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Local food export industry fears tighter restrictions
The United States and European Union could impose tighter
restrictions on the import of food products as part of plans to prevent
terrorist attacks in the wake of the Iraq war, which in turn could deal a
blow to Thai producers.
Phaiboon Pholsuwanna, acting president of the Thai
Association of Frozen Food Industries, said that even though the Middle East
was not a major market for Thai frozen food, the local industry could be
affected as major importers such as the United States and the European Union
could exercise greater caution in importing goods in order to protect
against terrorist attacks.
“As far as I can make out from conversations with Thai
exporters, it appears that after the war large nations such as the US and
the EU will be on the look-out for terrorism in various forms. Fewer people
in large cities will leave their homes and travel, which in turn will have
an impact on prawns, chicken and fish from Thailand, as fewer people will
eat out in restaurants and hotels,” Phaiboon said.
Phaiboon admitted it is too early to forecast the state
of the market for Thai food products in the US after the war. However
figures coming in from the US and Japan for the first two months of this
year showed continuous growth, particularly exports of Thai prawns, which
grew by 22 percent.
However, despite the easing of EU restrictions on Thai
prawn products, other categories of Thai exports to the EU remain relatively
low. (TNA)
TCC to follow central bank in new economic forecasts
The Thai Chamber of Commerce (TCC) is set to revise its
economic forecasts to take into account the Iraqi war and severe acute
respiratory syndrome (SARS); while remaining optimistic that the combined
effects of the two factors will not slow down the economy by more than 0.8
percent, and that overall growth should nudge towards earlier predictions of
4 percent.
Thanawat Pholwichai, director of the University of the
Thai Chamber of Commerce’s Economic Forecasting Center, said that the
university was currently revising its economic forecasts for 2003. He said
the combined effects of the Iraqi war and SARS will slow economic growth in
the first and second quarters of the year.
The TCC expressed confidence that if both the war in Iraq
and SARS blew over quickly, and the economy continues to be stimulated it
could bounce back.
Earlier this month the Bank of Thailand (BOT) also hinted
that it might revise its economic forecasts at the end of April.
Thanawat said, “Overall growth for the year could
increase if the government issues a further round of economic stimulus
measures. Waning consumer confidence is already sending out warning signals,
even though consumer confidence remains positive.”
Trade with China and India could reduce blow from war and SARS
In a recently published report, the Bank Thai’s Office
of Research and Planning urged Thailand to expedite trade negotiations with
India and China, saying that increased trade with both countries would help
compensate Thailand for the loss of tourism earnings due to the combined
impact of the war in Iraq and Severe Acute Respiratory Syndrome.
Analysts say increased trade with China would boost
Thailand’s market presence there, particularly in terms of rice, rubber,
cassava, sugar and fisheries export.
Thailand has an advantage compared to other markets in
the ASEAN region due to its ability to modify its marketing strategies prior
to the establishment of an ASEAN-China Free Trade Area.
The report also suggested that Thailand should push
exports to India, as at present its market presence in India was relatively
low due to India’s imposition of high import tariffs and quotas on the
quantity and type of imports allowed in.
Thai industry holds out hope for 70% production capacity after war ends
Thailand is likely to see a rapid expansion in exports
after the end of the war in Iraq, pushing up production capacity by the end
of the year. Praphat Phothiworakhun, president of the Industrial Council of
Thailand, expressed confidence that average industrial production capacity
would reach 70 percent this year, up from 63 percent last year.
“I’m confident that after the war the world economy
will continue to grow, as next year there will be Presidential elections in
the US, which means that President George W. Bush is unlikely to let the US
economy slide. Consumption will probably be boosted, which will improve the
US economy, the world’s largest consumer. The world economy will grow,
which in turn will boost Thailand’s exports,” Praphat said.
During the Iraq war the electronic goods industry have
seen a drop in exports. However other industries such as food saw exports
increase.
“Moreover, government negotiations to establish Free
Trade Areas with countries including China, India, Bahrain, Australia and
Japan should give a further kick to export expansion,” Praphat stressed. (TNA)
MOC urges overseas trade promotion offices to overhaul marketing strategies
Commerce Minister Adisai Botharamik called on the
directors of Thailand’s 53 foreign-based Trade Promotion Offices who
gathered in Bangkok for a workshop, to re-work their marketing strategies
for greater market penetration.
Speaking at the close of a three-day workshop, which saw
the directors of Thailand’s Trade Promotion Offices gathered together with
representatives from private-sector agricultural concerns and other
important industries, Adisai hailed the workshop as marking a new dimension
in the ministry’s working practices.
The workshop saw the various trade promotion offices draw
up marketing strategies on a market-by-market basis, while establishing
export targets for each region.
For the American market the export growth target was set
at 3.5-5 percent, with targets of 4.4 percent for the European Union, 12.7
percent for Eastern Europe, 10 percent for the Middle East, 2.5 percent for
Japan, at least 10 percent for India and 18 percent for ASEAN.
Marketing strategies were also reviewed, particularly the
promotion of trade relations among high-ranking government and private
sector executives.
Other strategies will included the creation of supply
chains, joint investment with private sector companies in important export
markets, the opening up of opportunities for the private sector to play a
greater role in trade negotiations, the establishment of Free Trade
Associations with important trading partners and a modification of trade
promotion offices to enable them to work with up-to-date information.
More opportunities will be available for members of the
private sector in industries such as woven goods, rice, rubber, cassava,
food, gemstones, clothing, agriculture, furniture, electronic goods and
service industries such as hospitals, education and Thai restaurants, to
exchange views and ideas, and to propose solutions to obstacles.
Government gives nod for lower fuel prices
The government finally gave the nod and local motorists
are now enjoying lower fuel prices. Retail gasoline prices, both benzene and
diesel dropped by 0.30 baht a liter nationwide as of April 18.
The move followed continued decline of world oil prices
over the past weeks. Energy Minister Prommin Lertsuridej said, “The
government will continue to closely monitor the development of world oil
prices, and may allow a further drop of domestic gasoline prices in the near
future.”
Since February 8 of this year the government has made an
effort to limit the impact of conflicting problems in the Middle East on
Thailand and the general public by imposing ceilings for retail gasoline
prices in the domestic market.
However, the energy minister said the government might
make a new decision after the next meeting of the Organization of Petroleum
Exporting Countries (OPEC), to be held soon. (TNA)
SET gives listed companies 3 years to complete debt restructuring
The Stock Exchange of Thailand (SET) will allow listed
companies currently undergoing debt restructuring three years to complete
the process. SET’s assistant manager Sarayuth Booncharoen said that the
regulations would apply both to companies going through debt restructuring
and to companies in the Rehabco program.
At present 70 listed companies, 15 percent of the 399
listed on the stock exchange, are going through debt restructuring, while
another 53 companies are on the Rehabco scheme. Sarayuth said that any
companies that failed to restructure their debts within the time specified
would find their listings revoked, according to new SET regulations
announced in March 28.
The SET has divided Rehabco companies into two levels
according to the progress they have made in debt restructuring.
The first level consists of 22 companies whose debt
restructuring program has been approved, and which are currently carrying
out the plan, while the second group comprises 11 companies which have made
no progress in restructuring, or whose debt restructuring plans are deemed
unsuitable.
Japanese reporters visit Detroit of The East Thailand
Thamrong
Mahajchariyawong, Minister of the Office of Economic and Investment Affairs,
Royal Thai Embassy, and the Board of Investment (BOI) Tokyo, Japan, led a
group of Japanese reporters to visit the infrastructure and facility of
Hemararaj’s Eastern Seaboard Industrial Estate (Rayong). The group
received a warm welcome from Yuji Nakamine, president of AutoAlliance
(Thailand) Co. Ltd. They also visited Johnson Controls & Summit
Interiors Ltd. Jinnapat Tongviseskul, assistant director, Corporate
Marketing of Hemaraj Land and Development Plc welcomed the group.
Thailand hails launch
of first solar-powered generating stations
Electricity Generating Authority of Thailand (EGAT)
recently announced that Thailand’s fierce sunshine is to be harnessed to
power the nation’s first solar-powered electricity generating station,
which should be up and running to solve Mae Hong Son’s expected surge in
demand for electricity by May next year.
Apichart Diloksophon, director of EGAT’s Research and
Development Office and head of the authority’s solar cell demonstration
project, said that Mae Hong Son’s electricity supply was heading towards
problems, with insufficient electricity produced to cope with the
province’s rising industrial and tourism demands.
At the same time, its designation as a ‘green’
province, to act as a national example for the conservation of natural
resources, meant that it was the only province in the country to which EGAT
could not directly transmit electrical supplies.
The new solar powered stations will boost existing
supplies from the Mae Sa-nga and Pha Bong hydroelectric plants, and EGAT’s
diesel-fuelled generating station. It will also act as a large-scale
national center for research into solar energy, in the hope that the project
could be expanded in the future.
The first phase of the project will see two separate
plants established within Mae Hong Son’s Muang district. The 500-kw Mae
Hong Son 2 station will be capable of generating 700,000 units per year,
thus saving 215,385 liters of diesel worth 2.9 million baht. Work on the
1,750 kw Mae Hong Son 1 station will start at a later date, after the
initial project had been assessed. (TNA)
Profits of Thai chicken exporters plunging due to tough EU rules
EU food and health officials found traces of banned
chemicals in Thai poultry in March last year and have since required all
Thai chicken to be tested. Thailand, lacking the necessary laboratories and
equipment to test all its chicken, has voluntarily cut its exports to Europe
to reduce the chances that shipments will be tested positive for the
antibiotic chloramphenicol.
Thai chicken exports to the European Union fell by 12.4
percent to 130,086 tons in 2002 from 148,526 tons in 2001. Since the strict
testing was introduced the domestic market has been flooded, pushing chicken
prices down to a six-year low.
Profits for Thai chicken exporters are shrinking. Charoen
Pokphand Foods (CPF) and GFPT, two of Thailand’s biggest chicken
producers, are expected to see huge drops in first-quarter net profit
compared with the same period a year earlier.
Analysts said GFPT, whose earnings come almost entirely
from chicken products, could see its first-quarter earnings fall as much as
90 percent from a year earlier while CPF’s earnings could drop by 64
percent.
CPF’s net profit is forecast to drop by 18 percent and
GFPT’s by as much as 47 percent. Most analysts recommend investors sell
both CPF and GFPT, at least in the short-term.
Terapatr Mathanukraw, an analyst at Seamico Securities
said, “Since the EU crackdown Thailand’s chicken export has plunged. The
extra chicken is being dumped domestically.”
In March Thailand’s chicken industry agreed to cut
supply from 21 million chickens per week down to 18 million to boost prices.
However, these measures will take time to impact the market. (TNA)
Singapore envisages Thailand as ASEAN leader within 2-3 years
Singapore’s government is putting its full weight
behind Thailand’s economic recovery and political stability, envisaging
Thailand as one of the core leaders in the Association of Southeast Asian
Nations (ASEAN) within the next two or three years.
Speaking at an unofficial meeting of economic ministers
from the 10-nation ASEAN grouping in the ancient Lao capital of Luang
Phrabang, Commerce Minister Adisai Bodharamik said that ASEAN members were
increasingly looking towards Thailand as one of core countries in the
grouping.
Singapore in particular fee’s that Thailand’s economy
is growing in potential and becoming increasingly stable and the kingdom’s
political stability could mean that Thailand could eventually see economic
growth rates of no less than five percent per year.
“Due to this confidence, Singapore wants to see
Thailand become an ASEAN leader, and act as a blueprint for other ASEAN
countries as a grouping. Singapore is confident that in the next two or
three years Thailand’s economy will have strengthened, and that Thailand
will have no problems in acting as an ASEAN leader to lead ASEAN forward in
concerted growth,” the commerce minister said. (TNA)
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