26 MY E.G. SERVICES BERHAD Registration No. 200001003034 (505639-K) ROBUST SUSTAINABILITY GOVERNANCE MYEG’s Sustainability Working Group (“SWG”) continues to play a crucial role in the Group’s sustainability governance framework, proficiently addressing significant risks and opportunities associated with MYEG’s material ESG concerns. The SWG, together with the Board and Senior Management, consistently enhances, endorses and puts into action sustainability plans and strategies, actively contributing to MYEG’s sustainability objectives in the short, medium and long term. In January 2024, MYEG conducted a refresher materiality assessment exercise to ensure that the Group’s prioritisation of material topics aligned with the post-pandemic socioeconomic landscape. The Group also organised an employees’ briefing on TCFD / Sustainability and Climate Change to further ingrain sustainability and climate change awareness knowledge in MYEG’s staff. Subsequently, MYEG updated its Sustainability Policy and developed its ESG Framework to serve as guiding principles for the organisation in driving its sustainability agenda across the Group and its value chain. More information on sustainability-related disclosures is provided in the FY2023 Sustainability Statement on page 54 of this IAR2023. ECONOMIC OUTLOOK Following a 2023 marked by external headwinds such as slower global trade, geopolitical tensions and tighter monetary policies, the economic outlook for Malaysia in 2024 looks to be stronger and more positive. Bank Negara Malaysia expects Malaysia’s growth to improve in 2024, driven by resilient domestic expenditure and a recovery in external demand. Citing the IMF’s projection for a rebound in global trade growth to 3.3% in 2024, the central bank notes that stronger external demand, along with the tech upcycle and continued improvement in the tourism sector are expected to provide support to Malaysia’s economy. At the same time, on the domestic front, household spending is projected to be supported by continued employment and wage growth while investment activity will be underpinned by further progress of multi-year projects, by both the private and public sectors, as well as the implementation of catalytic initiatives under the various national master plans. Having moderated in 2023 due mainly to lower cost pressures amid stabilising demand conditions, inflation is projected to remain modest in 2024, broadly reflecting stable cost and demand conditions. For 2024, the Finance Ministry has expressed its confidence that the economy can grow 4-5% as the government accelerates the implementation of the Madani economic framework, pointing out the importance of reforming Malaysia’s economy to not only address systemic, historical challenges, but also to focus on new areas of sustainable growth and resilience. The positive global and domestic prospects bode well for MYEG as they present an overarching, positive outlook for the Group in FY2024 in various business segments. MYEG’S OUTLOOK MYEG’s business performance is positioned for further growth and improvement in 2024, buoyed primarily by positive contributions from the Zetrix platform and related decentralised services. In particular, transactions on the Zetrix platform are expected to be fuelled by a ramp-up in ZTrade, the Group’s cross-border customs clearance service launched in collaboration with China’s customs institution, GACC. This is in view of the government endorsement obtained in both Malaysia and the Philippines for the use of the system to process exports from both countries to China. Efforts are also underway to expand coverage of ZTrade to other regional markets, in line with the overarching commitment to connect China to the rest of ASEAN and beyond that, to the RCEP-covered regions. With the introduction of complementary services targeting the global trading community, such as supply chain financing and other offerings to be rolled out in the near future, Zetrix is poised to emerge as a vibrant Web3 ecosystem, with usage of the platform continuing to broaden and deepen as it leads the way in the digitalisation of cross-border transactions. MANAGEMENT DISCUSSION AND ANALYSIS (cont’d)
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