LIMA, Peru (Nov 13): Malaysia’s Prime Minister Datuk Seri Anwar Ibrahim on Wednesday stressed the importance of strengthening ties with the Global South, highlighting the vast untapped potential and emerging opportunities in this region.

“It’s crucial to shift course slightly and enhance collaboration with the Global South, tapping into the vast new potentials and opportunities,” he said in his opening remarks during the roundtable with captains of industry from Malaysia and Peru here on Wednesday.

The prime minister is here for his official visit and also participation in the Apec Economic Leaders Week (AELW). Also present were Malaysia’s Foreign Minister Datuk Seri Mohamad Hasan, and the country’s Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Aziz.

Anwar, who is also finance minister, said that historically, the focus has been on a narrow set of partners, but the changing global dynamics present a compelling case for broadening the horizons and diversifying alliances. 

He reiterated that while the United States remains Malaysia’s top investor, Putrajaya also has strong trading partnerships with China, “and we are collaborating effectively in multiple areas. That is the way forward”.

“We should not be dictated to by anyone; instead, we must be guided by what is best for our country, as determined by our own people.

“I believe Malaysia and Peru share the same perspective. We need to remain open and neutral. In Asean, we call it centrality,” he said.

Anwar said both countries share several major concerns, as both the countries are multiracial, and are working to bring about change and transitions within their respective nations.

“Peru has policies on energy transition, environmental transition, and multilateralism, as well as investment, trade, governance, and anti-corruption efforts.”

“All these areas are critical, and I express that now is the time to take concrete actions,” he said.

He said alignment of some of the policies between Malaysia and Peru are encouraged, as both countries are members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). 

“We are now closely linked through Asean and the Asia Pacific Economic Cooperation (Apec).”

Meanwhile, Anwar also launched Yinson Holdings Bhd’s (KL:YINSON) Matarani Solar Park in Peru.

Yinson Renewables has completed the acquisition of the 97 MWp Matarani Solar Project in Peru from Grenergy Renewables, an international independent power producer, developer, and engineering, procurement, and construction company, with a strong track record in Latin America. 

The project is located in the Mollendo desert in the Arequipa region, one of the world’s highest solar irradiation areas. 

Most of the project’s energy has been contracted through a power purchase agreement with a bankable offtaker for the next 15 years.

Project Matarani had recently entered commercial operation, injecting about 260 gigawatt hours (GWh) of renewable energy into the Peruvian grid annually, enough to satisfy the energy needs of about 62,000 Peruvian households, and prevent the emission of more than 56,000 tonnes of carbon dioxide per year.

Source: Theedgemarkets

In October, employment rose by +15.9k (0.1%), slightly below Westpac’s forecast of +20k and under the market consensus forecast of +25k. This marks the softest monthly increase in employment since May, when a modest decline was reported, and a departure from the above-trend strength from more recent months – an average of around +50k per month over the September quarter. On a three-month average basis, employment growth has eased slightly from 2.9%yr in September to 2.8%yr in October. That was enough to see the employment-to-population ratio ease marginally from 64.44% to 64.36%, although both figures still round to a record high 64.4%.

We interpret October’s employment print as a normalisation from above-trend momentum that emerged over the last few months. While one month certainly does not mark a trend, there does not seem to be any ‘suspicious’ causes behind the October step-down in employment growth that could point to an unwind next month. Population growth is slowing broadly as expected, and that will continue to see the monthly prints for employment ease accordingly – a result of the Labour Force Survey’s design of estimating sample ratios and ‘scaling’ the implied level changes to population growth.

One factor worth bearing in mind near-term is that employment growth was much stronger than expected during the October-November periods of 2022 to 2023. This reflected an anticipation of stronger demand in the lead-up to Black Friday Sales and the Christmas spending season, as households concentrated spending during discount periods to alleviate cost-of-living pressures. However, this time around it may be the case that with cost-of-living pressures easing, population growth slowing and a greater capacity for employers offer more hours rather than expand headcount, the Black Friday/Christmas impetus is not as materially positive as it was in previous years.

Most analysts – including Westpac – anticipated the participation rate to hold flat at its record high of 67.2% in October. In the event, the participation rate fell by just 0.04ppt, but it was enough for it to round down from 67.2% to 67.1% (from 67.18% to 67.14%). This is still a result certainly worth celebrating – a near record proportion of the population actively engaging in the labour market. The future path for labour force participation depends critically on the balance of cyclical forces and the clear structural uptrend supported by demographic factors. One month’s result is not entirely informative, and whether a gradual downtrend in labour force participation ensues – as we anticipate – remains to be seen.

The tick-down in participation saw the labour force expand by +24.2k, more than the increase in employment recorded in the month, therefore implying a slight increase in the level of unemployment (+8.3k). Overall, this was not enough to see the unemployment rate budge from its current level of 4.1%, as it has done for the past three consecutive months.

The RBA are also closely monitoring developments across other measures of labour force slack and the dynamics around average hours worked – if there were to be clearer signs of easing labour market conditions, it would likely be initially more apparent in these more sensitive measures of underutilisation.

Growth in monthly hours worked rose 0.1%mth in October and 2.2%yr on a three-month average basis, matching the increase in employment and therefore implying no change to average hours worked. Employers have used average hours as a lever to adjust their labour demand quickly in response to rapidly evolving economic conditions over the past two years. With the large swings in average hours mostly behind us, there is no clear evidence of a renewed weakening in labour demand via average hours. As seen in the chart below, average hours are still tracking broadly in line with the historical downtrend that has been in place since the 1970s.

Other measures of underutilisation are also not ringing any alarm bells at this stage. The underemployment rate – which measures those that are willing and able to work more hours than they currently do – fell once again from 6.3% in September to 6.2% in October, the lowest result since April 2023. The underutilisation rate, which combines both unemployment and underemployment, held flat at 10.4%, the lowest since March 2024. Youth unemployment also remains well below the levels observed prior to the pandemic, currently at 9.2%.

Today’s data is a reminder that the Australian labour market remains in relatively solid health and is gradually becoming more balanced. With employment growth slowing broadly in line with population growth and average hours holding steady, there are few signs that labour demand is capitulating to an extent that warrants concern. While virtually all measures of underutilisation are signalling that labour market conditions remain somewhat tight, yesterday’s wages data suggests this is not translating to stronger wage inflation pressures. On balance, today’s update will see the RBA continue to remain focused on the dynamics around underlying inflation.

Finance Minister Choi Sang-mok said Thursday the government will take active steps, if necessary, to address excessive volatility in the foreign exchange (FX) market.

Since Donald Trump's victory in the U.S. presidential election last week, the local currency has been fluctuating around the psychologically significant level of 1,400 won against the U.S. dollar.

In a meeting with other economic policymakers in Seoul, Choi said that if there is excessive volatility in the financial and FX markets, the government will promptly and effectively implement market stabilization measures.

The minister had previously issued a similar message in mid-April, when the exchange rate surged to around 1,400 won against the greenback due to escalating tensions in the Middle East.

The finance minister also emphasized the importance of maintaining strong cooperation and a response system as part of the government's contingency plans.

Attendees at the meeting expressed a shared view that uncertainties surrounding policy changes during the transition period before the new U.S. administration takes office are also contributing to market instability, the ministry said.

Trump has vowed to impose high tariffs on imported goods, implement protectionist measures and introduce tax cuts, which experts believe could lead to an increase in the U.S. budget deficit, higher inflationary pressure and a slowdown in the Federal Reserve's rate-cutting actions. (Yonhap)

Source: Koreatimes

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