Pattaya Mail turns 12

Vol. XIII No. 37
Friday September 16 - September 22, 2005

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by Saichon Paewsoongnern


HEADLINES [click on headline to view story]: 

Investment by China quadruples in first seven months of this year

Thai farm produce as possible trade for Chinese buses

Finance ministry to offer tax exemption on interest on long-term savings bond

Hot JBIC Bond 1.5 times oversubscribed

‘Thai Kitchen to the World Fair’ expected to generate over Bt.200 million in revenue

Repo hike depends on internal factors, says BOT

Five-year goal to make Thailand Asia’s electronics hub, boost exports 50%

Thailand’s mega projects to be bid this year, says PM

BCCT goes to Kenya

‘Clinic of Energy for Industry’ opens for advisory services

Property business expands at slower pace in 2nd quarter

Investment by China quadruples in first seven months of this year

China’s investments in Thailand in the first seven months of the year increased more than four times to almost 8.9 billion baht, compared with the corresponding period last year, according to the Board of Investment of Thailand (BOI).

Speaking at a seminar on “Strengthening of Sino-Thai Relations”, BOI Secretary-General Sathit Sirirangaman said China was one of the countries being targeted as a source of investment.

Thailand is in a good position to display its potential as a possible production base for major industries in China. The seminar was organized jointly by the BOI and the Chinese Enterprise Association.

The BOI had set a target of increasing investment from China by 30 percent this year, but the first seven months of the year saw the investment more than quadruple to 8.87 billion baht, from 2.1 billion baht in the same period of the previous year.

Sathit said there remain great investment opportunities between China and Thailand, particularly in the processed agriculture and vehicles and parts industries. Both countries have abundant raw materials and are ready to offer investment incentives.

Thailand also has the potential to accommodate investment in major projects related to China’s steel industry. He said most Chinese investors wanted to obtain additional information on businesses that attracted support from the BOI and other incentives, as well as what opportunities existed for expansion. Many investors had shown keen interest in the logistics system, hotel and cold storage businesses, he added. (TNA)

Thai farm produce as possible trade for Chinese buses

A top-level Thai government delegation has held talks with a major Chinese bus manufacturer regarding a possible barter of Thai fruits for Chinese-made locomotives, passenger buses and even armored cars. The delegation, led by Deputy Prime Minister Phinij Jarusombat, recently met with senior executives of Jing Long Co., Ltd., a prominent bus manufacturer here.

Mr. Phinij said his visit to China was aimed at strengthening relations between the two countries as well as to explore ways on exchanging Thai farm products for Chinese goods as diverse as railway locomotives and armored cars for military use. He said Chinese government officials planned to visit Thailand September 22-24 to follow up on developments of agreements made between the two countries which, this year, celebrated their 30 years of resumed diplomatic relations.

The two countries have set a target to increase the value of bilateral trade to US$49 billion (Bt.1.96 trillion) by the year 2010.

Khunying Sudarat Keyuraphan, minister of Agriculture and Cooperatives, said the government has established a trade committee to study which Thai farm products could be exchanged with foreign goods on a barter system. She said a joint committee comprising of representatives of her ministry, the transport ministry and the Chinese firm would consider details of the barter arrangement before the issue was taken up by the barter trade committee.

Jing Long Co., Ltd. is a Chinese government-owned corporation and has manufactured buses for 17 years. Its buses are now exported to some 20 countries, including the US, Italy and the Middle East. (TNA)

Finance ministry to offer tax exemption on interest on long-term savings bond

The Finance Ministry is poised to offer tax exemptions on interest rates on a long-term savings bond in a bid to boost savings.

Speaking after a meeting with Prime Minister Thaksin Shinawatra and other economic ministers on measures to stimulate saving, Finance Minister Thanong Bidaya said all shared the common view that savings, particularly in households, was a matter of concern since it had dropped from 35 percent to 33 percent of the gross domestic product.

He said the ministry and the Bank of Thailand would jointly help stimulate saving by offering higher deposit rates and issuing a savings bond with a 7-10 year maturity.

The ministry planned to waive tax on interest rates offered by the long-term savings bond to attract people. However, details on the amount of the savings bond had yet to be discussed.

“Sometimes, when interest rates are too low, people have no choice but to spend money on what has not benefited the overall economy.

“Should the government issue a long-term bond with a tax waiver on the offered interest rate, people may opt to save more,’’ he said.

With the continued increase in inflation rates at present, Dr. Thanong said the central bank needed to raise repurchase rates to curb the trend. So, it was not unusual to see the BOT raise the repo at six of the previous eight meetings of the Monetary Policy Committee. He said the liquidity in the system had already eased since commercial banks had begun to raise interest rates. (TNA)

Hot JBIC Bond 1.5 times oversubscribed

A pioneering local currency bond issued by the Japan Bank for International Cooperation (JBIC) as part of efforts to strengthen the region’s equity market has been over-subscribed, according to Siam Commercial Bank President Khunying Jada Wattanasiritham.

The JBIC Baht Bond was put out under the Asian Bond Market Development plan. Valued at a total of three billion baht, it has a maturity period of five years and offers an annual interest rate of 4.78 percent.

Having secured an AA-rating from Standard & Poors, the JBIC Baht Bond was 1.5 times oversubscribed after a book-building exercise among institutional investors on August 30. (TNA)

‘Thai Kitchen to the World Fair’ expected to generate over Bt.200 million in revenue

The Ministry of Commerce will organize a ‘Thai Kitchen to the World’ fair in Bangkok later this month, which is expected to attract over 100,000 visitors and generate more than Bt.200 million in total revenue.

The fair will be held from September 28-October 2 at the Bangkok International Trade Exhibition Center (BITEC) between 10:00 a.m. and 9:00 p.m.

At least 200 entrepreneurs of Thai food and beverage businesses, including those running food franchises and restaurants, will join the fair, according to the secretary of the commerce minister, Pimol Srivikorn.

The Ministry of Commerce’s Department of Export Promotion and a government center in charge of developing Thai food and promoting the Thai Kitchen to the World Project, will also invite foreign food traders and importers, as well as owners of restaurants and hoteliers to take part in the event.

“Entrepreneurs of Thai food and beverage businesses will have a good opportunity to meet their foreign counterparts on September 28-29 from 10:00 a.m. to 6:00 p.m., and hopefully, they may be able to engage in some business deals,” he said.

The fair is aimed to promote Thai food and beverage products, as well as to create awareness of quality food with internationally recognized standards among Thai businesses and the general public. It will also help to internationally publicize the potential of Thailand as a ‘kitchen of the world’, according to Pimol.

The Thai government is targeting to expand the number of Thai restaurants oversees to at least 20,000 worldwide over the next five years (currently at 9,000), which is believed to earn the nation more than Bt.100 billion worth of revenue in return. (TNA)

Repo hike depends on internal factors, says BOT

Bank of Thailand (BOT)’s Governor M.R. Pridiyathorn Devakula disclosed on Tuesday that the Monetary Policy Committee (MPC) would give priority to deliberating many internal factors before deciding on a policy interest rate at its meeting on Wednesday.

He said whether the MPC would increase the 14-day repurchase rate (repo) depends on the internal factors, including inflation rates, rather than external factors and the United States’ interest trend.

The BOT chief said he was not put under pressure for the decision on whether or not the repo would be raised. Instead, he felt more at ease than at all previous meetings.

He said the central bank still wants actual interest rates to be positive, but conceded it could not yet keep the policy interest rate on par with inflation rates, which had sharply increased due to the oil price surge. He believed the inflation rates would begin to decline two months after diesel oil prices were floated. This would edge up actual interest rates closer to the inflation rates and possibly into positive territory in the future, he said.

He admitted the inflation rates had increased more rapidly than expected since fuel prices had significantly risen. As a result, it is very difficult to expect that the policy interest rate would rise on par with the inflation rates.

In this scenario, the actual interest rate would continue to be negative when compared with the current inflation rates, said the central bank chief. (TNA)

Five-year goal to make Thailand Asia’s electronics hub, boost exports 50%

The government is mapping out plans to induce more foreign investors to invest in electronics and electronic appliances with the goal of making Thailand the hub for these industries within the next five years.

Somkid Jatusripitak, deputy prime minister and commerce minister, told journalists after a meeting with senior officials of the Board of Investment (BOI), finance, industry and transport ministries that the government had a policy to push Thailand to become the hub for electronics and electrical appliances within five years.

Thailand has enough potential in these industries but most foreign investors in the past opted to invest in Singapore and Malaysia, he said. After the government revised its investment promotion policies, more foreign investment in these fields was seen in Thailand during the past two years.

To make the country become the center for these industries, four major action areas must be revised within the next two months, Somkid said. These areas include: 1. Improved incentives so that investment in Thailand is even more attractive in comparison with other countries, a task of BOI. 2. Restructuring customs, revenue and excise taxes by the Ministry of Finance. 3. Restructuring of infrastructure by the Ministry of Industry. 4. Planning the development of both industries, which requires the industry ministry to cooperate with educational institutions in producing sufficient technicians.

Somkid said that the current export of electronic products and electrical appliances stood at Bt.1.3 trillion (US$ 32.5 billion) annually, and he was optimistic that that number should increase by no less than 50 percent in the next three to four years after implementation of this plan. (TNA)

Thailand’s mega projects to be bid this year, says PM

Bidding for construction of all government-sponsored mega-infrastructure projects must be held this year, Prime Minister Thaksin Shinawatra said on Saturday.

Thaksin said he had ordered every ministry implementing the mega-projects to organize bidding within this year because the process is proceeding too slowly.

He said he had also ordered ministers to watch for alleged collaboration between state officials and private bidders on bids for government projects now conducted by electronic systems, or the so-called E-Auction.

Touching on an economic meeting on Friday, the prime minister said the Bank of Thailand (BOT), the National Economic and Social Development Board (NESDB), and the Finance Ministry had agreed to meet together every three months to assess the national economy.

During the meeting, Virabhongse Ramangura, advisor to the finance minister, expressed his concern regarding interest rates, which may have to be raised to encourage the public to save, said Mr. Thaksin. (TNA)

BCCT goes to Kenya

Stopping at the Bang Saray Club on the way

Miss Terry Diner

A warm and effusive welcome to the British Chamber of Commerce Thailand (BCCT) networking evening was given by the Kenya Airways Country Manager Merita A. Ombuor, who greeted everyone at the Bang Saray Club; Kenya Airways and The Travel Clinic having been the sponsors of the evening.

Graham Macdonald, chairman of the BCCT Eastern Seaboard Chapter welcomes members and guests.

It was a large turn-out, with over 85 members and friends shaking hands and exchanging business cards, as one does at these events. Of particular interest was the new Water Engineered Technologies, whose MD Keith Wilson was on hand to discuss his company’s answers to the water supply, condition, quality and quantity; a very topical subject in the dried out Eastern Seaboard.

Another interesting promotion was done by Natthachai of BNK Pattaya Wine Gallery, with many members lining up to try the latest offerings from the French, Australian, Chilean, Spanish and South African vineyards. Of even greater interest were the prices, with the vast majority under B. 500 a bottle, and having sampled the Merlot Reserva Punto Nogal 2002, retailing at B. 590, this was indeed a bargain. (You can contact Natthachai on 01 525 2776.)

Merita A. Ombuor, Kenya Airways Country Manager and her team greeted everyone with a friendly ‘Jambo’. At right is Suwannah Viroonchan MD of Travel Clinic.

As always, these functions are well attended by the logistics and moving people, with the lovely Pichitra Niphondkit from Crown Relocations, Pat Gossett of Transpo and Paul Wilkinson of Four Winds being the movers and shakers.

Other familiar faces in the 85 included Graham Macdonald (MBMG International and the Eastern Seaboard representative for the BCCT), Alain Durwardaer and Jimmy Howard from Katoen Natie, Maurice Bromley from Henry Butcher’s and Binny from Sher E Punjab who attended with his son from the Haveli Indian Restaurant in Bangkok, Eileen and a slimming Norman from Yorkies, and looking very assured were Peter Smith and Malcolm Scorer from AA Insurances.

The executive director of the BCCT, Greg Watkins, and now a new father was unable to get down to the Bang Saray Club through family commitments, but the Pattaya Mail’s Dr. Iain, also a new father, was seen flashing photographs of his latest son, Evan Corness who at 4.2 kg had been born three days earlier by chain-saw and grappling hook. Commiserations were sent to his wife Som!

Businessmen and women of all nationalities are welcome to attend the networking evenings. In fact your company is encouraged to join the BCCT.

Regulars of networking evenings, (l-r) Karanjit Singh GM of Haveli Indian Restaurant in Bangkok, Stuart Saunders and Pat Gossett.

‘Clinic of Energy for Industry’ opens for advisory services

In a bid to give industrial operators a proper understanding of ways to conserve energy, the Federation of Thai Industry (FTI)’s Institute of Energy for Industry has opened the so-called “Clinic of Energy for Industry” to provide advisory services for free.

The establishment of the clinic, which will operate until the end of June 2006, is part of the participating energy conservation program of the institute. Funding for this service comes from the Alternative Energy Development and Energy Conservation Department.

The clinic is set up to encourage personnel in industrial factories to participate in energy conservation to help reduce production costs of the factories.

The clinic will be open for services from 13.30 to 16.30 hours on weekdays. Experts from well-established industrial plants and universities are available to give useful advice and help solve energy-related problems in industrial factories. Veterans in power and thermal energy affairs will be also available for consultation.

Interested parties can contact the clinic, which is located in the Queen Sirikit National Convention Center at Tel. 02-345-1254-6. (TNA)

Property business expands at slower pace in 2nd quarter

Thailand’s property business has grown at a slower pace in the second quarter of this year upon a declined consumer purchasing power due to the oil price surge and higher costs of living, according to the Bank of Thailand (BOT).

In an economic and financial report released in July, the central bank reported that the overall property business experienced a slowdown in the second quarter of 2005 as a result of a decline in consumer confidence and purchasing power. The trading value of land nationwide totaled Bt.152.09 billion.

The number of completely built residences in Bangkok and its environs were 15,691 units, up 10.9 percent in the second quarter, compared with 16,709 units, up 40 percent in the first quarter. Of this, 8,411 units were detached houses, 1,252 flat/condominiums, 6,028 houses built by owners.

Figures showed that prices of single houses rose by 7.8 percent and those of townhouses by 5.4 percent. The price increase is attributed to the higher costs of raw materials.

In June, the trading of new and second-hand houses grew at a slower pace. The trading value of land countrywide totaled Bt.60.032 billion, up 8.7 percent from that of the same month last year.

The trading volume nationwide totaled 85,244 items, up 8.5 percent from the same month of the previous year, and 78,729 items in May, up 11.6 percent. (TNA)

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