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BOT seeks ways to strengthen commercial banks
The Bank of Thailand’s governor, M.R. Pridiyathorn
Devakula recently disclosed the central bank is in the process of
examining the performance of all local commercial banks to assess their
actual status and see how to strengthen their performance. The move was
made to identify weak points of each commercial bank and improve them.
Initially, the BOT will look into the status of four
state-owned banks, including Krung Thai Bank, Siam City Bank, Bangkok
Metropolitan Bank, and Bank Thai, and then examine privately owned banks.
It is expected the assessment of the status of all commercial banks will
be complete by mid-year.
Pridiyathorn conceded that the central bank remains
unable to estimate the loan amount all banks can extend solely on the
assumption that the country’s economy would grow 2-3% this year. Still,
it was believed the banks would be able to lend more while the excess
liquidity in the banking system would remain unabated.
The banks were likely to further cut interest rates
following the BOT’s move to reduce repurchase rates.
Regarding mounting concerns about wider spread between
lending and deposit rates as major banks opted to cut deposit rates only,
the BOT chief said Thailand adopted a liberal stance. Under the system,
all players including commercial banks had the right to decide what they
should or should not do. (TNA)
Unithai forms shipping joint venture with South Africa Shipping Co Ltd.
The Thailand publicly listed shipping company Unithai
Line Public Company Ltd. has announced the formation of a joint venture
with South African Shipping Company, Gearbulk (SA) Pty Limited to provide
a scheduled monthly break-bulk liner service between South Africa and
selected East Asian ports, including Bangkok.
The service, to be marketed as UniGear, will deploy two
dedicated multipurpose vessels in the trade to provide a minimum of one
sailing per month in each direction. With immediate effect the dedicated
vessels deployed in the service are the mv. Candia and mv. Carla. The
service commenced operations on the 1st of February.
The management of the eastbound marketing of the
service as well as all operations in South Africa will be the
responsibility of Gearbulk South Africa through its Durban office while
responsibility for the management of the westbound marketing of the
service and all operations in South East Asia will be in the hands of
Unithai Line.
Unithai Line chief executive officer Gerrit de Nys said
that, “The formation of this joint venture company by two large,
financially sound and professional shipping companies will provide clients
with long-term shipping opportunities in both directions. Given that high
levels of service and dependability are assured, we look forward to the
volume of shipping improving significantly.”
Giant automakers to set up production base in Thailand
Italian giant automaker Fiat has decided to invest 800
million to set up its manufacturing base in Thailand and make Alfa Romeo
cars for export in the ASEAN, according to industry minister Suriya
Juengrungroengkit.
Speaking after meeting with John Mack, president and
chief executive officer of Fiat Auto (Thailand) Co., he said the company
will use Thailand as its base to produce the Royal Alfa series for export
to Malaysia, Indonesia, and Singapore next year. “This decision shows
that foreign automakers have confidence in the country and its
potential.”
He said Fiat will use a plant owned by the General
Motors Group at the eastern province of Rayong as its base to produce the
vehicles. The plant currently utilizes only 30% of its total production
capacity. The Italian automaker has set a goal of eventually producing
10,000 cars per year, but will begin with 1,000 cars per year during the
initial stages.
This is the first time Fiat will produce Alfa Romeo
cars outside Italy. Its target customers are in a niche market as the
company produces luxury cars.
In addition, Suriya said, Fujio Cho, president of
Toyota Motor Corporation in Japan, will pay a courtesy call on Prime
Minister Thaksin Shinawatra during his visit to Thailand this month. He
will take this opportunity to inspect the Toyota manufacturing plants in
the country in order to explore the possibility of producing pick-ups to
export around the world. (TNA)
German businessmen keen on investing in Thailand
German investors are showing a growing interest in
investment in Thailand, particularly in auto and retail sectors and want
the country to be a gateway for trade and investment in this region,
according to a Thai trade representative. Not only large companies, but
small and medium sized entrepreneurs are also looking to invest in the
country.
Khanthee Supamongkol said he took a trip to Germany
late last month and met German businessmen to inform them of Thailand’s
stance on trade and investment from foreign countries. He said a large
number of German businessmen had previously eyed only Singapore, Malaysia
and Hong Kong as attractive investment spots in the region.
However, upon receipt of information on Thailand, the
Germans contacted the Thai embassy and were informed that they would
receive incentives for their companies to invest in the country,
especially in the auto and retail sectors.
Khanthee said he also spoke with executives of Metro
Co, a giant retailer in Germany. The firm was keen on opening a wholesale
superstore in Thailand. (TNA)
Thailand to have full-fledged Islamic Bank
Thailand is likely to have a full-fledged Islamic Bank
in May, as Krung Thai Bank Plc. (KTB) prepares to launch the Islamic
banking system separately in both management and operational aspects from
its normal commercial banking businesses. The project is expected to be
completed by May.
Theerasak Suwanayos, advisor of the KTB Board, in his
capacity as designated president of the Islamic Bank, said that much
progress had been made for the establishment of the Islamic Bank.
“A KTB panel in charge of studying and working out
the project has conducted a survey in various areas concerning Islamic
banking and principles, including seeking opinions and gathering
information from local Islamic people and institutions to ensure that the
operation of the new Islamic Bank will fully comply with Islamic
principles, and is trustworthy and reliable for Islamic people,”
Theerasak said.
He said that the main concern of Islamic people is the
mixing up of their deposits prohibited by the Islamic principles from
gaining interests or returns with those usable for gaining interest. He
stressed that this will not happen in the new Islamic Bank. KTB will
separate both the management and banking transactions of the Islamic Bank
from its normal banking system.
This worrying point has made existing Islamic Banks
operated on a trial basis by the Government Savings Bank (GSB) and Bank
for Agriculture and Agricultural Cooperatives (BAAC) unsuccessful.
KTB will launch the Islamic Bank as its full branch
offices, with 6-12 staff each in three provinces in the South, including
Yala, Pattani, and Narathiwat, where the majority of local people are
Muslims. In remote areas, special counters will be opened at KTB’s
branch offices covering five southern provinces, including Songkhla, Satul,
Yala, Pattani, and Narathiwat.
Theerasak said, “KTB plans to sign contracts on
exchange of consulting services with National Islamic Bank of Malaysia and
MayBank in mid March, and plans to open the Islamic Bank in May. People
who are not Muslims, but are willing to follow Islamic principles are also
welcome to use the new Islamic Bank’s services.”
In the initial stage, the new Islamic Bank will offer
four key services, including current account service, deposit maintenance
service, deposits for general investment service, and deposits for special
investment service. The former two of which will have no interest returns
to clients who, instead, have to pay fees for asking the bank to secure
their deposits.
Clients can apply for the deposits for general or
special investment services and will be able to receive returns to their
investment, but they will also be responsible for any loss of the
investment. Most of the investment will be in the form of joint ventures
with local entrepreneurs or enterprises. Theerasak said that the Islamic
Bank was, therefore, considered beneficial to the rehabilitation of local
small and medium-sized enterprises. (TNA)
Director General Dr Vallop Thaineua opens new R&D office
Thailand’s Department of Communicable Disease Control
(CDC) recently opened its new administration office in Bangkok. The office
opening ceremony affectively started the research and development clinical
collaboration with GlaxoSmithKline Biologicals. The collaboration will
focus mainly on the clinical development of pediatric vaccines including
combinations and vaccines against HIV. A key feature will include regular
academic exchanges between Thai medical experts and GlaxoSmithKline
vaccinology as well as training and development programs. The agreement
between the two parties is significant as it paves the way for further
strategic collaboration in Thailand.
This collaboration will not only aim to supply Thailand
with a clinically effective combination vaccine but also raise the health
benefits and cost savings for Thai patients. As Director General Vallop
said, “We are very pleased to be working with GSK Biologicals in
Thailand. Working with industry leaders not only helps us to build an
expertise in conducting clinical trials and biomedical science, it is an
investment in the healthcare sector of Thailand.”
Dr. Hans Bock, vice president and director Clinical
R&D and Medical Affairs for Asia Pacific, Middle East and Africa for
GSK Biologicals highlighted the mutual benefits of this arrangement. “We
are very pleased to be working with Thailand on our vaccines clinical
development. We have a strong track record of collaboration in Thailand
including large field efficiency and effectiveness trials. We view this
agreement as another step in our long-term investment to Thailand’s
knowledge economy, specifically in the medical science sector. Building up
Thailand’s expertise in R&D and clinical development provides
Thailand a significant competitive advantage, not only n the field of
vaccinology but in conducting clinical research more broadly.”
The CDC and GlaxoSmithKline Biologicals will establish
a working group to further develop a detailed plan that determines the
scope f the collaboration and mutual benefits to both parties. Steven
Drew, managing director of GSK (Thailand) added, “This event further
strengthens out relationship with the CDC. This collaboration fulfills the
Minister’s objective to ensure preventative care as a priority for the
Thai people.”
North Korea’s assembly leader pays official visit to Thailand
Prime Minister Thaksin Shinawatra gave a warm welcome
to Kim Yong-nam, chairman of the Standing Committee of the Supreme
People’s Assembly of the Democratic People’s Republic of Korea, who
arrived for an official 4-day visit to Thailand as a guest of the Thai
government. The North Korea’s assembly leader observed a guard of honor
at the Government House before joining a welcome dinner hosted by the Thai
premier.
Delivering a speech at the dinner, Thaksin said the
official visit by Kim would help strengthen the bilateral relations of the
two countries, which had established the diplomatic ties since 1985 during
which trade and cooperation had enormously increased.
The two countries have recently agreed to expand their
bilateral trade, particularly in rice and consumer products. Satisfactory
progress has been made in efforts by the two nations to settle debts
incurred through the account trading.
The premier said he believed peace and stability in the
Korean Peninsula would benefit the region as a whole.
Thailand fully supports talks on the national
reconciliation in the peninsula and welcomes the participation and
cooperation by the Democratic People’s Republic of Korea in various
activities, particularly cultural and trade.
Thailand officials intend to encourage North Korea to
become a member of the Asian Development Bank. Financial assistance from
the bank would greatly benefit North Korean national development.
As well as strengthening trading ties, the formal
discussion between officials of the two governments will include the
signing of agreements involving investment promotion and protection, news
exchange. (TNA)
Grandma’s curry spices up SMEs
It’s spicy, it’s saucy, and it could soon be in a
shop near you, helping prop up the nation’s small and medium
enterprises. As Thailand grapples for ways to sell its local produce to a
wider market, one shop in Phuket, specializing in southern Thai cuisine,
is branching out to sell products from local SMEs to both Thai and foreign
tourists.
Siam Southern Foodline Co. Ltd, manufacturer of the
“Mae Ju” brand of over 50 products ranging from chili paste to fish
curry, started off with one Phuket grandmother, Ju, who insisted that her
grandchildren took parcels of her fish kidney curry with them when they
went off to study abroad.
Soon all their fellow students were asking for the
curry and Ju decided to make one small pot of the curry each day for sale.
As word got around, the business expanded. Eventually a factory was set up
which employs 30 people to produce and market a wide range of southern
Thai cuisine, including fish kidney curry following the original recipe.
Narachai Phonsilp, the company president, said that
Siam Southern Foodline would be the first southern company to enter into
the Department of Industrial Promotion’s scheme to set up DIP shops, or
shops selling goods based on traditional Thai knowledge.
With its Phuket location, the company is in a prime
position to sell to both domestic and foreign tourists, and the DIP shop
idea will get round the problem of having to sell products to department
stores and paying a high commission fee.
The company’s DIP shops will sell not only Mae Ju
products, but also food, beverages, cosmetics, herbs and herbal medicine
from small and medium enterprises in the southern Thai region. (TNA)
Government to shell out B200 million to Maptaput residents
People living in the vicinity of the Maptaput
Industrial Estate were left with a major victory on their hands last week
when the government announced that it would pay out B200 million to
compensate them for the suffering caused to them by the estate’s
pollution.
Veera Mavichak, head of the Ministry of Industry’s
Industrial Factory Department said that the department, in conjunction
with the Industrial Estates Authority, had drawn up a blueprint for
improving the quality of life for people living in the vicinity of the
estate.
A budget of B200 million had been requested for the
various projects under the blueprint, which will operate as a pilot
scheme, he said, adding that the scheme will focus on public utility and
health issues.
Residents in the vicinity of the Rayong Industrial
Estate, one of the nation’s largest and most important industrial
development complexes, have long complained of the pollution and stench
emanating from the estate’s production plants.
Veera said that projects in the scheme included plans
to deal with the high levels of iron in the tap water supply, road
maintenance work, and training to local residents to enable them to engage
in sustainable employment by using the byproducts of the local factories.
Responsibility for the scheme will be in the hands of the Industrial
Estates Authority, together with the local population, he added. (TNA)
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