Vol. XII No. 3
Friday January 16 - January 22 , 2004

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by Saichon Paewsoongnern

 

 

BUSINESS NEWS
HEADLINES [click on headline to view story]: 

Exel opens new export and logistics branch on the Eastern Seaboard

Thais told to prepare for increased Chinese investment

Export offensive plan goes to MOC

New land assessment price will benefit economy

Productivity Institute to overhaul private enterprises

Foreign debt repaid from excess reserves

300 billion earmarked for water strategies

Crackdown on copyright violations showing results

Market cap of PTT expected to increase

Rice, the miracle food

Exel opens new export and logistics branch on the Eastern Seaboard

Damri Muangkaew

The latest addition to the freight export and logistics scene recently opened in Sriracha. Exel (Thailand) Limited Company officially opened their office at Talay Thong tower in Sriracha to service regional industry. The company already has 89 branches scattered throughout the Asia Pacific rim and over 8,000 employees with their head office based in Singapore.

Narapoj Tiewthanom (left), director of the Laem Chabang industrial estate and Graham Lunney (right), Exel managing director South Asia with guests and customers at the opening of the Sriracha office.

Exel managing director, Graham Lunney opened the office with honored guest Narapoj Tiewthanom, director of the Laem Chabang industrial estate.

During the opening, branch manager Grant Enders said that the company already has a large customer base in the area and that it is more beneficial for them if they are close by as this enables the company to provide better services.

Exel began operations in the year 2000 with the merging of two companies in freight and logistics. They now provide services around the globe with over 65,000 people from 120 countries on six continents providing high quality services to all their customers, local, regional or global based.


Thais told to prepare for increased Chinese investment

The Chinese government has hinted that Thailand could be the recipient of a portion of US$10 billion-worth of investment by Chinese companies, according to the KASIKORN Research Center, which in a recently published report called on Thailand to use its close relationship with China to attract Chinese business and industrial partnerships.

The Chinese government’s policy of promoting foreign investment could provide a boon for Thailand, which enjoys a close relationship with its near neighbor. As a result, Thailand is likely to see an influx of Chinese companies and state enterprises eager to invest in the Kingdom.

Various economic cooperation projects between the two countries, notably the opening up of free trade in fruit and vegetables, will encourage Chinese businesspeople to look for channels to enter into joint investment projects with their Thai counterparts. This will be particularly apparent in the agro-industrial sector and related downstream industries, resulting in a rise in exports of these products to other countries.

The report also noted that the development of transport links between Thailand and other countries in the Mekong sub-region - Laos, Myanmar, Vietnam, Cambodia and China’s Yunnan Province - was also likely to facilitate Chinese investment. These communications routes would also provide transport links with other countries in the wider region, including India, with Thailand acting as a transport and communications hub. These transport links, whether by land, air or river, would serve to boost trade, investment and tourism by collapsing journey times.

The research center report said that economic cooperation among members of the Greater Mekong Sub-region was set to boost Chinese interest in investing in Thailand, noting that businesses from China’s Yunnan Province were already placing their money in projects in the northern Thai province of Chiang Rai. The Thai government’s development of the northern border region as a special economic zone was already resulting in bilateral projects, whether in terms of transportation or tourism.

At the same time, the two countries are likely to engage in exchanges of technology and joint research and development (R&D) projects, thus promoting economic development in both countries and in the wider Asian region. (TNA)


Export offensive plan goes to MOC

The Department of Export Promotion has drawn up a marketing offensive designed to boost exports by 10-12 percent, according to department director Chantra Buronrik. Chantra said that the plan, which is hoped allow Thailand to achieve its 2004 export target, would now be proposed to the Ministry of Commerce (MOC).

On 11 January Deputy Prime Minister Somkid Jatusripitak is due to chair an integrated meeting to brainstorm ideas from various agencies involved with foreign trade, namely the Ministry of Industry, the Ministry of Agriculture and Cooperatives, the Board of Investment, the Ministry of Commerce and the Ministry of Foreign Affairs.

The private sector will be represented by the Thai Chamber of Commerce, the Federation of Thai Industries and the Council of Shipping Exporters. (TNA)


New land assessment price will benefit economy

An increase in the land assessment price by 14.44% will benefit Thailand’s economy, rather than having negative effects, according to the Finance Ministry.

Kitti Limsakul, assistant to the finance minister, conceded that the new assessment price set by the Treasury Department would more or less increase land prices. But it would help reflect the actual cost of the economy, he stated.

He said, however, that the general public would definitely bear higher costs of house ownership; still, the overall economy would be balanced.

“Before the crisis, property prices were excessively inflated without any mechanism to put a brake on them. The new assessment price will also definitely affect entrepreneurs, but it should help reduce speculation, which could help enhance the stability of the economy. I believed it will also prompt commercial banks to accelerate coping with non-performing assets (NPLs). The banks can take this opportunity to place the assets on sale in the market, as interest rates remain low, and the economy is still picking up,” Kitti said.

Somchai Sajjapong, Deputy Finance Ministry spokesman, said that the new assessment price would help facilitate the debt-restructuring process because prices which collateral debtors had pledged with the banks would rise.

Non-performance loans (NPLs) now stand at more than 15% of total loans in the banking system. The new assessment price should help increase revenue earned by local administrative organizations from various tax and fee collections. It would also enable the business sector to assess business costs more accurately. (TNA)


Productivity Institute to overhaul private enterprises

The government’s commitment to upgrading Thailand’s competitiveness was reaffirmed when Deputy Prime Minister Somkid Jatusripitak recently announced that he had ordered the Thai Productivity Institute to take a leading role in developing both state and private sector institutions.

Under the plan, strategic policy offensive will fall in line with the government’s vision of transforming Thailand into a fully developed nation. This will be achieved by upgrading Thailand’s national competitiveness to enable it to compete with other nations in the global arena of free trade.

As an important government driver, the Thai Productivity Institute will help encourage state agencies to overhaul their working practices, whether in terms of knowledge, personnel development, or technology, with the focus on the industrial, agricultural and service sectors and will support the development of research and innovations.

“The Institute will have to free itself from being a supporting agency under the auspices of the Ministry of Industry, and transform itself into a national level institution to assist small and medium-sized enterprises (SMEs), large-scale businesses and other agencies. Its funds of 220 million baht will be used both to expand its operations and to increase staffing levels. The government will provide full financial support, as the government aims to attach a high level of importance to this organization,” Somkid said.

In addition, the Thai Productivity Institute will be asked to link its work with that of the Thai Chamber of Commerce, and the Federation of Thai Industries (FTI), using methods successfully practiced by private sector heavyweights such as Thai Cement Plc. Special teams will be established to oversee each specific area of operations, while academics will be pulled in from educational institutions. (TNA)


Foreign debt repaid from excess reserves

Prime Minister Thaksin Shinawatra recently stated that he has ordered government agencies to study the feasibility of using Thailand’s huge volume of capital reserves to repay the nation’s foreign debts.

The prime minister noted that Thailand’s capital reserves were now at the extremely high level of US$42 billion. Thaksin told government agencies to determine the most suitable volume of capital reserves for Thailand’s economic situation, and to study the possibility to using an excess capital to make foreign debt repayments.

“In practice, capital reserves should be around two times higher than short-term debts. When debts and capital reserves are calculated according to this formula, I expect that we will have an excess of around 300 billion baht,” he said. “I have given related agencies the policy of using this excess to make debt repayments, which will reduce government debts to zero. Thailand will become an extremely strong nation. I believe that none of this is too difficult, and will take around 3-4 years to implement,” he said. (TNA)


300 billion earmarked for water strategies

Director-General of the Royal Irrigation Department Samart Chokkanapitark recently announced that a proposal will be made to the government to allocate funding of 300 billion baht for its nationwide water management strategies over the next five years as part of a wider plan to eliminate drought.

Speaking after a Cabinet meeting, Samart said that the Ministry of Agriculture and Cooperatives had requested the funding to solve problems related to the country’s water supply, whether for agriculture or general consumption, both within designated irrigation districts and outside them. “The money will also be used for the construction of large-scale projects, including dams, relating to water management,” he said.

Agriculture and Cooperatives Minister Somsak Thepsuthin said that the water management strategies, currently being drawn up, formed part of the ministry’s wider plans to solve problems faced by the nation’s agricultural sector. He conceded that the proposed 300 billion baht budget could rise to as much as 400-500 billion, depending on the details of the projects involved. (TNA)


Crackdown on copyright violations showing results

The Ministry of Commerce has heralded a 90 percent success rate in controlling violations of intellectual property rights. Revealing contents of a Ministry of Commerce report recently disclosed to the Cabinet, Government Spokesman Jakrapob Penkair said that over the past three months, operations in areas controlled by 18 police stations had led to a 90 percent reduction in intellectual property right violations, with arrests that would lead to 653 criminal cases.

Jakrapob conceded the crackdown on producers of counterfeit products had often simply resulted in them relocating their production bases to other areas of Thailand and to neighboring countries.

“In the short term the ministry will continue to target certain areas, particularly during holiday periods. Relevant legislation will be amended. Anyone involved in the trade of counterfeit tapes and television products will face charges under the Tape and Television Products Act and the Consumer Protection Act,” Jakrapob said. (TNA)


Market cap of PTT expected to increase

Prime Minister Thaksin Shinawatra expressed confidence that the combined market capitalization of PTT Public Company Limited (PTT) and companies under its umbrella would increase to 1 trillion baht from 700 billion baht at present.

Presiding over a function to celebrate the 25th anniversary of the establishment of PTT, Thaksin affirmed the government’s commitment for continued support in the performance of PTT, and projected the value of the company’s share price would further increase in the next five years. He said PTT would still serve as the government’s key mechanism in adopting an assertive strategy in the energy affair and competition in the region.

Prasert Bunsumpun, President of PTT, said, “Currently, the company distributes around 2.7 billion cubic feet of natural gas per day which is 35 percent of the country’s total energy consumption. PTT plans to invest 400 billion baht for business expansion in the next ten years to help the country become an energy trade hub in the region.”


Rice, the miracle food

Thai researchers have discovered that Thai rice is packed with vitamins, minerals, protein, and anti-carcinogens several times more powerful than vitamins E and C, according to the head of the DNA laboratory at the National Center for Genetic Engineering and Biotechnology (BIOTEC).

“Rice is a miracle food. It contains protein and carbohydrate, as well as vitamins which are essential for the body. This is especially true for rice bran and rice germ, which contain several types of vitamin B, vitamin C and vitamin D, as well as minerals which are an important constituent of muscles, blood, the nervous system and teeth. These minerals also help the body absorb vitamins. Rice contains calcium, potassium, phosphorous, iron and other minerals. Moreover, anti-carcinogens have been discovered in rice bran and rice germ, which offer 10 times better protection against the formation of abnormal cells than vitamins E and C,” said Dr. Somwong Trakunrung.

“Our country is blessed with a diversity of rice strains. We can develop this for our benefit, using technology to modify Thai rice strains to ensure high levels of iron and higher quantities of fat, minerals and vitamins. We must have procedures to ensure that these things add value to rice. In the future farmers will no longer be poor,” Dr. Somwong said. (TNA)



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