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Construction industry set to blossom in aftermath of war
Thailand’s construction industry is likely to boom in
the Middle East once reconstruction of Iraq gets underway, with Thai
construction companies roped in to design new buildings and export building
materials.
A recent Thai Farmers Research Center report said that
Thailand’s construction industry was expanding to foreign markets, both in
term of the export of building materials and in term of design and
construction. Products which Thailand exported in large quantities included
iron and steel, cement, glass and aluminum products.
The Middle East is regarded as a market with particularly
high potential for expansion. Last year a group of engineers, architects and
contractors who joined in forming the National Federation of Design and
Construction Businesses (FEDCON) won a contract to design the athletes’
village for the 15th Asian Games in Doha, Qatar, worth 1.14 billion baht.
This August, FEDCON is due to enter into bidding for the
16 billion baht construction contract for the project, as well as bidding
for the construction of roads and an airport worth 20 billion baht.
Each year Thailand exports around 2-3 billion baht worth
of construction materials and equipment to the Middle East. Export of iron
and steel amount to 800 million baht and plastic flooring and walling are
worth 400 million baht.
However, the report cautioned that the Middle Eastern
market was different from existing western and Asian markets, and that
construction companies have to engage in careful studies before making
inroads, as well as understanding trends in demand and market fashions,
possibly by creating networks of allied local companies. (TNA)
Government to train 50,000 new SME operators each year
The Office of Small and Medium Enterprises Promotion will
embark on a program to help train 50,000 new SME operators per year as soon
as the 2 billion baht funding is received from the National Economic and
Social Development Board.
Wiwat Winichaikul, the office’s director, said that the
main plan this year is to focus on the development and creation of new SME
operators in accordance with a policy directive from Industry Minister
Somsak Thepsuthin.
The project will see the Office training 24,000 of the
industry minister’s total 50,000 target of new SME operators each year.
Wiwat expressed confidence that the scheme would see over 200,000
applicants, but said that the Office would select only 60,000 from these for
training, of whom around 24,000 were likely to go on to open up their own
small businesses.
Trainees, who will be offered loans for their course from
state-run banks, will receive lessons in management and administration and
SME development. (TNA)
CP 7 Eleven stores move away from groceries to high-margin food items
CP 7 Eleven, Thailand’s largest chain of convenience
stores, said it expects to see its revenues rise by at least 17 percent
during the year as the company shifts focus away from groceries and toward
high margin food items.
CP 7 Eleven, a unit of the Charoen Pokphand Group, which
is Thailand’s largest agricultural conglomerate, is in the process of
listing its shares on the Stock Exchange of Thailand (SET) during this year.
CP 7 Eleven reported revenue of about 29 billion baht during 2002, a rise of
about 15 percent.
With a new focus on food items, the company hopes that
its revenue for this year will reach 34 billion baht, a rise of about 17
percent from last year.
Piyawat Titasattavorakul, managing director of CP 7 Eleven said, “The
Company is determined to go ahead with listing on SET.” He added however,
timing is always crucial and he couldn’t forecast anything at this
juncture due to local as well as global concerns.
Thailand-US to sign container inspection deal
The Thai and United States customs departments are to
forge a deal enforcing the X-ray inspection of shipping containers before
they depart for the US, the Customs Department director announced. Speaking
on April 1st Chavalit Sethmethikul warned exporters sending goods by ship to
the US that once the deal was enforced, failure to give advance warning to
the US authorities prior to shipping would see them faced with fines of
US$5,000 and stringent inspections, and that a second violation would mean a
ban on further exports to the US.
Thailand, which currently sends an average 50 billion
baht worth of exports to the US each month, or around 600 billion baht a
year, cannot afford to lose this lucrative market.
Chavalit, who said that the US measures were designed to
ensure that no ‘undesirable’ goods were hidden in shipping containers,
added that the deal would be signed after the April Songkran festival, and
that the measures would be enforced six months after the signing.
The agreement will force the Customs Department to
inspect containers by X-ray, as simple manual inspection would slow down the
process and cause goods to miss their shipping schedules. X-ray machines
will be fitted at Laem Chabang Port and Bangkok’s Don Muang Airport for
this purpose.
Chavalit said that bidding for the procurement of the
machines would take place in May, using a budget of 1.5 billion baht from
the economic restructuring program. (TNA)
Thailand to open BOI office
in Shanghai on April 23
Thailand is bracing itself for a new wave of Chinese
investment after the opening of a Board of Investment Office in Shanghai in
April, with 50 Chinese investors already expressing an interest in
Thai-based investment projects.
BOI secretary-general Somphong Wannapha said that the
Shanghai office would be officially opened by Deputy Prime Minister Somkid
Jatusripitak on April 23, when the BOI signs various investment agreements
with Chinese public and private sector agencies to promote mutual
investment. The two countries will also arrange a large-scale seminar on
investment opportunities in both countries.
The opening of the Shanghai office came in response to
global shifts in investment patterns towards China, due to changes in
China’s economic, social and political fundamentals.
Not only does China have a vast market of 1.3 billion
people, purchasing power is on the rise, and the potential for foreign
investment among Chinese businesspeople is immense.
The Shanghai office will bring the total number of BOI
offices abroad to five. The four current offices are in New York, Frankfurt,
Paris and Tokyo.
“The BOI decided to open an office in Shanghai, as this
is where trade and investment is happening. Shanghai has had a long history
of prosperous trade, and, importantly, it is located near economic areas,”
Somphong said.
“The BOI will act to encourage Chinese investors to
invest in Thailand, and support Thai investors wishing to invest in China.
The office will emphasize the creation of an investment network comprising
both public and private sector agencies from China in all large provincial
capitals such as Beijing, Hangzhou, Zhoucho, Kwangcho and Kunming,”
Sompong added. (TNA)
Stefan Buerkle featured at
Eastern Seaboard German Language Business Club March meeting
The month of March saw another very interesting meeting
of the Eastern Seaboard German Language Business Club at Benjarong
Restaurant in the Royal Wing at the Royal Cliff Beach Resort. The resident
manager, Nick Bauer welcomed the guests with a glass of champagne, sponsored
by Ambrose Wines. A special guest at this meeting was Stephanie Kage, the
new head of the economy department at the German Embassy.
Filled
with new and very useful information, the Eastern Seaboard German Language
Business Club takes a moment for posterity.
Elfi Seitz, who again was in charge of the discussion,
introduced the guest speaker Stefan Buerkle of the German-Thai Chamber of
Commerce.
Stefan Buerkle, who had held the very first business day
seminar for the Eastern Seaboard on the previous day at the Dusit Resort,
made this meeting the best ever. He introduced the chamber and mentioned
that it is the second largest in Thailand. His topic was also the
involvement of German companies in Thailand’s business potential.
Stefan explained that although Germany is the number 1 investor from
Europe, it still holds only 4% of the market in Thailand. He said since
Thailand is the fastest growing market in the Asia region, it would be good
if Germany pays more attention to it.
Seminar on foreign work permits and visas organized on Eastern Seaboard
Songklod Kaewvisit
Chutaporn Lampasara, vice secretary of Board of
Investment (BOI) and director of the work and visa permit center chaired a
meeting to discuss the issue of foreign work permits and the issuing of
visas. The seminar received cooperation from the Investment Service Center,
East Economic Investment Center, and the BOI.
Held on March 27, the seminar provided useful information
to companies that hire foreign employees, managers and experts. As a result,
there should be better cooperation between the companies under the care of
the BOI and the BOI itself. The ministry office officially set up a work and
visa permits center to cut red tape, speed up processing, and build a better
relationship between Thai and foreign business investors with an aim to
improve the county’s investment atmosphere.
The ‘One Stop Service’ provides foreigners with visa
extensions, re-entry visas and work permits. Personnel from the central visa
and work permits bureau are there to serve clients and with their help, the
authorizing process should take less than 3 hours.
Chutaporn explained how the center facilitates foreign
investors at management level, experts in different fields, and
international press. They will be eligible to stay in Thailand as short stay
business operators rather than be issued tourist visas. They can reenter the
Kingdom and will be issued with a 90 visa. The center will also aid other
special requests.
The law pertaining to foreign work permits includes some
strict rules which applicants must follow. As soon as they receive a letter
of approval from the authorities, they must take their passports to the
Immigration Office for stamps of authorization (within 30 days).
Holders of work permits must work only in fields approved
in their applications and will be subject to revocation of their permits if
they ignore this rule. Deportation is also a prescribed penalty for
offenders.
If work permit holders change careers or job description,
they must report to the office for document correction. Moreover, applicants
who are given work permits must engage in technology transfer to Thai
subordinates, i.e., teach their Thai coworkers how to do what they (the
foreign work permit holders) are doing.
Bader opens new plant in Rayong
Bader (Asia), one of the world’s leading leather
manufacturers for the auto industry, recently opened a new plant in Rayong.
The company, based in the south of Germany, has dealt with companies in
Thailand for 15 years and realizing the positive development of the car
manufacturers in Thailand, decided to open their own production plant.
(from
left) Piromsakdi Laparojkit, Deputy General Secretary BOI, Thomas Ferentzi,
Thomas Bader and Panus Kaewlai, Deputy Governor Chonburi Province, cut the
ceremonial ribbon to declare the factory officially open.
Piromsakdi Laparojkit, the Deputy Secretary General of
BOI and the Deputy Governor of Rayong, Panus Kaewlai, declared the plant
officially as opened.
In his opening speech Thomas Ferentzi, the managing
director of Bader (Asia), said, “We combine German technique and German
technology with Thai handcraft skills. The positive development of our base
here in Rayong will allow us to be engaged here for a long time.”
Bader employs 60 staff in Rayong which produces leather
covers for car seats and steering wheels and delivers its products to many
leading car manufacturers in Thailand and the South-East Asia region.
Raw materials used in manufacture come from all over the
world. The manufactured items are not only made with machines but also
handcrafted.
“We always follow the call of the big car manufacturers
and here in Rayong the dream of Thailand to reach a leading economic
position in central South-East Asia will come true” said Ferentzi.
Regional currency could be the new hope of Southeast Asia
Governor of the Bank of Thailand M.R. Pridiyathorn
Devakula recently discussed the need for a 9-nation regional currency to
reduce dependence on the US dollar and boost regional trade.
Speaking at lecture on “Regional trade: the hope of
Southeast Asia”, organized by the Thai International Chamber of Commerce,
Pridiyathorn said that nine Asian nations – Thailand, South Korea, Taiwan,
the Philippines, Singapore, Hong Kong, China, Malaysia and Indonesia –
were increasing their role in global trade, and that inter-regional trade
was on the rise.
The BOI governor said this contributed to the growth of
countries in the Asian region as he compared Asia to the G-3 grouping
comprising the US, EU and Japan, where the value of inter-regional trade was
minimal.
“The economic slump in Europe, the US and Japan meant
that last year trade among the nine Asian countries grew only 14.2 percent,
but exports among these same nine Asian nations expanded by as much as 24.3
percent. This trend was apparent from the fourth quarter of 2001, and growth
will proceed in this direction for some time. Investors should attach
importance to this and find new investment pathways”, Pridiyathorn said.
He advised the government’s of all nine countries to
cooperate in three areas in order to smooth the way for growth in regional
trade.
Firstly, governments should promote free trade, such
expanding the ASEAN Free Trade Area (AFTA) to include other countries.
Secondly, the governments should boost monetary cooperation, with
export-import banks of each country establishing a central promissory note
market for mutual trade.
“This could be located in Singapore or Hong Kong, which
are already financial hubs. If there is already buying and selling in the
market, trade financing will emerge by itself. All the countries have signed
initial agreements and now have to push further and ensure that markets are
receptive. If the will is there, this should be successful,” Pridiyathorn
said.
Thirdly, he advocated the establishment of regional
controls to ensure that the exchange rates of all nine countries were
broadly in line. If some countries used a floating exchange rate while other
exchange rates were pegged, this would pose an obstacle to mutual trade.
Regional currencies could be stabilized in several ways;
for instance, by giving financial assistance to countries with fiscal
reserve problems, or by assisting such countries by importing goods from
them. This in the future might lead to a regional currency, which would
reduce dependence on the dollar. (TNA)
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