News from Thailand – October 9, 2014

Thailand could easily become the region's leading trading nation when the Asean Economic Community comes into effect at the end of 2015. But the private sector cannot do it alone, it needs and gets government help.

Deputy Prime Minister Pridiyathorn Devakula, in charge of economic affairs, was yesterday during the (annual) Bangkok Post Forum 'Economic Reform: How will it be achieved?' optimistic about Thailand's future.

But this does not happen automatically: the tax system must be more competitive compared to the other Asean countries; the costs that companies pay in Thailand must be reduced; there should be better laws to combat corruption; logistics must be improved including the development of a new industrial zone on the Andaman Sea, tax revenue must be increased and the digital economy must be developed.

The latter is needed in all areas: communications, broadcasting, social exchange, education, product design, product promotion, industry, banking, charitable donations and even shopping, said Pridiyathorn. Many countries in the world are already becoming digital economies.

– Three Thai and three Myanmar provinces will become sister provinces. During Prime Minister Prayut's visit to Myanmar today and tomorrow, the six provincial governors signed three Memorandums of Understanding regulating closer cooperation between the border provinces. In Thailand, these are Chiang Mai, Prachuap Khiri Khan and Ranong.

Also on the agenda is the development of the Dawei project, currently a collaboration between Myanmar and Thailand, but the intention is that Japan will participate in the construction of a deep-sea port, industrial estate and pipeline in Dawei in Myanmar. The Thai government strongly supports Japan's participation, which came up last week during a visit by Japan's foreign minister to Thailand.

Other topics that are discussed are poverty alleviation and drug smuggling. Tomorrow Prayut will fly to Yangon, where he will meet Thai businessmen.

– Permission has not yet been requested and therefore not granted for the construction of a 21-meter high statue of the revered monk Luang Por To in Wat Rakang Kositaram, say the director-general of the Fine Arts Department (FDA).

The abbot of the temple wants to place the statue in an area of ​​registered historical ruins near the Chao Phraya River opposite the Grand Palace. The location is also part of the ancient city of Rattanakosin which has strict building regulations. For example, within 45 meters of the river no higher than 16 meters may be built. Only a small space is available for the image.

The abbot claims that it has authorized FAD. Construction will begin in one to two months. Elsewhere in the country there are already statues of Luang Por To, who was the sixth abbot of the temple in Bangkok. The cost is estimated at 100 million baht; that amount would already have been received thanks to contributions from believers, the navy and the Ministry of the Interior.

The Association of Siamese Architects has objections. The image becomes one eyesore (eyesore) and devalues ​​the temple. It harms the aesthetic value of a historic area.

– Minister Rajata Rajatanavin (Public Health) bows to the criticism of his dual function. He is stepping down as rector of Mahidol University. Rajata was given until yesterday by the university council to choose. The dean of the College of Music, among others, had protested against the two caps by wearing a metal box around his head, a reference to a Thai proverb.

– Thailand is able to reduce greenhouse gas emissions to 2020 percent in 7, if the government commits to this. This says Bundit Limmeechokchai, energy expert at the Sirindhorn International Institute of Technology. The reduction can be achieved by using ethanol, biofuels and improving electricity generation.

In the Climate Change Master Plan, the country has committed to a reduction of 7 to 20 percent in 2020. In 2020, 25 percent of energy must come from alternative energy sources. A 7 percent reduction is no big deal, says Bundit, but 20 percent will require government assistance for law enforcement, technology and financial support.

– You may remember the squabble between the Bangkok municipality and the Yingluck government over water management during the major floods in 2011. Governor Sukhumbhand Paribatra believes that the municipality should have sole rights and that is why he advocates the management of the weirs that currently managed by the Royal Irrigation Department, to be transferred to the council.

Sukhumbhand said this yesterday during the first meeting of the partly renewed city council. The issue was raised by Councilor Chotipon Janyou following the heavy rains in recent weeks, which have affected traffic on some roads. On September 28, some places in the city were flooded after just 15 minutes.

Chotipon did not want to blame the municipality, but he did appeal to the municipality to solve the problem and inform the city residents. Send staff to the flooded places and have them listen to the inhabitants, he said.

Sukhumbhand said Bangkok's sewage system has improved over the past five years. Canals and rivers in the urban area are regularly dredged. Main roads are never flooded for more than three hours. In 2009 this was three to four days on two roads. The construction of three large water tunnels is still on the wish list.

– I already touched on it in the post Pranburi is overflowing its banks: The Royal Irrigation Department shuts off the tap until April 30 and farmers in the central region are the victims. But there is no other way, because the four large water reservoirs contain very little water, not enough for irrigation purposes.

Second and third harvests in Ayuthaya are therefore virtually ruled out. Incidentally, there are already water shortages in the large rice fields on the east side of the Chao Phraya: from many districts in Ayutthaya to Rangsit in Pathum Thani.

– Are golden times dawning in Thailand? Will something really be done against corruption and will energy policy change? The members of the newly appointed NRC (National Reform Council) are confident that they can make 'a difference'. The newspaper bases that conclusion on conversations with five NRC members, which I don't like because often the newspaper only cites one source or a source is missing and I suspect the newspaper of using its own thumb as a source.

The NRC consists of 250 (appointed) members and is tasked with formulating reform proposals on the basis of which a committee can write the new constitution. A concise temporary constitution is currently in force.

– Rumors need to be debunked again. The government is said to be planning to kill its local governing bodies. Not true, says Deputy Prime Minister Wissanu Kreangam. But the structure must be changed, he said yesterday. He described the rumors as throwing mud. According to those rumors, TAOs (governing body of a tambon) would disappear and PAOs (province) would become provincial city areas into which municipalities would be incorporated. [Get it?]

There could be more changes in the pipeline, but I will omit those for the sake of clarity. Proponents of the changes see local government bodies as a source of corruption for politicians who use them to solicit votes.

Wissanu says there are no plans to abolish the LAOs. On the contrary, powers are moving from the central government to PAOs, TAOs, municipalities and the special administrative zones.

Economic news

The World Bank expects the Thai economy to grow by no more than 1,5 percent this year. The culprits are the slow recovery in domestic spending and exports. These will increase by 0,3 and 0,7 percent respectively this year.

Economic growth in the second half of the year is estimated at 3 percent on an annual basis, with exports, public investment, domestic spending and private investment as the main drivers.

For next year, the bank expects 3,5 percent when tourism has recovered, public spending has increased and exports are back on track. Risks next year are global economic uncertainties, particularly in the Eurozone, and domestic political uncertainty.

Ulrich Zachau, director of Southeast Asia, explains Thailand's declining competitiveness in technological production and labor potential as an explanation for the slow recovery in exports. According to him, these are structural factors that will play a role for a long time to come. Thai exports will grow, but slower than other countries' exports until Thailand finds a solution.

The government has recently announced that it wants to pump an amount of 324,5 billion into the economy in the coming months. A measure that Zachau welcomes is the one-off subsidy for rice farmers. As a result, according to him, gross domestic product will increase by 2014 percent in 2015-1,4. The other planned expenditures will add 0,8 percent this year and 1,5 percent next year.

The World Bank recommends that Thailand develop four areas to promote economic growth: upgrading commodity exports, improving rural education and skills, tackling social inequality through tax reforms, especially property taxes, and reducing intensive energy consumption. (Source: Bangkok Post, October 7, 2014)

www.dickvanderlugt.nl – Source: Bangkok Post

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