FTI chief backs proposed revision of oil excise tax hike

Federation of Thai Industries (FTI) chairman Santi Vilassakdanont on Friday expressed support for a proposed revision of the oil excise tax increase, saying efforts to raise the tax now might cause the country’s fragile economic recovery to stumble.
“I agree if the prime minister decides to revise the oil excise tax hike because global oil prices are likely to edge up, which can stoke up local retail oil prices,” he said.
However, Santi cautioned that an oil excise tax increase would fuel the burdens borne by consumers, that it would cause difficulty for the people. And it could lead the economy to stumble while gradually recovering.
Consequently he cautioned that the oil tax hike should be postponed until the economy recovers more fully.
“Should the economy recover and public confidence be restored, the government’s move to raise any kind of taxes will not be a problem. But now,” he said, “confidence has not yet been fully restored.”
At the same time, an oil excise tax increase would fuel rising transport costs and product prices, and could definitely affect consumer spending.
The FTI chief said he wanted the government to revive measures to encourage the use of alternative energy.
Santi said he believed the inflation rate would remain low. This year, inflation is forecast to stay at 1-2 percent because the public continues to reduce their consumption as they are uncertain about the economic recovery.
Regarding the lending rate cut by major commercial banks, he said, it would benefit the private sector as the cost for loan applications would reduce. (TNA)

Thai exports drop 26% in April

Thai exports in April fell 26.1 percent year-on-year, Permanent Secretary for Commerce Siripol Yodmuangcharoen announced on Wednesday.
Total Thai exports were valued at US$10.4 billion, he said. The sharp drop follows March’s 23.1 percent decline.
Thailand exported goods valued at $44.216 billion during the first four months of 2009 while it imports totaled $36.566 billion, enabling the country to enjoy a trade surplus of $7.65 billion, Siripol said.
Exports and imports during the period both declined, 21.9 percent for exports and 37.3 percent for imports in terms of value compared to the corresponding period of 2008, he said.
Siripol said exports fell due to declining purchasing power in the world market.
Key importers of Thai goods reduced their purchases between January-April this year, a trend which has continued since late 2008.
Exports to new markets dropped 19.5 percent, Europe 35.1 percent, ASEAN 33.4 percent, Japan 29.8 percent and the United States 28.7 percent.
The Commerce Ministry has maintained that Thailand’s exports would contract by two digit figures during calendar 2009.
Director-General Rachane Potjanasuntorn of the Ministry’s Export Promotion Department, said as the economies of several countries - including China, India and Australia - have shown signs of recovery, the Commerce Ministry will discuss with the Finance Ministry on ways to boost exports by providing incentives to exporters by lowering interest rates on loans and tax.
Measures on the planned offering incentives are expected to be concluded within the next two weeks and then proposed to the Cabinet for consideration, Rachane said. (TNA)
 

Thai economy on path to recovery, says FTI chief

The Thai economy has already bottomed out and is on the path to recovery, given improvements registered in many economic indicators, according to the Federation of Thai Industries (FTI).
FTI chairman Santi Vilassakdanont said foreign capital has begun to flow into Thailand, ASEAN, and Asia since investors want to invest in markets that they believe would give them attractive returns, which he said is a definite sign of returning investor confidence.
He said exports in April shrank 26 percent partly because there were many public holidays last month.
Santi said he believed exports in May and June would outpace those in April. The second half of this year would see the exports grow more than those in the first half.
The export situation would be even better in this year’s third and fourth quarters, he said, but noted that the strengthening of the baht was not good news for the export sector.
“Some exporters had sold products when the baht stayed at 35-36 to the US dollar. Their revenue has now declined due to the strengthening of the baht,” he said.
The FTI chief said he understood the Bank of Thailand’s efforts to supervise the baht value. However, he wanted the central bank to pay attention to the export sector as well.
Santi said the level at which he wanted the baht to stay now is 35-37 baht to the dollar.
He projected the exports for the whole year would contract more than 10 percent if the baht moves in a range of 35-36 to the dollar.
Should the baht continue strengthening over other currencies of trade competitors, he said, Thailand’s exports would shrink even further. (TNA)

Canada consider gold exploration investment in Thailand

Canadian business interests are looking to invest in exploration and development of gold mining in Thailand, according to Industry Minister Chanchai Chairungruang.
Speaking after a meeting with a group of Canadian business visitors led by Senator Mac Harb, Charnchai said he and the senator discussed mining business and promotion of investment in the mining sector in Thailand.
Harb, an advisor for the Southeast Asia Mining Corp, and the Canadian businesspersons expressed strong interest in investing in gold resource exploration for possible mines in Loei, Pichit, Petchabul and Prachinburi provinces, he said.
Recently, Canadian business interests established a joint venture with their Thai counterparts under the name of GO Thai to apply for permission from the National Parks, Wildlife and Plant Conservation Department to explore tin and zinc mining in Kanchanaburi province.
The department is considering the application and the geographical suitability of potential areas for exploration, he said.
Canada is the world’s largest mineral exporter, with a rapidly developing mining industry.
Canadian mining investment interests now want Thailand as their mining base in Southeast Asia. (TNA)

Thai industrial confidence index rises to 76.3 in April

Thailand’s industrial confidence index increased to 76.3 in April from 69.4 in March on increases in purchase orders, sales and production, Federation of Thai Industries (FTI) chairman Santi Vilassakdanont said on Thursday.
Santi said the increase was still not satisfactory as the April index was still lower than 100 for the 37th consecutive month - since April 2006 - due to the world’s sluggish economy and domestic political unrest.
These negative factors continue to haunt entrepreneurs’ confidence, he said.
The index showed that both small- and large-sized industrial performances improved but medium-sized fell slightly because of the decreases in purchase orders and sales of pulp and paper, pharmaceutical, and agriculture machinery industries.
Industrial performances in April also showed that indices in the North and Eastern regions dipped marginally from March due to higher production costs, a lack of labor and a stronger baht, which had depressed earnings. (TNA)