AFG looks to the future
Dr Iain Corness
The very proactive Automotive Focus Group (AFG) on the Eastern Seaboard
invited Chris Bruton, the ‘futurologist’ from Dataconsult to address their
May monthly meeting, which was held last week in the Amari Tower.
Bruton, the ‘futurologist’ from Dataconsult, addresses the Automotive Focus
Group monthly meeting at the Amari Tower.
Chris, who is a very well experienced political analyst, began his talk by
mentioning that whilst there is an overall down-turn, the outlook on the
Eastern Seaboard is more positive than in the rest of Thailand. He also
added that despite all the negative factors of late, political instability,
airport closure, abandoning the ASEAN meeting and professionally
orchestrated destabilization by Dr. Thaksin, Dataconsult had been getting
recent contact by companies looking at the possibilities to set up in
On a world scale, Thailand is actually not looking too bad. The World Bank
looked at 181 countries as far as ease of doing business was concerned and
Thailand was rated at number 13, whilst Malaysia was number 20 and Vietnam
92. The World Economic Forum rated Thailand as number 38 out of 131
Potential investors look for stability and predictability, and while
Thailand’s political scene looks anything but stable at present, Thailand
rates high as being competitive and able to withstand crises. After all,
Thailand has had solid growth, despite 22 coups at last count.
Chris brought out some very salient statistics showing the decrease of the
importance of Bangkok in GDP (a decrease from 40 percent to 25 percent) and
the increasing importance of the North and North-East, now combined in
producing 51 percent of GDP.
He finished the presentation looking at the various survival options which
were available to Thailand, including the Democrats, Peua Thai, a Thaksin
come-back, Newin Chidchob and even a PAD guided ‘democracy’ in concert with
He did have advice for the media, suggesting that positive policies were
needed, and both companies and individuals need to be involved in promotion
of these, and that there should be corporate policies to bring positive news
to the front pages.
As a small contribution towards that, the Pattaya Mail in this article now
mentions that AFG member Bob Franklin from Autoliv Inc. reported the
positive fact that his company is shutting down its Japan operations and is
moving to Thailand. (Perhaps not the front page, but at least prominent in
the Business section!)
The next AFG meeting will be held on June 12 and contact can be made with
the group through the website http://afg-thailand. blogspot.com
FTI chief backs proposed
revision of oil excise tax hike
Federation of Thai Industries (FTI) chairman Santi
Vilassakdanont on Friday expressed support for a proposed revision of the oil
excise tax increase, saying efforts to raise the tax now might cause the
country’s fragile economic recovery to stumble.
“I agree if the prime minister decides to revise the oil excise tax hike because
global oil prices are likely to edge up, which can stoke up local retail oil
prices,” he said.
However, Santi cautioned that an oil excise tax increase would fuel the burdens
borne by consumers, that it would cause difficulty for the people. And it could
lead the economy to stumble while gradually recovering.
Consequently he cautioned that the oil tax hike should be postponed until the
economy recovers more fully.
“Should the economy recover and public confidence be restored, the government’s
move to raise any kind of taxes will not be a problem. But now,” he said,
“confidence has not yet been fully restored.”
At the same time, an oil excise tax increase would fuel rising transport costs
and product prices, and could definitely affect consumer spending.
The FTI chief said he wanted the government to revive measures to encourage the
use of alternative energy.
Santi said he believed the inflation rate would remain low. This year, inflation
is forecast to stay at 1-2 percent because the public continues to reduce their
consumption as they are uncertain about the economic recovery.
Regarding the lending rate cut by major commercial banks, he said, it would
benefit the private sector as the cost for loan applications would reduce.
Thai exports drop 26% in April
Thai exports in April fell 26.1 percent year-on-year, Permanent Secretary
for Commerce Siripol Yodmuangcharoen announced on Wednesday.
Total Thai exports were valued at US$10.4 billion, he said. The sharp drop
follows March’s 23.1 percent decline.
Thailand exported goods valued at $44.216 billion during the first four
months of 2009 while it imports totaled $36.566 billion, enabling the
country to enjoy a trade surplus of $7.65 billion, Siripol said.
Exports and imports during the period both declined, 21.9 percent for
exports and 37.3 percent for imports in terms of value compared to the
corresponding period of 2008, he said.
Siripol said exports fell due to declining purchasing power in the world
Key importers of Thai goods reduced their purchases between January-April
this year, a trend which has continued since late 2008.
Exports to new markets dropped 19.5 percent, Europe 35.1 percent, ASEAN 33.4
percent, Japan 29.8 percent and the United States 28.7 percent.
The Commerce Ministry has maintained that Thailand’s exports would contract
by two digit figures during calendar 2009.
Director-General Rachane Potjanasuntorn of the Ministry’s Export Promotion
Department, said as the economies of several countries - including China,
India and Australia - have shown signs of recovery, the Commerce Ministry
will discuss with the Finance Ministry on ways to boost exports by providing
incentives to exporters by lowering interest rates on loans and tax.
Measures on the planned offering incentives are expected to be concluded
within the next two weeks and then proposed to the Cabinet for
consideration, Rachane said. (TNA)
Thai economy on path
to recovery, says FTI chief
The Thai economy has already bottomed out and is on the path
to recovery, given improvements registered in many economic indicators,
according to the Federation of Thai Industries (FTI).
FTI chairman Santi Vilassakdanont said foreign capital has begun to flow into
Thailand, ASEAN, and Asia since investors want to invest in markets that they
believe would give them attractive returns, which he said is a definite sign of
returning investor confidence.
He said exports in April shrank 26 percent partly because there were many public
holidays last month.
Santi said he believed exports in May and June would outpace those in April. The
second half of this year would see the exports grow more than those in the first
The export situation would be even better in this year’s third and fourth
quarters, he said, but noted that the strengthening of the baht was not good
news for the export sector.
“Some exporters had sold products when the baht stayed at 35-36 to the US
dollar. Their revenue has now declined due to the strengthening of the baht,” he
The FTI chief said he understood the Bank of Thailand’s efforts to supervise the
baht value. However, he wanted the central bank to pay attention to the export
sector as well.
Santi said the level at which he wanted the baht to stay now is 35-37 baht to
He projected the exports for the whole year would contract more than 10 percent
if the baht moves in a range of 35-36 to the dollar.
Should the baht continue strengthening over other currencies of trade
competitors, he said, Thailand’s exports would shrink even further. (TNA)
Canada consider gold exploration investment in Thailand
Canadian business interests are looking to invest in
exploration and development of gold mining in Thailand, according to Industry
Minister Chanchai Chairungruang.
Speaking after a meeting with a group of Canadian business visitors led by
Senator Mac Harb, Charnchai said he and the senator discussed mining business
and promotion of investment in the mining sector in Thailand.
Harb, an advisor for the Southeast Asia Mining Corp, and the Canadian
businesspersons expressed strong interest in investing in gold resource
exploration for possible mines in Loei, Pichit, Petchabul and Prachinburi
provinces, he said.
Recently, Canadian business interests established a joint venture with their
Thai counterparts under the name of GO Thai to apply for permission from the
National Parks, Wildlife and Plant Conservation Department to explore tin and
zinc mining in Kanchanaburi province.
The department is considering the application and the geographical suitability
of potential areas for exploration, he said.
Canada is the world’s largest mineral exporter, with a rapidly developing mining
Canadian mining investment interests now want Thailand as their mining base in
Southeast Asia. (TNA)
Thai industrial confidence index rises to 76.3 in April
Thailand’s industrial confidence index increased to 76.3 in
April from 69.4 in March on increases in purchase orders, sales and production,
Federation of Thai Industries (FTI) chairman Santi Vilassakdanont said on
Santi said the increase was still not satisfactory as the April index was still
lower than 100 for the 37th consecutive month - since April 2006 - due to the
world’s sluggish economy and domestic political unrest.
These negative factors continue to haunt entrepreneurs’ confidence, he said.
The index showed that both small- and large-sized industrial performances
improved but medium-sized fell slightly because of the decreases in purchase
orders and sales of pulp and paper, pharmaceutical, and agriculture machinery
Industrial performances in April also showed that indices in the North and
Eastern regions dipped marginally from March due to higher production costs, a
lack of labor and a stronger baht, which had depressed earnings. (TNA)