HEADLINES [click on headline to view story]: 

Bankers say economy is improving

Budget presented in Saha Group’s Trade Exhibition

Local production of pick-ups and cars expected to skyrocket by 2006

BOI wants more tax incentives for investors and state grants for R&D

Industrial Solutions Roadshow at TGI

Thailand ranks 7th most favored investment base in Asia-Pacific region

Quality development and new markets to boost export growth

Kasikorn Bank to introduce ‘coffee banking’ service

1.8 billion baht budget planned for extravaganza to promote Thailand as fashion center

ASEAN scouts three gas pipeline routes

Bankers say economy is improving

The majority of bankers feel the country’s economy has already picked up and feel the economic policy is the right track, according to a recent poll conducted by Suan Dusit. The poll was conducted with a random sample of 318 bankers in Bangkok and its environs after commercial banks moved to further cut lending rates.

The survey found 62.2 percent of bankers polled viewed the Thai economy was on the rise and based their responses on the increasing number of customers requesting loans, and increased consumer spending.

Asked about the effects of intense competition between commercial banks trying to offer low borrowing rates, the bankers showed a considerable amount of ambivalence.

On the positive side, 34.78 percent said low interest rates were good for the public purse, and 31.1 percent felt that low interest rates will boost borrowing for investment.

However, 42.2 percent of respondents said that depositors would see lower interest rates on their deposits, and 29.2 percent warned that the income of commercial banks could also drop. (TNA)

Budget presented in Saha Group’s Trade Exhibition

Worldclass Rent a Car Co., Ltd. (Budget Car and Truck Rental of Thailand), the world’s leading rental car firm, participated in the 7th Saha Group Export & Trade Exhibition as an affiliation of Sahapat. The exhibition was held by the Saha Group in cooperation with the Department of Export Promotion. Its objective was to expand export channels abroad and at the same time to promote domestic trade and investment and to present the company as Thailand’s leading major consumer product. People interested in renting a car today until the end of August, Budget has a special promotion offer of 599 baht per day with unlimited kilometers in northern (Chiang Mai-Chiang Rai) and southern (Phuket-Samui) Thailand.

Vanchai Tangpanichdee, MD of the Worldclass Rent a Car Co., Ltd.

Local production of pick-ups and cars expected to skyrocket by 2006

The Ministry of Industry expects the production of cars and pickup trucks in Thailand to increase by 70 percent by the year 2006 as more auto companies shift their plants here. The government has forecast production of vehicles to top 1 million units by 2006, from 584,951 in 2002.

During a recent automobile industry conference in Bangkok, Manu Leopairote, permanent secretary at the Industry of Industry said, “Consumer spending on new cars, homes and other products is driving Thailand’s economic growth. The government has now raised its gross domestic product growth forecast for this year to as much as 5.5 percent, higher than last year’s 5.2 percent.”

The combination of demand for new models and lower lending rates has driven up car sales and production is expected to rise as more automakers such as Toyota Motor increase their manufacturing capacity by shifting their plants to Thailand. Manu said that Honda Motor, Japan’s second-biggest automaker, also plans to shift production of some vehicles from the Philippines to Thailand. (TNA)

BOI wants more tax incentives for investors and state grants for R&D

The Board of Investment (BOI) is asking the government to provide the agency with more tax incentives for investors which are more in line with those of Malaysia and Singapore

BOI’s secretary-general Somphong Wanapha said, “The BOI wants the government to amend existing laws which would allow more attractive tax incentives for investors and also grant subsidies for the private sector for research and development in certain areas. BOI would select an educational institution or agency that specializes in business and international laws so that BOI incentives don’t contradict the World Trade Organization’s (WTO) regulations.”

Somphong said he expected a study could be completed within 6-8 months after it hires a new consultant. Following that, the BOI will submit its proposal to the House of Representatives for debate to change the present BOI law that was introduced in 1977.

Somphong said the study will encompass the possibility of the BOI providing investment incentives based on individual companies rather than projects. He used Toyota Motors’ proposal to build a pick-up truck plant and a research center as an example.

Consideration of WTO regulations is a top priority in working out the details. The WTO only bars its member countries from providing state exports subsidies for private firms. Since Thailand retains its developing country status, it would be subject to a grace period of three years before this WTO rule would apply. (TNA)

Industrial Solutions Roadshow at TGI

Topics to cover Engineering, Finance and Training

Three well-established institutions in the Eastern Seaboard industrial zones have put together their resources to organise a road show in the fields of engineering, financing and training. This first in the series of seminars will be held at the Thai German Institute, Amata Nakorn Industrial Estate, Bangna-Trad Highway on Friday 1 August 2003 commencing at 9:45 a.m.

This roadshow will provide companies with information about how to increase their productivity and competitiveness through modernisation, automation, quality enhancement, reliability, service and compliance with international environmental standards as keys to success in today’s market place. The three organisers are,

RieckermannThai Engineering who have been supplying manufacturing and process machinery, and providing professional engineering in Thailand for some 50 years and is the local representative for a large number of international manufacturers of plant and equipment.

The main reason for their long and successful business operations in Thailand is that they employ a team of highly-qualified and experienced engineers who are able to take the best engineering concepts that are available world-wide, and adapt them to suit local conditions. RTE can design and supply engineering solutions to suit almost any industrial requirement.

DEG is part of KFW Group, a leading AAA rated German Bank with total assets of 261 billion Euros. DEG provides tailor-made long-term project and corporate finance through equity participation, mezzanine finance, and loans in all major currencies as well as Thai baht.

DEG offers more than only money - based on the experience of having financed more than 1,000 projects worldwide, DEG can provide know-how for the financial engineering of your projects, consultancy and a network of specialists covering a wide range of services.

The Thai-German Institute (Thailand) is a joint project of the Royal Thai Government, the Government of the Federal Republic of Germany and the Federation of Thai Industries. TGI is the largest and most advanced independent training center for industrial technologies in Thailand. With universally accepted quality principles, state-of-the-art equipment and highly-trained staff, we offer a real opportunity for Thailand’s process and manufacturing industries to help their technicians and engineers improve their qualifications and keep up-to-date with the most advanced techniques and technologies.

Don’t miss this opportunity to meet representatives of three well-established institutions in the fields of engineering, financing and training presented in three informative presentations followed by an open forum lunch and a lucky prize draw for a weekend for 2 on Koh Samui, including flights and accommodation, and other attractive prizes. For more information and to confirm your participation Contact Khun Siriporn at e-mail [email protected], tel: 038 743 463 or fax: 038 743 465.

Thailand ranks 7th most favored investment base in Asia-Pacific region

Thailand has been placed as the seventh favorable investment base in Asia and the Pacific over the next five years; while Singapore has been ranked top, according to a recent survey.

The survey, conducted by the Economist Intelligence Unit (EIU), found that despite being ranked the world’s 30th favorable investment place, the Thai kingdom was voted the seventh in the region.

The EIU survey of 60 countries worldwide also found that Singapore would surpass Hong Kong as the most favorable investment destination in the region over the next five years although the island state was placed as the world’s seventh favorable investment base.

Canada was ranked number one, followed by the Netherlands, Finland, Britain and the Unites States, according to the survey.

The Philippines and China were ranked as the world’s 35th and 38 places respectively, said the news report.

The ranking was based on 10-factor criteria, namely development of infrastructure, policies accommodating foreign trade and investment, marketing prospects, growth trend, and terrorism risks.

Quality development and new markets to boost export growth

The country’s exports are likely to grow more than 7% this year, boosted by product quality development and the government’s efforts to open new markets, according to Boonyasith Chokwattana, chairman of Saha Group.

Boonyasith said, “The situations looks promising this year following the easing of SARS, the quality of Thai exports has been widely recognized in Asia and the government has sought new export destinations, particularly for consumer products.”

The chairman said interest rates offered by local financial institutions could drop further and the downward trend is expecteda to have a positive impact on the property and auto businesses. (TNA)

Kasikorn Bank to introduce ‘coffee banking’ service

You’ve had armchair banking, you’ve had telephone banking, you’ve had Internet banking, but now thanks to Kasikorn Bank, or well known in their old name - Thai Farmers Bank - and the international coffee chain Starbucks, in jointly introducing a new ‘coffee banking’ service which will soon be coming to a town near you.

According to Chakree Trichulee, Senior Director of the bank’s Branch Sale Administration Department, the new service aims to create a ‘coffee shop’ atmosphere in the bank’s branches.

Customers will be able to order coffee - Starbucks coffee, naturally - as they sit and carry out their banking transactions.

The first ‘coffee banking’ branch in Asia will be opened at the corner of Sukhumvit Soi 33 here, and three more branches are planned within this year. (TNA)

1.8 billion baht budget planned for extravaganza to promote Thailand as fashion center

Industry Minister Somsak Thepsuthin will propose a budget of 1.8 billion baht to organize the ‘Bangkok - Fashion City’ show planned for October. Somsak said that the budget for the event is designed to boost the competitiveness of Thailand’s gemstone, leather goods, fabric, ready-wear garments and cosmetics industries.

The Fashion City program will include 11 interrelated projects, including the promotion of Thai designers, the creation of brand names, and the search for a designated location to sell Thai fashion goods. The program will also link with Thailand’s tourism industry.

Somsak said, “The government wants Thailand to be a fashion center for the wider Asian region and eventually the world.”

Somsak revealed that eventually Thailand will be able to produce its own designers since a number of countries, including Italy, were already setting up fashion schools in the Kingdom.

“Each year Thailand exports fashion goods worth around 300 billion baht, but if there are no developments, exports will drop. For instance, exports of leather goods have already fallen by 10 billion baht. Moreover, in 2005 these goods will have to be liberalized in line with World Trade Organization agreements. Thailand may not be able to compete with rivals such as China, as their labor costs are cheaper,” Somsak said.

The industry minister said that he would take Chinese-produced clothes to the Cabinet meeting to show that clothes made in China were now half the price of those made in Thailand, and to warn the government that unless it promoted Thailand’s fashion industry, the fashion sector would be in serious trouble.

Phanlert Baiyok, assistant to the industry minister, said that China’s lower labor costs had forced many Thai clothing manufacturers to halt production and turn instead to importing clothing from abroad. “

When people across the world think of neckties, they immediately think of Italy, or when they think of watches, Switzerland comes to mind. Thailand should have a chance when it comes to fashion,” Phanlert said. (TNA)

ASEAN scouts three gas pipeline routes

Energy Minister Prommin Lertsuridej announced that Japan has expressed interest in backing Association of Southeast Asian Nations (ASEAN) plans to develop pipelines linking Indonesia’s Natuna gas area to Malaysia, Thailand and Vietnam, with possible future links to the Philippines.

Noting that a recent ASEAN energy ministers meeting had discussed plans to link gas pipelines across the region, Dr. Prommin conceded that while such plans would lead to increasing energy security, further studies would have to be conducted to ensure that these projects were cost effective.

Initially seven projects had been proposed, but only three pipeline routes were deemed feasible in terms of cost. The first would link Indonesia’s eastern and western Natuna areas, a distance of 400 kilometers, and a 140-kilometer offshoot would be built linking the pipeline with Thailand’s Joint Development Area (JDA).

The second would provide a 140-kilometer link between the eastern and western Natuna areas and from there would link with Malaysia’s Koteh gas field, a distance of 200 kilometers.

Another fork of the pipeline would link with the Thai-Malaysia JDA, and from there would link with the Gulf of Thailand, and from the JDA stretch 140 kilometers to Vietnam.

The third route would link Malaysia’s Koteh gas field with the eastern Natuna area, and from there link with the JDA and Vietnam’s Block B. “

Japan expressed an interest in supporting ASEAN gas pipeline projects, but we first have to determine if the 1,000-1,500 kilometer-long pipelines are financially viable. Costs for the pipeline will be compared with transportation of liquid natural gas (LNG). We will use whichever program is better,” the energy minister said. (TNA)