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lamyenzoro1 Member Star
Total Cumulative Posts 2
Joined Feb 2020
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FORUM: Shadow Economy in Malaysia

Blog 03 Mar 2020, 1:12:02 PM

Link: https://www.thestar.com.my/business/business-news/2020/02/29/the-rm300bil-shadow-economy

Example:  The MNC has cast blame on illegal cigarette trade that it said currently makes up 63% of the total industry volume, up from 33.5% in 2015.“The legal (cigarette) industry has diminished by almost 40% in the span of four years since 2015 due to the illegal cigarettes trade

Malaysia’s average ratio during the 1991-2015 period was 31.5% – higher than Singapore (11.9%), Australia (12.1%), China (14.7%), Hong Kong (14.7%), Vietnam (18.7%), India (23.9%), Indonesia (24.1%) and South Korea (25.7%). And according to Lim, based on World Bank figures for 2017, although the size of Malaysia’s economy was RM1.4 trillion, the tax-to-GDP ratio was only 13.1%.

This puts Malaysia below countries such as Vietnam, Chile, Poland and South Korea, for which the ratio was 19%, 17.4%, 16.8% and 15.4% respectively



FORUM: BAT - British American Tobacco [Status - 2020]

Blog 23 Feb 2020, 11:25:25 AM


It seems that BAT stock rises recently and people getting all *hyped* out over it. Indeed there is a growth but what concerns me would still be the existing impact of illicit cigarettes in this market.

Based on actual facts that I know:

- 6 out of 10 cigarettes consumed in Malaysia is illicit as proven from the news as well

- The research house has a hold call on BAT, and slashed its price target on the share from RM19.20 to RM11.50 previously

- Illicit market doubled since the surge in excise duty in 2015 (33.5% in 2015 vs 63% in 2019) 

Well this is my skeptism on the current growth. As long as the governments are not imposing anything drastic to tackle illicit cigarettes, I don't think it's a wise choice to invest in BAT but again I might be wrong so I would like to hear more feedbacks from you.