Malaysia’s lockdown is the latest threat to a Singapore economy already reeling from the coronavirus outbreak.The city state relies heavily on its neighbor’s workers and food, and Malaysia’s move Monday night to ban all visitors and prevent residents from traveling overseas for about two weeks will choke off a key labor channel.Maybank Kim Eng Research Pte. estimates that about 400,000 Malaysians working and studying in Singapore cross the border on a daily basis. The potential hit to the city state’s economy could therefore be large. Topics : “Banning daily commuters will essentially cut off almost a 10th of Singapore’s labor force, hurting both the manufacturing and services industries,” said Chua Hak Bin, a senior economist at Maybank in Singapore.Read also: Malaysia restricts travel, shuts schools and businesses to combat coronavirusSingapore was already facing a recession because of virus-related disruptions to the city’s trade and tourism. Maybank was estimating a 0.3 percent contraction in gross domestic product in 2020, with the potential for a more severe decline if the Malaysia shutdown takes a heavier toll on the economy.“Malaysia and Singapore remain joined at the hip by geography and history,” Chua said. “Malaysia’s lockdown, especially on travel and non-essential business, could have severe knock-on effects on Singapore’s economy.” The cut-off also threatens to pummel food supplies in Singapore, which relies on Malaysia for a substantial volume of fruits and vegetables. Singapore officials moved Monday to reassure citizens the city won’t run out of food and supplies as consumers rushed out to stack up on groceries.“Although it’s unexpected and unprecedented, I guess we’ll just have to wait and assess given it’s only for two weeks,” and there should be sufficient inventories of food to cover that period, Selena Ling, head of research and strategy at Oversea-Chinese Banking Corporation Ltd. in Singapore, said in an email.Ling said she’s forecasting a 0.9 percent year-on-year contraction for Singapore’s first-quarter GDP growth, “but the risk is that it drags into the second quarter as well.”While Singapore’s officials were credited with a swift, clear, and effective response in the early stages of the outbreak, the global spread of the virus has brought a new wave of challenges to the small and open city state. The number of infections has spiked in recent days, with new cases mainly from overseas arrivals to the country.Read also: Three Indonesians who attended mass prayer in Malaysia test positive for COVID-19The latest economic data doesn’t yet show the pain of the virus outbreak. Non-oil domestic exports expanded 3 percent in February from a year earlier, including a 2.5 percent gain in electronics shipments, according to data published Tuesday.Port data for February showed that Singapore container throughput was humming along, if not booming, at an above-average rate compared with long-term norms.Before the virus outbreak set in, Singapore was poised for a modest rebound following the worst growth performance in a decade in 2019. The government last month reduced its forecasts for 2020 economic growth to a midpoint of 0.5 percent, from 1.5 percent.
The UK’s £22.6bn (€30.9bn) Pension Protection Fund (PPF) has begun building its in-house management team, hiring a senior member of the Aviva Staff Pension Scheme as its inaugural head of liability driven investment (LDI).Trevor Welsh will join in October, leaving the Aviva fund after three years as its head of UK sovereign and LDI.Welsh’s position as head of LDI at the lifeboat fund will likely see him oversee its new hybrid asset portfolio, aimed as a liability matching portfolio and set to grow to £3bn, or 12.5% of assets, by 2017. As part of the portfolio’s growth, the PPF this week appointed Pramerica Investment Management to a £400m direct lending mandate that would see the manager offer inflation-linked loans to firms. Before joining the insurer’s pension fund in 2012, Welsh spent 17 years at Aviva Investors, and a further 14 years at UBS, where he was the Swiss bank’s head of fixed income futures.He will report to the PPF’s CIO Barry Kenneth, who said the hire would allow the fund to exert greater influence over asset allocation as it began bringing investments in-house.“Taking in-house part of our LDI is a key step in updating our investment model and crucial in helping us meet our funding target and future aspirations,” Kenneth said.He added: “Trevor’s expertise in LDI will be invaluable to our development and I very much look forward to working together.”For his part, Welsh said joining the PPF as it began to insource investments was “hugely exciting”.Kenneth previously told IPE that control, rather than management cost, was the driving factor behind its decision to bring management of some of its portfolio in-house.“We know our framework better than anyone else, so, by definition, we should be able to manage it, knowing everything else within the fund, and do so in a more controlled fashion,” he said at the time.During his time at the £14bn Aviva pension fund, Welsh would have helped broker a £5bn longevity swap, at the time the largest ever completed.For more from Barry Kenneth on the PPF’s investment strategy, see the upcoming September issue of IPE
FORMER West Indies pace bowler Andy Roberts believes Darren Sammy’s comments after the regional side won the T20 World Cup in India on April 3 cost him his job as captain of the two-time world champions.Last week, Sammy posted on Facebook that he was informed by Chairman of Selectors Courtney Browne that he was being sacked as captain and based on his performance he would also be dropped from the team selected to play India in two T20 Internationals in Florida at the end of August.Roberts, a consistent critic of the West Indies Cricket Board, said Sammy’s performance in the recently concluded Hero CPL should have earned him a spot on the team but his words from April have come back to haunt him.“This is Sammy’s best year in the CPL and you can see, this year, he was inspired by what transpired in the World T20,” said Roberts.“I think his comments afterwards were more of a motivation for him to do well so that in the event they wanted to axe him, they would do it on the fact that it has nothing to do with cricket.”Roberts also believes Sammy’s replacement Carlos Braithwaite will be damaged by the captaincy, arguing that the pressures of captaincy will impact him negatively.“I don’t know if it’s a choice; they can’t give it to Sammy because they axed Sammy. They can’t give it to (Kieron) Pollard whom I think should be the T20 captain because, to me, he is the best captain around the region right now and they wouldn’t give it to (Dwayne) Bravo either or give it back to Chris Gayle.“So, who are they going to give it to?” (Sportsmax.com)