Saturday March 28, 2009
US corporate profits plunge US$120bil in fourth quarter
US corporate profits plunged a record US$120.1bil in the fourth quarter as the economy shrank at its fastest pace since 1982, depressed by a slump in consumer spending and exports, government data showed on Thursday.
In another snapshot of the distressed economy, the number of workers collecting state jobless benefits rose to a record 5.56 million earlier this month, while new claims climbed to 652,000 last week, according to a separate government report.
“It is indicative of the sharp decline in overall economic activity experienced in the fourth quarter,” said Joseph Brusuelas, an economist at Moody’s Economy.com in West Chester, Pennsylvania, speaking of the drop in corporate profits.
The Commerce Department said after-tax corporate profits dropped 10.7% in the fourth quarter, the largest decline since the first quarter of 1994. Profits fell US$5.2bil in the third quarter.
Domestic profits of financial firms skidded US$178.7bil, compared with a US$75.5bil decline in the third quarter. Non-financial corporations’ domestic profits tumbled US$89.1bil in the fourth quarter after increasing US$52.1bil in the prior period.
Shrinking profits came as gross domestic product, which measures the total output of goods and services within US borders, fell at an annual rate of 6.3% in the October-December quarter.
This was the steepest decline since the first quarter of 1982.
But analysts said the October-to-December quarter was probably the worst of the 15-month recession and they expect the economy to start stabilising, although first-quarter output would still show another deep fall.
“We think that the decline in GDP reached its trough in the fourth quarter. GDP will not decline again as fast as it did in the fourth quarter,” said Zach Pandl, an economist at Nomura Securities International in New York.
The government last month estimated the drop in fourth-quarter GDP at 6.2% and the modest revisions to the output estimates reflect adjustments to business inventories and investment figures. – Reuters
Saturday, March 28, 2009
World stuck with dollar
Saturday March 28, 2009
World stuck with dollar
THE dollar is, and will remain, the US’ currency and its own and everyone else’s problem.
The idea of creating a global currency, as espoused by China earlier this week, is interesting, has a certain amount of merit and is simply not going to happen any time soon.
The US’ desire for free access to the cookie jar that being the world’s reserve currency represents will be too strong, especially given its need to finance huge amounts of debt reasonably cheaply. As well practicalities are fearsome, even if consensus was more or less there.
Chinese central bank head Zhou Xiaochuan on Monday called for the creation of a new “super-sovereign” global reserve currency, advocating building on an International Monetary Fund instrument called Special Drawing Rights.
Zhou echoed a call by Russia last week, when it indicated it would raise the issue at the upcoming Group of 20 meeting in London on April 2, saying the idea had support from emerging market economies including Brazil, India, South Korea and South Africa.
There is no doubt that the current system breeds instability, but it enjoys the great advantage of entrenchment and sticking with it allows the US, and others, to avoid making hard choices and paying true market prices for their economic decisions.
No surprise then that President Barack Obama knocked the idea down in blunt terms. “I don’t believe that there’s a need for a global currency,” Obama said, terming the dollar “extraordinarily strong right now.”
Exactly. Too strong by some margin, especially when one considers the coming effects of both quantitative easing and a massive long-term need to fund the costs of the debt binge that exploded and the ever increasing bailout to clean up the aftermath.
In fact, you could say the dollar’s “extraordinary” strength can only be fully explained when you take into account the fact that foreign central banks keep piling up huge reserves of the thing and that it is the international medium of exchange for commodities and energy, well really for global trade and financial intermediation.
Treasury Secretary Timothy Geithner said on Wednesday the US dollar is still the world’s reserve currency and will remain so for a long time, but expressed openness to greater use of IMF SDRs.
The dollar’s central role has two main implications, both rather ugly but also very seductive for those involved.
For the US, it’s a bit of a free ride as far as debt financing goes. People buy and hold treasuries more and the US gets cheaper financing that would otherwise be the case. Of course, that’s a bit like an alcoholic bartender getting a discount at work; a real benefit, but not a true one. It also means that even if the US has the will to take away the proverbial punchbowl or drive the dollar down, it doesn’t always have control, as what it does at the short end of the interest rate curve can be confounded by foreign purchases that keep the long end and financing costs down and the dollar up.
The US reserve status also opens up the opportunity for mercantilist countries, like, say China, to keep its own currency cheap, building up huge dollar stocks and force-feeding the American milch cow with cheap credit with which to buy imported goods.
That may not work any more anyway, as all of the cow’s stomachs are full and the milk’s gone thin.
There is a temptation also to build up reserves as protection against bad times and bitter IMF medicine. Many Asian leaders seem to have vowed after 1997 that they would do what was needed, which often included building up dollar reserves, to avoid having to meet an IMF director’s plane at the airport and accept the accompanying prescription.
That rather indicates that the old system, with the US as global reserve currency, is dying, but I doubt it will do so without a fight and with cooperation among nations willing to cede part of their sovereignty, even for a greater good.
It is amazing and encouraging that China speaks of ceding control of a portion of its foreign reserve assets to IMF management, but I have a hard time seeing it happening widely soon.
So, we will have to get through the next year or two without a super-sovereign currency and with global imbalances being worked out, or around, under the current system.
My best guess is that things actually go in the right direction, more or less. The dollar should weaken as a result of US policy even without a deliberate push downhill from the Chinese. Asian exporting nations will see slowing reserve growth generally, which should translate into diminished flows into the dollar and Treasuries.
That’s going to be painful all around. The Chinese and others will see their investments dwindle, even as they have to resist the impulse to sell into the fall. For the US the process of implementing monetary policy and paying for fiscal policy will be made that much more difficult.
So, goodbye and perhaps good riddance to dollar hegemony, but don’t expect a stable system of global cooperation to rise easily and quickly in its place. – Reuters
World stuck with dollar
THE dollar is, and will remain, the US’ currency and its own and everyone else’s problem.
The idea of creating a global currency, as espoused by China earlier this week, is interesting, has a certain amount of merit and is simply not going to happen any time soon.
The US’ desire for free access to the cookie jar that being the world’s reserve currency represents will be too strong, especially given its need to finance huge amounts of debt reasonably cheaply. As well practicalities are fearsome, even if consensus was more or less there.
Chinese central bank head Zhou Xiaochuan on Monday called for the creation of a new “super-sovereign” global reserve currency, advocating building on an International Monetary Fund instrument called Special Drawing Rights.
Zhou echoed a call by Russia last week, when it indicated it would raise the issue at the upcoming Group of 20 meeting in London on April 2, saying the idea had support from emerging market economies including Brazil, India, South Korea and South Africa.
There is no doubt that the current system breeds instability, but it enjoys the great advantage of entrenchment and sticking with it allows the US, and others, to avoid making hard choices and paying true market prices for their economic decisions.
No surprise then that President Barack Obama knocked the idea down in blunt terms. “I don’t believe that there’s a need for a global currency,” Obama said, terming the dollar “extraordinarily strong right now.”
Exactly. Too strong by some margin, especially when one considers the coming effects of both quantitative easing and a massive long-term need to fund the costs of the debt binge that exploded and the ever increasing bailout to clean up the aftermath.
In fact, you could say the dollar’s “extraordinary” strength can only be fully explained when you take into account the fact that foreign central banks keep piling up huge reserves of the thing and that it is the international medium of exchange for commodities and energy, well really for global trade and financial intermediation.
Treasury Secretary Timothy Geithner said on Wednesday the US dollar is still the world’s reserve currency and will remain so for a long time, but expressed openness to greater use of IMF SDRs.
The dollar’s central role has two main implications, both rather ugly but also very seductive for those involved.
For the US, it’s a bit of a free ride as far as debt financing goes. People buy and hold treasuries more and the US gets cheaper financing that would otherwise be the case. Of course, that’s a bit like an alcoholic bartender getting a discount at work; a real benefit, but not a true one. It also means that even if the US has the will to take away the proverbial punchbowl or drive the dollar down, it doesn’t always have control, as what it does at the short end of the interest rate curve can be confounded by foreign purchases that keep the long end and financing costs down and the dollar up.
The US reserve status also opens up the opportunity for mercantilist countries, like, say China, to keep its own currency cheap, building up huge dollar stocks and force-feeding the American milch cow with cheap credit with which to buy imported goods.
That may not work any more anyway, as all of the cow’s stomachs are full and the milk’s gone thin.
There is a temptation also to build up reserves as protection against bad times and bitter IMF medicine. Many Asian leaders seem to have vowed after 1997 that they would do what was needed, which often included building up dollar reserves, to avoid having to meet an IMF director’s plane at the airport and accept the accompanying prescription.
That rather indicates that the old system, with the US as global reserve currency, is dying, but I doubt it will do so without a fight and with cooperation among nations willing to cede part of their sovereignty, even for a greater good.
It is amazing and encouraging that China speaks of ceding control of a portion of its foreign reserve assets to IMF management, but I have a hard time seeing it happening widely soon.
So, we will have to get through the next year or two without a super-sovereign currency and with global imbalances being worked out, or around, under the current system.
My best guess is that things actually go in the right direction, more or less. The dollar should weaken as a result of US policy even without a deliberate push downhill from the Chinese. Asian exporting nations will see slowing reserve growth generally, which should translate into diminished flows into the dollar and Treasuries.
That’s going to be painful all around. The Chinese and others will see their investments dwindle, even as they have to resist the impulse to sell into the fall. For the US the process of implementing monetary policy and paying for fiscal policy will be made that much more difficult.
So, goodbye and perhaps good riddance to dollar hegemony, but don’t expect a stable system of global cooperation to rise easily and quickly in its place. – Reuters
China challenges US global financial leadership
Published: Saturday March 28, 2009 MYT 12:28:00 PM
Updated: Saturday March 28, 2009 MYT 12:49:30 PM
China challenges US global financial leadership
SHANGHAI: The only major economy still growing at a fast clip, China is being unusually forthright in challenging the U.S.-led global order ahead of an April 2 summit on the financial crisis.
In his second rebuke of U.S. leadership this past week, the central bank governor, Zhou Xiaochuan, said China's rapid response to the downturn - including a 4 trillion yuan ($586 billion) stimulus package - proved the superiority of its authoritarian, one-party political system.
"Facts speak volumes, and demonstrate that compared with other major economies, the Chinese government has taken prompt, decisive and effective policy measures, demonstrating its superior system advantage when it comes to making vital policy decisions," Zhou said in remarks posted on the People's Bank of China's Web site.
In the approach to the London summit of 20 leading economies, Zhou called on foreign governments to give their finance ministers and central bankers broad authority so that they can "act boldly and expeditiously without having to go through a lengthy or even painful approval process."
China has made its agenda clear: It wants a stable U.S. dollar, and has even advocated the creation of another global currency altogether.
It is leery of protectionism.
And it is demanding a larger say in how financial systems are regulated and rescued, while holding back on any promises for new rescue or stimulus measures of its own.
"So far, China has been playing a game set up by other powers. Now China wants to be part of the agenda or rules-setting," said Ding Xueliang, a China expert at Hong Kong's University of Science and Technology.
Whether Beijing has a workable alternative vision for the future of world finance remains to be seen.
But China's growing assertiveness also suggests a sharpening urgency over its vulnerability to the global financial meltdown.
Fearful of any moves that might weaken the dollar and imperil China's estimated $1 trillion in Treasuries and other U.S. government debt, Chinese Premier Wen Jiabao has urged the United States to remain "a credible nation."
In other words, Beijing wants Washington to avoid spurring inflation with excessive government spending on bailouts and stimulus packages.
To keep the value of its own currency steady - some say undervalued - the Chinese government must recycle its huge trade surpluses.
The biggest, most liquid option is U.S. Treasuries.
But a weakening dollar saps the value of those investments.
The Chinese "are being hurt more than anyone else by the mismanagement of the dollar," said William Overholt, an expert with Harvard University's Kennedy School of Government.
Underscoring that grievance, earlier this week Zhou, the central bank governor, called for a new global currency to end the dollar's dominance in trade, foreign reserves and commodity pricing.
Echoing proposals that have been debated for years, he urged the International Monetary Fund to create a "reserve currency" based on shares in the organization held by its 185 member nations, known as special drawing rights, or SDRs.
Such a move would "achieve the objective of safeguarding global economic and financial stability," Zhou said in an essay released by the central bank both in English and Chinese.
Given the wariness of most governments toward relinquishing any sovereign control over their currencies, few even in China view Zhou's proposal as likely to catch on anytime soon.
"Nobody believes the current global monetary system will be changed soon.
It's more like a warning or signal to America to let them know how important it is to keep the dollar stable," said Ding Xinghao, president of the Shanghai Association of American Studies, a private academic think-tank.
China's stolid and somber president, Hu Jintao, will likely focus on cooperation rather than table pounding when he meets President Barack Obama for the first time at next week's London summit on the financial crisis.
"There is no strong consensus between the U.S. and Europe. They have different policy priorities. The EU is quite weak. There are too many states with different opinions and different policy priorities," said Zheng Yongnian, director of the East Asia Institute at the National University of Singapore.
"So it would be easier for the U.S. and China to work together, despite their huge differences."
Still, China is committed to leading a push by the developing world for a greater say in how global finance is regulated and managed.
G-20 members already have agreed that developing countries need a bigger voice in the IMF.
But under a system devised 63 years ago, each country's vote is tied to its financial commitments to the institution, which are determined by economic size, currency reserves and openness to trade and capital flows.
Wang Qishan, a top Chinese financial official and vice premier, said Friday in a commentary in The Times of London that Beijing was ready to contribute more, but wants changes in the IMF's governance structure.
"China is ready to play an active part in exploring ways to raise resources and will contribute to this effort within its ability," Wang wrote.
But he reiterated China's rejection of calls for it to provide part of its $2 trillion in foreign reserves to an IMF bailout fund.
China's leaders have problems at home that they need to spend on, and they insist that their country's greatest contribution to a global recovery is keeping its own house in order and following through on its stimulus package.
Wen said fresh stimulus measures were possible, but only if necessary.
"They've barely spent half of the money.
Why should they be spending more now?" said Jing Ulrich, chairwoman for China equities at J.P. Morgan. "They are pacing themselves."
Despite its massive foreign reserves and an economy that many analysts believe is on the brink of recovery, China's leaders face stunning challenges in finding ways to create jobs for millions of migrant workers left newly unemployed.
Social welfare and health systems are inadequate and its environment wrecked by decades of rampant industrialization.
"On the top, national level, yes, China has lots of money," says Ding Xueliang, a former Communist Party official.
"But if you look at the troubles, all the economic and social challenges the leadership faces, China may hold so much money but it's not enough. It's not enough," he said.
Still, he says, China's leaders do recognize the need to make a bigger contribution if they want a larger say in reshaping the world financial order.
"More and more of the leadership see there is an opportunity for China," Ding said.
"I don't expect a big contribution is possible in the short-term, but a gradual increase in support is possible."
For Another perspective from the China Daily, a partner of Asia News Network, click here
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Updated: Saturday March 28, 2009 MYT 12:49:30 PM
China challenges US global financial leadership
SHANGHAI: The only major economy still growing at a fast clip, China is being unusually forthright in challenging the U.S.-led global order ahead of an April 2 summit on the financial crisis.
In his second rebuke of U.S. leadership this past week, the central bank governor, Zhou Xiaochuan, said China's rapid response to the downturn - including a 4 trillion yuan ($586 billion) stimulus package - proved the superiority of its authoritarian, one-party political system.
"Facts speak volumes, and demonstrate that compared with other major economies, the Chinese government has taken prompt, decisive and effective policy measures, demonstrating its superior system advantage when it comes to making vital policy decisions," Zhou said in remarks posted on the People's Bank of China's Web site.
In the approach to the London summit of 20 leading economies, Zhou called on foreign governments to give their finance ministers and central bankers broad authority so that they can "act boldly and expeditiously without having to go through a lengthy or even painful approval process."
China has made its agenda clear: It wants a stable U.S. dollar, and has even advocated the creation of another global currency altogether.
It is leery of protectionism.
And it is demanding a larger say in how financial systems are regulated and rescued, while holding back on any promises for new rescue or stimulus measures of its own.
"So far, China has been playing a game set up by other powers. Now China wants to be part of the agenda or rules-setting," said Ding Xueliang, a China expert at Hong Kong's University of Science and Technology.
Whether Beijing has a workable alternative vision for the future of world finance remains to be seen.
But China's growing assertiveness also suggests a sharpening urgency over its vulnerability to the global financial meltdown.
Fearful of any moves that might weaken the dollar and imperil China's estimated $1 trillion in Treasuries and other U.S. government debt, Chinese Premier Wen Jiabao has urged the United States to remain "a credible nation."
In other words, Beijing wants Washington to avoid spurring inflation with excessive government spending on bailouts and stimulus packages.
To keep the value of its own currency steady - some say undervalued - the Chinese government must recycle its huge trade surpluses.
The biggest, most liquid option is U.S. Treasuries.
But a weakening dollar saps the value of those investments.
The Chinese "are being hurt more than anyone else by the mismanagement of the dollar," said William Overholt, an expert with Harvard University's Kennedy School of Government.
Underscoring that grievance, earlier this week Zhou, the central bank governor, called for a new global currency to end the dollar's dominance in trade, foreign reserves and commodity pricing.
Echoing proposals that have been debated for years, he urged the International Monetary Fund to create a "reserve currency" based on shares in the organization held by its 185 member nations, known as special drawing rights, or SDRs.
Such a move would "achieve the objective of safeguarding global economic and financial stability," Zhou said in an essay released by the central bank both in English and Chinese.
Given the wariness of most governments toward relinquishing any sovereign control over their currencies, few even in China view Zhou's proposal as likely to catch on anytime soon.
"Nobody believes the current global monetary system will be changed soon.
It's more like a warning or signal to America to let them know how important it is to keep the dollar stable," said Ding Xinghao, president of the Shanghai Association of American Studies, a private academic think-tank.
China's stolid and somber president, Hu Jintao, will likely focus on cooperation rather than table pounding when he meets President Barack Obama for the first time at next week's London summit on the financial crisis.
"There is no strong consensus between the U.S. and Europe. They have different policy priorities. The EU is quite weak. There are too many states with different opinions and different policy priorities," said Zheng Yongnian, director of the East Asia Institute at the National University of Singapore.
"So it would be easier for the U.S. and China to work together, despite their huge differences."
Still, China is committed to leading a push by the developing world for a greater say in how global finance is regulated and managed.
G-20 members already have agreed that developing countries need a bigger voice in the IMF.
But under a system devised 63 years ago, each country's vote is tied to its financial commitments to the institution, which are determined by economic size, currency reserves and openness to trade and capital flows.
Wang Qishan, a top Chinese financial official and vice premier, said Friday in a commentary in The Times of London that Beijing was ready to contribute more, but wants changes in the IMF's governance structure.
"China is ready to play an active part in exploring ways to raise resources and will contribute to this effort within its ability," Wang wrote.
But he reiterated China's rejection of calls for it to provide part of its $2 trillion in foreign reserves to an IMF bailout fund.
China's leaders have problems at home that they need to spend on, and they insist that their country's greatest contribution to a global recovery is keeping its own house in order and following through on its stimulus package.
Wen said fresh stimulus measures were possible, but only if necessary.
"They've barely spent half of the money.
Why should they be spending more now?" said Jing Ulrich, chairwoman for China equities at J.P. Morgan. "They are pacing themselves."
Despite its massive foreign reserves and an economy that many analysts believe is on the brink of recovery, China's leaders face stunning challenges in finding ways to create jobs for millions of migrant workers left newly unemployed.
Social welfare and health systems are inadequate and its environment wrecked by decades of rampant industrialization.
"On the top, national level, yes, China has lots of money," says Ding Xueliang, a former Communist Party official.
"But if you look at the troubles, all the economic and social challenges the leadership faces, China may hold so much money but it's not enough. It's not enough," he said.
Still, he says, China's leaders do recognize the need to make a bigger contribution if they want a larger say in reshaping the world financial order.
"More and more of the leadership see there is an opportunity for China," Ding said.
"I don't expect a big contribution is possible in the short-term, but a gradual increase in support is possible."
For Another perspective from the China Daily, a partner of Asia News Network, click here
Latest business news from AP-Wire
Most Viewed
Most E-mailed
Baby gloom haunts Lee
Father of four sues bank for causing him to be declared a bankrupt
Canny Ong’s killer to hang, Ahmad Najib loses final appeal
Khir: Selangor dropping contractors with links to BN
Court no place for Bollywood drama
Police shoot dead three armed men, arrest three others near resort
Motion on Khir to be tabled at State Assembly
First Lady pitching for home-grown veggies
Missing doctors found dead in ravine
Proper rest and meals
Baby gloom haunts Lee
TB cases on the rise again
Missing doctors found dead in ravine
First Lady pitching for home-grown veggies
Canny Ong’s killer to hang, Ahmad Najib loses final appeal
Khir: Selangor dropping contractors with links to BN
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Specialist doctors go missing
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China calls for global currency
TALKING UP THE DOLLAR
"I don't believe that there's a need for a global currency… (the dollar) is extraordinarily strong right now".
-- US President Barack Obama dismisses suggestions by emerging economic powers, like China, that the world should move away from using the US dollar as its main reserve currency.
Click on the numbered boxes for more quotes …
"I don't believe that there's a need for a global currency… (the dollar) is extraordinarily strong right now".
-- US President Barack Obama dismisses suggestions by emerging economic powers, like China, that the world should move away from using the US dollar as its main reserve currency.
Click on the numbered boxes for more quotes …
Saturday, March 14, 2009
Online shoppers flock to the way of the Taobao.com
Saturday March 14, 2009
Online shoppers flock to the way of the Taobao.com
Shanghai Bund
By CHOW HOW BAN
In the three years since it began, this shopping portal has captured some 75% of China’s online retail market.
AT A weekend badminton session, my Chinese badminton mate revealed that we had been playing with shuttlecocks he had bought online.
“It was as simple as ABC, and furthermore, convenient,” he said of online shopping, a trend that has grown in recent years.
Lucy Jin, 24, who has been buying and selling stuff on Taobao.com at least once a month since two years ago, says: “Shopping online is very interesting. I bought tickets for performances at cheaper prices. And delivery fees are very cheap, too.
“Sometimes, I buy gifts for my friends. And you don’t have to meet up with your friend to give him or her the present. Almost every Chinese girl uses Taobao.”
She said a good buyer could walk away with a good bargain – just like in real-life shopping.
“The owner and I will talk online or via e-mail on discounts,” the Shanghainese lass added.
A Malaysian student, who only wanted to be known as Fiza, was influenced by her Chinese friends into buying things on the popular shopping portal.
“I buy clothes. Sometimes they are cheaper than what I can get at the shopping malls,” she said.
The buyer can also return defective products for an exchange. One can use Internet banking to pay for the goods and check the delivery status on the portal.
Buyers can also obtain receipts from the sellers – individual and corporate – for the products.
Taobao, established in 2003, has become China’s most-used consumer-to-consumer and business-to-consumer website in less than three years.
Taobao facilitated the sale of 99.96bil yuan (RM54bil) of merchandise last year, more than double the 43.3bil yuan in 2007.
Bloomberg reported that Taobao, the e-commerce unit of Alibaba, dominates 75% of China’s online shopping market, citing data from third-party research firm iResearch.
With 62 million registered members, it is not a hard decision for many to turn to Taobao to fulfil their dreams of doing business online, as setting up their own e-commerce portal would require a lot of capital.
However there is still a learning curve.
A Taobao “shop owner” said she sat in front of her computer for days without receiving any orders.
“At the beginning I was worried as I didn’t know if I could recoup the investment I put into my computers and office. But, my perseverance finally paid off,” she said.
Another “shop owner” who succeeded in establishing her own retail brand after years of trial and error, said when she first joined the fray years ago the market was rather new, but the Taobao operator and users upgraded the platform to meet consumers’ demands.
“I think every ‘shop owner’ has faced difficult times in finding the right product to sell.
“There are many success stories among Taobao ‘shop owners’. It’s a matter of whether you put your heart into it.”
She said she had learned to zoom in on her target audience, be specific about the product she was selling, and to vary her marketing strategies.
For another trader, having his product information on various platforms helped develop him into a credible “shop owner”. He sells decorative glass products.
“I started doing business on Taobao in 2005 hoping that I could promote my products to more customers than I could through conventional retailing,” he said.
“When I first registered myself on the portal, I was so naive that I used my real name and personal details, which I shouldn’t have. Now, I have learned a lot and gained tremendous profit in online sales.”
He spends about 10 hours online daily to communicate with his customers and to complete transactions.
Taobao welcomes any company or retailer, and e-commerce has been an effective platform to reach out to the world, he added.
According to an iResearch survey, Taobao created some 570,000 jobs last year, 19% of it in Shanghai, the international gateway to China.
More than half the individual sellers on Taobao are aged between 23 and 32, the majority fresh graduates.
Some 44% earn between 1,000 yuan and 2,000 yuan a month; 4% between 4,000 yuan and 5,000 yuan, and 2% more than 6,000 yuan a month.
Online shoppers flock to the way of the Taobao.com
Shanghai Bund
By CHOW HOW BAN
In the three years since it began, this shopping portal has captured some 75% of China’s online retail market.
AT A weekend badminton session, my Chinese badminton mate revealed that we had been playing with shuttlecocks he had bought online.
“It was as simple as ABC, and furthermore, convenient,” he said of online shopping, a trend that has grown in recent years.
Lucy Jin, 24, who has been buying and selling stuff on Taobao.com at least once a month since two years ago, says: “Shopping online is very interesting. I bought tickets for performances at cheaper prices. And delivery fees are very cheap, too.
“Sometimes, I buy gifts for my friends. And you don’t have to meet up with your friend to give him or her the present. Almost every Chinese girl uses Taobao.”
She said a good buyer could walk away with a good bargain – just like in real-life shopping.
“The owner and I will talk online or via e-mail on discounts,” the Shanghainese lass added.
A Malaysian student, who only wanted to be known as Fiza, was influenced by her Chinese friends into buying things on the popular shopping portal.
“I buy clothes. Sometimes they are cheaper than what I can get at the shopping malls,” she said.
The buyer can also return defective products for an exchange. One can use Internet banking to pay for the goods and check the delivery status on the portal.
Buyers can also obtain receipts from the sellers – individual and corporate – for the products.
Taobao, established in 2003, has become China’s most-used consumer-to-consumer and business-to-consumer website in less than three years.
Taobao facilitated the sale of 99.96bil yuan (RM54bil) of merchandise last year, more than double the 43.3bil yuan in 2007.
Bloomberg reported that Taobao, the e-commerce unit of Alibaba, dominates 75% of China’s online shopping market, citing data from third-party research firm iResearch.
With 62 million registered members, it is not a hard decision for many to turn to Taobao to fulfil their dreams of doing business online, as setting up their own e-commerce portal would require a lot of capital.
However there is still a learning curve.
A Taobao “shop owner” said she sat in front of her computer for days without receiving any orders.
“At the beginning I was worried as I didn’t know if I could recoup the investment I put into my computers and office. But, my perseverance finally paid off,” she said.
Another “shop owner” who succeeded in establishing her own retail brand after years of trial and error, said when she first joined the fray years ago the market was rather new, but the Taobao operator and users upgraded the platform to meet consumers’ demands.
“I think every ‘shop owner’ has faced difficult times in finding the right product to sell.
“There are many success stories among Taobao ‘shop owners’. It’s a matter of whether you put your heart into it.”
She said she had learned to zoom in on her target audience, be specific about the product she was selling, and to vary her marketing strategies.
For another trader, having his product information on various platforms helped develop him into a credible “shop owner”. He sells decorative glass products.
“I started doing business on Taobao in 2005 hoping that I could promote my products to more customers than I could through conventional retailing,” he said.
“When I first registered myself on the portal, I was so naive that I used my real name and personal details, which I shouldn’t have. Now, I have learned a lot and gained tremendous profit in online sales.”
He spends about 10 hours online daily to communicate with his customers and to complete transactions.
Taobao welcomes any company or retailer, and e-commerce has been an effective platform to reach out to the world, he added.
According to an iResearch survey, Taobao created some 570,000 jobs last year, 19% of it in Shanghai, the international gateway to China.
More than half the individual sellers on Taobao are aged between 23 and 32, the majority fresh graduates.
Some 44% earn between 1,000 yuan and 2,000 yuan a month; 4% between 4,000 yuan and 5,000 yuan, and 2% more than 6,000 yuan a month.
Friday, March 13, 2009
Growing number of cardholders
Saturday March 14, 2009
Consumers readily use credit cards after relaxation on rates and charges
By ELAINE ANG and YVONNE TAN
DESPITE the notion that it is never the best of ideas to spend on credit given the costs involved, consumers appear to be doing just that in this economically trying times, based on feedback from industry players.
AEON Credit Service (M) Bhd, for example, says it noticed that consumers were buying more items on credit these days, instead of using cash.
Additionally, the recent relaxation in the interest rate and the late payment charges may encourage consumers to increase further their consumption credit patterns via the use of credit cards, according to OSK Research.
Late payment fees were reduced from a minimum of RM10 to RM5, while the maximum fees were reduced from RM100 to RM75.
The reduced rates were from 15% to 13.5% for Tier 1 credit card holders, 18% to 17% for Tier-2 and 18% to 17.5% for Tier-3. While this may enhance customer numbers, default rates remain a concern.
Citibank Bhd business director (cards and personal loans) Vipin Agrawal expects the current uncertain economic and financial conditions to definitely influence card spending this year.
“Credit card spending is more likely to be cautious and selective. Nevertheless, we do expect the number of cardholders to continue to grow, albeit at a slower pace, this year,” he says.
Amid the global slowdown, some banks have launched credit cards this year with the aim of increasing their customer base.
Alliance Bank Malaysia Bhd recently introduced the You:nique Picture Card – Malaysia’s first personalised picture credit card that comes with customised value plans offering preferred rebates, rates and rewards. Hong Leong Bank Bhd also unveiled a Platinum Business Credit Card this year.
Corporates such as Ming Heng Motor Sdn Bhd and Tesco (M) Sdn Bhd have also tied up with banks to offer credit cards to customers.
Ming Heng became the first automotive retailer to launch a credit card in the country in a partnership with EON Bank Bhd, while Tesco collaborated with RHB Bank Bhd.
OSK Research notes that while growth for unsecured loans such as credit cards and personal loans continue to be relatively high, their respective default risks have remained relatively low.
The gross non-performing loan (NPL) ratio is low at 2.5% for credit cards and 6.3% for personal loans versus household loans of 5.3%, says the research outfit.
Nevertheless, some banks do anticipate credit card default rates to grow in tandem with the more difficult economic environment, which puts a strain on the purse strings.
HSBC Bank Malaysia Bhd general manager (personal financial services) Lim Eng Seong, without revealing the bank’s default rate, says although the bank’s card default rate has not changed significantly over the last few months, the bank is bracing for more difficult times ahead due to the anticipated changes in economic situation.
“The bank has been very selective in growing its card base since 2006 and we do not foresee any changes in the bank’s credit card acquisition strategy,” he says, adding that HSBC has a credit card base of more than one million.
Alliance Bank group chief executive officer Datuk Bridget Lai says the bank’s default rate has remained stable but expects it to grow.
“It will remain manageable given our risk management system,” she adds.
She remains optimistic of the opportunities ahead and expects the bank to continue outperforming the industry as it had done in the last few years.
Malaysian credit card spending grew by 17% last year, according to Bank Negara data.
“Our receivables have been growing two to three times above market rate with significantly low NPLs,” Lai notes.
“But, as expected, when the economy turns bearish, more consumers will face cash flow constraints that will in turn curb spending and spur higher NPLs.”
She says the bank is an advocate of financial literacy – credit limits are assigned in accordance with the ability to pay, with reminder systems in place.
The bank also provides an inclusive range of structured payment products such as balance transfer and installment payment plans for those who seek flexibility and affordability.
To Lai, card acquisition, though important, is not the main driver for the bank.
“For us it is more about risk-adjusted returns and keeping our fundamentals strong,” she says.
In the past three years, the bank has also heavily invested in its distribution channels, marketing capabilities and servicing infrastructure.
Consumers readily use credit cards after relaxation on rates and charges
By ELAINE ANG and YVONNE TAN
DESPITE the notion that it is never the best of ideas to spend on credit given the costs involved, consumers appear to be doing just that in this economically trying times, based on feedback from industry players.
AEON Credit Service (M) Bhd, for example, says it noticed that consumers were buying more items on credit these days, instead of using cash.
Additionally, the recent relaxation in the interest rate and the late payment charges may encourage consumers to increase further their consumption credit patterns via the use of credit cards, according to OSK Research.
Late payment fees were reduced from a minimum of RM10 to RM5, while the maximum fees were reduced from RM100 to RM75.
The reduced rates were from 15% to 13.5% for Tier 1 credit card holders, 18% to 17% for Tier-2 and 18% to 17.5% for Tier-3. While this may enhance customer numbers, default rates remain a concern.
Citibank Bhd business director (cards and personal loans) Vipin Agrawal expects the current uncertain economic and financial conditions to definitely influence card spending this year.
“Credit card spending is more likely to be cautious and selective. Nevertheless, we do expect the number of cardholders to continue to grow, albeit at a slower pace, this year,” he says.
Amid the global slowdown, some banks have launched credit cards this year with the aim of increasing their customer base.
Alliance Bank Malaysia Bhd recently introduced the You:nique Picture Card – Malaysia’s first personalised picture credit card that comes with customised value plans offering preferred rebates, rates and rewards. Hong Leong Bank Bhd also unveiled a Platinum Business Credit Card this year.
Corporates such as Ming Heng Motor Sdn Bhd and Tesco (M) Sdn Bhd have also tied up with banks to offer credit cards to customers.
Ming Heng became the first automotive retailer to launch a credit card in the country in a partnership with EON Bank Bhd, while Tesco collaborated with RHB Bank Bhd.
OSK Research notes that while growth for unsecured loans such as credit cards and personal loans continue to be relatively high, their respective default risks have remained relatively low.
The gross non-performing loan (NPL) ratio is low at 2.5% for credit cards and 6.3% for personal loans versus household loans of 5.3%, says the research outfit.
Nevertheless, some banks do anticipate credit card default rates to grow in tandem with the more difficult economic environment, which puts a strain on the purse strings.
HSBC Bank Malaysia Bhd general manager (personal financial services) Lim Eng Seong, without revealing the bank’s default rate, says although the bank’s card default rate has not changed significantly over the last few months, the bank is bracing for more difficult times ahead due to the anticipated changes in economic situation.
“The bank has been very selective in growing its card base since 2006 and we do not foresee any changes in the bank’s credit card acquisition strategy,” he says, adding that HSBC has a credit card base of more than one million.
Alliance Bank group chief executive officer Datuk Bridget Lai says the bank’s default rate has remained stable but expects it to grow.
“It will remain manageable given our risk management system,” she adds.
She remains optimistic of the opportunities ahead and expects the bank to continue outperforming the industry as it had done in the last few years.
Malaysian credit card spending grew by 17% last year, according to Bank Negara data.
“Our receivables have been growing two to three times above market rate with significantly low NPLs,” Lai notes.
“But, as expected, when the economy turns bearish, more consumers will face cash flow constraints that will in turn curb spending and spur higher NPLs.”
She says the bank is an advocate of financial literacy – credit limits are assigned in accordance with the ability to pay, with reminder systems in place.
The bank also provides an inclusive range of structured payment products such as balance transfer and installment payment plans for those who seek flexibility and affordability.
To Lai, card acquisition, though important, is not the main driver for the bank.
“For us it is more about risk-adjusted returns and keeping our fundamentals strong,” she says.
In the past three years, the bank has also heavily invested in its distribution channels, marketing capabilities and servicing infrastructure.
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Saturday, March 7, 2009
The real cost of credit cards
Saturday March 7, 2009
The real cost of credit cards
A QUESTION OF BUSINESS
By P.GUNASEGARAM
LET’S say you have an outstanding balance on your credit card of say RM100. And you just forgot to pay your bill on time. What do you think your charge will be on an annual basis? Would you believe 10,000%?
The answer is very illuminating but you have to read the fine print to find out. I just did when I saw a late payment charge of RM40 on my bill because a payment of RM4,000 was late by a few days.
First, you have to pay up to 18% a year on the outstanding amount. Second you pay a charge of 1% or RM10 on the outstanding amount the moment you go beyond the repayment deadline. You have 20 days free credit but only if you pay on time. Otherwise, it is 18% from the date of purchase even if you choose to pay in instalments plus your penalty charge if you are late.
Let’s say you are late by a week, which is very normal for a lot of people – in other words, by a week you failed to pay a minimum 5% of your outstanding amount or RM5 in our example of RM100.
For that one-week delay on that RM100 outstanding you pay the minimum charge of RM10. Let’s calculate the charge in percentage terms per year. That’s 10% (10/100X100) for one week or 520% (52x10) for one year, not compounded! Total interest charge: 520+18 or 538%. You pay RM10 because you are late with your instalment payment of RM5 and you still have to pay that instalment.
But hang on a second? Are we calculating this right? No, it’s not quite accurate – in fact we have made a terrible, horrible mistake. You see, you are being charged RM10 on the RM5 instalment that you did not pay on time, not on your outstanding balance of RM100 on which you are already paying 18% a year.
Yes, it’s becoming mind-boggling. If you are a week late, you pay 200% (10/5X100) a week or 10,400% (200X52) a year!! I don’t often use double exclamations but you must admit that it is deserved here.
Oh, I can hear what the banks say – the RM10 is a minimum charge. But you don’t need a minimum charge in this age of computerisation when the machine does the calculation with no people involved in the automatic generation of the charge.
Perhaps you think that’s an extreme example. Let’s take my case of an outstanding sum of RM4,000 for which the late payment charge is 1% or RM40. I think I was late by less than a week but let’s just say it was one week. My minimum payment is 5% of RM4,000 or RM200. The RM40 is 20% of RM200.
That 20% a week translates to 1040% a year, not compounded. If I were a mere day late, it would be 7300% (20X365 days in a year).
I have heard the argument that the late payment charge should be imposed to encourage people to pay the minimum amount and maintain discipline for using credit cards. I suppose then one has to believe that banks will play this role well when they stand to benefit more the more miscreants there are. I prefer to suspend belief.
My bank, a large foreign bank with a long presence here shall remain unnamed because it will be unfair to single it out, but it tells me in the small print that the interest rate on outstanding amounts is 18% a year. But it omits to explain how much in percentage terms its late payment charges (1% or RM10, whichever is higher) on a yearly basis are.
Here’s what I suggest and I hope Bank Negara and the Association of Banks will pay attention. Late payment charges are punitive especially when you are already paying punishing interest rates of up to 18% a year.
So simply do away with the late payment charge and charge the interest, as long as I am under my credit limit. If I have just RM1,000 outstanding on a credit limit of RM80,000 should I be charged for not paying the minimum monthly maintenance? No! I should be penalised only if I go above my credit limit.
If banks still want more, give them the liberty to charge higher rates for outstanding amounts not already paid as required by instalments, a more punitive rate of a reasonable 25%, on the minimum instalment not paid
Let’s see what I would have paid if that was done. I was a week late on RM4,000. But if I had paid 5% or RM200 of it, there would have been no punitive rate. So I would pay 25% a year on RM200 for one week. That works out to 96.15 sen, yes sen. (200x25/100/52), instead of the RM40 I paid.
Really, charging a penalty of RM10 because I missed my instalment of RM5 or even RM25 just is too much. So is having to pay up to 7300% a year in charges because I was late in payment.
And while Bank Negara is looking at these things, perhaps they should take a closer look at the entire penalty rate system and see how bad they really are.
It baffles me how such high charges were permitted in the first place.
Managing editor P. Gunasegaram has no doubts that credit cards are the worst form of legal financing.
The real cost of credit cards
A QUESTION OF BUSINESS
By P.GUNASEGARAM
LET’S say you have an outstanding balance on your credit card of say RM100. And you just forgot to pay your bill on time. What do you think your charge will be on an annual basis? Would you believe 10,000%?
The answer is very illuminating but you have to read the fine print to find out. I just did when I saw a late payment charge of RM40 on my bill because a payment of RM4,000 was late by a few days.
First, you have to pay up to 18% a year on the outstanding amount. Second you pay a charge of 1% or RM10 on the outstanding amount the moment you go beyond the repayment deadline. You have 20 days free credit but only if you pay on time. Otherwise, it is 18% from the date of purchase even if you choose to pay in instalments plus your penalty charge if you are late.
Let’s say you are late by a week, which is very normal for a lot of people – in other words, by a week you failed to pay a minimum 5% of your outstanding amount or RM5 in our example of RM100.
For that one-week delay on that RM100 outstanding you pay the minimum charge of RM10. Let’s calculate the charge in percentage terms per year. That’s 10% (10/100X100) for one week or 520% (52x10) for one year, not compounded! Total interest charge: 520+18 or 538%. You pay RM10 because you are late with your instalment payment of RM5 and you still have to pay that instalment.
But hang on a second? Are we calculating this right? No, it’s not quite accurate – in fact we have made a terrible, horrible mistake. You see, you are being charged RM10 on the RM5 instalment that you did not pay on time, not on your outstanding balance of RM100 on which you are already paying 18% a year.
Yes, it’s becoming mind-boggling. If you are a week late, you pay 200% (10/5X100) a week or 10,400% (200X52) a year!! I don’t often use double exclamations but you must admit that it is deserved here.
Oh, I can hear what the banks say – the RM10 is a minimum charge. But you don’t need a minimum charge in this age of computerisation when the machine does the calculation with no people involved in the automatic generation of the charge.
Perhaps you think that’s an extreme example. Let’s take my case of an outstanding sum of RM4,000 for which the late payment charge is 1% or RM40. I think I was late by less than a week but let’s just say it was one week. My minimum payment is 5% of RM4,000 or RM200. The RM40 is 20% of RM200.
That 20% a week translates to 1040% a year, not compounded. If I were a mere day late, it would be 7300% (20X365 days in a year).
I have heard the argument that the late payment charge should be imposed to encourage people to pay the minimum amount and maintain discipline for using credit cards. I suppose then one has to believe that banks will play this role well when they stand to benefit more the more miscreants there are. I prefer to suspend belief.
My bank, a large foreign bank with a long presence here shall remain unnamed because it will be unfair to single it out, but it tells me in the small print that the interest rate on outstanding amounts is 18% a year. But it omits to explain how much in percentage terms its late payment charges (1% or RM10, whichever is higher) on a yearly basis are.
Here’s what I suggest and I hope Bank Negara and the Association of Banks will pay attention. Late payment charges are punitive especially when you are already paying punishing interest rates of up to 18% a year.
So simply do away with the late payment charge and charge the interest, as long as I am under my credit limit. If I have just RM1,000 outstanding on a credit limit of RM80,000 should I be charged for not paying the minimum monthly maintenance? No! I should be penalised only if I go above my credit limit.
If banks still want more, give them the liberty to charge higher rates for outstanding amounts not already paid as required by instalments, a more punitive rate of a reasonable 25%, on the minimum instalment not paid
Let’s see what I would have paid if that was done. I was a week late on RM4,000. But if I had paid 5% or RM200 of it, there would have been no punitive rate. So I would pay 25% a year on RM200 for one week. That works out to 96.15 sen, yes sen. (200x25/100/52), instead of the RM40 I paid.
Really, charging a penalty of RM10 because I missed my instalment of RM5 or even RM25 just is too much. So is having to pay up to 7300% a year in charges because I was late in payment.
And while Bank Negara is looking at these things, perhaps they should take a closer look at the entire penalty rate system and see how bad they really are.
It baffles me how such high charges were permitted in the first place.
Managing editor P. Gunasegaram has no doubts that credit cards are the worst form of legal financing.
Monday, March 2, 2009
Airline credit card launched
WEB EDITION :: Media & Marketing
Airline credit card launched
Hemananthani Sivanandam
MAYBANK, Singapore Airlines (SIA) and American Express jointly introduced the Singapore Airlines KrisFlyer American Express Gold credit card recently.
SIA’s Chen Sy Yen, Kula, Hew, Lim and Maybank
executive vice-president head of cards and payments
Ashraf Ali Kadir at the launch of the credit card.
The card, the airline’s first co-brand credit card in Malaysia which offers the best KrisFlyer "miles earned rate" in the Malaysian market and attractive savings, puts card members on the fast track to fly for free, and make their travel dreams a reality.
The card was jointly launched by Maybank senior executive vice-president and consumer banking head Lim Hong Tat, American Express Japan, Asia Pacific and Australia senior vice-president and global network services head Kula Kulendran and SIA general manager (Malaysia) Hew Chuen Chiet.
For the first three months, card members will earn two KrisFlyer miles for every RM2 spent on the card, besides receiving a bonus of 3,000 KrisFlyer miles upon the first transaction being made on the card.
Thereafter, card members will earn one KrisFlyer mile for every RM2 spent on the card.
Upon renewal, cardmembers can enjoy up to 50% savings on KrisFlyer miles for a round trip economy class free flight on SIA to the destination of their choice if they have spent a minimum of RM40,000 per year with the card.
"This card will appeal particularly to frequent flyers of Singapore Airlines who wish to enjoy the exclusive privileges in addition to the attractive benefit that American Express offers," said Lim.
He said the credit card is unique as it combines the brand strengths and value of American Express, SIA and Maybank.
"The introduction of the co-brand card is part of Maybank’s strategy to work with leading brands to continuously offer distinct value to its customers," he added.
"We believe there will be tremendous opportunities for Maybank, Singapore Airlines and American Express to leverage on this partnership and ensure our customers benefit from our different rewards and loyalty programmes."
Kula said the partnership marks a new milestone in American Express’ strong track record of success, in developing best-in-class airline co-brand cards that allow banks to broaden their relationship with their most affluent customers.
"This re-affirms American Express’ commitment to increase its brand presence and give the best card benefits to its customers in Malaysia."
Meanwhile, Hew said the airline’s collaboration with Maybank and American Express in presenting the credit card would lead to greater synergy.
"Together, through the strategic partnership between Singapore Airlines and the two leading brands in Malaysia, we will deliver greater rewards for our KrisFlyer members."
The credit card is the latest in the range of American Express charge and credit cards issued in Malaysia in three different categories – classic, gold and platinum. Maybank is the sold acquirer and issuer of American Express cards in Malaysia.
For more information, visit www.americanexpress.com.my/Krisflyer or www.maybank2u.com or call 03-2295 8877. Application forms are also available at Maybank branches and SIA offices.
Updated: 10:14AM Mon, 02 Mar 2009
Printable Version | Email to a Friend
Airline credit card launched
Hemananthani Sivanandam
MAYBANK, Singapore Airlines (SIA) and American Express jointly introduced the Singapore Airlines KrisFlyer American Express Gold credit card recently.
SIA’s Chen Sy Yen, Kula, Hew, Lim and Maybank
executive vice-president head of cards and payments
Ashraf Ali Kadir at the launch of the credit card.
The card, the airline’s first co-brand credit card in Malaysia which offers the best KrisFlyer "miles earned rate" in the Malaysian market and attractive savings, puts card members on the fast track to fly for free, and make their travel dreams a reality.
The card was jointly launched by Maybank senior executive vice-president and consumer banking head Lim Hong Tat, American Express Japan, Asia Pacific and Australia senior vice-president and global network services head Kula Kulendran and SIA general manager (Malaysia) Hew Chuen Chiet.
For the first three months, card members will earn two KrisFlyer miles for every RM2 spent on the card, besides receiving a bonus of 3,000 KrisFlyer miles upon the first transaction being made on the card.
Thereafter, card members will earn one KrisFlyer mile for every RM2 spent on the card.
Upon renewal, cardmembers can enjoy up to 50% savings on KrisFlyer miles for a round trip economy class free flight on SIA to the destination of their choice if they have spent a minimum of RM40,000 per year with the card.
"This card will appeal particularly to frequent flyers of Singapore Airlines who wish to enjoy the exclusive privileges in addition to the attractive benefit that American Express offers," said Lim.
He said the credit card is unique as it combines the brand strengths and value of American Express, SIA and Maybank.
"The introduction of the co-brand card is part of Maybank’s strategy to work with leading brands to continuously offer distinct value to its customers," he added.
"We believe there will be tremendous opportunities for Maybank, Singapore Airlines and American Express to leverage on this partnership and ensure our customers benefit from our different rewards and loyalty programmes."
Kula said the partnership marks a new milestone in American Express’ strong track record of success, in developing best-in-class airline co-brand cards that allow banks to broaden their relationship with their most affluent customers.
"This re-affirms American Express’ commitment to increase its brand presence and give the best card benefits to its customers in Malaysia."
Meanwhile, Hew said the airline’s collaboration with Maybank and American Express in presenting the credit card would lead to greater synergy.
"Together, through the strategic partnership between Singapore Airlines and the two leading brands in Malaysia, we will deliver greater rewards for our KrisFlyer members."
The credit card is the latest in the range of American Express charge and credit cards issued in Malaysia in three different categories – classic, gold and platinum. Maybank is the sold acquirer and issuer of American Express cards in Malaysia.
For more information, visit www.americanexpress.com.my/Krisflyer or www.maybank2u.com or call 03-2295 8877. Application forms are also available at Maybank branches and SIA offices.
Updated: 10:14AM Mon, 02 Mar 2009
Printable Version | Email to a Friend
Harrods boss and daughter to promote Malaysian craft
Saturday February 28, 2009
Harrods boss and daughter to promote Malaysian craft
By CHOI TUCK WO
LONDON: Harrods chairman Mohamed Al Fayed has not only pledged to help promote Malaysian craft worldwide but will also rope in his designer daughter as well.
The Egyptian tycoon said he was confident that his daughter Jasmine would do her best to market products such as accessories as well as batik and the intricately-woven songket.
Describing Malaysia’s handmade textiles and fashionable accessories as “out of this world,” Al Fayed, 76, said his daughter would place orders for her boutique.
Boost for Malaysian talent: The Raja Permaisuri Agong with Al Fayed at the Malaysian Craft Promotion at Harrods, London on Thursday. — AP
Al Fayed, who first visited Malay-sia 11 years ago, paid tribute to the country’s young talent, especially the designers, traditional craftsmen and women who had produced such tremendous art work.
He said he would help expose them to the global market through international buyers, fashion industry people and the store’s involvement in international fashion shows.
“Over the next five weeks, I will also get some of my models to wear the beautiful textile designs so that more people could see them worldwide,” Al Fayed said after attending the launch of the Malaysian Craft Promotion at Harrods by the Raja Permaisuri Agong Tuanku Nur Zahirah on Thursday.
Unity, Culture, Arts and Heritage Minister Datuk Seri Shafie Apdal, who met Al Fayed earlier, said the Egyptian tycoon had agreed to take up the popular products as part and parcel of the Harrods brand.
Harrods boss and daughter to promote Malaysian craft
By CHOI TUCK WO
LONDON: Harrods chairman Mohamed Al Fayed has not only pledged to help promote Malaysian craft worldwide but will also rope in his designer daughter as well.
The Egyptian tycoon said he was confident that his daughter Jasmine would do her best to market products such as accessories as well as batik and the intricately-woven songket.
Describing Malaysia’s handmade textiles and fashionable accessories as “out of this world,” Al Fayed, 76, said his daughter would place orders for her boutique.
Boost for Malaysian talent: The Raja Permaisuri Agong with Al Fayed at the Malaysian Craft Promotion at Harrods, London on Thursday. — AP
Al Fayed, who first visited Malay-sia 11 years ago, paid tribute to the country’s young talent, especially the designers, traditional craftsmen and women who had produced such tremendous art work.
He said he would help expose them to the global market through international buyers, fashion industry people and the store’s involvement in international fashion shows.
“Over the next five weeks, I will also get some of my models to wear the beautiful textile designs so that more people could see them worldwide,” Al Fayed said after attending the launch of the Malaysian Craft Promotion at Harrods by the Raja Permaisuri Agong Tuanku Nur Zahirah on Thursday.
Unity, Culture, Arts and Heritage Minister Datuk Seri Shafie Apdal, who met Al Fayed earlier, said the Egyptian tycoon had agreed to take up the popular products as part and parcel of the Harrods brand.
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