[Rencana ini membongkar penghapusan levi tidak berfungsi - sekaligus menampakkan kedunguan 'diktator yang baik' itu lagi. Saham melonjak sedikit pada awal minggu tetapi ia menjunam kembali di paras yang lebih rendah lagi. Kebimbangan ringgit akan dinilai semula serta khabar angin yang disebar oleh Mahathir sendiri mengenai penglibatan Tenaga Nasional dalam Bakun dikatakan punca semakin sakit BSKL ketika ini walaupun sudah menerima satu dos penghapusan levi dan satu sudu kelonggaran pelabur luar membeli hartanah sebelumnya. Inilah bahananya bila Daim sudah pergi - setidak-tidaknya boleh juga dia bertekak dengan Mahathir walaupun dia pun dua kali lima penyangak juga.

Perenggan terakhir rencana ini menyebut:

Keuntungan hadapan begitu sukar untuk tiba jika dilihat kepada prestasi pasaran Malaysia minggu lepas. Indeks BSKL melonjak hampir 5% pada hari Khamis selepas berita mampusnya kawalan modal tersiar. Tetapi indeks itu berakhir sedikit rendah dari tahap ia bermula pada hari Isnin untuk jatuh keparasnya 60% lebih rendah dari paras tertingginya 5 tahun sudah"

Jangan lupa untuk membaca kisah Mahathir menyebar khabar angin sehingga menggelabah pengurusan TNB dibuatnya. - Editor]

http://www.asiawise.com/mainpage.asp?
mainaction=50&articleid=1592

Ringgit Fears Keep Investors Away

By Mark Thompson, AsiaWise

7 May 2001 15:30 (GMT +08:00)

If Malaysian officials thought their move last week to lift the last vestige of capital controls would unleash an inflow of foreign money, they are likely to be disappointed. Foreign fund managers have a number of serious reservations about Malaysia, as they have made clear in recent commentaries.

Capital controls have long been one major deterrent to foreign investment in Malaysian stocks. But concern about a possible devaluation of the ringgit has loomed larger in recent months.

Ironically, the sudden move last week to abolish a 10% exit tax on stock market profits, bringing to a close an era that began with the abrupt introduction of capital controls in September 1998, may only heighten suspicions about Malaysia's erratic leadership. As Hugh Young, managing director of Singapore-based Aberdeen Asset Management, said in an interview published earlier this year: "In Malaysia, the perception is that one man or group at the top changes the rules," and that lack of predictability disturbs investors.

As a result, though Prime Minister Mahathir Mohamad insists he has no intention of lowering the fixed rate of 3.80 Malaysian ringgit to the dollar, many fund managers believe a devaluation is all but inevitable in the face of a shrinking U.S. appetite for imports. "The risk of a re-pegging is rising given the recent weakness in regional currencies," noted Charlotte Yew, manager of Jardine Matheson's Malaysia Fund and ASEAN Fund. "With the external environment slowing, the authorities may come under pressure to reduce the value of the ringgit so that Malaysia can gain market share," according to an April Investec report. Foreign investors, the report concluded, "will not want to buy Malaysian stocks just before a devaluation in the currency."

Political turmoil is another cause for concern. "Chaos and violence are not images that appeal to [foreign] investors -- though most of them expect Mahathir will be squeezed out before that happens," a recent report from the Warburg Pincus funds noted. "Until then, they plan to limit their exposure to his whims."

That said, the meager Malaysian weighting in many regional mutual funds has nowhere to go but up. In the $269 million Fidelity Southeast Asia Fund, for example, Malaysia at last report ranked fifth of five countries -- with a weighting of just 1.1%. The removal of capital controls could be an excuse for such funds to become at least somewhat less underweight. Among the Malaysian stocks that might benefit from an inflow of foreign funds are those that have already passed muster with wary foreign analysts.

Despite their reservations about the country, managers of the $46 million Warburg Pincus Emerging Markets Fund at last report made exceptions for six Malaysian stocks. Three of them were resort, hotel and gaming operators Genting Berhad, Resorts World Berhad, and Tanjong Plc.

All three stocks have lost more than 40% over the past year, but news about the lifting of capital controls sent them soaring at least for a day or two last week. Resorts World surged 15% and Genting and Tanjong jumped 8% after the policy change was announced. But by the time the market closed on Friday, they were a percent or two below where they had started the week.

In their otherwise critical recent report on Malaysia, the Warburg Pincus managers suggested that intrepid investors willing to venture into the country should consider the financial sector. The Warburg fund's top pick in the sector is Malayan Banking Berhad, a commercial and merchant bank with offices in Singapore, Hong Kong and the United Kingdom. The Jardine Matheson funds' favorite Malaysian bank is Public Bank Berhad, which is involved in merchant banking, leasing, financing, stock broking and related financial services. Both banks have lost more than 30% over the past year but gained 3% last week.

Malaysia International Shipping Corp., which owns and operates 127 ships, is another top Malaysian holding in the Jardine Matheson Malaysia and ASEAN funds. It has the rare distinction among Malaysian stocks of boasting a gain in value over the 52-week period ending last week -- albeit just 1%.

Further gains could be hard to come by, judging from the Malaysian market's performance last week. The Kuala Lumpur Composite Index jumped nearly 5% on Thursday after the news about the demise of capital controls broke. But it ended the week slightly below where it started on Monday and more than 60% below its highs of five years ago.

The Business Times, Singapore
5th May 2001

Tenaga share price hit by talk it will control Bakun dam

Dr M says it will own majority stake; Tenaga denies this

By Eddie Toh

CONFUSION reigned over the role Tenaga Nasional will play in the controversial Bakun hydroelectric dam project in Sarawak after a day of conflicting statements by the Prime Minister and the national utility's chief.

Malaysian Prime Minister Mahathir Mohamad surprised the market when he told reporters yesterday: 'Tenaga will own most of Bakun if Tenaga wants to invest.'

Barely two hours later, Tenaga chairman Jamaludin Jarjis said the listed giant, which is 64 per cent controlled by the Ministry of Finance and two of its agencies, will only have a minority stake in Bakun. 'I have to clarify what he meant,' Mr Jamaludin said. 'Today the government confirmed that they will consider Tenaga's offers, including the offer to take up a small equity stake in the project.'

The confusion, as well as the Cabinet's decision on Wednesday to leave electricity tariffs unchanged until the year-end, sent Tenaga's share price reeling to RM8.70, down RM1.10 or a hefty 11 per cent.

The price fall of Malaysia's largest company exacerbated the fall of the broader market yesterday. The Kuala Lumpur Stock Exchange Composite Index shed 29.67 points or 4.9 per cent to 576.99 points.

Other analysts attributed the sharp fall to local traders squaring off their positions ahead of the settlement on Monday as they noted that the scrapping of the 10-per cent exit levy on Wednesday did not generate much foreign interest.

But some said the market may consolidate following the short-lived rally due to lingering concerns of the falling reserves and the wobbly ringgit peg. But the focus yesterday was on Tenaga, the biggest price loser. Critics have pointed out that the RM9 billion (S$4.3 billion) Bakun project, which was revived this year, will not be viable.

'The market won't like it if Tenaga gets involved in Bakun. They didn't get their tariff increase, their gearing is high and Bakun is not viable,' Bloomberg quoted Chan Eu-Ky of Dresdner Kleinwort Wasserstein as saying.

Another analyst said Tenaga will be hard-pressed to raise more funds to finance any acquisition of Bakun although the government has dropped the plan to build a 670-km submarine cable to transfer electricity from Sarawak to the Malaysian peninsula. Tenaga's long-term borrowings hover around RM27 billion, nearly double its shareholders' funds.

But Dr Mahathir has a different view. He said yesterday companies like aluminium smelters in California may relocate to Sarawak following the power outages there. As smelters are major power consumers, the dam project will benefit from their presence.

He also said the Malaysian government will halt power pooling and will not be 'hasty' in the privatisation of power generation assets to avoid the fiasco in California. 'So don't be too harsh on us if we have a blackout,' he told the 3,000-odd Tenaga employees.

He added: 'Maybe the California blackout is bad luck. Nobody is perfect. Even the Titanic sank.'

Malaysia suffered a crippling blackout in 1995 and has since taken steps towards power pooling and the privatisation of Tenaga's power generation assets. However, the government cancelled the plan to pool energy with the handful of independent power producers in the wake of the energy crisis in California.

According to an earlier report, Tenaga said power outages in the American state showed that power pooling, where companies buy their power in the open market, has not benefited consumers.

California's 1996 deregulation law required electric utilities PG&E Corp and Edison International to sell off their power plants and buy electricity on the open market.

Higher fuel prices, a drop in imported electricity from other states and too few power plants, have caused the price of electricity the two utilities buy to quadruple this year, bringing them to the brink of bankruptcy.

http://business-times.asia1.com.sg

The Asian Wall Street Journal
4th May 2001

Tenaga Nasional Contradicts Mahathir on Stake in Bakun Dam

By AZIZUL SHAMSUDDIN

Dow Jones Newswires

KUALA LUMPUR, Malaysia -- National utility Tenaga Nasional Bhd. Friday said it has offered to take "a small equity stake" in the multibillion-ringgit Bakun hydroelectric dam project.

The press statement from the company is in contrast to what Prime Minister Mahathir Mohamad said earlier in the day. "Tenaga will probably own most of Bakun Dam, as Bakun is now looking brighter," Mr. Mahathir said in a news conference.

"Today the government confirmed that they will consider Tenaga Nasional's offer including the offer to take up a small equity stake in the project," Tenaga said in a statement.

Other than the offer to take up stake in Bakun project, Tenaga Nasional said it also has offered its assistance in the project management and engineering services, development and management of the Trans-Borneo transmission lines.

"In addition, Tenaga Nasional will also assist in the operations and maintenance of the [Bakun] hydroelectric station to ensure proper implementation of the facilities involved," it said.

Mr. Mahathir's earlier remarks on Tenaga Nasional's possible equity involvement in the Bakun dam pushed Tenaga Nasional's share price down 11% to 8.70 ringgit at the close of trading Friday.

Analysts said some foreign institutional funds sold their holdings in the utility Friday following Mahathir's remarks as they fear the debt-laden company will need to fork out a large sum to build the dam. Tenaga has about 27 billion ringgit ($7.1 billion) in debt.

The Bakun dam project is estimated to cost between eight million ringgit and 10 billion ringgit.

Write to Azizul Shamsuddin at azizul.shamsuddin@dowjones.com

http://interactive.wsj.com/