Asia First - Thu 19 Jun 2025
02:29:20 Min
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CNA
an hour ago
- CNA
Money laundering charges dropped against former Malaysia PM Najib in US$6.34 million case linked to 1MDB
KUALA LUMPUR: Ex-Malaysia Prime Minister Najib Razak was on Friday (Jun 20) granted a discharge not amounting to an acquittal in a money laundering trial linked to a former subsidiary of the scandal-hit state fund 1Malaysia Development Berhad (1MDB). The High Court ruled that there was nothing to show the prosecution was able to proceed with the case for the time being. Najib, 71, faced three money laundering charges filed in February 2019. He was accused of receiving RM27 million (US$6.34 million) in illegal proceeds from SRC International through his three AmPrivate Banking accounts in July 2014. Judge K Muniandy said there had been a plethora of postponements in the case, indicating the prosecution was not ready to proceed. 'The circumstances of the case lean in favour of the accused whereby the prosecution, as of today, is not ready to proceed with the trial of the preferred charges against the accused,' the judge was quoted as saying by news portal Free Malaysia Today. A discharge not amounting to acquittal means the accused is released from current charges, but the prosecution retains the right to reinstate those same charges in future. Najib is currently serving a jail term for a separate conviction of corruption and money laundering for illegally receiving about US$10 million from SRC International. He was in July 2020 found guilty of misappropriating SRC International funds involving the transfer of RM42 million into his personal bank accounts in 2014 and 2015. He has been in Kajang Prison since August 2022, after the Federal Court upheld the High Court decision. In February 2024, his jail term was halved from 12 to six years by the Pardons Board and his fine was reduced from RM210 million to RM50 million. The former premier is fighting to serve the rest of his jail term at home, and has filed an application to initiate contempt proceedings against a former attorney-general for allegedly failing to reveal a royal addendum order allowing him to do so.
CNA
3 hours ago
- CNA
Slow rate hikes could cause wage-price spiral, BOJ paper says
TOKYO :Hiking interest rates only gradually as raw material costs rise could heighten the risk of an upward spiral in wages and consumer prices, the Bank of Japan said in a research paper released this week. The paper's publication on Thursday comes as the central bank faces an increasingly complicated policy environment, with inflation at a more than two-year high and U.S. tariffs fanning economic uncertainty. While the staff papers do not represent the BOJ's official view on monetary policy, they provide hints on key topics of attention within the central bank in setting interest rates. The BOJ staff paper, using data from 2002 to 2024, analysed trends in Japan and Europe - which both rely heavily on imported commodities - to study the extent to which rising material costs led to second-round effects on inflation. In Japan, the pass-through of prices from rising raw materials was more moderate than in Europe, the paper said. The second-round effects were moderate but sustained in both Japan and Europe, it said. "Both in Japan and Europe, the initial effects of high raw material costs were the main cause of inflationary trends since 2020. The second-round effects may have heightened the sustainability of price rises," the paper said. Central banks typically raise interest rates to avoid second-round effects on inflation, or a state in which initial price shocks like higher energy costs trigger a spiral of rising wages and inflation that could lead to a broad-based, persistent inflationary environment. A closer look at Japan's data suggested the BOJ's slow pace of interest rate hikes could be enhancing the second-round effects on inflation, the paper said. Structural changes in Japan's labour market could also be making wages less rigid - or more likely to move flexibly reflecting a tight job market - and enhancing the second-round effects on inflation than in the past, the paper said. The analysis comes amid heightening attention within the BOJ board on how persistent rises in food and raw material costs could affect underlying inflation, and households' perception of future price moves. While uncertainty over U.S. tariff policy has put the BOJ on hold in raising interest rates, Governor Kazuo Ueda has signaled the bank's resolve to keep pushing up borrowing costs if Japan stays on course to durably hit the bank's 2 per cent inflation target. Japan's core inflation hit a more than two-year high in May and exceeded the central bank's 2 per cent target for well over three years, keeping it under pressure to resume rate hikes despite economic headwinds from U.S. tariffs.
CNA
3 hours ago
- CNA
Tariff threats, wars will slow but not collapse global luxury sales in 2025, new study shows
Global sales of personal luxury goods are "slowing down but not collapsing", according to a Bain & Co consultancy study released Thursday (Jun 19). Personal luxury goods sales that eroded to €364 billion (US$419 billion; S$539 billion) in 2024 are projected to slide by another 2 per cent to 5 per cent this year, the study said, citing threats of US tariffs and geopolitical tensions triggering economic slowdowns. 'Still, to be positive in a difficult moment – with three wars, economies slowing down, inequality at a maximum ever – it's not a market in collapse,'' said Bain partner and co-author of the study Claudia D'Arpizio. 'It is slowing down but not collapsing.' Alongside external headwinds, luxury brands have alienated consumers with an ongoing creativity crisis and sharp price increases, Bain said. Buyers have also been turned off by recent investigations in Italy that revealed that sweatshop conditions in subcontractors making luxury handbags. Sales are slipping sharply in powerhouse markets the US and China, the study showed. In the US, market volatility due to tariffs has discouraged consumer confidence. China has recorded six quarters of contraction on low consumer confidence. The Middle East, Latin America and Southeast Asia are recording growth. Europe is mostly flat, the study showed. This has created a sharp divergence between brands that continue with strong creative and earnings growth, such as the Prada Group, which posted a 13 per cent first-quarter jump in revenue to €1.34 billion, and brands like Gucci, where revenue was down 24 per cent to €1.6 billion in the same period. Gucci owner Kering last week hired Italian automotive executive Luca De Meo, the former CEO of Renault, to mount a turnaround. The decision comes as three of its brands – Gucci, Balenciaga and Bottega Veneta – are launching new creative directors. Kering's stock surged 12 per cent on news of the appointment. D'Arpizio underlined his track record, returning French carmaker Renault to profitability and previous roles as marketing director at Volkswagen and Fiat. 'All of these factors resonate well together in a market like luxury when you are in a phase where growth is still the name of the game, but you also need to make the company more nimble in terms of costs, and turn around some of the brands,'' she said. Brands are also making changes to minimise the impact of possible US tariffs. These include shipping directly from production sites and not warehouses and reducing stock in stores. With aesthetic changes afoot 'stuffing the channels doesn't make a lot of sense,'' D'Arpizio said. Still, many of the headwinds buffering the sector are out of companies' control. 'Many of these (negative) aspects are not going to change soon. What can change is more clarity on the tariffs, but I don't think we will stop the wars or the political instability in a few months,'' she said, adding that luxury consumer confidence is tied more closely to stock market trends than geopolitics. President of Italian luxury brand association Altagamma Matteo Lunelli underlined that the sector recorded overall growth of 28 per cent from 2019-2024, 'placing us well above pre-pandemic levels.' While luxury spending is sensitive to global turmoil, it is historically quick to rebound, powered by new markets and pent-up demand. The 2008-2009 financial crisis plummeted sales of luxury apparel, handbags and footwear from €161 billion to €147 billion over two years. The market more than recovered the losses in 2010 as it rebounded by 14 per cent, with an acceleration in the Chinese market. Similarly, after sales plunged by 21 per cent during the pandemic, pent-up spending powered sales to new records.
