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April’s consumer
confidence index drops
The consumer confidence index for April dropped to 87.7
points from its 90.8 points in March due to SARS related anxieties. The
index stood at 93.3 points in February. A consumer index of below 100 points
indicates weak consumer sentiment.
A recent survey done by The University of Thai Chamber of
Commerce said the SARS health scare in the region discouraged people from
traveling and triggered a downturn in the service and airline industry.
Thanawat Polvichai, director of the university’s
economic and business forecasting center, said, "The worse economic
impact of SARS is being felt throughout the service sector. The
manufacturing sector has remained relatively unscathed."
Positive factors which surfaced in April included stable
fuel prices, the end of the war in Iraq, continued growth in the county’s
exports, and the central bank’s policy to keep the repurchase rates low. (TNA)
PM says the world needs more Thai restaurants
The government will provide financial support to Thai
people living overseas who want to open Thai restaurants so that Thai
cuisine will be expanded worldwide, according to Prime Minister Thaksin
Shinawatra.
During his recent official visit to France, Thaksin told
the Thai community in Paris that Thais overseas who want to open Thai
restaurants could seek financial support from Thai Embassies abroad.
"The government promotes and supports the expansion
of Thai restaurants globally. Therefore, Thai people living overseas who
want to open Thai restaurants can contact Thai Embassies in their respective
countries to ask for loans to be used for running the business,"
Thaksin said. (TNA)
DHL changes name to DANZAS after merger
DHL International (Thailand) launched its new "DANZAS"
transportation and parcel delivery brand name after a recent merger with
Deutsche Post World Net (DPWN).
DANZAS is now the world’s largest express
transportation and logistics company.
FTI revives project to set up
international trading companies
Tax beaks and access to loans considered to be vital incentives
The Federation of Thai Industries (FTI) is reviving plans
to establish international trading companies to act as export
representatives. At the same time FTI is requesting tax and interest
concessions for small and medium-sized enterprises (SMEs).
FTI president Praphat Phothiworakhun said that the FTI
and the Thai Chamber of Commerce has joined with the National Economic and
Social Development Board (NESDB), the Department of Export Promotion and the
Office for the Promotion of Small and Medium Enterprises to determine ways
to add value to export products.
International Trading Companies (ITCs) were briefly set
up in 1998, but soon disbanded due to insurmountable obstacles.
Praphat said that the ITCs, which would be run as private
sector agencies, would assist SMEs in exporting their products onto the
global market. "The ITCs will form a conglomeration of businesses from
each industrial sector, and members must be listed companies with a secure
financial base, expertise in exports, the ability to research and develop
their products to meet international standards, and initiate a network of
contacts at home and abroad," said Praphat.
The plans call for the ITCs to liaise with financial
institutes in order to facilitate access to sources of credit for the
purchase of raw materials, machinery and equipment.
At the same time, the ITCs will request investment
privileges from the Board of Investment of Thailand (BOI), customs and
taxation privileges, and low interest rates on loans from the Export Import
Bank of Thailand. (TNA)
Over 20 billion baht circulates during SET’s Money Expo
The Money Expo fair, organized in Bangkok by the Stock
Exchange of Thailand (SET) was a roaring success, with over 20 billion baht
circulating from loan applications, credit card purchases, insurance
purchases and fund applications over the four days of the event.
Held at the Queen Sirikit National Convention Center on
May 15-18, the Expo proved bigger and better than the previous two years.
Money Expo manager Santi Wiriyaransrit said that over
500,000 members of the public attended the fair, of whom 77,000 applied for
various services offered by financial institutes exhibiting there, worth a
total of around 21 billion baht.
Santi added that of the services offered by commercial
banks, credit cards proved the most popular, with 38,000 applications made
for new cards; while 27,000 people signed up for personal loans, 9,900
people signed up for mortgages, and 1,100 people signed up for small
business loans.
Property loans applied for at the event were worth a
staggering 16 billion baht, accounting for 78 percent of the total amount
circulated at the expo, followed by personal loans worth 1.8 billion baht,
credit card applications worth1.3 billion baht, and small business loans
worth1.1 billion baht.
At the same time, 3,000 participants applied to brokers
to open stock trading accounts, worth a total of 180 million baht, while
2,000 people applied to open investment capital accounts and 700 people
applied for life insurance.
Cut in fuel prices wins high praise
The government got high marks for its courageous decision
to cut local retail fuel prices by over 1 baht per liter.
Dr Arch Taolanond, president of the Thai Chamber of
Commerce said, "The decision to float fuel prices is praiseworthy
because it will enable entrepreneurs to evaluate actual operational costs.
Producers can now calculate the real cost of energy and assess their
competitiveness with foreign rivals."
The decision will also have a positive psychological
effect on local consumers since it will help stabilize goods prices.
However, Dr Arch said, private companies must realize the
actual cost of fuel and improve production efficiency and their competitive
edge.
Commerce ministry projects 8%
growth in food exports
Thailand’s exports of food and agricultural goods this
year is expected to grow eight percent from last year’s 567 billion baht.
Banphot Hongthong, director-general of the Department of
Export Promotion, said, "Thailand could indirectly benefit from
outbreak of Severe Acute Respiratory Syndrome (SARS) in Asia if foreign
buyers switch their purchasing orders to Thailand from the SARS-affected
countries including China and Vietnam. We feel they will seek alternative
markets and could turn away from countries most deeply affected by the
epidemic."
Two exhibitions -the Thailand International Food
Exhibition 2003, and the Thailand International Muslim Food Exhibition 2003
- were held during May 28-30 at the Bangkok International Trade and
Exhibition Center (BITEC). Over ten thousand visitors attended the fairs
with a transaction value estimated at over 1 billion baht.
Around 427 local and foreign food producers and exporters
including those from Korea, Laos, Vietnam, Cambodia, Malaysia, Myanmar and
the Philippines brought their products to display and market at the fairs,
Banphot said.
In addition, BITEC will host the "Food Catering Asia
and Food Technology Asia 2003" trade fair scheduled for October 1-4. It
is expected to draw 18,000 participants.
Prasarn Bhirajburi, managing director of BITEC said the
country last year exported 29 million tons of food products worth three
billion baht.
Prasan added, "Thailand faces strong competition
from neighboring countries exporting the same products at lower prices. If
we can add more value to our products, such as making them ready to eat, it
will bring more income to our country."
Lack of WTO progress may hinder competitiveness of Thai agricultural goods
The Thai Chamber of Commerce has expressed concern over
the lack of progress on World Trade Organization (WTO) talks on agricultural
and industrial goods; while warning that certain Thai agricultural products
were unable to complete in the global market.
Speaking at a seminar on "Trends in Thai economic
policy under globalization", Dr Ach Taolanont said that the lack of
progress during the last WTO Doha trade talks could spell trouble for the
kingdom’s agricultural and industrial products. Expressing concern that
WTO trade negotiations in September would be marred by a similar lack of
progress, he said, "The Thai Chamber of Commerce will liaise closely
with the public sector to prepare for the next round of trade talks."
Meanwhile, Dr At Phisalwanich, director of the Center for
WTO studies, said that the liberalization of world markets had benefited
some Thai products, but had an adverse impact on others. He urged the
government to study which agricultural products were most successful in the
world market and work to boost their competitiveness.
It was suggested that multilateral negotiations with a
number of countries could find markets for less competitive goods.
EXIM Bank still upbeat about economic growth
The Thai economy remains likely to see healthy growth for
the remainder of this year in spite of the war in Iraq and the SARS virus
outbreak in Asia, according to a veteran banker.
Sathaporn Chinajit, president of the Export and Import
Bank of Thailand (EXIM Bank), said the war in Iraq had no negative impact on
the economy. In contrast, it seemed to have a positive effect as the export
in the first quarter of this year expanded satisfactorily since there were
orders placed for stocks and strategic materials.
Sathaporn said, "What is of concern now is the
economic slowdown in the countries where there was an epidemic of SARS
virus."
Hong Kong, for example, might see its growth ease by
0.7-1 percent. Worse still, the US economy appears not to be recovering as
quickly as expected.
The banker said, "Thailand has also been affected by
the SARS outbreak although there was no epidemic in the country. The tourism
and hotel business took the brunt as the number of foreign tourists dropped.
Although the effect on the country’s exports is not yet clear, I am still
confident the economy will expand at by at least 6 percent this year."
(TNA)
Exporters urged to fill trade vacuum left by SARS
Deputy Chairman of the Federation of Thai Industries (FTI)
Kiertiphong Noijaiboon is urging the private sector to turn the SARS crisis
into opportunities by rushing to fill the trade vacuum left by China; while
calling on the government to reiterate Thailand’s SARS-free status to
facilitate private sector companies.
Kiertiphong conceded that the flu-like epidemic was
affecting Thailand despite Thailand’s SARS-free status, as foreign
investors were lumping Thailand with other countries in the Asian region. He
called on the government to launch campaigns for greater use of
domestically-manufactured goods and fill role previously held by countries
severely affected by the health scare such as China, Hong Kong, Taiwan and
Singapore.
The FTI said that Thai companies should enter into trade
negotiations with Europe and the United States to promote their products, in
particular by citing World Health Organization (WHO) assurances that Thai
products do not carry a risk of SARS contamination.
‘When Thailand’s competitors blunder, we should turn
their markets into ours. The public and private sectors must work together
to promote Thailand," said Kiertiphong.
The manufacturers’ confidence index for March showed a
clear decline due to the combined affects of SARS and the Iraqi war.
The FTI is currently drawing up new economic forecasts
for April, but expressed confidence that the rate of growth would remain
unchanged due to Thailand’s strong export performance, in particular in
the food and automobile sectors. (TNA)
Export of farm and agro-industry
products still promising
Thai Farmers Research Center (TFRC) recently reported
that the export of farm and agro-industry products, particularly to China,
is likely to enjoy accelerated growth.
The leading think tank projected that the value of the
export this year would be around US$13.9 million, up 13.5% from that of the
previous year, although the SARS outbreak would have an effect on key
trading partners, including China.
Thailand has aggressively expanded its export base into
China. This, coupled with possible tariff cuts as a result of the Sino-Thai
trade liberalization, could significantly boost the export of the farm and
agro-industry goods for this year. The portion of the Thai exports to China
may increase to the close level as that to the US.
Still, the report warned there were external factors that
could affect the export of the products and the government should closely
monitor. They include the possible economic slowdown in the US in the
post-war period, stiff competition for markets in Iraq and other Middle East
countries, consumer product purchase orders from the United Nations, and
restriction of the import of some kinds of foods by the US and European
Union as a measure to prevent terrorism.
But overall, it believed the export of the products this
year would remain promising as a result of the government’s efforts to
spearhead the expansion of export destinations and negotiation for trade
cooperation with rivals. (TNA)
Introduction of new models at low prices drives up motorcycle sales
Thai Auto-parts Manufacturers Association fears future tariff cuts with India
According to a statement released from market leader AP
Honda, sales of motorcycles soared in April by 53 percent due to intense
marketing campaigns promoted in the provinces.
Sales totaled a whopping 137,056 units, compared to
89,834 units recorded in March. AP Honda said the increase was due to
manufacturers’ introduction of a variety of models and lower prices
intended to boost market share.
Suzuki sold 18,628 units last month, 68 percent more
compared to figures recorded during the same period last year and enabling
it to seize 14 percent share of the market.
In April Yamaha sold 13,676 units, representing a 10
percent market share.
Concerned that lower tariffs could put pressure on local
manufacturers, Thai auto parts makers have been urging the government to
revise its policy on the trade liberalization agreement between Thailand and
India.
Thai Auto-parts Manufacturers Association vice president
Yongkiat Kitaphanich said, "Since India has the advantage of lower
wages, more material resources and better production technology, Thailand is
not ready to compete if tariffs are lowered, and our spare parts industry
will suffer."
The association wants the Thai government to cut tariffs
on certain products Thailand doesn’t produce.
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