BANGKOK, Jan 29 – The Japanese business community in Thailand has called on the caretaker government to urgently end the political turmoil and warned that prolonged conflicts will affect spending and investment in the public sector.
Setsuo Iuchi, economic survey chairman of the Japan Chamber of Commerce, said the unfavourable political climate would pose a negative psychological impact on the tourism industry.
The Japanese private sector, which has been a business partner with Thailand over the years, is hoping for urgent resolution of the political stalemate so that mutual economic development will not be disrupted, he said.
Thailand’s political unrest has affected the tourism and hotel industries, but coordination with the public sector on customs and other procedures remains unaffected.
According to a survey on economic trends in the first half of this year, 73 per cent of Japanese joint venture companies called on the government to return political stability to the country, 46 per cent urged the public sector to improve the customs and taxation system, 44 per cent said the public utility system in Bangkok and outlying areas should be improved, and 36 per cent called for more serious government action on flood prevention.
The majority of Japanese businessmen were optimistic on business and industrial development in Thailand in the first six months of the year, especially in metal and non-metal industries, machinery for the transport industry and non-production transport industry.
Japanese businessmen forecast an improved trend in almost all industries particularly in the trading and retail business, with 62 per cent of them predicted a total sales growth and 86 per cent of them said they would make pre-tax profit.
Losing companies predicted dwindling losses and balanced performance with investment in factory construction and machinery for expanded production.
Regarding export trend in the first half of the year, 41 per cent were optimistic about market expansion in Indonesia, Vietnam and Myanmar while non-manufacturing industries will have a bright future in Cambodia and Laos.
The survey found that 54 per cent of Japanese investors have yet to expand their business to other countries under the Thailand Plus One concept, 28 per cent have launched it and 19 per cent were considering if they would do it. Targeted countries for business penetration are Indonesia, Vietnam and Myanmar.
Fifty-two per cent said they have encountered labour shortages and 64 per cent said the shortage was personnel at the managerial level.
