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SEC invokes deposit
on net settlement
The Stock Exchange of Thailand (SET) index plunged to
more than 20 points on panic sales when the market opened on November 17
following the Securities and Exchange Commission’s (SEC) decision to curb
speculation through the net settlement.
The SEC resolved to have the SET require securities
companies to make customers put minimum deposits of 10% of the trading
amount starting on December 1, 2003 and increase the deposits to 25% on
January 1, 2004.
SET president Kittirat Na Ranong said the stock exchange was ready to
comply with the new regulations because of the SEC’s claim on the
Securities Act on Article 186 (2). However, we must say that many brokers
are not ready to comply with the measure,” he said. (TNA)
Cambodian industrial estates expected to slash costs
The Industrial Estate Authority of Thailand (IEAT) is
studying ways in which the Thai government can support the establishment of
an industrial estate on Cambodia’s Kong Island as a mean of allowing Thai
investors to shift their production bases to where costs are lower,
according to IEAT Governor Anchalee Chavanich.
Anchalee, who recently visited Myanmar as part of Prime
Minister Thaksin Shinawatra’s delegation said that the government had
allocated a budget of 10 million baht for a feasibility study to
establishing special economic zones or industrial estates in neighboring
countries.
The IEAT is eyeing Kong Island due to its enormous
resources, which would enable the development of downstream industries such
as timber processing, glassware and fabrics.
“Expansion into surrounding countries will create new markets for Thai
products in the future and will give Thai investors an opportunity to invest
in production bases where labor or raw material costs are low for certain
industries,” Anchalee said.
E-commerce center
for entrepreneurs
The Ministry of Industry is joining with Rangsit
University and the private sector to open a new e-commerce center in the
heart of the capital, as part of a bid to boost the competitiveness of
Thailand’s entrepreneurs.
Manu Leopairote, Permanent Secretary for Industry, said
that the new center would encourage entrepreneurs to apply information
technology to their marketing campaigns.
Pledging full backing from the Department of Industrial
Promotion and the Office of Small and Medium Enterprise Promotion (SMEs), he
said that the center would provide a complete range of support services for
entrepreneurs, including e-commerce training and workshops, while also
giving financial support.
Studies carried out by the government suggest that the
main problem afflicting e-commerce in Thailand is a lack of confidence among
trading partners. Mau expressed hope that the new center would help solve
such problems, as it would allow sellers to display their goods.
The Ministry of Commerce will provide e-commerce and IT
training through video conferencing, which will not only slash costs but
also lead to the exchange of ideas among centrally-based and
regionally-based academics.
The e-commerce centre will be divided into three zones.
The first will provide data research facilities, with over 50 computers on
hand for participants in training programs.
The second will act as an exhibition and distribution center for
e-commerce goods to allow purchasers to examine the products before buying
them. The third zone will allow sellers and purchasers to engage in business
negotiations. (TNA)
DPM calls on all parties to help strengthen SET
Deputy Prime Minister Somkid Jatusripitak is calling on
all parties concerned to help develop and strengthen the Stock Exchange of
Thailand (SET). While presiding over the 2nd “SET in the City Fair” at
the Queen Sirikit National Convention Center, he said the stock market, now
in its 28th year, had managed to weather several encounters with economic
crises. In particular, the SET index had plunged to a low of 260 points from
1,700 since the economic crisis in 1997, he noted.
Somkid said that the market capitalization had decreased
to only 1.3 trillion baht from 2.6 trillion with the price/earning ratio
falling to 5-6 times from 25-26 times and listed companies had experienced
combined losses of hundreds of billions of baht. However, he stressed that
the index had recovered to exceed 600 points, with market capitalization of
3.8 trillion baht and the P/E ratio of 11-12 times.
The deputy prime minister conceded the SET remained fragile and sensitive
to news on measures to curb trading on net settlement. He said investors
were nervous about rumors on mass redemption of unit trusts of fixed-income
funds which had caused the SET to drop significantly. He said this showed
that local investors were very sensitive. He urged investors to make their
decisions based on hard information and not rumors. (TNA)
New measures for housing loans
Measures aimed at overseeing proper lending in the
property business are expected to be issued by the end of this year,
according to the Bank of Thailand (BOT). Tarisa Watanagase, BOT’s Deputy
Governor, said the central bank was studying the appropriateness and details
of the measures, and considering how it could control lending by financial
institutions and implement them by the end of this year.
Tarisa said the bank had planned to oversee the extension of two types of
loans, including loans for property developers and end-users. She added that
the BOT needs to supervise the lending procedure to ensure the quality of
the loans. (TNA)
“Charge it!” say Thai consumers
More Thai consumers have turned to purchase products via
credit cards instead of cash, according to a giant card issuer. Somboon
Kobtheeranond, manager of VISA International, Thailand and Indochina,
disclosed that more consumers had changed their behaviors by using credit
cards rather than cash to buy products.
In 2002, the number of consumers spending through credit
cards in lieu of cash stayed at 4.6%, and was expected to increase to 5%
this year. Somboon said it was also projected that the number could rise to
8% in the next five years.
He said VISA would attempt to have its member banks
increase the number of electronic data capture (ECD) machines to accommodate
the expansion of the credit card business, particularly in provincial areas
and VISA hoped to increase the number of member shops in provincial areas to
equal that in Bangkok. (TNA)
SMEs to be given training via satellite
The Ministry of Commerce has asked the Department of
Trade Business Development to join with the Thai Training Network and other
related agencies to offer training programs via satellite links to at least
10,000 SME entrepreneurs across the country.
Deputy Commerce Minister Phongsak Rattanaphongphaisan
said, “Despite the high potential of many of Thailand’s SMEs,
administrative systems often remain weak, with an over-reliance on
traditional family management structures. As a result, financial
institutions and commercial banks are often reluctant to extent loans to
boost SMEs’ liquidity or allow them to expand their businesses.”
Phongsak conceded that not all goods produced by Thai
SMEs met customer demands and tastes. “The Ministry of Commerce has a duty
to provide information on the exact nature of demands for each product in
different markets so SMEs can make adjustments to meet customer demand,”
he said.
On 20 December, the program will begin with a course on basic accounting
and financial skills. This will be followed on 17 January 2004 with a course
on business planning strategies and sources of capital. On 21 February the
course will focus on boosting the efficiency of the administrative system
using computers, while the course on 20 March will look at the transfer of
experiences. Speakers will all be people who are knowledgeable and
experienced in the SME sector. (TNA)
Thais urged to invest in Indonesia’s energy sector
Thai Energy Minister Prommin Lertsuridej
recently revealed that Indonesia’s national oil company Pertamina has
already asked PTT Plc (PTT), Malaysia’s Petronas and an energy company in
Singapore to jointly invest in the East Natuna petroleum block in Indonesia.
Prommin said Jakarta has agreed to focus on energy
production in cooperation with Thailand in the ASEAN Power Grid and AEAN
Pipeline projects to maximize energy production within the ASEAN region. The
cooperation scheme will cover electricity and petroleum production.
Indonesia has huge resources, but its production capacity
is currently overwhelmed by domestic demand and has asked the Electricity
Generating Authority of Thailand (EGAT) and other Thai electricity
generating companies to invest in power plants.
Indonesia has up to four times more natural gas than
Thailand. Benefits for Thai firms would include a more stable long-term
outlook in the energy production sector if they could secure stakes in
Indonesia.
PTT chief executive officer Prasert Boonsamphan said,
“East Natuna has the biggest natural gas deposit in all of Indonesia. The
invitation to foreign investors is aimed at creating higher demand and
reducing investment risk. The new capital will speed up development of the
resource.”
“If the project is developed, a feasibility study may follow regarding
gas transportation by ship. Another project under discussion is an ASEAN
pipeline linking Indonesia, Singapore, Malaysia and Thailand. The decision
will be based on a cost-benefit analysis and local demand,” said Prasert.
(TNA)
Thailand and Japan prepare for FTA talks
Thailand and Japan are preparing to announce the launch
of negotiations on the establishment of a free trade area (FTA) when Prime
Minister Thaksin Shinawatra visits Japan.
Deputy director-general of the Department for
International Trade, Sriwicha Rakcharoen, said that the start of the talks
would be officially declared during Mr. Thaksin’s visit to Japan on 11-13
December.
Thailand has already signed FTA deals with China, India
and Bahrain, as well as members of the Association of Southeast Asian
Nations (ASEAN). Under the FTA deals, imports taxes will be gradually
reduced to zero percent.
The FTA deal with Japan would not only provide Thailand
with more opportunities to export its goods to Japan, but also lead to more
investment and technology transfer from Japanese companies. Although The FTA
agreement could open more markets for Thai goods, they will also force Thai
companies to prepare themselves for an increase in international
competition. (TNA)
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