anthony L. Cuaycong has been writing Courtside since BusinessWorld introduced a Sports section in 1994.
LeBron James of the Los Angeles Lakers attends a quarterfinal game of the 2018 NBA Summer League between the Lakers and the Detroit Pistons at the Thomas & Mack Center on July 15 in Las Vegas, Nevada. — AFP

Fortnite phenomenon turns epic game developer into billionaire

TIM SWEENEY made Fortnite a phenomenon by doing something that sounds crazy: He gave it away.

That strategy has made him a billionaire.

In an industry chock-a-block with monster hits, such as Candy Crush and Pokemon Go, Fortnite’s popularity isn’t surprising. Its revenues are. Between the release of the current version in September and the end of May, Fortnite brought in more than $1.2 billion, according to SuperData Research. As of early June, it has been played by 125 million people.

That’s powered a revenue surge at Epic Games Inc., the company Sweeney created in his parents’ basement 27 years ago. Fortnite alone is on track to generate $2 billion this year, making the Cary, North Carolina-based gamemaker worth $5 billion to $8 billion, according to the Bloomberg Billionaires Index. Sweeney, 47, is the controlling shareholder.

Fortnite is a global phenomenon, played obsessively by children, rappers, professional athletes and middle-age accountants. It’s a cartoonish, last-character-standing, fight-to-the-death battle royale where players thrash one another in a struggle for weapons, resources and survival on a shrinking, storm-ravaged island.

Instead of shelling out upwards of $40 for the game, players buy online V-bucks, a virtual currency they can exchange during play for outfits, called skins, celebratory dances or special missions that can cost as much as $20 each.

“On the revenue side, they’ve done something that’s really unique, which is come up with a perception of exclusivity,” said Michael Pachter, an analyst at Wedbush Securities Inc. Many accessories in the Fortnite shop are available on a limited basis, prompting players to buy before coveted items disappear from virtual shelves. “If you see another player in a leopard skin and go to the store and see it’s no longer available, you think, Shoot, I’ve got to move on it next time.”

All that commerce translates into some of the highest rates of revenue-per-user in the industry and operating margins north of 50 percent, according to analysts.

“Epic’s valuation has exploded alongside Fortnite’s success,” said Timothy O’Shea, who covers gaming at Jefferies Financial Group Inc.

Based on the trading multiples of peers Electronic Arts Inc. and Activision Blizzard Inc., Epic could be worth as much as $14 billion, though potential buyers would demand a discount due to questions over whether Fortnite could sustain revenue growth, O’Shea said. Even if sales were to fall to $1 billion a year — half of its current estimate — the company could still reasonably command $7.5 billion in a sale, Pachter said.

That’s a bonanza for Sweeney and Chinese internet behemoth Tencent Holdings Ltd., which bought 40% of Epic in 2012 at an $825 million valuation. It’s still unclear what impact Fortnite has had on Tencent’s balance sheet. Three analysts who cover the Shenzen-based firm said they hadn’t yet factored the game into their sum-of-the-parts valuations.

While most games hit peak popularity shortly after launch, Fortnite was still drawing millions of new users six months on, thanks to a broadly appealing aesthetic that’s more comic mischief than graphic violence. Celebrity fans such as rapper Drake and the Los Angeles Lakers’ Josh Hart have pushed it further into mainstream consciousness. French soccer star Antoine Griezmann celebrated a goal in the World Cup final this month by performing the game’s “Take-the-L” dance.

As a game that’s social, easy to play and hard to master, it’s been a particular hit with school-age kids, raising concerns from teachers and parents reporting obsessive playing during class.

Fortnite is no bolt from the blue for Epic. The developer’s biggest previous hit was Gears of War, a best-selling franchise for Microsoft’s Xbox 360. Epic also owns Unreal Engine, one of two widely used operating systems developers rely on for building games. At first, Epic charged customers to use the software. Sales took off when Sweeney made the product free and instead began collecting a royalty on sales from games made using the software, which have included hits like Mass Effect and Batman: Arkham.

Fortnite also started as a paid product. Launched in July 2017 as a $40 version where players built forts to defend themselves against zombie hordes, the game really took off after Epic made it free and added the multi-combatant style of play.

Its success surprised even Epic. At last year’s E3, the industry’s big trade show, Epic showed a few reporters the game hidden away in a meeting room. At this year’s convention, the Epic booth was entirely devoted to Fortnite, with a replica of the bus that players travel in at the beginning of the game and opportunities for fans to star in videos dancing and hang gliding. That week, Epic staged its first Fortnite Celebrity Pro-Am with guests such as comedian Joel McHale and professional gamer Ninja (real name Tyler Blevins) competing in a soccer stadium. In May, Epic announced it would provide $100 million to fund prize pools for Fortnite competitions.

At Epic’s office, located in a Raleigh suburb around the corner from a shopping mall, employees have their pick of free ice cream and Hot Pockets. There’s a game room, a slide between two floors and giant sculptures of some of the company’s video-game characters.

Raised in suburban Potomac, Maryland, Sweeney showed a knack early on for game design and business. At 11, he taught himself to program using the family’s Apple computer and made a hobby of dissecting electronics. At 15, he quit his job at a hardware store after noticing that everyone made the same hourly wage regardless of how hard they worked. Instead, he borrowed his father’s tractor and began trimming neighbors’ lawns, undercutting professional landscapers, according to a 2011 interview with gaming website Kotaku. Sweeney began designing his own games at age 21, packaging them on floppy disks and sending them through the mail.

“Tim Sweeney is a legendary character,” said Joost van Dreunen, chief executive officer of SuperData Research Holdings Inc., which provides market intelligence on the gaming industry. “He’s a hardworking, outspoken person with a clear vision of what he wants to do.”

Despite captivating millions of gamers, Sweeney isn’t much of a player himself. He’s an avid conservationist and one of the biggest private landowners in North Carolina. After the financial crisis, he bought thousands of acres, mostly in the mountains, aiming to create nature preserves.

Sweeney often wanders the Epic office, leaving large soda cups in his wake. He favors a self-made concoction of 60% water and 40% Diet Coke from the company’s fountains.

In a 10-year-old video posted online, Sweeney gives a tour of his sprawling home. The lifelong bachelor says he’d never eaten in the elegant dining room and prefers takeout from Burger King. He once owned several sports cars, including a Lamborghini, but he’s sold most of them. He drives a 2019 Corvette.

“It turns out having a fast car is an excellent hobby when you’re a workaholic because even when you don’t have any free time you can always drive to work,” he said. — Bloomberg

Malaysia’s problem: How to cut a better economic deal with China

Malaysian Prime Minister Mahathir Mohamad is pushing back against China’s dominance in the economy, stalling billions of dollars of contracts as he tries to renegotiate them.
He’s heading to China in August — specific dates haven’t been disclosed yet — to discuss those projects and try to win deals that he says should be more favorable to Malaysia.
China has $34 billion worth of infrastructure projects underway in Malaysia negotiated by the previous government of ousted leader Najib Razak, deals that Mahathir said favored Chinese investors over the Malaysian economy. Among his concerns are the large sums that the government has borrowed from China and contractors that use Chinese labor and equipment.
Earlier this month, Malaysia’s government suspended the East Coast Rail Link, which was being built by China Communications Construction Co. with an estimated price tag of 81 billion ringgit ($20 billion). Two energy pipeline projects were also stalled.
Mahathir’s move comes against the backdrop of growing disquiet in Southeast Asia about China’s spreading influence in the region. China’s multi-billion dollar Belt & Road Initiative to build roads, railways and ports is stoking fears of ballooning debt in poor countries like Myanmar and Laos. China’s actions in the South China Sea are also a source of tension.
‘Nationalistic Stance’
Malaysia has been one of the region’s biggest beneficiaries of Chinese investment in the 15 years between Mahathir’s first and latest stint as leader, while economic links in the two countries from trade to tourism have strengthened.
“We expect some negative impact on future Chinese-related investments in Malaysia due to PM Mahathir’s nationalistic stance with regard to investment,” said Chua Han Teng, head of Asia Pacific country risk at BMI Research.
“However, we expect a compromise to mitigate the effect, with Malaysia unwilling to antagonize an important trade partner and China likely to prioritize its ambitious Belt and Road Initiative, of which projects in Malaysia are a key part,” he said.
Here’s a look at how China’s economic links with Malaysia have evolved in recent years:
1. Trade
Malaysia is China’s biggest trading partner in Southeast Asia after Vietnam, with total trade of $92.4 billion last year. In 2003, when Mahathir ended his first period as prime minister, the figure was less than a quarter of that.
Malaysia is one of the few economies in Southeast Asia to run a trade surplus with China, exporting everything from electronics and palm oil to liquefied petroleum gas. Last year, Malaysia exported $54.4 billion to China, or about 18 percent of its total shipments. In 2003, that figure was just $14 billion.
Malaysia imports electrical products, machinery and equipment from China.
2. Investment
Official data shows Chinese foreign direct investment into Malaysia surged more than 700 percent in the past decade to 9.9 billion ringgit last year, a far bigger increase than any other source country.
The inflow has raised concerns among Malaysians over sovereignty, indebtedness and the risk of creating white elephant projects.
“Both Dr Mahathir and the China side look at the definitions of investments from their own experience and perspective and therefore differently,” said Oh Ei Sun, a senior adviser for international affairs at the Asian Strategy and Leadership Institute in Kuala Lumpur. “It is important for both sides to iron out their difference in preferences and expectations.”
3. Tourism
Chinese tourists are now the third-largest group of visitors to Malaysia after Singaporeans and Indonesians, lured by sandy beaches, a shared culture in a country where a quarter of the population are ethnically Chinese, and a love of the pungent durian fruits.
That growth has underpinned a tourism industry that now makes up about 15 percent of gross domestic product. Total tourism receipts in Malaysia climbed 54 percent in the past decade to 82.1 billion ringgit in 2017.
4. Immigration
Chinese nationals were the largest group of participants in the state-run Malaysia My Second Home program, an international residency plan allowing wealthy foreigners to live in the Southeast Asian nation on a long-stay visa. Chinese citizens accounted for almost 30 percent of successful applicants since the program was launched in 2002.
5. Property
The increase in Chinese migration has helped underpin property demand in Malaysia, especially in the southern city of Johor Bahru, which borders Singapore, and in Penang and Melaka states, according to Knight Frank LLP consultants.
For Chinese investors, Malaysia is a cheaper alternative to real-estate markets in Australia, Hong Kong and Singapore. What also counts in Malaysia’s favor is a lower entry cost for property and cultural ties that make food and language familiar to Chinese buyers.
China’s Xiamen University also became the first one in the country to open an overseas campus, which was set up outside of Kuala Lumpur with the aim of boosting ties between Chinese and Malaysian students and academics. — Bloomberg

Asia is hunting ground as bond funds see bargains in EM rout 

The sell-off in emerging markets is prompting some global money managers to hunt for bargains in Asian bonds and currencies.
The rout set off by the dollar’s surge and exacerbated by escalating global trade tensions may have reached an inflection point, and buying opportunities are showing up in countries including India and Malaysia, according to BNP Paribas Asset Management. For Amundi Asset Management, regional currencies such as Indonesia’s rupiah are starting to look attractive.
“We think we are at a turning point,” said Jean-Charles Sambor, the London-based deputy head of emerging-market debt at BNP Paribas Asset, which oversees the equivalent of $664 billion. “Of course the trade war, high oil prices and overall risk sentiment are a threat but it is to some extent already priced in. We have been increasing risk recently.”
Investors are taking a fresh look at Asian emerging-market assets after the carnage that regional bonds and currencies suffered last quarter. A Bloomberg currency index measuring carry-trade returns from developing markets ended a five-quarter winning streak when it slumped 8.8 percent in the April-June period, the most since 2011.
The index has risen in July, suggesting that funds may be returning.
“We are becoming constructive after the excessive negative market performance,” said Hakan Aksoy, London-based senior portfolio manager for EM local currencies at Amundi Asset, which oversees the equivalent of $1.7 trillion. “We concentrate on the countries that have not only better valuations but also the ability for higher growth and improving fiscal room going forward, such as Indonesia.”
Net flows for Indonesian debt turned positive in July for the first time in four months, while outflows from Indian notes have slowed. Sovereign bonds in the two nations offer the highest 10-year yields among major regional markets.
Emerging Asian markets may also be deriving some comfort from China’s efforts to bolster its economy. Regional currencies have advanced this week as risk appetite improved following China’s stimulus measures.
BNP Paribas favors the currencies and bonds of Indonesia, India, China and Malaysia, Sambor said. Lower-yielding markets such as Thailand and South Korea may be vulnerable in case yields on U.S. Treasuries rise further, he said.
As trade conflicts dominate attention in global markets, Investec Asset Management Ltd. says that the U.S.-led tariff war may not be positive for the dollar, if history is a guide.
“A lot of the nervousness around Asia has to do with U.S. tariffs, China’s reactions, and how Asia might stand to lose should exports/production take a hit,” said Wilfred Wee, a fund manager in Singapore at Investec, which oversees $146 billion globally.
Yet, the dollar depreciated in previous periods when the U.S. imposed tariffs, said Wee, pointing to the 1970s to early 2000s when presidents including Richard Nixon, Ronald Reagan and George W. Bush slapped duties on imports to address a trade deficit.
“Could this not also be the case today?” Wee said. — Bloomberg

Security Bank sees loan growth easing this year

Security Bank Corp. expects its total loan growth to slow down on the back of high base effects, its president said on Wednesday, July 25.
In a business matching event in Makati City, Security Bank said it projects slower loan growth this year following “stronger than expected” lending performance in 2017.
“We don’t give our targets, but I think the loan growth this year will be lower than last year,” Security Bank President and Chief Executive Officer Alfonso L. Salcedo, Jr. said Wednesday.
“For one thing, our loan growth last year was very strong. It was at 28%.” — Karl Angelo N. Vidal

Agri damage from July storms estimated at P1.12 billion

Farm damage incurred from two consecutive typhoons and a tropical depression has reached more than a billion pesos, the Agriculture department said.
The Department of Agriculture’s Disaster Risk Reduction Center said that as of 12:00 pm on Wednesday, July 25, damage in the agriculture sector caused by Tropical Storm “Henry”, Severe Tropical Storm “Inday” and Tropical Depression “Josie” has increased to P1.12 billion.
Affected crops include rice, corn and other high-value crops. The fisheries and livestock sub-sectors also suffered losses.
“The increase in the overall damages and losses is attributed to reports on rice, corn, high value crops and fisheries in all the provinces of Region III and Oriental Mindoro,” the agency said in a Facebook post on Wednesday.
Rice farms sustained the greatest damage, representing 83% or P925.99 million worth of crops totaling 12,111 metric tons (MT). Washed-out palay used for seedbeds amounted to a total of 5,137 bags.
The damaged area spanned 30,274 hectares of rice paddies in the provinces of Pangasinan, Bataan, Bulacan, Nueva Ecija, Pampanga, Tarlac, Batangas, Rizal, Laguna, Occidental Mindoro, Negros Occidental and Aklan.
Some 37,927 rice farmers were affected. — Janina C. Lim

Meralco seeks ERC approval to include local franchise tax in Biñan customers’ bills

Manila Electric Co. (Meralco) has asked the Energy Regulatory Commission (ERC) to implement the new local franchise tax rate imposed by Biñan City in Laguna province ahead of its inclusion in the customer’s retail rates.
Meralco said the city government had imposed a tax on business enjoying a franchise at a rate of 50% of 1% of the gross annual receipts, which include both cash sales and sales on account realized during the preceding calendar year within Binan.
The distribution utility is also asking that it be able to recover the differential local franchise tax for 2017 from customers in the said city.
Meralco has a legislative franchise to operate and maintain a distribution system in the cities and municipalities of Metro Manila, Bulacan, Cavite and Rizal, and certain cities, municipalities and barangays in Batangas, Quezon, Pampanga and Laguna.
As such it is authorized to charge all its customers for their electric consumption at the rates approved by the ERC. — Victor V. Saulon

NGCP seeks ERC approval to procure ancillary services from power firms

Privately-owned National Grid Corporation of the Philippines (NGCP) has asked the Energy Regulatory Commission (ERC) for provisional authority to implement its ancillary services procurement agreement (ASPA) with a power plant in Luzon and another in the Visayas.
In a joint application filed with the ERC, the power grid operator and Therma Luzon, Inc. (TLI) have sought approval for the 60 megawatts (MW) that NGCP will buy from the power plant’s units 1 and 2 in Pagbilao, Quezon province on a firm basis, and another 60 MW on a non-firm, or as needed, basis.
Separately, NGCP and Palm Concepcion Power Corp. (PCPC) are asking approval for an ASPA for 15 MW on a firm basis, and 15 MW on a non-firm basis. Both applications sought provisional authority ahead of the ERC’s final approval.
NGCP forges agreements to procure “ancillary services” — in this case power supply — to ensure reliability in the operation of the transmission system and consequently, in the reliability of the electricity supply in the Luzon, Visayas and Mindanao grids.
Ancillary services are necessary to support the transmission of capacity and energy from energy resources to electricity load centers, while maintaining the reliable operation of the transmission system.
NGCP said the ancillary services to be sourced from TLI and PCPC will be used as contingency reserve, or power that will be allocated to immediately answer any reduction in supply when the largest power generating unit online fails to deliver. — Victor V. Saulon

Globe partners with DMCI Homes to offer broadband service to condo owners

Globe Telecom, Inc. said it is partnering with DMCI Homes, Inc. to offer easy subscription to Globe At Home services exclusive to DMCI condominium owners.
In a statement on Wednesday, July 25, the telco giant said residents at The Birchwood and Ivory Wood in Taguig City, Asteria Residences in Parañaque City and Lumiere Residences and Sheridan Towers in Pasig City may now directly apply for subscription to Globe’s services through DMCI Homes.
“Globe At Home…has found a way to make things more convenient for their customers together with their new partner, DMCI Homes. Now, new condominium owners of DMCI Homes won’t have to brace traffic and long queues as they will have the option to apply for Globe At Home’s exclusive broadband plan during the turnover of their units,” it said. — Denise A. Valdez

RFM merges with three subsidiaries

RFM Corp. is folding three subsidiaries into its portfolio in a bid to achieve efficiency in operations.
In a disclosure to the stock exchange on Wednesday, July 25, the listed ice cream and pasta manufacturer said it is merging with Cabuyao Logistics Industrial Corp., Interbake Commissary Corp., and Invest Asia Corp., with RFM as the surviving entity. — Arra B. Francia

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