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Finance Ministry promotes plans to boost economy at provincial level
Speaking during a meeting of ministry officials,
provincial governors and private business leaders based in Thailand’s
upper northeastern region, Thanong said provincial CFOs should prepare
indicative data on GDP, investment, consumption, exports, and other related
information in their own provinces so that a clearer view on the local
economy could be seen and development could be carried out correctly.
Local participants at all levels must have information in
their hands to plan to develop industries in their own provinces, Thanong
said, and business figures must be able to set up factories and industries
in their own provinces, instead of being forced to order goods from
manufacturers in Bangkok, he said. If this scheme is carried out, it could
help reduce transportation costs.
The Board of Investment of Thailand (BOI) and related
government agencies must assist in creating new businesses, he said, adding
that the cost of land upcountry is cheaper than in the capital.
He further said that a number of provinces are now well
prepared to host new industries because of sufficient infrastructures
available there.
He also urged provincial CFOs, set up by Finance Ministry
last year, to help provincial governors, who are the provincial chief
executive officers (CEOs), in developing the economy in their provinces.
The Finance Ministry is ready to provide budget intended
for conducting feasibility studies for projects. (TNA)
Capital inflows and healthy economic figures behind rise in baht, says BOT
The Bank of Thailand (BOT) has said the current strength
of the baht against most other regional currencies is a result of a range of
factors, including the country’s robust economic performance and capital
inflows attracted by rising domestic interest rates.
However, BOT Governor M.R.Pridiyathorn Devakula said the
strong baht would not weaken Thailand’s global competitiveness.
The governor also said that the value of the local
currency was being boosted against currencies such as the US dollar by the
profitability of local commercial banks and profit repatriation.
“The Bank of Thailand has closely monitored the
situation. We think that while the baht is stronger than many other
currencies, it won’t have any impact on our competitiveness. Therefore, we
won’t be intervening to regulate the value of the currency. The Bank of
Thailand has not been buying US dollars to store up on foreign currency
reserves,” the governor said on Monday.
He said that the continuing sale of Thai stock by foreign
investors would have no impact on the baht, arguing that the value of a
currency is determined by capital flows, not whether foreigners buy or sell
shares on the stock market.
He acknowledged that increasing Thai interest rates are
attracting capital inflows, triggered in particular by trade and financial
transactions from the European Union market. But the governor said he was
not worried by such inflows, arguing they were not short-term speculative
funds, but backed by concrete trade transactions. (TNA)
Garment industry plans big export boost in 2006
Thai textile and garment manufacturers have announced
they are preparing plans to increase exports by up to 25 percent in 2006,
especially to the American market.
A senior representative of the sector, Gartchai
Jaemkajornkiat, said industry strength and weakness analysis and a
competition strategy were being drawn up with the aim of boosting
Thailand’s exports to the world market next year by 20-25 percent.
Gartchai sits as an industry representative on the
Fashion Sector Competitiveness Committee, which has 122 companies as
members.
The strategy will be presented to Vice Minister for
Commerce Suvit Mesinsee in November, before being forwarded to Deputy Prime
Minister and Commerce Minister Somkid Jatusripitak.
According to Gartchai, the private sector was expected to
focus on defining and building new market opportunities. Thai manufacturers
were also being encouraged to make ASEAN a significant base for the textile
and garment industry export trade.
“The US market is worth 211 billion dollars and we aim
to reduce trade barriers to a minimum. The emphasis is also on how Thai
entrepreneurs can have direct access to major importers, which means
possible joint ventures between Thai businesses and US importers,”
Gartchai said. Problems with logistics and how to add value to Thai exports
would also need to be addressed, he said.
During the first eight months of 2005, Thailand exported
2.2 billion dollars worth of garments, a 3.5 percent increase over the same
period last year, and 2.1 billion dollars worth of textiles, up 8.75
percent. (TNA)
Thai business cautiously upbeat
about economic outlook for 2006
Thai business leaders see good prospects for the Thai
economy in 2006 which they believe will grow by 4-4.5 percent.
The Economic and Business Forecasting Center of the
University of the Thai Chamber of Commerce polled over 800 members of the
nationwide Thai Chamber of Commerce during their annual meeting in this
central province.
Tanavat Polvichai, director of the center, said chamber
members from across the country believe that the Thai economy will grow next
year despite a number of risk factors that include the global energy price,
violence in the southern border provinces, the bird flu threat, as well as
the looming problem of non-performing loans, rising interest rates and
inflation.
These factors may pose a threat to the Thai economy
during the first half of the year. However, the outlook for the second half
of 2006 could improve in response to government stimulation - chiefly
investment activities for the mega-infrastructure development projects,
along with its export drive.
Saowanee Thairungroj, dean of the Economics Faculty of
the University of the Thai Chamber of Commerce, said the survey on Thai
economic outlook for 2006 conducted among Chamber members and public sector
representatives revealed a consensus growth projection of 4-4.5 percent. The
respondents also suggested that the government ensure equal distribution of
development opportunities, investment in human resources and alternative
energy.
The private sector called for more government support for
investment in the fisheries, tourism and agribusiness sectors.
Regarding public administration policy, the private
sector said the government should carefully study implications of
deregulation of various sectors, and be careful about budget expenditure and
reduce corruption. (TNA)
Trade among ACMECS members believed to grow more than 700 percent in future
Thai Foreign Minister Kantathi Suphamongkhon said that he
believes regional trade among the five member countries of the
Ayeyawady-Chao Phraya-Mekong Economic Cooperation Strategy (ACMECS) will
grow more than 700 percent in the future.
In 2004 alone, trade among the ACMECS member states,
including Cambodia, Myanmar, Laos, Vietnam and Thailand, grew 700 percent,
Kantathi noted.
After an ACMECS foreign ministers’ meeting, Thai
foreign minister told TNA, “I believe that trade among the ACMECS members
will further expand considerably from the impressive growth of 700 percent
last year after tariff barriers are eliminated.”
The ACMECS member countries agreed at the Foreign
Ministers’ Meeting to reduce trade barriers, including red-taped customs
procedures and double taxation, to further boost regional trade, he
disclosed.
Thailand also agreed to cut import tariffs for the other
four ACMECS members to zero percent under a regional contract farming deal.
Thailand’s four neighbors will be granted import
privileges on 10 items, according to the Thai foreign minister. The products
include cashew, castor oil, palm, potato, soybean, green bean, peanut,
maize, sweet corn and eucalyptus. (TNA)
Canadian private sector keen to invest in Thailand
Deputy Finance Minister Chaiyot Sasomsub has said several
Canadian private sector representatives have expressed interest in pursuing
investment opportunities in Thailand.
During his visit to Canada, Chaiyot had talks with
representatives of the Bank of Nova Scotia. The bank has a branch in
Thailand and has expressed an interest in expanding its operations in
Thailand. In response, Chaiyot said the Finance Ministry was in the process
of amending the regulations to allow foreign financial institutions to hold
up to 49 percent of shares, from the present limit of 25 percent.
The deputy finance minister also met executives of Magna
International, one of Canada’s largest car parts manufacturers.
The firm, which supplies parts to many leading brands,
said it was keen on a possible joint venture with Thai Summit Auto Parts,
given Thailand’s role as the automobile industry hub of Southeast Asia.
During a visit to Montreal, Chaiyot held talks with
executives of the Canadian engineering-construction firm SNC Lavalin on the
company’s possible participation in future bids to build mass transit
systems in Thailand. (TNA)
Private sector submits economic measures to PM
A meeting of national chambers of commerce has presented
a list of suggested economic reforms to Prime Minister Thaksin Shinawatra.
Thaksin presided over the closing ceremony of the two-day
gathering.
Thai Chamber of Commerce Secretary General Dusit
Nontanakorn said the proposals included measures to improve the quality of
Thai goods to enable them to compete more effectively as global tariffs fall
over the next 20 years.
The meeting also called for setting up a high-level
government body to monitor the impact of the various free trade agreements
Thailand has negotiated with other countries.
Among its other proposals, Dusit said the chambers of
commerce tackled the problem of high oil prices. He said suggestions
included the promotion of alternative energy sources in the production
process; an enlargement of revolving capital for use in procuring oil
conservation equipment; and for the state to reward energy-efficient firms
through the tax system. (TNA)
Surging inflation to highest level in seven years won’t affect Thai economy
Deputy Prime Minister and Commerce Minister Somkid
Jatusripitak on Wednesday voiced confidence that a surging inflation rate to
the highest level in seven years would not affect Thailand’s overall
economy, saying the economy would stay at 4 percent as earlier targeted for
the whole year.
 Deputy
Prime Minister and Commerce Minister Somkid Jatusripitak
He said the general inflation rate soared to a hefty
level of 6.2 percent in October because it was calculated based on last
year’s level, which was very low.
Actually, the core inflation rate remained at the same
level, showing the government’s measures to control product prices were
proven successful.
As long as the fuel tariff (FT) charge and transport
costs remain unchanged, he believed, product prices would not edge up
definitely.
Somkid projected that the average inflation rate for the
whole year would stay close to 4 percent as targeted because the rate stayed
at an average of 4.4 percent in the first nine months of this year.
He said, however, that the government would have to pay
attention to supervising power bills and transport costs. An upward
adjustment should be made only if necessary, he noted. To ease people’s
burdens, the government would attempt to accelerate increasing their
incomes, said the deputy premier.
Overall, he said, state agencies concerned had managed to
control product prices on the domestic market quite efficiently, while goods
prices in many countries around the world had significantly risen.
The minister insisted that the planned listing of EGAT
Public Company Limited (EGAT) did not mean the newly privatized power firm
had a policy to raise electricity bills.
Instead, he said, EGAT has attempted to enhance its production efficiency
to reduce power generation costs and avoid increasing power bills. (TNA)
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