BUSINESS NEWS
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First 10,000 smart cards issued to govt officials and ‘lucky’ citizens

Firms in REHABCO likely to be back in normal sector in 2006

Thailand rushes to breed cows as demand for milk soars

IMF: Asian economic outlook is bright

UN ranks Thailand 4th in global investment ratings

First 10,000 smart cards issued to govt officials and ‘lucky’ citizens

The Ministry of Interior’s Department of Provincial Administration has issued the first 10,000 multi-purpose identity cards, or smart cards, to government officials, including cabinet members, as a pilot project at an event held at the Impact Arena Trade Exhibition Centre in Muang Thong Thani of Bangkok’s suburban province of Nonthaburi.

The first 10,000 smart cards were issued at the four-day event based on a ‘first come, first serve’ basis.

The Interior Ministry particularly invited civil servants to take the right to mark the Civil Servants’ Day, which fell on April 1.

About 2,000 general identity card holders, aged 15-70, who registered at the [www.khonthai.com] website were also randomly selected to be included in the first 10,000 Thai citizens receiving the smart cards.

Those who were informed of being selected as one of the first 10,000 smart card holders received their smart cards at the four-day event, or left the right to others.

However, Information and Communications Technology Minister Surapong Suebwonglee announced late last month that the first phase of the government’s ‘smart card’ project would have to face about a one month delay, as the government decided to open new bidding for firms wanting to apply to be an authorized producer and developer of the country’s multi-purpose identity cards.

M.D. Surapong said that the Ministry of Information and Communications Technology had scrapped the old bidding, and would open new bidding after the former authorized company failed to offer a cheaper production cost of the first 12 million smart cards.

The decision would result in about one-month delay of the government’s planned issuance of the smart cards to the general public, he stated.

The government earlier planned to issue the first-phase 12 million smart cards to Thai citizens, excluding the first 10,000 under the pilot project, in April.

Last month, the cabinet also approved a total budget of over Bt7.9 billion to support the Ministry of Information and Communications Technology’s smart card project.

The earmarked Bt7.910 billion budget is to be used for producing and managing the distribution of 64 million smart cards to all Thai citizens.

The smart card scheme is divided into three phases.

In the first phase, supported by a budget of Bt1.670 billion from this 2004 fiscal year, 12 million smart cards are to be produced.

In the second phase, backed by another budget of Bt3.120 billion in the 2005 fiscal year, 26 million more smart cards will be produced.

And in the third phase, backed by another budget of Bt3.120 billion, the rest of the 26 million smart cards are to be produced.

The government will also accelerate the issuance of new legislation to protect holders of the smart cards regarding access to their reserved information. (TNA)


Firms in REHABCO likely to be back in normal sector in 2006

Listed companies in the rehabilitation sector (REHABCO) are likely to be transferred back to the normal sector as a whole within the first quarter of 2006, according to the Stock Exchange of Thailand (SET).

SET’s President Kittirat Na Ranong said 95 companies had been transferred to REHABCO since January 5, 1998 because their financial positions had been adversely affected by the country’s economic crisis. These companies had undergone the debt restructuring during 1998-2003, but the process had been so slow that 29 firms were delisted under duress and on a voluntary basis, he disclosed.

As Kittirat explained, only nine had successfully managed to rehabilitate their business in that period, and had moved back to the normal sector. Still, performances of the companies in REHABCO have significantly improved since last year as a result of the economic recovery.

Up to 10 firms received approval by SET to be transferred back to the normal sector, as their qualifications met its criteria. Now, there are only 44 companies in REHABCO.

Kittirat said the number was expected to continue to drop now that the country’s economy is sustaining growth, and SET came up with measures to facilitate the debt-restructuring and rehabilitation process.

Sarayuth Booncharoen, senior vice president of SET in charge of supervising the debt restructuring of listed companies, said SET expects to see around 15 firms in REHABCO be transferred back to be traded in the normal sector within this year. He said SET would closely monitor the performance of the remaining companies in REHABCO, and would review a progress in their rehabilitation process every six months. In the first quarter of this year, he said, there were a few companies whose performances remained of concern. (TNA)


Thailand rushes to breed cows as demand for milk soars

A few decades ago, milk was almost unheard of as part of the Thai diet, but today demand for milk is rising so fast that the Thai Organization for the Promotion of Milk Cows is rushing through a mass program of artificial insemination in the hope of boosting supply.

According to Dr. Phiphob Jarikphakorn, head of the organization’s Office of Milk Cow Promotion, the organization is heavily promoting milk cow farming in 21 provinces under its jurisdiction.

This year the organization aims to artificially inseminate around 57,000 cows to meet the demand of the domestic raw milk market, which is expected to soar to at least 3 billion baht by next year.

The organization is also encouraging milk cow farms to meet the quality standards laid down by the Department of Livestock Development, which will lead to safer, better quality products and help boost consumer confidence.

Thailand currently imports large quantities of milk from countries such as New Zealand in order to meet domestic demand. (TNA)


IMF: Asian economic outlook is bright

With the global economic expansion strengthening and deepening, the near-term prospects for Asia look good, David Burton, Director of the Asia and Pacific Department of the International Monetary Fund (IMF), said in a recent interview with IMF Survey magazine. He predicted that growth of the whole of Asia, except for Japan, could reach 7% this year.

Burton stated that although the avian flu in the first quarter of this year triggered great losses for a number of economies, the risk was quickly driven back. There were reasons to be optimistic about Asian economic outlook, Burton noted, citing China’s growing demand for imported commodities, including raw materials which had created a momentum to spur business and production activities in other countries.

“However, for a strongly sustainable growth rate, Asian economies, especially China, need an orderly adjustment of global current account imbalances, and must manage the transition to higher interest rates globally”, the IMF official said.

He stressed that China would need to strike the right balance between preventing overheating, and avoiding an unduly sharp cutback in investment.

The IMF has supported initiatives of ASEAN + 3 (China, the Republic of Korea, and Japan), saying that these initiatives can potentially strengthen growth and financial stability in the region. However, the IMF official held that ASEAN + 3 macroeconomic impact had so far been relatively modest. “Therefore, Asia needs to maintain an outward-looking focus, and not see these initiatives as substitutes for broader integration into the global economy,” Burton suggested. (TNA)


UN ranks Thailand 4th in global investment ratings

Thailand’s business community is celebrating as news emerged on April 17 that the United Nations Conference on Trade and Development (UNCTAD) had ranked Thailand as the fourth most attractive investment destination in the world, a move which the Thai Chamber of Commerce and the Federation of Thai Industries (FTI) said would help boost investors’ confidence in Thailand’s burgeoning economy.

The UNCTAD report, published on 14 April, names Thailand as the fourth most desirable investment ‘hotspot’ after China, India and the United States.

Describing the report as a ‘boost in Thailand’s rating’, FTI President Praphad Phodhivorakhun said that it would boost Thailand’s standing in the eyes of foreign investors. He called on the government to seize the opportunity offered by the report to publicize Thailand’s investment opportunities through a series of foreign road shows, expressing confidence that the level of foreign investment in Thailand was now set to rise.

Despite the economic recession of the 1990s, Thailand has already emerged as Southeast Asia’s economic powerhouse, with economic growth second only to China. Unlike other countries in the region, such as Indonesia and the Philippines, it is not plagued by internal political problems, while its geographical position in the center of the region makes it an attractive prospect for investors eyeing up emergent economies such as Cambodia and Laos.

The report was also greeted with enthusiasm by Deputy FTI President Kiertiphong Noijaiboon, who said, “In the future I am confident that Thailand will overtake China, as all countries now perceive China as a competitor. Thailand is ready in terms of infrastructure, low labor costs and internal stability”.

Kiertiphong said that investment focus was likely to center on the automobile industry, with Thailand now emerging as the ‘Detroit of Asia’. This, in turn, helped drive other industries, such as plastics, chemicals and rubber.

At the same time, he predicted, the food and clothing industries were also likely to attract foreign investor interest, thanks to heavy promotion by the government through campaigns such as the Global Kitchen Project and the Bangkok Fashion City Scheme. His optimism over the report was echoed by Wirot Amatakulachai, deputy chairman of the Thai Chamber of Commerce, who forecast that the publication of the report would see an influx of foreign investment. He noted that Thailand presented a particularly attractive investment proposition compared to other economically powerful countries in the region due to its low administrative costs, which meant that returns on investment could be realized within a short time.

Ajva Taulanada, chairman of the Thai Chamber of Commerce, went even further, expressing surprise that Thailand had not been ranked higher. In comparison with other countries, Thailand was the world’s most attractive investment location, he said, adding that it was now vital that Thailand worked to maintain economic growth of 7-9 percent. (TNA)