Managing strata properties in Malaysia

I LIKE to highlight the rather difficult and controversial issue of the management (and maintenance) of stratified properties, particularly flats, apartments and condominiums, in the context of the proposed Strata Management Act, 2012 which is expected to be tabled during the upcoming session of Parliament.

The Building Management Association of Malaysia (BMAM) is the only multi-stakeholder organisation (established in 2009) representing the collective interests of chambers of commerce, developers, engineers, architects, shopping and high-rise complex managers, management corporations (MCs), joint management bodies (JMBs) and managing agents.

However, BMAM was not nvited to participate in the workshops and discussions held by the National Land Council and the Housing and Local Government Ministry when the draft Bill was deliberated, although the implementation of the Act will have consequences that will directly affect BMAM stakeholder-member organisations.

According to the information available to us, the Bill states that only licenced valuers who have been admitted as Property Managers pursuant to Section 21(1)(a) of the Valuers, Appraisers and Estate Agents Act, 1981 (VAEA Act) to manage and maintain stratified (or subdivided) buildings as managing agents.

No such restrictions exist in the current laws that regulate building management, namely the Strata Titles Act, 1985 (ST Act) and the Building and Common Property (Maintenance and Management) Act, 2007 (BCPMM Act).

Building management is a multi-disciplinary occupation and cannot be exclusive to the valuers alone.

The JMBs and MCs want to have the independence and opportunity to appoint any fit and proper person, or appropriate entity, as managing agent on a “willing seller-willing buyer” basis on mutually agreed terms and conditions.

The Bill, by restricting building management and maintenance to valuers, would create a monopoly, and is inconsistent with the spirit of the Competition Act, 2010, which clearly discourages the creation of monopolies.

Though building owners (JMBs and MCs) and Real Estate Investment Trusts (REITs) have been exempted from this ruling, most JMBs and MCs, led by volunteers, do not have the time, skill, expertise or experience to manage and maintain their buildings, and neither can they afford to appoint a registered property manager as a managing agent.

JMBs and MCs would be required to pay a management fee in compliance with their Fee Schedule, excluding other operating costs such as staff salaries, electricity, water, cleaning, security, etc.

We will soon see the mushrooming of more urban stratified slums and ghettos, thereby defeating the objectives of the Government’s squatter resettlement programmes and public housing projects.

The fiduciary responsibilities of the MCs and JMBs have been clearly stated in the ST Act and the BCPMM Act on the management of the Building Maintenance Fund and the Sinking Fund.

The managing agent appointed by the JMB or MC to manage and maintain the subject properties is only required to perform these functions for and on behalf of the JMB or MC. A registered property manager is therefore not required.

The MCs and JMBs only need building and facilities management for their common properties.

Since common properties and facilities cannot be sold, and most residential building owners do not lease their common properties to third parties as they would need them for their own use.

Many non-valuer managing agents have several years of experience in building and facilities management.

They have also been admitted as members and registered building managers by BMAM upon satisfying the required admission criteria.

They are qualified and skilled in building management, operations and facilities maintenance, and have also subscribed to a professional building management liability insurance policy entered into between a local insurance company and BMAM.

Any attempt by the ST Act to split managing agents as valuers and non-valuers will be detrimental to the growth and development of the building management industry in Malaysia.

It will result in the loss of valuable management talent in the industry. It will also have serious social implications on the upward career mobility of qualified and experienced local building managers, many of whom are bumiputras.

The Commissioner of Buildings (COB) should be the sole regulatory body to
supervise and oversee the management and maintenance of stratified buildings in Malaysia.

The involvement of third parties, who have no ownership interests in the properties, will not only erode the COB’s authority but may also result in unnecessary layering, additional costs (with no proportionate increase in service quality), corruption, rent seeking and abuse of power.

PROF S. VENKATESWARAN
Secretary-general
Building Management Association of Malaysia

Time to reform Malaysia's tax system?

Comprehensive review timely as Malaysia is driving its transformation programme

RECENT developments in parts of Europe have sparked a debate in the eurozone on austerity and growth. Those who argue for austerity or “fiscal prudence” claim that debt management is key to restoring investor confidence and, therefore, long-term prosperity.

Borrowing more is not an acceptable response to a crisis caused by over-borrowing and over-spending. In contrast, those who prefer greater stimulus claim that, without further investment, growth will simply not return, and without some Government stimulus, no economy can pull itself out of recession to achieve long-term stability and growth.

Whilst there is no clear “right” answer, there is one aspect of Government policy that is absolutely central to this taxation. Governments must ensure a balanced system of taxation that provides the right incentives to business and citizens, while enabling the Government to meet its debt and spending obligations. Getting this balance right can drive increased confidence among the investor community and stimulate economic activity, international competitiveness and long-term growth.

A new approach

In the past, many countries have relied on the support of international bodies and other inter-governmental assistance to begin the process of tax reform in respect of designing the tax system itself and in improving the ability to collect taxes. In the post “credit-crunch” world, it has become apparent that the operational ability to increase tax revenues is somewhat limited. A new hands-on approach is required to assist the public sector, generating increased tax revenues and driving corporate activity without raising taxes or damaging international competitiveness.

Malaysia has never had a comprehensive review of its tax system

 

Like any business, a Government has costs and it has revenues. A framework is required to help Governments optimise their tax revenue and balancing this need with the creation of the right incentives for citizens and businesses to stimulate the economy. To achieve this, our experience in working with Governments is typically structured around three core work streams:

● Tax reform design - Modeling the economy and designing a new system of taxation appropriate for the jurisdiction, with the emphasis on simplicity, fairness, participation and economic stimulus;

● Tax compliance - Building the taxpayer base to ensure all taxpayers have paid the correct amount of tax under the law and will continue to do so and;

● Tax operational improvements - underpinning both streams, identifying and delivering detailed operational improvements, ensuring transparency of data and processes within the tax administration, across Government departments and with taxpayers.

Malaysia has never had a comprehensive review of its tax system. The setting up of a Tax Review Panel a few years ago basically focussed on the proposed Goods & Services Tax and has done some good work in this area but the focus on income taxes was limited and too restrictive. A comprehensive review is now timely given that Malaysia is aggressively driving its transformation programme towards achieving developed nation status by 2020.

Tax reform design

A tax system is at its best when it is at its simplest, levying the minimal number of taxes, thus making compliance easy for taxpayers and the tax authorities. Headline rates should be minimised, often in exchange for the removal of reliefs or deductions. In addition, it is essential to improve the quality of the taxpayer base. Finally, international trends are to shift the burden of taxation towards indirect taxes to ensure participation in the tax system, improve the reliability of collections and increase fairness.

An effective communications strategy is critical to the success of any tax reform project. To succeed, these projects require a proactive approach to ensure that stakeholders are aware of their progress.

Tax reform projects should have four key phases:

Understand - Work closely with the Government and external bodies to gather and verify data. Quickly establish a detailed understanding of the current tax system and understand the issues from a number of different perspectives. At the same time, model the economy and current tax collections, benchmarking them against other jurisdictions.

Model - Develop an outline model for the proposed tax system, meeting regularly with stakeholders to develop and test ideas and model alternative taxation methods. Produce a detailed proposal for the new tax system, including clear legislative and operational proposals, for political approval.

Implement - Bring the approved model to life. This can include taking a lead drafting new legislation and guidance. A highly operational approach, working to ensure systems, processes and controls are best-in-class and fit-for-purpose is essential at this stage.

Roll-out - Roll out the new system to the various groups of taxpayers and stakeholders and train the Tax Administration teams, including training on tax technical and operational / systems issues.

Tax compliance

In many developing economies, the incidence of tax evasion is certainly not small. Broadening the taxpayer base and ensuring current taxpayers are paying the correct amount of tax under the law helps keep taxes low. Economic and forensic analysis must be applied to identify areas of the economy requiring particular attention. A range of techniques is typically required to provide a complete picture of the tax-paying community.

To deliver real change for the tax administration, forming a single team to identify taxpayers, initiating assessments, managing taxpayer responses and building IT databases is key. Enhancements to processes and systems also drive improved service levels to taxpayers (whether this be speed or quality), which is vital to gain support for the tax system and for improving participation.

Tax operational improvements

Real operational improvements are essential to the successful delivery of any tax reform project. This may include improvements to existing IT systems to automate processes and controls and improve the way data is managed. This applies both to the tax administration's systems and the way it interacts with other Government departments. For example, the tax administration should automatically be informed whenever a new business registers with the Companies Commission.

On a practical basis, it is essential to ensure new tax documents and forms are produced where required, both in paper and electronic form. It makes sense to consider these as part of a wider programme of improving taxpayer interaction, for example, with the implementation of a new website or the ability to file tax returns online. Key to the success of any new document is simplicity both for the tax administration to review and process and for the taxpayer to understand.

Conclusion

The post credit-crunch world has generated a renewed focus on how a Government raises its revenue the right balance of fiscal prudence and stimulus is difficult to achieve. However, with a clear view on what taxes are levied, who pays them and how they are administrated, jurisdictions can drive real improvements in tax collections, real efficiency gains and, in doing so, drive the participation of the taxpaying community. This, in turn, can provide assurance for the investor community, enable the Government to meet its obligations and drive long-term growth for the wider economy, its businesses and citizens.

It is timely that Malaysia announces a comprehensive fiscal reform which is wide-based and wide-ranging and puts into place a long-term plan to mould a world class tax system that will be comparable to the leading developed nations in the world. It is time to let go of the ad-hoc approach of tinkering with the tax system let us get on with it!

By Dr Veerinderjeet Singh and Andrew Burman

● Dr Veerinderjeet is chairman of Taxand Malaysia and Andrew Burman is senior director at Alvarez and Marsal Taxand in the United Kingdom. Both entities are part of the Taxand Global Organisation. They can be contacted at vs@taxand.com.my and aburman@alvarezandmarsal.com respectively.

World Competitive Rankings defy logic

The WEF may have its own method of measuring the competitiveness of each country but its rankings defy the stark reality of what is going on in the world.

BANGKOK: The World Economic Forum (WEF) has just issued its Global Competitiveness Index 2012-2013 rankings.

Thailand’s competitiveness ranking has improved slightly to 38th spot this year, while Switzerland has edged out Singapore to become the most competitive nation on earth.

The WEF has its own formula in ranking the competitiveness of each country. However, the WEF’s ranking does raise some eyebrows.

According to the WEF, Spain is more competitive than Thailand because its overall ranking is 36th. This ranking is questionable.

Spain is planning to seek a full bailout from the European Union. The European Central Bank is about to monetise its debt. It has received €100bil (RM393.7bil) in bailout funds already. Some €75bil (RM295.3bil) in deposits have fled the Spanish banking system.

Spain is in a similar situation to Thailand in the first part of 1997 before Thailand sought a bailout from the International Monetary Fund. By this measure, Spain should not get a ranking higher than Thailand.

Switzerland, ranked No.1, will not enjoy its position as an oasis of peace and prosperity in Europe for too long in the event of a euro implosion. Swiss banks’ assets, which are tied to the European banking crisis, are more than 300% of the country’s GDP.

The United States has slipped to 7th in the rankings. The US economy is in big trouble. Some 46 million Americans are on food stamps. There are 10 million Americans unemployed, including another 12 million who are doing odd jobs.

Some 18 million American households are having a tough time making ends meet. The banking system is in shambles. The US national debt has hit US$16tril (RM49.7tril), or about 100% of the GDP. The budget deficit is chronic. The country is years away, if ever, from being able to balance its budget.

Most important, the Federal Open Market Committee will meet on Sept 12 to determine whether it will go ahead with a bond-buying programme, or QE3, to further prop up the financial system. US finances are in very bad shape indeed.

Japan is ranked in 10th spot. Does it deserve this position? The whole world knows that Japan has the world’s largest public debt at more than US$12tril (RM37.3tril), or 230% of its GDP. Japan’s debt is largely financed by domestic bonds. But with an ageing society, Japan will face higher interest costs from its borrowing, which will put the health of its finances into further question.

The Japanese economy is far from recovering from its crisis of the 1990s. Japan is facing sluggish growth and also high energy costs in the aftermath of the Fukushima nuclear plant disaster.

Its export sector is feeling the pinch from the strong yen. If the consumer markets in Europe or US were to slacken even more, Japan’s export machines will wobble. Foreign exchange earnings will plunge, while domestic demand has been in a weak state all along.

Saudi Arabia, ranked at 18th, is the world’s largest oil exporter. But a Citibank report issued last week said Saudi Arabia might have to import energy by 2030 if the current pace of domestic consumption and exports continues.

Israel is ranked 26th, though it is facing off against Iran in the Middle East. A war could break out between the two countries at any time, given the tensions between their leaders.

China is ranked 29th, although it is the richest country in terms of foreign exchange reserves. Its reserves stand at US$3tril (RM9.3tril). China is the world’s production factory. Its economy is the world’s second largest after the United States. It is improving fast in technology and innovations.

Moreover, China is also building up its military and has nuclear weapons in store. Apparently, China does not deserve this relatively low ranking.

This also applies to other Brics countries such as Russia (67th), Brazil (48th) and India (59th). How is it possible that the Philippines musters at 65th, two notches higher than Russia, which is still a superpower, rich with resources? The Philippines is vulnerable to food price increases and also to natural disasters.

The WEF may have its own method of measuring the competitiveness of each country. But its rankings defy common sense and the stark reality of what is going on in the world.

From a group of leading Asian newspapers working towards improving coverage of Asian affairs
http://www.asianewsnet.net/

Making all housing more affordable in Malaysia

WHEN I watched Usain Bolt cross the 100m line in an Olympic record of 9.63 seconds during the recent concluded Olympic Games, I saw a young focused sprinter with only one objective in mind; to cross the finish line in the shortest possible time. He amazed the world with his stunning performance again.

This reminds me of our journey in making all Malaysian housing more affordable. It is a race that requires the same amount of focus from all relevant stakeholders including public sector which is the Government, and private sectors, i.e. the property developers, home buyers and NGOs. Furthermore, like in a race where the sprinters have a sight on the direction and goal, all stakeholders in the housing industry should be aligned to the same goal before starting the race.

To understand what exactly drives up property prices, we need to analyse the various factors that influence the price of a housing development in Malaysia. This may help us identify the root cause and provide us with the correct remedies to make Malaysian housing more affordable and sustainable.

Let's begin by looking at what are the major cost components of a property project. Twenty or 30 years ago, land acquisition was only about 5% to 10% of a project cost, but nowadays, it can take up to a sizable 20% to 30% of the whole development budget before any value-added works are carried out on the land itself.

Land prices are ever rising due to scarcity of urban land especially in the major cities. For example, a piece of land that used to cost RM10 per sq ft in Mont' Kiara during the late 80's now can cost up to RM300 per sq ft. With rising land cost “eating” up a significant portion of the development budget, house prices automatically increase as a result.

The next major cost is the holding cost and construction financing cost of the project. The longer it takes to complete a project, the higher the financing costs of the project which will then increase the price of a home.

I mentioned this before in my earlier articles that property projects are sometimes subjected to one, two or more years of gestation period to obtain all the necessary approvals from the relevant authorities before they can be launched. The lengthy approval period will definitely affect the holding costs, and slow down the supply of housing units. If this approval time is not shortened, the rising demand will only further push the prices up. This is the basic market influence of supply and demand.

Another factor that influences the cost of housing, as highlighted by developers surveyed during the recent Real Estate and Housing Developers' Association (Rehda) media briefing, is the unsold and unreleased Bumiputra units.

According to the latest half-yearly property industry survey by Rehda, the number one reason for unsold properties comes from unreleased bumiputra units and has been so for the past two years.

With the requirement to hold on to the unsold bumiputra units, the additional holding cost is inevitably spread out to all the other house buyers in the form of higher priced units. Unreleased bumiputra units may also create a false impression of supply shortage in the market, and these can cause the prices to increase again. While we recognise the need for a bumiputra housing policy, the various states should agree on a transparent, auto-release mechanism to release bumiputra units if unsold beyond 18 months of launch, to make houses more affordable for everyone.

Apart from land cost, holding, and construction financing costs, another cost component that adds to the price of properties is utilities costs. In the past, utility companies would be expected to build substations and water storage towers as well as lay electrical cables and water pipes. Today, all these are required to be completed by developers themselves.

In a roundtable discussion on housing affordability, Housing Buyers Association secretary-general, Chang Kim Loong highlighted that the privatisation of utility companies have turned them into profit-oriented companies. Taxpayers' monies are no longer utilised to provide the basic necessities that they have paid for. This ends up making houses cost more because home owners end up bearing the cost of the infrastructure for these utility services.

In the illustration mentioned at the start of this article, a sprinter must stay focused on the targeted goal of winning the race without mental and physical disadvantages before and during the sprint. Imagine if Bolt needed to run against a headwind and carried a few pounds on his back all along the race. Would he still able to break the Olympic record and become a legend?

In the race to make the price of all housing units more affordable, the issues of high land cost, lengthy approval period, additional utilities expenditure and unreleased bumiputra lots are the burdens that are holding houses back from becoming more affordable. Solve these dilemmas and we will begin to break records.

● FIABCI Asia-Pacific Regional Secretariat chairman Datuk Alan Tong has over 50 years of experience in property development. He is also the group chairman of Bukit Kiara Properties. For feedback, please email feedback@fiabci-asiapacific.com. 

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China, Russia sound alarm on world economy at APEC summit

By Timothy Heritage

VLADIVOSTOK, Russia

(Reuters) - China and Russia sounded the alarm about the state of the global economy and urged Asian-Pacific countries at a summit on Saturday to protect themselves by forging deeper regional economic ties.

Chinese President Hu Jintao said Beijing would do all it could to strengthen the 21-member Asia-Pacific Economic Cooperation (APEC) by rebalancing its economy, Asia's biggest, to improve the chances of a global economic recovery.

Russian President Vladimir Putin said trade barriers must be smashed down as he opened the APEC summit which he is hosting on a small island linked to the Pacific port of Vladivostok by a spectacular new bridge that symbolizes Moscow's pivotal turn to Asia away from debt-stricken Europe.

"It's important to build bridges, not walls. We must continue striving for greater integration," Putin told the APEC leaders, seated at a round table in a room with a view of the $1 billion cable-stayed bridge, the largest of its kind.

"The global economic recovery is faltering. We can overcome the negative trends only by increasing the volume of trade in goods and services and enhancing the flow of capital."

Hu told business leaders before the summit the world economy was being hampered by "destabilizing factors and uncertainties" and the crisis that hit in 2008-09 was far from over. China would play its role, he said, in strengthening the recovery.

"We will work to maintain the balance between keeping steady and robust growth, adjusting the economic structure and managing inflation expectations. We will boost domestic demand and maintain steady and robust growth as well as basic price stability," he said.

Hu spelled out plans for China, whose economic growth has slowed as Europe's debt crisis worsened, to pump $157 billion into infrastructure investment in agriculture, energy, railways and roads.

Hu steps down as China's leader in the autumn after a Communist Party congress, but he promised continuity and stability for the economy.

Putin, who has just begun a new six-year term as president, said on Friday Russia would be a stable energy supplier and a gateway to Europe for Asian countries, and also pledged to develop his country's transport network.

RUSSIA LOOKS EAST

The relative strength of China's economy, by far the largest in Asia and second in the world to the United States, is key to Russia's decision to look eastwards as it seeks to develop its economy and Europe battles economic problems.

APEC, which includes the United States, Japan, South Korea, Indonesia and Canada, groups countries around the Pacific Rim which account for 40 percent of the world's population, 54 percent of its economic output and 44 percent of trade.

APEC members are broadly showing relatively strong growth, but boosting trade and growth is vital for the group as it tries to remove the trade barriers that hinder investment.

The European Union has been at odds with both China and Russia over trade practices it regards as limiting free competition. Cooperation in APEC is also hindered by territorial and other disputes among some of the members.

Putin, 59, limped slightly as he greeted leaders at the summit. Aides said he had merely pulled a muscle. Underlining Putin's good health, a spokesman said he had a "very active lifestyle."

Discussions at the two-day meeting will focus on food security and trade liberalization. An agreement was reached before the summit to slash import duties on technologies that can promote economic growth without endangering the environment.

Breakthroughs are not expected on other trade issues at the meeting, which U.S. President Barack Obama is missing. He has been attending the Democratic Party convention and Washington is being represented by Secretary of State Hillary Clinton.

U.S. officials say Clinton's trip is partly intended to assess Russia's push to expand engagement in Asia, which parallels Washington's own turn towards the Asia-Pacific region.

Also missing the summit was Australian Prime Minister Julia Gillard. Putin said she had dropped out because her father had died.

(Additional reporting by Gleb Bryanski, Andrew Quinn, Katya Golubkova, Douglas Busvine, Denis Pinchuk and Andrey Ostroukh; Editing by Janet Lawrence)

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Japan's buying Diaoyu Islands provokes China to strike back

China should strike back over sale: experts

Analysts Friday slammed Japan's plan to nationalize the Diaoyu Islands in the East China Sea as provocations which would further trash Sino-Japanese relations, and called on the Chinese government to take corresponding measures to counter Japan's scheme.

This video image, taken by the Japan Coast Guard on Aug 15, and released on Aug 27 shows a Chinese boat carrying Hong Kong activists after landing on the disputed island called Senkaku in Japanese and Diaoyu in Chinese in the East China Sea.
Japan's Yomiuri Shimbun paper reported that Japan is scheduled to hold a cabinet meeting on Monday to officially "nationalize" the Diaoyu Islands on Tuesday.

The Japanese government will sign a deal with the so-called private owners on Tuesday to purchase the islands. And the Japanese government believes that putting the Diaoyu Islands under state ownership at an early date could minimize the backlash from China, said the report.

The paper also noted that the actions of Tokyo Governor Shintaro Ishihara, who had pushed strongly for the island purchase, had helped drive the state toward the purchase.

Qu Xing, director of the China Institute of International Studies, told the Global Times that by buying the islands, Japanese Prime Minister Yoshihiko Noda's administration is attempting to reinforce Japan's claim of sovereignty over the Diaoyu Islands.

"The repeated provocations have greatly undermined Sino-Japanese relations," said the expert.

"We should resort to corresponding countermeasures to strike back against Japan's unilateral move. Japan is making their assertion by legal means. Accordingly, China could also reinforce our claims of sovereignty over the islands through legal means," said Qu.

According to the Kyodo News Agency, Japanese Foreign Minister Koichiro Gemba said that Noda is unlikely to hold summit talks with Chinese President Hu Jintao and South Korean President Lee Myung-bak on the sidelines of the ongoing Asia-Pacific Economic Cooperation (APEC) forum in Vladivostok, Russia, indicating that formal talks would not be appropriate given renewed territorial rows.

Gemba added that informal and "spontaneous" exchanges may take place, the report said.

Wang Ping, a researcher with the Institute of Japanese Studies under the Chinese Academy of Social Sciences, told the Global Times that Sino-Japanese relations are bound to be further undermined if Tokyo continues to inflame the situation.

"Japan's national interests as well as its strategic interests in East Asia and the West Pacific will also be hurt. It should better recognize the consequences of its moves," warned Wang.

The impact of the diplomatic rows between the two countries have already extended to the sphere of economic ties.

Reuters quoted Toshiyuki Shiga, a senior executive of Japanese auto maker Nissan, as saying that Japanese car manufacturers were having difficulty in holding big, outdoor promotion campaigns, which may have hurt August sales.

Foreign ministry spokesman Hong Lei said Thursday that in order to change the current situation, Japan must immediately stop encroaching upon China's territorial sovereignty.

China is Japan's largest trading partner, while Japan is the fourth largest trading partner of China.

Though Japan relies much more on its trade with China than China does Japan, economic friction is a double-edged sword, Qu said.

"The adverse political climate will definitely affect economic relations. But smashing Japanese cars and boycotting Japanese goods don't help resolve the problems," said Qu, calling for the public to remain rational.

Separately, Taiwan leader Ma Ying-jeou Friday inspected the Pengjia Islet, which is located 156 kilometers from the Diaoyu Islands. He made a speech in front of a monument on the islet and praised those who have helped to protect the Diaoyu Islands, reported the Xinhua News Agency.

Responding to a question about Ma's visit, Hong Lei said Friday that all Chinese, including those from both sides of the Taiwan Straits, are responsible for safeguarding the sovereignty of the islands.

By Jin Jianyu and agencies contributed to this story

 

Taiwan warns Japan against nationalising islands

Pengchia:  Taiwan’s president used a high-profile visit to a Taiwanese islet on Friday to warn Japan against making any attempts to nationalise islands that are part of a disputed chain in the East China Sea.

Escorted by warplanes and naval vessels, President Ma Ying-jeou flew by military helicopter to Taiwan’s Pengchia Islet, which lies off northern Taiwan, only about 140 kilometers (85 miles) west of the disputed chain.

The chain — known as Senkaku in Japan and Diaoyu in China — is controlled by Japan but also claimed by China and Taiwan, and has been a key part of simmering regional tensions over rival territorial claims. Japan’s government reportedly is planning to buy several of the islands from their private Japanese owners.

Analysts say Ma chose the Taiwanese islet to make his well-measured gesture to raise international attention without further aggravating tensions.

South China Sea. Agencies

Disputes have flared over island chains in the East China and South China seas, rich fishing grounds with potentially lucrative oil and gas reserves.

But diplomatically isolated Taiwan — which China claims a part of its own territory 63 years after the two sides split amid civil war — has been largely left out of the spotlight.

Ma called on the East China Sea chain’s three claimants — Taiwan, China and Japan — to put aside their disputes and hold dialogues to jointly develop the rich resources there. He suggested bilateral or trilateral talks “to resolve the issue in a peaceful way.”

Ma also asked commanders at two Taiwan-controlled islets in South China Sea’s Pratas and Spratly island chains to strengthen guards. Those chains are claimed by Taiwan, China, Vietnam, the Philippines, Brunei and Malaysia.

“Ma has tried to avoid provoking tension, but as Taiwan’s leader, he must make a gesture even though the impact may be limited,” said Lo Chih-cheng, a political scientist at Taipei’s Soochow University.

While Taiwanese media were generally skeptical about the visit’s impact, some say Ma’s trip may manage to rebut Beijing’s appeal for a united front with Taiwan over the disputes. Many Taiwanese fear Beijing may be using its warming economic ties with Taiwan in recent years to further its goal of unifying with the self-ruled democratic island.

“The mainland is trying to create the false scenario of cross-Strait cooperation in the East and South China” seas, Taiwan’s China Times said in an editorial. - AP

No let-up in protests over Diaoyu Islands

By CHOW HOW BAN hbchow@thestar.com.my/Asia News Network

There have been protests on many fronts after the move on Monday by Japanese government to buy the islands from their “owners”.

CHINESE actress Li Bingbing became the latest ordinary citizen to publicly show her outrage against Japan over its claim of the disputed Diaoyu Islands (known in Japan as Senkaku Islands).

The Golden Horse Best Actress award winner turned down an invitation to attend the premiere of her latest film, Resident Evil: Retribution, in Tokyo on Monday in protest of the move by the Japanese government to buy the islands from their “owners”.

“The premiere in Tokyo was an important event for this film because it was the first premiere around the world. During the shoot, it was already decided that all the production crew should go for the Tokyo premiere,” she said.

“I do not like to break an appointment but after what had happened to the Diaoyu Islands, I did not feel like going. It is something I cannot stand and I thank the film company for their understanding,” Li was quoted by the Chinese media as saying on Thursday.

Two weeks ago, two Chinese men, aged 23 and 25, were detained for stopping the car of the Japanese Ambassador to China, Uichiro Niwa in downtown Beijing.

The duo allegedly emerged from their car and pulled the Japanese flag off Niwa’s car when the ambassador was on his way back to the Japanese embassy.

Another man was issued a warning for blocking Niwa’s car.

Earlier last month, hundreds of Chinese protesters took to the streets in Shenzhen and Hangzhou and called on the Chinese government to protect the islands, following an incident where 10 Japanese nationalists swam to the islands in East China Sea in response of a similar landing by seven Chinese activists.

Some Chinese protesters also surrounded the embassy in Beijing and the Japanese consulate office in Shenyang, Liaoning province.

Two senior citizens who threw eggs at the embassy were persuaded to leave, while another demonstrator was stopped by the police when he attempted to enter the premises.

Other demonstrators held a 7m-long banner expressing their indignation over Japan’s detention of the Chinese activists who landed on the islands.

Last Monday, Kyodo News Agency reported that Tokyo was in the final stages of reaching a deal to buy the islands by the end of this month.

Japanese television images showed that a team of surveyors dispatched by Tokyo Governor Shintaro Ishihara was surveying the shoreline and waters around the uninhabited isles.

The surveyors then released the outcome of their investigation, detailing the geographic composition of the islands.

Apparently, Ishihara called on the Japanese government to build a harbour in the area.

It was reported that the administration of Prime Minister Yoshihiko Noda had agreed to pay two billion yen (RM79mil) for the islands.

The controversial islands are counter claimed by China and Taiwan.

China and Taiwan claim that the islands have been a part of Chinese territory since at least 1534 until Japan took brief control of it during the first Sino-Japanese war (1894-1895), while Japan has rejected claims that the islands were under China’s control prior to 1895.

In its editorial, China Daily warned that Japan was dicing with danger of leading the Sino-Japanese relations to their worse path.

“Japan is escalating tensions between itself and China. Our protests, be it official or civil, have fallen on deaf ears with the Japanese government.

“The deal for the islands was signed just five days after a letter from Japanese Prime Minister Noda to Chinese President Hu Jintao was delivered in Beijing on Aug 31. Noda was then said to have talked about lowering tensions between the two countries.

“The Noda administration now lacks credibility. They said they wanted to maintain and manage the islands in a peaceful manner but the islets are not part of Japan’s territory,” it said.

The newspaper said while China had kept its word to seek common ground on the islands and to maintain peace in the area, Japan had no longer shared the same goal.

China had failed to understand Japan’s diplomatic strategy, after all, and should re-look into its stand on the issue, it added.

Xinhua news agency slammed the islets purchase deal, saying that it would put to test Japan’s credibility over an historical commitment made in 1978 friendship treaty between Japan and China to resolve the issue.

Renmin University’s Centre for East Asia Studies director Huang Dahui said the pressure from the Japanese elections and fears of China’s economic development were reasons for the move.

“Japan is playing a two-faced game with China. What Ishihara and Noda are trying to do share the same purpose, which is to nationalise the Diaoyu Islands. China should strongly protest,” he told Global Times

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Gamers battle it out for chance to ‘fight’ for country

KUALA LUMPUR: Over 600 Malaysian gamers are battling it out in the national edition of the World Cyber Games (WCG) to claim the chance to represent Malaysia in the Asian championships this weekend.

The tournament will see teams from nine other regional countries – China, India, Indonesia, South Korea, Mongolia, Singapore, Thailand, the Philippines and Vietnam – competing.

Winners will be selected to represent Malaysia in the WCG grand finals in Kunshan, China this November.

The national event at the Kuala Lumpur Convention Centre saw seasoned teams pitted against ad hoc teams, playing seven games including DOTA 2, FIFA 2012, Counter Strike Online and World of Tanks.

Among the teams was Orange eSports, which had participated in the Dota 2 tournament “The International 2” in Seattle earlier this week.

Cyber superheroes: Gamers fighting on the cyber battlefield during the World Cyber Games at the KL Convention Centre.

Team member Chan Litt-Binn, 23, from Kepong, said the six-man team barely had any time to recover after flying back on Tuesday, and had not even practised for this competition.

He said gaming did not have a good reputation here despite it being a lucrative career in other countries like China and Korea.

“My parents are not happy about my passion. They are expecting me to get a job soon,” said Chan, a former national chess player.

His team won US$25,000 (RM77,700) in their last tournament. The grand prize was US$1mil (RM3.11mil).

Form Five student Kung Ter Chuen took part in his team event in Counter Strike GO, despite dislocating his left elbow the day before in a bicycle accident.

Arriving at KLCC with his arm in a bandage and sling, Kung did not even go for an X-ray first before joining his team, called `Unknown’ at the championship.

The WCG was held in conjunction with the Pikom Digital Lifestyle Expo 2012, and is part of the programme for the National ICT Month.

By SHAUN HO shaunh@thestar.com.my

Smartphone Ascend P1 unveiled by Huawei Technologies

KUALA LUMPUR: With smartphones becoming an indispensable tool for staying connected on the social media networks, China-based Huawei Technologies has launched an affordable yet feature-rich model.

Many queued up as early as 6.30am to get their hands on the Ascend P1 at the introductory price of RM999 during its launch in KL Hilton yesterday.

Ong Boon Lin, 35, who was first in line, said he bought the phone for his wife as the larger screen would make it better for “reading news and books”.

“The Ascend P1 is a fast smartphone with a camera for capturing and sharing contents while on the move,” said Huawei country director for consumer business group Wong Wey Hwa.

A model with the Ascend P1 smartphone at the launch.

The phone has a large 4.3-inch screen, making it easy to browse the web, view images and watch high-definition videos. It also comes with 4GB of storage to store content, applications and games.

“Huawei has been working behind the scenes for many years by supplying infrastructure for network service providers,” said Wong. “We are now trying to grow our brand using online and social media with the Ascend P1.”

The smartphone, which is available currently in the Klang Valley, is expected to hit shelves nationwide in the coming weeks. The introductory price is valid until Malaysia Day.

Meanwhile, Bernama reported Huawei country director for consumer business group Wong Wey Hwa as saying that the company was aiming for double-digit sales growth in the Malaysian market.

“Last year, we did US$40mil sales in Malaysia for all our products,” he said, adding that the smartphone was expected to contribute 20% to 30% of the targeted double-digit sales growth.

Wong also announced the expansion of Huawei's device business under a new distribution partnership with ECS ICT Bhd via its wholly-owned subsidiary, ECS Astar Sdn Bhd, which would open up access to over 3,000 resellers nationwide.

“Through our formal partnership with ECS in Malaysia, we are able to expand our product reach and offer more accessibility of our devices to everyone looking for value-added mobile connectivity,” he said.

Wong said Ascend P1 would be available at participating ECS retailers in the Klang Valley and in other places in the next few weeks.

For a review of the Ascend P1, check out TechCentral.my.

By CHONG JINN XIUNG starbiz@thestar.com.my  

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