BoI: Thailand still has some catching up to do
Foreign investors believe that Thailand lags behind its neighbors in terms of clear government policy and infrastructure in the field of telecommunications. China, Malaysia and Vietnam are more attractive in terms of government policy. This is evident from the annual survey of the Board of Investment (BoI) among foreign companies. Incidentally, the response was meager: the BoI's questionnaire was only completed by 7 percent of the 6000 companies. According to the investors, Malaysia is outperforming Thailand because it…
Rice will become 25 percent more expensive; exports are struggling
The retail price of rice will increase by at least 25 percent next month. A bag of 5 kilos of white rice will cost 120 to 130 baht and Hom Mali (jasmine rice) 180 to 200 baht. Somkiat Makcayathorn, president of the Thai Rice Packers Association, makes this prediction. The price increase is the result of the reintroduction of the collateral system for rice. In this system, farmers mortgage their white rice for 15.000 baht per ton and Hom Mali…
The 40 richest men in Thailand
The political tension is still palpable, but Thailand's transition to a relatively calm period after last year's violence has caused stock prices and the economy to grow strongly. The SET 50 stock index rose a whopping 21,7% over last year, the biggest increase in 15 years. The Thai baht rose 6,1% against the dollar over the same period. The Gross National Product is expected to be in 2011 …
Asia Books goes multimedia
The 42-year-old bookstore chain Asia Books is becoming multimedia after the example of amazon.com and is expanding its range with products such as iPad, smartphone, educational toys and lifestyle products. Asia Books started selling books and magazines online in March; 500.000 titles are already available as e-books. Asia Books has 66 stores plus Bookazine in the 7-Eleven grocery chain. The company was acquired in July by publicly traded Berli Jucker Plc (BJC), owned by…
Fixed price for LPG expires
Households and food vendors should be aware that the butane bottle will become more expensive as the government plans to let the price of LPG float. Low-income earners will receive a credit card as compensation, but how it can be used is still unclear. The Ministry of Energy has also decided to lower the price of 95 gasohol (a mix of petrol and ethanol) by 1,07 baht, making it the same price as petrol…
Infrastructure key for strengthening competitive position
Thailand faces four challenges: investment in public infrastructure, solving labor shortages in the manufacturing sector, boosting the green economy and limiting the price of consumables. So said Suzanne Rosselet, deputy director of the World Competitive Centre, at the Thailand Competitiveness Conference 2011. If Thailand succeeds in eliminating its main weaknesses, it could move 10 places in terms of competitiveness in the world ranking of the International Institute for Management …
Gasoline and diesel cheaper (but at what cost?)
Petrol and diesel have become cheaper as of today and that is good news for the 10 million motorcyclists, 7 million motorists who drive diesel and 1 million who drive premium petrol. But critics say it's bad news for alternative energy promotion, aside from the lower contribution to the State Oil Fund. A liter of gasoline (95 octane) now costs 39,54 baht; petrol (91) mainly used by…
Floods and crisis slow down agricultural production
The sluggish global economy and flooding are the main causes of limited growth in Thai agricultural production. Previously, 4 percent was expected, now 3 percent. Rubber and other staple products are suffering from reduced demand and lower prices, the Agricultural Economics Office said. While exports remain healthy, especially in the food sector, the crisis in the US and Europe will drive demand for Thai products, which are in competition with products…
The Pheu Thai government's plan to revive the rice collateral system was heavily criticized by Democrats on the second day of debate over the government's statement. The system is ineffective, it favors wealthy exporters, it burdens the government with heavy losses and it may violate World Trade Organization (WTO) rules. The system was introduced by the Somchai government in 2008 and…
Higher wages do Thailand a lot of good
Thailand's economic performance is strong. It is a world leader in manufactured goods, food products, mining and tourism. Profits of listed companies are robust, the unemployment rate is 1,2 percent and the demand for labor is strong. But Thailand suffers from the same problem as revealed by an International Labor Organization analysis of global wages over the past 30 years: 1 the share of wages in gross domestic product is declining and the share going to profits …
Economic growth in Thailand drops to 2,6 percent
Economic growth fell to 2,6 percent in the second quarter as a result of a dip in the export of cars and electronics, caused by the stagnating supply of parts from Japan after the earthquake and tsunami. The National Economic and Development Board has revised its forecast of export growth this year from 3,5-4,5 percent to 3,5-4 percent, taking into account the debt crisis in the US and Eurozone, particularly in Spain and Italy, although…
Minister: Wage increase is not mandatory
The increase in the minimum daily wage to 300 baht is not mandatory. This is what Deputy Prime Minister Kittiratt Na-Ranong said yesterday during an informal meeting with the joint standing committee on commerce, industry and banking. 'The hike will not be a compulsory measure, but the government needs to accelerate working out measures to help the private sector reduce production costs such as interest rates, corporate income taxes and human resource development.' In any case, the government will be in charge…
Higher minimum wage drives Hana to Vietnam
Hana Microelectronics Plc may move to Vietnam or China when the minimum daily wage rises to 300 baht next year, as the new Pheu Thai-led government plans to do. The company employs 10.000 workers in Thailand and 2000 in Jiaxing, China, almost all of whom are paid minimum wage. Although personnel costs represent only 6 to 8 percent of operating costs, the increase still has major consequences because profit margins are small. Next one …
Bank of Thailand under fire over debt
The new government is not letting any grass grow over it. On his first day in office, Finance Minister Thirachai Phuvanatnaranubala said he was unhappy with a debt of 1,14 trillion baht still on the books of the Bank of Thailand. Last year it cost the state 65 billion baht in interest, this year 80 billion because interest rates are rising. The debt is a remnant of the financial crisis…
Big C is taking Tesco Lotus to court
Big C is at odds with its main competitor Tesco Lotus. The hypermarket has launched a civil suit for unfair competition and is seeking 415 million baht in damages. According to Big C, Tesco Lotus has violated the Business Competition Act. Tesco Lotus is not aware of any harm. The company says it has not violated the law. The argument is about a promotional campaign that Big C launched in February because of the acquisition of Carrefour. Customers…
Pay rise in Thailand comes much too late
Workers at the lower end of the pay scale can barely make ends meet. The Thai Labor Solidarity Committee (TLSC) has calculated that an appropriate minimum daily wage for a worker with two family members should be 441 baht this year. Pheu Thai has promised 300 baht during the election campaign, but already seems to be backing down under pressure from the business community. The effective date of the increase is likely to be postponed with the exception of…
Gasoline at the pump is getting cheaper
The economic measures of the new government, which Prime Minister Yingluck will announce during her government statement, are broadly known. The priority is to lower the price of premium petrol by 7,5 baht/litre, regular petrol (6,7 baht) and diesel (2,2 baht). The reductions are possible because the State Oil Fund levy on fuel will be reduced for a year. This costs the government 3 billion baht per month. The State Oil Fund was originally intended…