Apollo Asia Fund
What was new - 2023 archive

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5 Dec 23:
The NAV of the Series A shares rose 3.5% in November to US$ 2,487.35; charts.

1 Nov 23:
The NAV of the Series A shares fell 7.8% in October to US$ 2,402.92. As horrific violence erupted in Israel and Palestine, amid warnings of mass ethnic cleansing, prices of almost all our shares fell, and currencies weakened against the US$. The US$ value of our holdings in Hong Kong and Japan fell 5%, in Malaysia 9%, in Indonesia 12%, and in Vietnam and Sri Lanka 16%. The alacrity with which the US, UK and many European countries cast aside vaunted principles of human rights and international law has been shocking to many. This has damaged the trust needed for collaboration on the many other new challenges facing the world, and for maintenance of the rules-based international order which did so much to promote trade, investment and prosperity in the decades after World War II. In the increasingly chaotic present, we'll continue to look out for resilient businesses that act responsibly while serving real needs, and for opportunities to buy them at attractive valuations. Charts of past performance.

26 Oct 23:
The news that Google refused takedown requests from the Hong Kong government for 'The Hong Konger' may further expand viewership for this documentary about the imprisoned Jimmy Lai. It provided a record of the extraordinary roller-coaster of Hong Kong over the last few decades, as well as the titanic clash of values; it may be doubly interesting in the current international context.

Meanwhile, the jailing of an elderly busker for playing a melody which he described as 'Glory to Carrie Lam' has caused some confusion, since the similar 'Glory to Hong Kong' is currently not banned. Some of the many versions of the original remain on line, if not all as tuneful as the orchestral version, or as powerful as the videos which admirers of Hong Kong film-making will remember. But is it now an offence to play, to listen, to remember? What will be deemed to comprise 'soft resistance'?

20 Oct 23:
In the quarterly report we showed the chart of sea surface temperatures to the end of August; by then they had been anomalously high for five months. The Climate Reanalyzer site from the University of Maine shows daily updates, so we can now see another seven weeks of data, and it's not reassuring: near-global measurements of the daily sea surface temperature remain very high. Because water is so much more dense than air, it seems likely that this may have momentous implications for other planetary systems? The subtitle of Helen Czerski's new book is 'How the Ocean Shapes Our World', and it connects ecological cycles with chemical transformations and physical flows in thought-provoking ways. A splendid introduction to awe-inspiring complexity: 'Blue Machine'.

12 Oct 23:
Our 3Q report examines the startling climate change stats, pondering both risks and transformative hopes.

2 Oct 23:
The NAV of the Series A shares fell 2.2% in September to US$ 2,605.55; charts.

16 Sep 23:
Anyone with an interest in YTL Corporation, parent of Wessex Water in the UK and holder of many other government concessions, may wish to note that despite high-flying claims on sustainability and governance it is attempting to evict the Sakyamuni monastery and quarry the last remaining parts of the beloved Gunung Kanthan geopark, home to flora and fauna found nowhere else on earth.

12 Sep 23:
"It is surely troubling that the proposed future Chairman of the UK's flagship, part publicly-owned bank, may have even floated the possibility of an offshore tax avoidance vehicle relating to a British contract that he now dismisses as not appropriate? Is it not equally concerning that the bank which was apparently offering this facility is none other than the scandal-hit institution that this Chairman has been appointed to bring back in line?" More good questions from Sarawak Report on the Haythornthwaite appointment to NatWest.

10 Sep 23:
On Wednesday, the Guardian newspaper opined that 'NatWest plays it safe with new chairman Rick Haythornthwaite'. Four days later, it had reassessed, and published two new articles: 'New NatWest boss worked for oil firm under investigation in 'world's biggest financial scandal'' and 'The NatWest boss, the missing Malaysian billions and the damning email'. These articles quote the original Sarawak Report post on Rick Haythornthwaite's high-handed response which contributed to the cover-up, but should have included a link; SR has shown the relevant part of his e-mail. The 2015 SR post is also well worth re-reading. Not only were SR's enquiries reasonable, and in the public interest: it is worth noting that 1MDB had by then been raising red flags in financial markets for more than three years, that regulatory concern was by this stage global, and that Sarawak Report's extraordinary record of exposing wrongdoing was extremely well established. (Clare Rewcastle Brown's identity had been known since February 2011, and her investigative journalism acclaimed.) SR's 2015 post also highlights the deep involvement of Coutts in the 1MDB scandal. Coutts was then, and is now, a subsidiary of NatWest. NatWest is a systemically important bank in the UK. This extraordinary appointment will be of concern to customers, shareholders, and taxpayers - and not only within UK borders.

4 Sep 23:
The NAV of the Series A shares fell 2.6% in August to US$ 2,664.60; charts.

31 Aug 23:
When I first came to Malaysia, Sarawak was renowned for its lush rainforests and biodiversity. The impressive participants of the Rainforest Tribunal this month in Basel reckon that the subsequent destruction of ecosystems has been an order of magnitude worse than in the Amazon, with 90% of Sarawak's primary rainforest destroyed. They talk of the widespread impoverishment, and of the stolen funds, in this powerful statement.

Meanwhile in neighbouring Sabah, the Deputy Chief Minister insists that the 100-year 'Natural Capital Agreement' with opaque beneficiaries over an unspecified 27% of the state's total land area will proceed, despite legal challenges. Mongabay has explained the magnitude of the issues at stake.

These two states represent 60% of Malaysia's land area, and land grabs continue in the Peninsula which accounts for the remaining 40%. Jaded readers may think scandals the norm, but consider the scale of destruction of the natural capital on which 'ecological services' and the survival of our species depend. The pace of change in other Asian countries may be similar, but Malaysia is now governed by an Alliance of Hope, which has announced widespread consultation on national priorities. To local readers, a Happy Malaysia Day: may it be an occasion for reflection.

2 Aug 23:
The NAV of the Series A shares rose 2.4% in July to US$ 2,736.82; charts.

28 Jul 23:
When I first came to Malaysia in the 80s I was impresssed by the applied science in the research institutes of the plantation sector. I'm intrigued now to see Khazanah launching an 'Innovation Challenge' to improve agricultural resilience and tackle food security in the context of climate change. Open competition, fairly judged, could be catalytic, so these small grants seem a thoughtful initiative by Malaysia's sovereign wealth fund. From small seeds, great trees may sometimes grow... crescat, floreat!

26 Jul 23:
The 2Q report is entitled 'Tipping points & the quest for resilience'.

3 Jul 23:
The NAV of the Series A shares rose 2.4% in June to US$ 2,673.62; charts.

1 Jun 23:
The NAV of the Series A shares gave back April's gains, falling 0.5% in May to US$ 2,610.15; charts.

Information is the lifeblood of markets, so investors may wish to note concerns as to its free flow. See Asia Sentinel answer to Singapore Government Demand for Correction and the books Hong Kong is purging from public libraries.

19 May 23:
We are very grateful to those investors who returned the forms affirming their accredited or institutional status according to Singapore definitions. For anyone who was unable to do so, we no longer need to trouble you for this. Not all of our co-investors were able to return the forms by the deadline, and we have been sorry to hear of some cases of ill health. Seraya has decided not to proceed with the proposed agreement. Apollo Asia Fund will continue to be managed by AIMS Asset Management, with Claire Barnes as the fund manager, as since inception. If any investor has questions, do please ask.

Meanwhile, back to the search for good investments, and a resilient portfolio: I will be writing more on this in the future, and welcome input from all our readers. Environmental change is now hitting Asia hard; it is no longer a distant possibility beyond the investment horizon. Some political and demographic risks are also much higher than during the peaceful post-war decades. The time seems right to reassess all businesses and enterprises, and to consider which may be able to adapt and flourish in the decades ahead. We hope to be among them, and to pay even more attention to resilience in our investing.

2 May 23:
The NAV of the Series A shares rose 0.5% in April to US$ 2,623.23; charts.

28 Apr 23:
Many people share the shock and outrage expressed by Sahabat Alam Malaysia at the conditional approval of the environmental impact assessment for a controversial construction project to destroy 4,500 acres of the seabed and build the 'Penang South Islands'. Aliran explains 'Why the three-island mega-project in Penang must be scrapped'. An earlier article, 'Green or greenwash?' continued: 'food security vs another dodgy megaproject?' Important questions. This seabed destruction would be catastrophic for remaining fish supplies, and exacerbate climate change. It is being announced amid an unprecedented heat wave. This is not 'development'; it impoverishes us all. We hope that federal and state governments will rethink this.

27 Apr 23:
For the self-certification of accredited or institutional investor status, electronic or digital signatures are fine. (This relates to the file "AAF investor confirmations.pdf", which all Apollo Asia Fund investors should have received at your registered email addresses.)

Andrew has been in Vietnam this week, and attended an AGM on behalf of both of our funds. Teamwork is invaluable, and we are keen to have the co-management agreement in place so that the collaboration between members of our long-standing investment team, now based in both Singapore and Malaysia, will again be seamless. Many thanks to our investors who have already returned their forms; it would be a great help if others do that soon - and please sign in whichever way is most convenient!

22 Apr 23:
I wrote to all of my fellow-investors in Apollo Asia Fund this week to explain why the new co-management agreement is so desirable (see below). At the same time, the administrator sent a form for investors to confirm their status as an accredited or institutional investor according to the Singapore definitions. Sorry about the additional paperwork! The good news is that this form should take little time to complete. We do not expect any of our investors to have difficulty meeting the criteria, but we do need to ask all ongoing investors to self-certify their status, as this will be required by Singapore regulations. My explanatory letter is here, and if any investor has not received the form (sent to registered email addresses) then please get in touch. Thank you! and Selamat Hari Raya from Malaysia.

16 Apr 23:
The 1Q report briefly discusses psychological anomalies hampering accurate appraisal of risk. It also explains why we propose a co-management agreement with Seraya Investment in Singapore, to maintain and extend the long-standing collaboration with our colleagues who have moved to the new firm. This is good for resilience; do please ask if you have any questions.

3 Apr 23:
The NAV of the Series A shares rose 1.6% in March to US$ 2,611.38; charts.

1 Mar 23:
The NAV of the Series A shares fell 4.3% in February to US$ 2,569.82; charts.

6 Feb 23:
Malaysia's new prime minister urges Goldman Sachs to honour 1MDB financial settlement since it apparently has not paid even the reduced amount bizarrely agreed in 2020; commentators on Malaysiakini and Sarawak Report suggest reopening the case. (Original Malaysiakini article, paywalled.) With a legitimate government restored, the defrauded Malaysian taxpayers would like to see money clawed back.

1 Feb 23:
The NAV of the Series A shares rose 3.6% in January to US$ 2,684.48; charts.

28 Jan 23:
I linked recently to comments on the Hemingway Decline, embedded in the 2Q19 report. The topic now has a freestanding page, updated and more suitable for current discussion; I have changed the recent links to point to the new version. Please circulate it freely if it seems useful; feedback would be very welcome.

21 Jan 23:
A shocking animation of the spread of polluting plastic waste from Asia to the once-pristine beaches of the Seychelles, Mauritius and East Africa has been highlighted by Oxford University in this twitter thread and short article; these link to the thread and original paper by lead author Noam Vogt-Vincent. Don't miss the animation: four years in one minute... and now we're four more years on. Steady growth in polluted areas will be resulting in accelerating rates of decline in the not-yet-visibly affected: it's the arithmetic of the Hemingway Decline. If you book a beach holiday while attractions remain, please choose carefully!

16 Jan 23:
The 4Q report is 'Taking stock at the end of a Tiger Year'.

5 Jan 23:
29 days after the AGM, Scientex Packaging (SCIPACK) sent a written response to some of our questions which it declined to tackle on the day. We were disappointed that the new and non-independent chairman was unwilling to address shareholders on the future strategy or any substantive matter (he spoke only formulaic sentences relating to conduct of the meeting), and that following this huge change in board composition the managing director and all new directors were unwilling to speak at all. Apparently no-one was willing to sign today's response, sent from a no-reply email, so it seems that "IR" is now anonymous as well as one-way. Responsibility for this attitude to minority investors therefore rests with the chairman and each member of the SCIPACK board, as well as with the board and management of the controlling shareholder Scientex Berhad: corporate governance standards for large listed companies also apply to their listed subsidiaries. AGM conduct guidance requires all questions to be made known to all participants, but that was not done on the day, and neither a comprehensive list of questions nor this delayed response have yet been provided on the website. We therefore share here today's response to AAF, and invite fellow shareholders to contact us with any other questions asked, responses received, and their thoughts on this unusual situation and the apparent attempt to rebuff constructive investor engagement and suppress normal interest in what should be a strong recovery situation and growth opportunity.

3 Jan 23:
The NAV of the Series A shares rose 3.9% in December to US$ 2,591.18; charts.

Claire Barnes

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