Maiden pre-budget statement

       THE Finance Ministry (MoF), on Tuesday, issued its maiden pre-budget statement (PBS) that contained updates of its current year fiscal performance and preliminary view on the direction of the upcoming Budget 2022.

       Starting this year, the PBS is part of the government’s effort to improve the annual budget preparation process.

       For 2021, the MoF estimates an increase in the fiscal deficit to 6.5% to 7% of gross domestic product (GDP), higher compared with the initial target of 5.4% of GDP.

       The wider gap was due to a tax revenue shortfall and continued fiscal support, as well as weaker-than-expected economic growth.

       The revised target for tax revenue in 2021 is RM162.1bil, or 12.3% lower than the earlier target of RM174.4bil.

       Meanwhile, direct cash injection under the four fiscal stimulus packages announced this year raised the Covid-19 funds to RM27bil versus RM17bil originally.

       Operating expenditure this year would be reduced by 7.1% to RM219.6bil, while development expenditure remained at RM68.2bil.

       The government is scheduled to table Budget 2022 in Parliament on Oct 29 with a pro-growth and inclusive agenda aimed at ensuring sustainable economic recovery from the Covid-19 pandemic.

       August corporate report card

       THE second-quarter earnings reporting season officially ended on Aug 31, but a relatively small number of companies, including AirAsia Group Bhd, have announced that they will release their June quarterly earnings in September due to the pandemic.

       All major 30 constituents of the FBM KLCI have announced their results.

       The were no big corporate surprises during the season.

       While most investors are still keeping to the sidelines, foreign funds were back in town to lift the main stock benchmark above the 1,600-point mark.

       August was an interesting month for the stock market.

       While the average daily value of stocks traded was down to a 16-month low, the FBM KLCI’s 7.1% advance was the strongest monthly gain in 10 years.

       Overseas fund managers were net buyers in August, adding RM1bil in local equities to their portfolio after months of sustained selling.

       The latest stock exchange data showed that foreign shareholdings had plummeted to 20.2% in July, the lowest in a decade.

       And despite the sharp rally, the local market is still under-performing most of its regional and global peers on a year-to-date basis.

       Is TH taking plantation arm private?

       REPORTS this week suggested that Lembaga Tabung Haji (TH) is considering taking TH Plantations Bhd private, as surging prices of palm oil fuels a flurry of mergers and acquisitions in the industry.？

       Bloomberg, on Wednesday, reported that TH had asked bankers for proposals, citing sources.

       TH Plantations made a net profit of RM52mil on a revenue of RM307mil in the first half of 2021, boosted by surging crude palm oil (CPO) prices.

       It produced 41,055 tonnes of CPO in the three months ended June 30.