AGP Executive Report

US–China Trade: The US is reportedly preparing a calibrated 7.5% tariff on Chinese goods tied to excess capacity, aiming to avoid breaking the one-year trade truce ahead of a Xi–Trump summit. ASEAN Battery Push: Malaysia and Indonesia launched lithium-ion battery pouch cell work at the 4th ASEAN Battery Technology Conference in Sepang, alongside new industry partnerships to move research into manufacturing. AI & Chips: Nvidia is paying US$6b to license open-weight AI model-building tech and hire engineers, signaling intensified competition with Chinese AI players. Energy & Ports: Bintulu Port LNG throughput is expected to stay stable on Japan/South Korea demand, with China potentially covered via trade diversion. Construction & Property: SunCon’s 2Q net profit rose to RM103.58m on diversified contributions and a stronger order book; Sime Darby Property said 1H 2026 AUM hit RM5b. Tourism Marketing: Tourism Malaysia signed an MoU with Foodie Media to boost Visit Malaysia 2026–2027 promotion via digital content. Film Industry Policy: FINAS will investigate alleged cartel/market dominance in local films and is set to launch National Film Policy 2026–2035 later this year.

Film & Creative Economy: Malaysia’s local film momentum keeps rising: FINAS says compulsory screening collections hit RM253.31m in 2025 (up from RM125.28m in 2024), while 2026 collections reached RM111.83m as of Aug 10; FINAS also reports local films drawing 7.5m cinema admissions in the first seven months of 2026, edging past Hollywood. Arts Policy: PM Anwar Ibrahim urged a more open approach for filmmakers and the arts, stressing freedom must still respect local culture and morals. Industry Oversight: FINAS will summon exhibitors, distributors and producers to look into claims of cartel/market dominance in the film chain, as it finalises National Film Policy 2026-2035 with new funding, tech and market-access moves. TVET & Skills: A RM3.7m upgrade at IKBN Jitra’s fashion and clothing training facility aims to keep TVET aligned with industry needs, while JTKSM pushes workplace safety education from school. Halal Trade: MATRADE raised MIHAS 2026 sales target to RM5b and added Women in Export plus AI-enabled buyer-seller matching. Energy & Sustainability: McDonald’s Malaysia and TNB expand rooftop solar and green electricity sourcing, adding EV charging at more restaurants. Cross-border Business: Kedah and Thailand’s Trang chambers run B2B networking focused on tourism and halal spillovers. Market Pulse: Bursa Malaysia saw RM230.2m net foreign inflows into utilities, transport/logistics and healthcare last week, but foreign institutions kept net selling overall.

Engineering Safety: Works Minister Alexander Nanta Linggi urged Malaysia’s engineering players to never cut safety to chase profits, as BEM 2026 awards highlighted youth innovation and national engineering figures. Palm Oil Pricing Battle: Indonesia plans a new commodities exchange to set palm oil benchmarks from Jan 1, challenging Malaysia’s FCPO futures as traders weigh whether supply dominance will translate into pricing power. Student Cooperatives Go Digital: ANGKASA says student cooperatives should adopt e-commerce, e-wallets and QR payments to match Gen Z habits, after a MoA with Universiti Utara Malaysia. Semiconductor Supply Chain: Tokuyama is expanding polysilicon production with new Vietnam facilities and a Malaysia synthesis/deposition plant, aiming to reduce reliance on Japan. Trade & Investment Facilitation: APEC reiterated that smoother investment rules—one-stop portals, digital services and streamlined procedures—need sustained policy direction and regional cooperation. Food Security Research: MARDI expects Budget 2027 to keep boosting agriculture and livestock research, alongside entrepreneur programmes like Rezeki Tani. Flood Response (Klang Valley): Selangor and the federal government agreed on five measures, including dam capacity reviews and new flood retention ponds, with technical work to be mapped before Budget 2027. Halal Tourism Push: Ahmad Zahid called for Malaysia to become a global Muslim travel hub by linking tourism with halal innovation, trade, tech and local enterprises.

ESG & Capital Markets: Malaysia’s IPO market is shifting into a stricter ESG disclosure phase as the National Sustainability Reporting Framework expands to all Main Market issuers, with investors warning that weak reporting can hit valuations and raise financing costs. Flood Resilience (Klang Valley): Selangor and the federal government agreed on five measures to cut Klang Valley flood impacts, including technical studies on Batu Dam and Klang Gate Dam capacity, new flood retention ponds, and coordinated river dredging and silt removal ahead of Budget 2027. Halal Tourism Push: Deputy PM Ahmad Zahid says Malaysia should go beyond being a Muslim-friendly destination and build a full Muslim travel economy ecosystem linking tourism with halal innovation, tech and local enterprises. Agri-Tech for Food Security: MARDI is urging Budget 2027 to keep funding agricultural and livestock research, with focus on strategic crops and entrepreneur programmes like Rezeki Tani and Young Agropreneur. Fisheries Modernisation: LKIM will showcase satellite buoys, boat simulators and other tech at MAHA 2026 to help fishermen track fish locations and cut operating costs. Domestic Trade Compliance: Terengganu selected five markets as KPDN Compliant Markets, rolling out trader briefings on licensing, safety and food hygiene. Health Caution: Authorities are warning about unregistered hydrogen inhalers sold online in Malaysia with unverified health claims.

Foreign Worker System Upgrade: Malaysia’s move to online foreign worker applications via the Foreign Workers Centralised Management System (FWCMS) is being welcomed by industry groups, with a push for faster approvals and clearer status tracking. Diesel Subsidy Overhaul: Domestic Trade and Cost of Living Minister Armizan says improvements to the targeted diesel subsidy mechanism will be announced within a month, after feedback from Sabah/Sarawak and KPDN is sent to the Finance Ministry. Trade Momentum: MATRADE reports Malaysia’s total trade hit RM2.16 trillion in Jan–July 2026 (+24.7% y-o-y), with exports up 29.2% and a trade surplus jumping to RM170.5b. E-Waste Crackdown: Despite a full ban on electronic waste imports, illegal shipments still slip in, keeping enforcement and smuggling disruption a priority. MSME Cost Relief: KUSKOP is rolling out steps to help MSMEs manage rising costs, including longer renewal periods for selected licences and permits. Timber Value Shift: The timber sector is urged to move from volume to higher-value, design-led products to build a stronger Malaysian brand. Malaysia–Brunei Ties: Leaders at ALC-27 reaffirmed cooperation, including disaster management and progress on border demarcation, while also addressing immigration frictions. Regional Disruption Watch: West Asia tensions are raising concerns over maritime safety and supply-chain disruption through the Strait of Hormuz.

Malaysia–Brunei Diplomacy: PM Anwar Ibrahim wrapped up his ALC-27 visit to Brunei, thanking the host for hospitality and witnessing an MoU on disaster management cooperation; the leaders also flagged West Asia tensions and urged restraint, while Malaysia said border demarcation is about 50% done and immigration rules need updating. Trade & Industry: MATRADE reported Malaysia’s total trade hit RM2.16trn in Jan–Jul 2026 (+24.7%), with exports up 29.2% and a bigger trade surplus; it also said its Cambodia export mission logged RM186m sales (above target). Skills for Oil & Gas: Sabah pushed to mainstream TVET for oil and gas needs, with RM39.24m allocated for human capital programmes and a career carnival to match talent to industry. Local Business Support: KUSKOP rolled out PRIME 2026 to help MSMEs cut costs, including extending renewal periods for about 55 licences/permits to reduce red tape. Environment & Enforcement: Perak approved RM250,000 to upgrade roads in five Orang Asli villages, and Perak plus the federal government moved to tighten enforcement laws for Pulau Sembilan State Park waters. Semiconductors Push: Malaysia aims to get locally manufactured ARM chips into production by 2030, with token-based access for firms like Oppstar Technology and Alphaswift Industries. E-waste Crackdown: Despite an absolute e-waste import ban, illegal shipments still slip in, showing enforcement gaps remain.

Agri-Trade Push: Malaysia is seeking wider China market access for premium agro-foods, with Agriculture and Food Security Minister Mohamad Sabu visiting Beijing’s Xinfadi wholesale hub to boost “Taste of Malaysia” brand localisation for durian, seafood and halal poultry. Biotech Seeds Drive: KPKM approved a modern biotechnology direction to cut seed and breed import dependency by 30% by 2040, strengthening local planting materials and livestock breeding resilience. Digital Supply Chain: HAVI will open a Kuala Lumpur TechHUB in November, aiming to grow AI-driven forecasting, analytics, automation and IoT fleet management for Asia-Pacific logistics. Manufacturing Finance: Maybank and Singapore Manufacturing Federation signed an MoU to expand access to the Johor-Singapore SEZ, supporting manufacturers with sustainable finance and cross-border supply chain financing. EV Policy Debate: Penang CM Chow says Malaysia’s EV localisation push should strengthen industry without restricting competition or consumer choice, urging clearer communication to protect investor confidence. Tourism-Air Connectivity: MOTAC and Malaysia Aviation Group are deepening ties to expand routes and marketing for VM2026, including India, China and Europe. Local Creative Economy: Malaysia’s digital creative industry hit RM92.5b revenue and RM12.1b exports, creating 11,000+ high-value jobs. Corporate Watch: Khee San’s subsidiary had six bank accounts frozen under AMLA investigations, while Malaysia’s film sector saw local films outperform Hollywood in cinema admissions (Jan–Jul 2026). Tech & Industry Signals: Tokuyama plans chip-material production expansion into Vietnam and Malaysia to reduce supply disruption risk.

Semiconductor Talent Push: Malaysia-Arm partnership is ramping up chip-design capability, with Economy Minister Akmal Nasrullah saying at least 5,000 local talents will be trained by end-2027, building toward 10,000 over four years; four firms are already at design and IP evaluation stage. Arm Tech Access: Oppstar Technology and Alphaswift Industries received Arm Compute Subsystem tech and Arm Flexible Access tokens to accelerate integrated circuit R&D, including drones and advanced microelectronics. Digital Supply Chain: HAVI will open a Kuala Lumpur TechHUB (first in Asia Pacific) to drive AI-enabled logistics, hiring 150 high-value roles by mid-2027. Construction Standards Update: CIDB gazetted nine more construction material products and 22 standards under Act 520, with enforcement starting Feb 2027 after a six-month transition. Haze Disruption: Transboundary haze hit Sarawak hard, forcing nearly 600 schools to close as air quality reached “very unhealthy” levels. Trade Momentum: Malaysia’s exports and imports surged in Jan–July 2026, lifting confidence in the external outlook and supporting higher 2026 export forecasts. Corporate/Finance Watch: Khee San Food Industries’ bank accounts were frozen under AMLA investigations, with potential operational disruption but no expected material financial impact. EV Policy Debate: Penang’s Chow Kon Yeow urged Malaysia to avoid protectionism in CBU EV policy, warning against over-concentration in the sub-RM100,000 segment.

Rubber Upgrading: Plantation and Commodities Minister Noraini Ahmad urged Malaysia to move up the value chain by making more specialised, higher-value rubber products, backed by digital adoption, talent development, traceability and stronger sustainable supply chains. Sovereign Wealth Probe: Prime Minister Anwar ordered a forensic investigation into Khazanah subsidiary Xeraya Capital after the board flagged governance irregularities tied to past transactions. Shipping & Tariff Evasion: A shipping CEO says Malaysia should consider an independent review after the White House flagged Malaysia as a potential “microhub” in China-linked transshipment networks used to evade tariffs. Construction Cashflow Support: Government financing schemes were highlighted as a “lifeline” for small contractors facing cash-flow strain from West Asia geopolitical uncertainties. Healthcare Logistics Drones: A POC in Pahang showed drone delivery of medical samples can cut turnaround by about 20 minutes over ~20km, with further safety and rollout steps needed. JS-SEZ Manufacturing Push: IRDA and AmBank convened a CEO roundtable to keep the Johor-Singapore SEZ aligned with business needs, focusing on investment facilitation, talent, tech adoption and policy support. Telecom Enforcement: Malaysia’s first CMA 1998 charge was brought against Aircom Telecommunication for providing network services without proper licences. Oil Ore Transshipment: Vale Malaysia said it aims to keep iron-ore transshipment at about 20 mln tonnes annually, using automation to improve port efficiency and safety. Cyber/Online Commerce Oversight: Anwar said MITI will review new investment applicants after concerns about warehouse/transit activities that don’t deliver jobs or economic benefits, amid rising cross-border cheap imports.

Construction Finance Lifeline: Malaysia will extend cash-flow support for local contractors hit by West Asia geopolitical uncertainty, using CAKNA 1/2 and BNM SRF, MARA’s SPiKE, and TEKUN’s Contract Financing Scheme-i—aimed especially at G1–G4 firms, with calls to cut red tape. Rail & Ports Boost: Segamat Inland Port in Johor targets 6,000 TEUs by year-end after restarting in late June, while DP World opened an 11,514-sqm warehouse in Johor to deepen contract logistics links across Malaysia–Singapore corridors. Digital Commerce Rules: PM Anwar says MITI will review new investors after spotting warehouse/transit players that don’t create jobs or economic value; separately, the Communications Ministry plans Postal Services Act amendments next year to tighten courier security, as anti-scam enforcement ramps up. Cyber & AI Governance: Malaysia’s industries are shifting from awareness to operational defence, with CyberDSA 2026 returning in October; ExcelScale also launched a unified AI platform in Malaysia offering 100+ models via a single OpenAI-compatible API. Critical Minerals Push: MITI says rare earth investors should bring technology and join upstream-to-downstream supply chain work, not just export raw materials. Energy & Industry Outlook: Gas Malaysia earnings are forecast to rise on higher regulated tariffs and volume recovery, while Vale Malaysia targets steady ~20m tonnes annual iron ore transshipment via its Perak hub.

Tourism & Trade: PATA Travel Mart 2026 in Kuching (18–20 Aug) drew 1,100 delegates from 48 countries, with Sarawak Tourism Board named Grand Title Winner for Marketing at the 2026 PATA Gold Awards; PATA also expanded its Executive Board with five new members. Food & Commodities: Malaysia’s palm oil futures hit a 4½-month high on El Niño supply-risk pricing, while MPOC expects CPO to stay firm above RM4,600 in September. Labour & Migration: Activists want third-party oversight and stronger labour protections for refugees being employed under Malaysia’s Refugee Registration Document programme. Agriculture Security: KPKM is pushing to cut import reliance for farm inputs amid geopolitical uncertainty, citing poultry as stable but dependent on imported inputs. Islamic Economy: MATA urges a special Budget 2027 allocation to boost Islamic tourism and Islamic MICE in Kuala Lumpur. AI Adoption: An AWS survey says 38% of Malaysian businesses now use AI tools, but most are still stuck at basic use cases. Energy/Industry: Petronas Chemicals posted higher Q2 revenue and profit but flagged a challenging outlook.

Budget 2027 Focus: Malaysia’s Budget 2027 draft flags cost-of-living relief, social protection and public-service upgrades, while pushing high-value jobs and investment that builds local supply chains across semiconductors, AI, digital services, energy transition, pharma, logistics and aerospace. Manufacturing Pulse: Capacity utilisation in Malaysia’s manufacturing rose to 83.7% in Q2 2026, led by transport equipment and E&E, though low demand and material supply gaps still weigh on some sectors. Palm Oil Outlook: MPOC expects crude palm oil to stay firm above RM4,600/tonne in September, supported by tighter supply and El Niño risks, while noting downside if vegetable oil prices ease. Academic Reform: IKIM backs AUKU repeal but urges a new framework to protect academic freedom, student rights and university autonomy with clear checks and balances. Rail & Medtech Partnerships: UTHM and KTMB expand rail tech cooperation via work-based learning and joint research; USM’s molecular diagnostics prototypes move toward ISO 13485 and MDA approval. Trade & Industry Links: MATRADE targets RM100m in Cambodia trade via an export acceleration mission and B2B meetings, as Malaysia-Cambodia bilateral trade continues to climb. Energy Market Watch: Kenanga notes Malaysia’s budget is more exposed to refined product prices and subsidies than crude export headlines suggest. Regional Business: TikTok’s role in learning and skills is highlighted by a local study, while Malaysia’s tourism ties with Bangladesh look set to deepen through connectivity, visas and hospitality training.

Halal Bio-innovation: USM and Biotenova, via Pharm-D Health Science, have developed halal postbiotic technology using local resources like Musang King durian and cabbage, with applications spanning healthcare, skin/oral care, pet wellness, and even agriculture, livestock and aquaculture—positioned to support food safety and reduce antibiotic reliance. Insurance & Safety: Allianz General urges Malaysians and businesses to step up electrical fire prevention as EV adoption and higher electricity use raise risks, citing overloaded circuits, faulty wiring and poor maintenance; it recommends annual wiring checks and certified components. AI for Enterprise: Sonata Software appoints Hariprasad “Hari” Rebala as its first Chief AI Officer to move clients from AI pilots to real production outcomes. Rail & Urban Works: MRT Corp announces partial road closures in Penang for Mutiara Line LRT preliminary works (Aug 20–Oct 31) to support drainage and road widening. Bumiputera Financing: TERAJU approved nearly RM190m financing for Bumiputera firms across Pahang, Kelantan and Terengganu to help them scale and become investable. Tech Manufacturing Push: Intuitive will lease a 316,000 sq ft Penang facility (Bandar Cassia) to manufacture da Vinci instruments and devices, targeting operations in 2028 and 1,200 jobs by 2032. Trade & Markets: Bursa Malaysia closed higher as investors rotated into commodity and plantation stocks amid geopolitical uncertainty.

Patent & Traditional Knowledge: MyIPO DG Yusnieza Syarmila Yusoff says Malaysia must protect biodiversity and community know-how via a transparent patent system, including proper disclosure of genetic resource origin and Orang Asal sources under the WIPO treaty—aimed at preventing inappropriate grants and exploitation. Market Watch: Bursa Malaysia closed higher, led by commodity and plantation stocks as investors rotated amid geopolitical uncertainty and firmer crude oil. Aquaculture Push: The tilapia sector gets a boost with a Klang biofloc project backed under PPAN, targeting modern, sustainable production and income for farmers. Dairy & Manufacturing: Dutch Lady Milk Industries reported stronger 2Q profit and revenue, citing core liquid milk momentum and completion of its IR4.0 manufacturing and distribution transition in Bandar Enstek. Competition Law: The Court of Appeal ruled MyCC can’t use judicial review to challenge its own appellate tribunal’s decisions, ordering costs after CAT overturned penalties on insurers. Transport & Infrastructure: Penang’s Mutiara Line LRT work triggers partial lane closures from Aug 20 to Oct 31 for drainage and road widening. Rail Governance: Wan Ahmad Dahlan appointed MRT Corp chairman as RTS Link and Penang LRT progress into delivery phases. AI Policy: Science minister Chang Lih Kang urges Malaysia to move beyond AI adoption toward responsible, trust-based solutions—backed by data centre growth and a future-ready workforce. Tax Reform Debate: PM Anwar says Malaysia is considering consumption tax reform and may combine SST with “acceptable” GST features, while stressing protection for the poorest. Road Safety Target: Govt sets a goal to halve motorcycle deaths by 2030, citing RM30b annual socioeconomic losses from road accidents. Energy & Offshore: Petronas Carigali starts the hunt for an FPSO for the deepwater Megah-1 discovery offshore Sabah. Bilateral Trade: Malaysia and the Philippines agreed to deepen cooperation across defence, law enforcement, migrant worker protection, digital economy, food security and energy at the 9th JCM in Manila.

Malaysia-Philippines Trade Push: Foreign Minister Datuk Seri Mohamad Hasan arrived in Manila to lead Malaysia’s delegation for the 9th Philippines-Malaysia Joint Commission Meeting, with talks set to cover trade, cross-border investment, halal and Islamic finance, energy, agriculture/food security, defence and disaster response. Higher Education Shake-up: IIUM Rector Osman Bakar backs the move to replace AUKU, saying the new higher-education legal framework should protect academic freedom, student participation and university sustainability. Construction Cost Controls: Works Minister Ahmad Maslan tells contractors to submit real proof for Variation of Price (VOP) claims, noting DOSM data shows most materials rose less than 1%—with sand up to 19% in some areas. Sabah Healthcare Build: Sabah Heart Centre at Queen Elizabeth II Hospital is expected to finish in Q3 2027, with operations starting about 24 months later. Retail Growth Watch: 99 Speed Mart’s 2Q 2026 net profit rose 13.4% to RM163.95m as it added 257 outlets and lifted revenue 13.6% to RM3.08b. AI Infrastructure Risk: A regional analysis warns Southeast Asia’s AI buildout could create “technical debt” in GPUs, data centres, power and cooling if investments outpace long-term efficiency.

Construction Costs & Procurement: Malaysia’s Works Ministry says contractors seeking Variation of Price (VOP) must submit real field cost data to DOSM; recent DOSM figures show most materials up less than 1%, with sand rising up to 19% in some areas—so “evidence” matters before VOP is considered. Health Infrastructure: Sabah Heart Centre at Queen Elizabeth II Hospital is on track for completion in 3Q 2027, with operations expected about 24 months later under the 13th Malaysia Plan (RM125m). Food Security & Agri-Industry: Malaysia launches large-scale local grain maize cultivation with MARDI-produced MZ1 and MZ2 varieties in Sepang (about 400 hectares now; first harvest expected end-2026), relying on private-sector cooperation. Logistics & Trade Support: J&T Express Malaysia pledges RM630,000 to sponsor HKHM 2026, backing land transport and air freight for nationwide connectivity. Economy Watch: Inflation eased to 1.8% in July (from 1.9%), with transport costs the key moderating factor. ASEAN Business Links: Malaysia and the Philippines kick off the 9th Joint Commission Meeting in Manila, targeting trade, cross-border investment, and cooperation across halal/Islamic finance, energy, agriculture and food security.