Nobel Prize for Chinese traditional medicine expert who developed malaria cure

Developed for Communist troops fighting in the Vietnam War, Tu Youyou's treatment was major breakthrough in global fight against malaria

Tu Youyou, right, working with Prof Lou Zhicen in the 1950s (Xinhua via AP)

A Chinese scientist who pioneered a malaria treatment for Communist troops fighting America in the Vietnam War has won the Nobel Prize for Medicine.

Tu Youyou spearheaded a secret programme set up by Chairman Mao to see if traditional Chinese herbal cures could reduce the number of North Vietnamese troops dying to malaria.

After sifting through thousands of different folk remedies, she finally unearthed a 1,600-year-old recipe using sweet wormwood that formed the basis for one of the most effective treatments ever discovered.

Under Mao's Cultural Revolution, which saw academics as part of the despised bourgeoisie, her name was kept anonymous for decades, and until recently, even colleagues had never heard of her.

Now, though, at the age of 84, she has finally taken her rightful place in world medical history, with the Nobel judges announcing on Monday that she would be a joint winner of this year's $960,000 award.

Pharmacologist Tu Youyou attends an award ceremony in Beijing in 2011 (Reuters)

The other two winners are Irish-born William Campbell and Japan's Satoshi Omura, who developed avermectin, derivatives of which are used to treat river blindness and elephantiasis.

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“The two discoveries have provided humankind with powerful new means to combat these debilitating diseases that affect hundreds of millions of people annually,” the Nobel committee said. “The consequences in terms of improved human health and reduced suffering are immeasurable.” Ms Tu's work created the drug artemisinin, which now forms part of the mainstay of malaria treatment in Africa. Used in tandem with insecticide-impregnated bednets, it is credited with helping to halve malaria mortality rates worldwide in the last 15 years.

Yet for decades, its exact origins remained unknown - as did the remarkable story of its creator, which could easily form the script for a Hollywood movie.

It begins in 1969, when Ms Tu - then a mid-career scientist - was recruited to Chairman Mao’s top-secret Project 523. Its task was to investigate cures for malaria, which in the 1960s was developing resistance to existing drugs such as chloroquine.

An illustration describing Ms Tu's work displayed during the press conference announcing the winners of the Nobel Medicine Prize (AFP)

It was also taking a heavy toll on the armies of China's communist ally, North Vietnam, who were losing more soldiers to malaria in their jungle warfare against US troops than they were to American bombs or bullets.

At the time, the quest for an effective alternative to chloroquine had baffled the world's scientific community, which had tested some 240,000 different compounds without success.

It was then that Ms Tu, who had studied both Chinese and Western medicines, began reviewing some 2,000 ancient herbal recipes from the Academy of Traditional Chinese Medicine in Beijing.

One of them, written in a 1,600 year old text called "Emergency Prescriptions Kept Up One’s Sleeve”, recommended soaking sweet wormwood in water and then drinking the resulting juice.

Tried out first on mice and monkeys, it proved highly effective, although it then had to be tested to see if was harmful of humans. As head of the research group, Ms Tu volunteered to be the first test subject herself. Subsequent trials on labourers who had caught malaria while working in dense forests proved that it could banish malarial parasites from the bloodstream within just over a day.

While such a discovery might have won Ms Tu considerable fame in the West, in Maoist-era China, she gained no kudos at all. At the time, scientist and intellectuals were viewed with suspicion at best, with Ms Tu’s husband having been banished to the countryside, and the idea of an individual scientist claiming credit for a breakthrough sat uneasily with Maoist notions of collective endeavour. Tu was not even allowed to publish her findings until 1977, a year after Mao's death, and even then, her contribution remained anonymous.

News of her work only emerged in the West when Louis Miller, an American research scientist, met Chinese scientists in 2005 and chanced to ask who had discovered artemisinin. Intrigued at the blank stares that his question produced, he began investigatingin detail.

An illustration describing the research on roundworm infections by Nobel Medicine Prize winners (AFP)

Various official paperwork - much of it once secret - revealed it to be Ms Tu, who by then was living in a shabby apartment block in Beijing. At the time, she was known by colleagues as "The Professor of the Three Nos", since she had no post-graduate degree, was not a member of any national academy, and had no foreign research experience.

While Ms Tu received America’s top medical accolade, the Lasker award, in 2011, this is the first time that any expert in Chinese traditional medicine has been awarded a Nobel.

"This is indeed a glorious moment," said Li Chenjian, a vice provost at Peking University. "This also is an acknowledgement to the traditional Chinese medicine, for the work began with herbal medicine."

Artemisinin-based drugs are now routinely used by pharmaceuticals giants like Sanofi and Novartis in the fight against malaria, which still kills half a million people a year.

It is not yet clear whether the ageing Ms Tu will attend the Nobel annual award ceremony, which takes place on December 10. Each winner will also get a diploma and a gold medal.

AT A GLANCE

Nobel Prizes 2015

Pic: AP/Fernando Vergara

Nobel Prize for Medicine

Awarded jointly for discoveries that assisted the treatment of infections caused by roundworm parasites, and Malaria

• William C Campbell & Satoshi Omura
• Youyou Tu

Nobel Prize in Physics

Awarded jointly "for the discovery of neutrino oscillations, which shows that neutrinos have mass"

• Takaaki Kajita and Arthur B. McDonald

Nobel Prize in Chemistry

Awarded jointly to three people for "mechanistic studies of DNA repair"

• Tomas Lindahl, Paul Modrich and Aziz Sancar

Nobel Peace Prize

• To be announced 9 October

Prize for Economics Science

• To be announced 12 October

Nobel Prize in Literature

• Awarded to the Belarusian author Svetlana Alexievich

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Discovery of DNA Repair Methods Nails 2015 Chemistry Nobel Prize

Three scientists who found ways that cells fix damaged DNA—staving off cancer and other diseases—have won this year's prize There ...

Discovery of DNA Repair Methods Nails 2015 Chemistry Nobel Prize

Three scientists who found ways that cells fix damaged DNA—staving off cancer and other diseases—have won this year's prize

There are three reasons we are not constantly riddled with cancer, and today the scientists who discovered those reasons—three ways that cells repair damaged DNA that can ruin bodies--won the 2015 Nobel Prize for Chemistry.

This morning The Royal Swedish Academy of Sciences announced the coveted prize is going to Tomas Lindahl from the Francis Crick Institute and Clare Hall Laboratory in Hertfordshire, England; Paul Modrich from the Howard Hughes Medical Institute and Duke University School of Medicine in North Carolina in the United States; and Aziz Sancar from the University of North Carolina in Chapel Hill, also in the U.S. “I know, over the years, that I’d been mentioned for the prize,” Lindahl said in a telephone call to the academy. “But hundreds of people get considered every year so I feel very lucky.”

He and the other two researchers, working independently over the last 40 years, described three different mechanisms that create errors in DNA—the molecule that controls cell behavior—and the different ways that chemical and biological processes fix many of these problems.

“All forms of cancer start with DNA damage,” said biochemist Claes Gustafsson, one member of the Nobel chemistry committee. “If you do not have DNA repair, we would have a lot more cancer. That’s how important this is.” He added that the repair techniques let us understand how cigarette smoke, sunlight, and even mundane substances like water can damage DNA and point to ways that the damage can be rectified.

It is not just about cancer, Diane Grob Schmidt, president of the American Chemical Society, told Scientific American in an interview. “The understanding that we have of these mechanisms help us design drugs to repair all sorts of DNA errors,” she said. There are also several genetic diseases caused by the inability of cells to fix DNA properly, for instance, and work on the repair methods aids understanding of these ailments and how to treat them.

The discoveries illustrate the crucial and central role of chemistry, Schmidt added. “These mechanisms are fundamentally about the making and breaking of chemical bonds,” she said.

Scientists used to believe that DNA molecules were extremely stable. After all, they had to reliably transmit genetic information from generation down to generation. Then in the 1970s Lindahl demonstrated that the neat double helix and its components constantly decays. Every day, hundreds of those components, the DNA building block chemicals abbreviated as A, T, C, and G, get knocked out of their places. If the process continued unabated, the development of life on Earth would have been impossible. This insight led Lindahl to discover a series of enzymes and reactions, called base excision repair, which constantly works to fight this decay. The C building block, for instance, is repeatedly broken down into another molecule that should not be in DNA. The enzymes Lindahl found identify that broken molecule and rebuild it into a C.

Sancar found that cells use another technique to repair damage to DNA caused by ultraviolet light, the same thing that gives you a sunburn. This DNA fix is called nucleotide excision repair. People born with defects in this repair system will develop skin cancer if they are exposed to sunlight. Excision enzymes cut out the DNA lesions. The cell also uses this repair system to correct DNA damage people get after they are born, when they encounter mutagenic substances

Finally, Modrich found out how a cell corrects errors that occur during a vital biological process: Cell division, when DNA is replicated. This copying process is supposed to produce identical strands of DNA but often there are stretches of the new stand that do not match up. The set of cellular chemicals that Modrich found, a complex called mismatch repair, scans the strands and fixes them, reducing the error frequency during replication by about a thousand times during each replication cycle. (Modrich co-authored a Scientific American article on genetic engineering.)

“Without all of these repair mechanisms.” Lindahl said, “we would not be long-lived.” For finding them, he and the two other scientists will split $1 million dollars in three equal shares.
- By Josh Fischman | Scientific American







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TPPA a bad deal for Malaysia, can't isolate China, only trade growth defines merits of TPP

KUALA LUMPUR: United Nations assistant director-general and coordinator for economic and social development, food and agriculture organisation, Dr Jomo Kwame Sundaram (pix) has called on the government not to join the Trans Pacific Partnership Agreement (TPPA) as it provides little benefit for Malaysia.



“I am extremely disappointed. I think it is going to affect, not only the Malaysian business community, but also Malaysian consumers and citizens adversely,” he told reporters on the sidelines of the Khazanah Megatrend Forum 2015 .

On Monday, the Ministry of International Trade and Industry (Miti) said the recently concluded TPPA negotiations had agreed to take into consideration almost all of Malaysia’s concerns and sensitivities such as government procurement, state-owned enterprises and bumiputra issues.

The TPP is a trade agreement initiative involving 12 countries namely Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US and Vietnam.

Miti said the TPPA will be presented to parliament once the complete and official text of the agreement is prepared.

Bloomberg reported that Malaysia’s state-owned enterprises may suffer from the deal, which calls for equal access to government procurement even though electronics, chemical products, palm oil and rubber exporters benefit from it.

Jomo said that the TPPA is politically motivated, in that it is an attempt by the US to try and isolate China, with minimum trade advantages for Malaysia.

“For example, if Malaysia produces solar panels it can’t be sold in the US and elsewhere. These are all contravening the bilateral agreements. You cannot expect the TPPA to overcome that,” he explained.

On intellectual property rights, Jomo said that the most significant implication is the cost of medication.

“They have exclusive rights and have been depriving people from the benefits of this. This is scandalous and inhumane, it cannot explain why Malaysia agreed to this,” he said.

In a statement late on Monday however, Miti had reiterated that the TPPA should not hinder the public’s access to affordable drugs and healthcare, while ensuring the necessary incentives for pharmaceutical innovators to produce new drugs and medicines.

Even though there will be “small” benefits, Jomo said the government should look at it as a whole, especially from the cost perspective.

He also said foreign complainants will have more legal resources for dispute settlement through new arbitration panels compared with those from developing countries.

“Even in the negotiations, they (developing countries) are not very well prepared, and everyone knows most of the developing countries just accepted what was given to them. It was the developed countries such as Australia, New Zealand and Japan that were insisting on it and the US compromised to them,” he added.

Meanwhile, Miti secretary-general Tan Sri Rebecca Fatima Sta Maria stressed that the full text of the TPPA will be made available to the public soon.

“We’ve nothing to hide, at the end of the day, the important thing is we want to be sure this works for Malaysia,” she said.

She does not foresee the TPPA taking effect in the next two years considering it has to be approved by every participating country

“ It will be a long process, maybe two years or more, I don’t know,” she added.

A cost benefit analysis commissioned by Miti to determine the attractiveness of the deal is yet to be completed.

TPPA cost benefit analysis still pending

Should have been finalised earlier for the sake of public understanding



PETALING JAYA: The cost benefit analysis on the Trans-Pacific Partnership Agreement (TPPA) should have been finalised and released earlier for the sake of public understanding, Bantah TPPA group chairman Mohd Nizam Mahshar said in a statement yesterday.

Commenting on the conclusion of the TPPA negotiations, he said the cost benefit analysis should have been finalised and released earlier, to provide the public and interested parties with a greater understanding of the TPPA and its implications.

The release of the cost benefit analysis has been delayed for months.

“Until now, it has not been released and we only have three months from the official date of the negotiation’s conclusion to the date that it has to be signed,” he added.

International Trade and Industry Minister, Datuk Seri Mustapa Mohamed said in a Facebook posting yesterday that the contents of the TPPA deal will be made public next month and presented to parliament for debate within the next two months.

The minister said it would also include the completed cost benefit analysis.

“This does not mean a thing. Even though debated by parliamentarians, the agreement cannot be amended,” Mohd Nizam said. “From this day to the next 90 days Malaysia has only two choices, either to take the TPPA agreement as a whole or to reject it completely. We still have a say if we choose to speak up,” he added.

Nizam said despite the conclusion of the negotiations, the group is maintaining its position that the TPPA deal will not benefit the country’s trade or economic health.

He said the possible impact includes restrictions of policy space, intrusions on legal and political sovereignty, huge impact to small and medium enterprises and infant industry, access to affordable medicine, as well as intellectual property effects to knowledge and information institutions and industries.

Meanwhile, the recently formed coalition party Parti Amanah Negara said it hoped all comments from the public will be considered seriously.

“We also hope all necessary action will be taken and the debate will not merely be an exercise in ‘public relations’,” its communication director Khalid Abd Samad said in a statement.

He added that the minister previously had acknowledged that there were several concerns regarding the TPPA, saying among the concerns in the agreement is that it seeks to ensure free competition with minimal government control or intervention.

“This will only result in stronger companies overcoming all others and dominating the market,” Khalid said, explaining that local companies, which are much smaller than the United States multinational companies and other member countries will not be able to compete and therefore become sidelined.

Commenting on the intellectual property rights issue, Khalid said it would have a direct impact specifically on the price of medicine, and enforcement of intellectual property rights would cause higher prices of medicine.

“Even though this may be good for the pharmaceutical companies, it will certainly have a negative effect on the population as a whole,” Khalid added, saying that the party is worried that the deal will only bring short-term benefits, while increasing the country’s dependency on specific sources of revenue.

Meanwhile, Asian Strategy and Leadership Institute’s Centre for public policy studies chairman Tan Sri Ramon Navaratnam said the Ministry of International Trade and Industry should hold several town hall meetings to explain the TPPA deal to the public.

“We cannot afford to leave important national agreements and treaties only to politicians to decide, as they may have their own political deals to settle. We all have to actively participate in the debate outside parliament as well,” he added. - The Sunbiz

TPP cannot ‘isolate China’ - Chinese economy increasingly open, inclusive: economist

The US-led Trans-Pacific Partnership (TPP) trade agreement will not isolate China or seriously hurt the Chinese economy, experts said Wednesday, adding it could lead the world's second-largest economy to reach similar deals with other nations, after a deal was reached on the TPP earlier this week.

Amid widespread online pessimism over the trade pact among 12 Pacific Rim nations that some believe deliberately excluded China, Chinese economists said such anxieties have been overblown.

Huang Wei, director of the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, said the TPP will affect China, but will have a "minimal negative impact" on the Chinese economy in the long run because of the economy's size and its irreplaceable role in regional and global markets.

Huang believes the TPP creates more of a "psychological effect" on China that the country has been left out by its neighbors and trading partners from such a significant trade agreement. "But don't turn pale just at the mention of a tiger," she told the Global Times on Wednesday.

She said, if anything, the trade accord will push China to further engage with regional and global economies and pursue more trade agreements with countries in Asia and around the world, which will help the Chinese economy grow and better compete globally.

Chen Fengying, an expert at the Institute of World Economics Studies under the China Institute of Contemporary International Relations, also believes that the TPP will not isolate China from the regional economy and could even be beneficial.

"Given the important role China plays in regional and global economics, a single agreement won't isolate China," Chen told the Global Times Wednesday. She added that if the TPP can help build a more open and prosperous Asia, it will be conducive for the Chinese economy.

Both Huang and Chen's comments come after trade ministers from the US, Canada, Mexico, Chile, Peru, Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, and New Zealand reached a deal.

After days of negotiations on the details of the deal in Atlanta, US officials announced Monday that an agreement had been reached, ending years of talks, though the deal still needs to go through the legislative process of each country before it can be signed and implemented.

Prevailing issues

Some posts on popular social media platforms in China suggested Wednesday that China's own issues in areas such as intellectual property protection, environmental standards and currency policies prevented it from being included in the deal, while others said the US is trying to single out China and counter China because the US feels its economic and political dominance is being threatened.

Experts said understanding the TPP's impact should not only be based on the "US conspiracy theory" or the "China-deserves-it" angle.

Zhang Jianping, a foreign trade expert at the National Development and Reform Commission, told the Economic Daily that China lags behind in meeting the TPP's requirements, such as environmental, finance and labor standards. It will take a long time for China to reach those standards, and that is why China held back in joining the TPP, he said.

Chen also said that intellectual property protection, environmental standards and other factors might have been reasons why China did not sit at the negotiating table, but such a move has pushed China to improve in such areas, as it holds numerous trade talks with countries in Asia and beyond, including TPP member-nations.

China engages world

China has reached separate free trade agreements with Australia, New Zealand, Chile, Peru, and Singapore, who are also involved in the TPP, while continuing talks with the US, Japan and other countries on free-trade deals.

China is also engaged in regional multilateral trade talks, such as the Free-Trade Area of the Asia-Pacific (FTAAP) with Asia-Pacific Economic Cooperation (APEC) economies, and the Regional Comprehensive Economic Partnership (RCEP) with the Association of Southeast Asian Nations (ASEAN) and Japan, South Korea, Australia, New Zealand and Indonesia.

All these efforts and other projects such as the "Belt and Road" initiative and the Asia Infrastructure Investment Bank (AIIB) show the Chinese economy is moving toward being more open and inclusive, Chen said. It will help the country to maintain its increasing influence over regional and global trade, she added.

Chen also said she believes these trade deals are not mutually exclusive, saying they can complement each other by building a more open and fair regional economy in the Asia-Pacific.

China's Ministry of Commerce said Tuesday that China is open to any trade agreement "compatible" with rules established by the World Trade Organization, and that is conducive to the regional economic integration of the Asia-Pacific region.- Global Times

Only trade growth will define merits of TPP


Labourers work at a garment factory in Sai Dong, outside Hanoi, Vietnam. [Photo/Agencies]

At a critical moment when trade is set to grow less than the global economy for the first time in the last four decades, there is no reason not to welcome the ambitious pact that 12 Pacific Rim countries reached on Monday to create the largest free trade area of the world.

That is why China's Ministry of Commerce said on Tuesday that the Trans-Pacific Partnership is one of the key free trade agreements for the region and China is open to any mechanism that follows the rules of the World Trade Organization and can boost the economic integration of the Asia-Pacific.

As a top global trading power that has hugely contributed to and benefited from the global trade growth for the last two decades, China sincerely hopes the TPP pact and other free trade arrangements in the region can strengthen each other and boost trade, investment and economic growth in the Asia-Pacific, to benefit not just the region but also the rest of the world.

It is also the common wish of the international community that, as a long-term driving force, the current slow pace of global trade growth should be revived through deeper and wider reforms of the international trade system to fuel a sustainable global recovery from the 2008 financial crisis.

The appealing promise that the TPP may reshape industries and liberalize commerce in 40 percent of the world's economy has understandably given rise to praise such as the "most ambitious trade pact in a generation".

Yet the real implications of the TPP deal are far from clear since it has been largely negotiated under a blanket of secrecy to facilitate give-and-take among the signatories.

The power of a successful trade deal is to maximize as much as possible each participant's comparative advantages in global trade while minimizing predictable political opposition from various domestic vested interests.

Nevertheless, even before the five-year marathon talks have secured a really workable arrangement, US President Barack Obama hastened to paint the pact as a way of stopping China from writing the rules of the global economy in an illusion that he may easily win over the domestic political support he expects.

However, if the deal is based on the political priority of one partner, rather than the shared benefit of all partners, it would be hard to believe that it can ensure free market trade as it is being touted.

The world needs a trade-boosting deal. The United States has a huge onus to prove the merits of the TPP.  - China Daily

Economic woes a test for South East Asia

Speculative attacks will challenge reserves, defences built after 1997/98

A man is silhouetted as he fishes near Northport in Klang outside Kuala Lumpur June 6, 2014. REUTERS/SAMSUL SAID

Southeast Asia has spent the best past of two decades shoring defenses against a repeat of the Asian financial crisis, including building up record foreign exchange reserves, yet is now feeling vulnerable to speculative attacks again.

Officials are growing increasingly concerned as souring sentiment has made currencies slide and investors reassess risk profiles in an environment where China is slowing and U.S. interest rates will rise at some point.

And while economists have long dismissed comparisons with the 1997/98 currency crisis, pointing to freer exchange rates, current-account surpluses, lower external debt and stricter oversight by regulators, lately there has been a change.

Malaysia and Indonesia, which export oil and other commodities to fuel China's factories, are looking vulnerable as the world's second-largest economy heads for its slowest growth in 25 years and the prices of their commodity exports plunge.

"We are worried about the contagion effect," Indonesian Finance Minister Bambang Brodjonegoro said last week, using a word widely used in 1997/98.

In 1997, "the thing happened first in Thailand through the baht, not the rupiah. But the contagion effect became widespread," he added.

Taimur Baig, Deutsche Bank's chief Asia economist, said that unlike 1997, when pegged currencies were attacked as over-valued, today's floating ones are "weakening willingly" in response to outflows.

But there can still be contagion, as markets lump together economies reliant on China or on commodities. "If you see a sell-off in Brazil, that can easily spread to Indonesia, which can spread to Malaysia, and so on," he said.

Foreign funds have sold a net $9.7 billion of stocks in Malaysia, Thailand and Indonesia this year, with the bourses in those three countries seeing Asia's largest net outflows, Nomura said on Oct. 2.

Baig said that as in 1997/98, falling currencies will naturally pose balance-sheet problems for companies with dollar debts and local-currency earnings.

This year, Malaysia's ringgit MYR= has fallen nearly 20 percent against the dollar and its reserves dropped by about the same percentage, to below $100 billion.

"It's almost like a perfect storm for Malaysia," the country's economic planning minister, Abdul Wahid Omar, said.

Malaysian officials insist the economic fundamentals are stronger than two decades ago, but some economists aren't sure.

Chua Hak Bin of Bank of America Merrill Lynch said he draws "little comfort" from comparisons with 1997. While in many ways Malaysia's economy is stronger now, for example by having a current account surplus, its external debt is 70 percent of gross domestic product, compared with 44 percent in 1997, and there's "significant downside risk even after the sharp ringgit correction".

None of the three main credit-rating agencies has downgraded Malaysia's creditworthiness in response to market ructions, but Moody's said in September the currency's fall was a symptom of declining exports and other factors negatively impacting key credit buffers.

SOURING SENTIMENT

Indonesia, Southeast Asia's largest economy, has a lower external debt relative to GDP - 32 percent – but foreigners also own a large share its local-currency bonds.

This makes the rupiah, down 13 percent against the dollar this year after jumping on Tuesday, vulnerable to souring sentiment.

"We are trying to differentiate ourselves from Malaysia," Indonesia's Brodjonegoro said. "At least we can get the inflows, we can still create positive sentiment."

At end-February, Indonesia's reserves topped $115.5 billion. On Sept. 21, they were $103 billion.

On Wednesday, the central banks of Indonesia and Malaysia are due to announce fresh reserve figures.

By months of import cover, Southeast Asia's holdings of foreign reserves still seem sufficient. But looking at them relative to overall foreign financing needs, they are more stretched.

Malaysia's reserves barely cover its short-term external debt due this year, while Deutsche Bank says Indonesia's are about 1.5 times what's needed to finance its debts and current-account deficit.

The Philippines, by contrast, has reserves equal to 11 times its financing needs. The $2 billion monthly remittances from its overseas workers provides a solid buffer.

BY NICHOLAS OWEN Reuters

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Good infrastructure determines property value

Sound advice: Lee delivering his talk at the Star Property Fair 2015 in Queensbay Mall, Penang.

GOOD infrastructure plays an important role in determining the value of properties.

Zeon Properties chief executive officer Leon Lee said even US president Barrack Obama stressed the link between infrastructure and a healthy economy.

“According to Obama, a sound infrastructure helps create new jobs, increase business opportunities and facilitating the movement of business,” he said during his talk on ‘Market Outlook 2015: Investing in Uncertain Times’.



“When the second link connecting Johor and Singapore was ready in 1998, the value of properties in the surrounding areas rose 100 times from RM2 psf in 1994 to RM211.

“Similarly when the Shenzhen Bay Bridge was ready in 2008, the value of the properties in Hong Kong and New Territories increased to RM2,870 psf in 2013 from RM470 psf in 1988,” he said.

In Penang, when the second link connecting Batu Maung and Batu Kawan was ready in 2014, the terraced properties in Batu Kawan increased to RM430,000 in 2014 from RM180,000 in 2008.

“In 2007, a terrace house in Batu Maung was worth about RM700,000. But now, a similar unit is priced at RM1.4mil,” he said.

Homebuyers also got an insight on how to get their housing loan approved by Miichael Yeoh.

“One must understand how the process works and if it’s done systematically, it will not get rejected,” he said in his ‘How to Get Your Loan Approved’ talk.

Property investor-cum-author B.K. Khoo said property was an appreciating asset and such investment could generate passive income.

He said effective time management, money and building the right knowledge were keys in sound property investment.

“Don’t wait to buy a property. Buy a property and then wait.

“And remember, your network is your net worth. Try to look around and you will get people to contribute to your success and net worth,” he said in his talk ‘How You Can Be The Next 9 to 5 Property Millionaire?’

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22 Jul 2013

... The road to huge profits. Packed room: Lee giving his talk on 'Infrastructure goes a long way when picking the best property' during The Star Property Fair 2013 at G Hotel, Penang. http://www.zeon.com.my/index.html ...... The value of M&A deals in the first half of this year exceeded US$300bil (RM1.3 trillion), an increase of more than 60% over the same period last year, which had already set the record for the first half year. Perhaps most significantly, China and the ...

http://rightwaysrichard.blogspot.com/

A new era for world powers

Meeting of minds: Xi talking to Obama during a high-level ‘Leaders Summit on Peacekeeping’ during the 70th session General Debate of the United Nations General Assembly at United Nations headquarters in New York. — EPA

THE visit last week by President Xi Jinping to the United States was significant on many levels. It will take months, perhaps years, to fully gauge its implications, but it is not too soon to make some preliminary remarks.

While the main focus was on the fact that it was a full scale state visit with all the trappings, the programme actually comprised three legs: a high-profile meeting with US business leaders in Washington State; the formal state visit in Washington DC including meetings with President Barack Obama; and a speech to the United Nations General Assembly in New York.

On the first leg, Xi assured the US business community that China would remain open to them – as a market for their products and services, as a destination for their investments, and as a source of the goods US consumers want. The underlying message was a very important one: China is now fully plugged in to the global economy, and intends to remain so forever.

The second leg was more notable for the pomp and ceremony rather than for its tangible achievements. There was a Guard of Honour to be inspected, a 21-gun salute on the South Lawn of the White House, a full-scale state dinner plus several meetings with Obama in greater or smaller groups, and even a “private” stroll in the garden.

The third leg saw Xi in the role of international statesman. His measured address to the world body included a pledge of US$2bil (RM8.82bil) to help poorer countries to develop, and the promise of debt relief to those governments who are most hard up.

All high-profile visits of this type have three distinct audiences – one in the host country, one in the home country, and one in the international community at large.

It is probably fair to say that the public in the US took more interest in the coincidental visit of Pope Francis. Then just when the focus began to swing back toward the Chinese leader, the Speaker of the House of Representatives John Boehner announced his resignation and briefly captured the headlines.

Nonetheless, it is the visit of China’s president that will have left the more enduring and deeper impression, especially with the audience that matters most in politics, the media and commerce. The sight of the titans of US business queueing up to greet him on arrival in Seattle, Washington, will linger, as will the mutual respect shown during the formal proceedings, and the heavyweight address to the UN. All these have raised China’s profile with the US people.

For Obama, the visit required the striking of a delicate balance. His overriding priority during the next 16 months is to preserve the main items of his legacy, in particular the Iran nuclear deal and the affordable healthcare legislation.

That means, if possible, he must try to ensure that another member of the Democratic Party succeeds him. If the Republicans were to take the White House and maintain their majorities in both houses of Congress, they could do a great deal to undermine his achievements. The audience back home in China cannot fail to have been impressed. There was the president rubbing shoulders with Bill Gates, Tim Cook and Mark Zuckerberg – all household names – who could not wait to greet Xi. Similarly, officials at all levels will have got the message that engagement with the US is inevitable and needs to be handled pragmatically. Recognition for Xi as a major player in front of the UN added further luster.

Other nations around the world will have seen the same events as people in the US and China. Government leaders in Tokyo, Seoul, Pyongyang, Canberra and other capitals will have to factor in the developments in Sino-US relations to their own policies and strategies going forward. The world has changed and a new era has begun. - China Daily

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Job cuts: rightsizing the oil and gas industry

THE slide in global crude oil prices has left a trail of casualties in its wake.

Oil companies and governments that rely on the price of crude oil for profit and revenue have been hurt by plunging receipts from lower crude oil prices.

For countries dependent on commodities such as crude oil, the effect cuts deeper. Their currencies have felt the brunt from the weaker crude oil prices and it is this group of countries that have a reliance on commodities that have seen the biggest depreciation against the US dollar compared with oil importing countries.

While the macro picture hogs the headlines and generates most of the chatter, the real micro cost of plunging crude oil prices has been felt by employment in the sector.

Many oil majors have announced job cuts to manage costs that had spiralled upwards during the boom days in the industry. Oil majors now have resorted to slashing their workforce amid the biggest downturn in the industry for decades.

For Malaysia, that impact is telling. Between January and July, the Malaysian labour market has laid off 6,547 people (not inclusive the voluntary separation schemes for Malaysia Airlines and banks). But 30% of that number, or nearly 2,000 people who lost their jobs, have come from the oil and gas industry alone.

“It is getting worse,” an oil industry executive says on the job cuts plaguing the industry. He says the oil major he works for is in the midst of a rightsizing exercise and that will mean many jobs will need to be slashed in the coming months.

“We have to reach a new equilibrium for the economies in the oil and gas sector.”

And it does not seem like the industry has hit a trough when it comes to retrenchment.

Part of that is down to the outlook for the price of crude oil. Although there is optimism that prices have hit a bottom, there is another school of thought that predicts more pain for the sector.

Supply from shale oil and future Iranian oil, once trade sanctions are lifted, are clouding the supply dynamics for crude oil and gas.

With expectation that oil prices will remain weak for the foreseeable future, oil majors continue to announce job layoffs. More jobs are expected to be cut next year.

In the US alone, oil companies are reported to have laid off more than 86,000 personnel from June last year up to September of this year. With many global giants having a presence in Malaysia, the workforce in the country will likely be included as part of a global cut in workforce.

Poor profit

The main culprit for job cuts among oil and gas has been the financial performance of those companies. As profits plunge, the knee-jerk reaction is to cut costs, and employment is in the crosshair of such cuts.

The hit on leaner employment prospects has already been told through not only the fall in crude oil prices but also cuts in capital expenditure and operating expenditure by Petronas Nasional Bhd. Companies that service the upstream segment of the industry have been the worst hit.


Downsizing: The main culprit for job cuts among oil and gas has been the financial performance of O&G companies. As profits plunge, the knee-jerk reaction is to cut costs, and employment is in the crosshair of such cuts. — EPA

Petronas, the driver of the local oil and gas industry, has cut its operating costs and that has meant lesser demand for services provided by the oil and gas industry.

An industry official says Petronas, for its part, is not retrenching employees at the moment despite pressure to maintain profitability. It will cut bonuses in order to keep its permanent staff.

“There is no rightsizing of permanent staff at Petronas but whether it renews the contracts of high-paying employees is another thing,” he says.

The hardest hit segment on the industry’s value chain has been upstream activity. The cut in the number of exploration rigs and the associated services indicates the predicament the industry is going through.

The collapse in the price of crude oil has meant that companies are less inclined to spend on searching for new sources of crude oil. It makes matters worse when it is already costly to search for such oil in areas such as deepwater oil fields.

“As revenue comes down, staff are being redeployed from upstream to downstream. Staff will also be asked to multi-task but whether they can do that is another thing,” he says.

A pickup in hiring activity in the upstream segment is not expected as long as crude oil prices are anaemic.

Job cuts have taken place in that segment as a result of dimmed prospects in the industry.

With prices not expected to bounce up significantly, job prospects will remain dim. The general consensus is that crude oil prices are expected to remain sluggish for the short- to medium-term and that has necessitated the cut in expenditure and staff costs.

Trickle down effects

The oil and gas sector is not the only segment that has laid off workers as the pace of retrenchments seemed to have picked up pace.

Maybank Investment Bank says in a report that retrenchments rose sharply in the second quarter, up 56.7% year-on-year to 3,213 in the second quarter compared with a 14.4% increase to 2,789 in the first quarter of this year. “Retrenchments in the construction sector went up as a number of major projects are nearing completion amid slow replenishment rate. The oil and gas sector’s retrenchment has been on the uptrend since the second half of 2014, coinciding with the plunge in crude oil price.

“At the same time, services industries like ‘finance, insurance, real & business services’ and ‘transport, storage & communications’ also showed uptrends,” it says.

Between January and July of this year, statistics indicate that 47% of retrenched workers are skilled, 40% semi-skilled and 13% unskilled.

It is the loss of skilled jobs, such as that by the oil and gas sector, that will have a big knock-on effect on the rest of the economy. The higher than average salaries that those workers once commanded will evaporate from the system and the absence of which will trickle down to the different sectors of the economy.

The slump in the industry has already been felt in the areas surrounding KL City Centre (KLCC), which is said to be the operational hub for oil and gas companies in Malaysia.

Hotel occupancy is down in Kuala Lumpur, especially those around KLCC. The Kuala Lumpur Shangri-la, which is the benchmark for hoteliers in the country, has announced a 10% drop in revenue in the second quarter of this year.

Apart from hotels, rental demand for houses surrounding the KLCC area has been acutely felt with the loss of jobs in the oil and gas industry.

“There has been a knee-jerk reaction especially around the KLCC area,” says a property consultant.

He says tenancies have been cancelled with oil and gas workers retrenched and for those who still have their jobs, their employers are housing them in different areas in the city.

“The numbers are down but it is not significant. There has, however, been a downgrade in the choice of accommodation,” he says.

The outlook though is not going to be rosy. With gross domestic product clocking a growth rate of 4.9% in the second quarter compared with growth of 5.6% in the first quarter, the slower growth rate will eventually bite into the prospects of employment.

“The labour market lags economic activity. There will be a lag of one or two quarters as companies won’t immediately lay off workers,” says an official.

By JAGDEV SINGH SIDHU

Fewer job vacancies due to wait-and-see attitude.

INDUSTRY experts say the shrinking number of job vacancies in the country is due to companies adopting a “wait and see” approach, putting on hold any expansion plans because of economic uncertainty..

Other worse-affected businesses which cannot afford to wait, they said, are downsizing, contributing to the rising number of retrenchments that totalled 6,547 until July this year..

While retrenchments are pressured to rise, what is worrisome is that the number of job vacancies has been on a decline over the past few years. The new openings for jobs have fallen from 1.62 million jobs in 2012 and 1.4 million in 2013 to only 1.07 million last year..

The biggest drop in vacancies was seen in the manufacturing sector, followed by the services sector..

Vacancies in the manufacturing sector fell from 598,890 in 2012 to 352,784 positions last year, a massive 45% drop in just three years..

Retrenchments in the sector was also the highest last year with 5,716 job cuts..

In the services sector, job vacancies went down from 369,983 in 2012 to 275,199 available positions in 2014, while retrenchments were up by an additional 1,151..

The construction sector also saw fewer job vacancies last year, with only 202,878 positions compared to 310,954 two years earlier..

Vacancies in the mining and quarrying sectors saw a marginal increase, up 19% from 2,180 to 2,605 jobs. But conditions have soured in the mining industry led by the slump in global crude oil prices..

The sector saw retrenchments surge almost four-fold from only 81 in 2012 to 318 job cuts last year..

Economist Yeah Kim Leng says the authorities must scrutinise data very carefully to find out to what extent the drop in job opportunities are due to the slowdown in investments and business expansions..

“The Government needs to look at the factors affecting business confidence and the measures to alleviate these factors..

“Given that the investment pipeline seems healthy, the declining number of vacancies is very surprising,” he says..

Yeah expects the situation to improve in the second half of next year, once the Chinese economy stabilises and commodity prices recover..

The Government is currently mulling the possibility of setting up an Employment Insurance Scheme to help retrenched workers in the country..

Deputy Human Resources Minister Datuk Seri Ismail Abd Muttalib said early this month that the scheme, aimed at helping retrenched workers through temporary financial aid, reskilling and upskilling, was announced in Budget 2015 last year..

“In Malaysia, during the economic crisis of 1997-1998 and 2008-2009, we had a steady increase of unfair dismissal cases filed at the Industrial Relations Department. “After those periods, the cases returned to a normal pace. With an economic downturn possibly occurring in the near future, we are getting worried that dismissal and retrenchment cases would go up tremendously,” he said..

The total job loss in Malaysia as a result of the 2008/09 global economic crisis was around 40,000, out of which around 60% were in the manufacturing sector..

This was less severe compared with the estimated total job loss of 84,000 during the 1997/98 Asian financial crisis..

The unemployment problem in Malaysia during the global economic crisis was somewhat cushioned by the “more considerate” strategies taken by companies, which included cutting down their operating hours or days and reducing the salaries of their workers, so as to retain as many workers as they possibly could, instead of cutting headcount..

Weak business sentiment.

Although there has been an increase in investment approvals by the Malaysian Investment Development Authority, Yeah says, business sentiment needs to be monitored..

“We must monitor closely to see if they are going ahead with their investments or are pulling out,” he says..

Business conditions in Malaysia have deteriorated this year, with the Business Conditions Index by the Malaysian Institute of Economic Research painting a grim outlook after the second quarter of the year..

The index fell to 95.4 points from 101 points in the previous quarter. A reading below 100 indicates pessimism..

It also found that the local and export sales outlook was bleak, and capacity utilisation rate had dipped further..

The survey, conducted each quarter to assist in assessing the short-term economic outlook, covers a sample of over 350 manufacturing businesses operating in 11 industries..

Areas explored include production level, new order bookings, sales performances, inventory build-up and new job openings..

In June, Minister in the Prime Minister’s Department Datuk Seri Abdul Wahid Omar said although Malaysia had more than 400,000 people looking for jobs at any given time, the Government had set a target that 75% of graduates would find employment within six months of graduation..

According to the latest numbers from the Department of Statistics, in July this year, there were 459,900 Malaysians unemployed compared to 394,100 in July last year, a 16.7% increase..

The unemployment numbers have been on a rise every month since April this year, from 429,000 to 460,000 persons jobless in July..

Malaysian Employers Federation executive director Datuk Shamsuddin Bardan says the situation is worrying as it means that many graduates would not be able to secure employment due to the shrinking number of vacancies..

“The ability to create middle-level management vacancies is a challenge now due to the economic condition..

“Nobody is sure what is going to happen, so companies have adopted a wait-and-see attitude..

“They are not making any new commitments. They are just maintaining what they have – if possible – or downsizing,” he says..

Shamsuddin says employers need the extra confidence from authorities in order to fix the situation..

“To stimulate employment, incentives have to be given directly to the sector. For example, there are incentives for companies that hire women who have been on a career break for over six months..

“The same can be done for companies that hire fresh graduates, for example, who have not secured jobs after a certain period,” he says..

This, he says, could be in the form of salary subsidies for the first few months..

By P. ARUNA.

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