Monday, January 28, 2008

Thai business sets out urgent tasks to fire up economy

FINANCIAL RECOVERY
New PM told 'get moving'

Published on January 29, 2008

Business sets out urgent tasks to fire up economy

Thai business leaders have called for newly-elected Prime Minister Samak Sundaravej to jump-start the economy by restoring investor confidence and stimulating domestic demand.

They said they are anxious to see the line-up of Samak's economic team.

Pramon Sutivong, chairman of the Thai Chamber of Commerce (TCC) and the Board of Trade of Thailand (BoT), said Samak had little experience in economic and international affairs.

"As an old politician, the new premier should seek a strong team specialising in economics to increase business confidence. It will also take some time to boost the Kingdom's economic growth," he said.

He pointed out the urgent task was to stimulate domestic consumption and investment.

BoT secretary-general Pornsilp Patcharintanakul said he was surprised by the House decision to name Samak as PM. However, he said Samak's government should be able to produce results within four months, otherwise investor confidence will not return.

Pornsilp gave a 50 per cent "confidence score" for the new premier, but if his economic team does not have respectable and qualified members, the score would plunge to 30 per cent.

Priority tasks that businessmen want to see include a cut in the rising cost of living by increasing incomes and concrete measures to solve the fuel price hikes as a result of skyrocketing world oil prices. They also want a better environment for increasing trade and investor confidence.

Vallop Vitanakorn, vice president of the Thai Garment Manufacturers Association, believed consumer confidence, particular among foreigners, should increase now that a prime minister has been elected via the democratic system.

He urged the new government to immediately start mega project investments but added that the Bank of Thailand's capital control requirement should continue to be imposed to help stabilise the baht.

Bodi Chunnananda, a director of TMB Bank, said the PM vote was expected. "I want the government to solve the economic problems and if the government can cut the interest rate, that will be good for business," he said.

Bodi said the new government should also use the fiscal deficit to stimulate the economy.

Sigve Brekke, chief executive of Total Access Communication Plc (DTAC), said he hoped the new government would quickly get the economy back on track through a stimulus package and investment in large infrastructure projects.

"I would also like to see the new government put more focus on the development of the telecom industry. According to numerous studies, mobile-internet penetration rates have a significant impact on a nation's economic and social development. I don't see why Thailand has to be left behind by other countries in this area," Brekke said.

"I therefore urge policymakers to pay serious attention to the following issues to pave way for the industry's liberalisation."

One of the issues is speeding up the decision on wireless broadband 3G. Thailand is one the few countries in the region that still hasn't got 3G.

He hoped the government ensured that mobile number portability can be implemented within this year.

Wichian Mektrakarn, president of Advanced Info Service Plc, said the government should focus on promoting the availability of new telecom licences as a means to further liberalise the telecom industry.

Energy Minister Piyasvasti Amranand also urged his successors not to subsidise the oil price again.

"A lesson has been learned, as the intervention by the Thaksin government resulted in losses of over Bt90 billion, and in the end consumers had to shoulder the loss as oil prices in the following period could not be reduced," he said.

Arthit Vechakit, managing director of Excellent Energy International, said Samak was neither a good nor a bad choice because ex-prime minister Thaksin Shinawatra was still popular in the country.

"I think businessmen would rather know who will become Finance minister rather than prime minister. If the Finance minister is really good, the private sector's confidence will recover," he said.

Poj Aramwattananont, chairman of the Thai Frozen Foods Association said: "We should see what the Cabinet looks like. The position of prime minister has no significant importance on its own," he said.

Kongkrit Hiranyakit, president of the Tourism Council of Thailand (TCT), said the council was not worried about the new prime minister because he was elected by the majority. He said the council would meet with the government after the Cabinet is announced to discuss how to rebuild tourist confidence.

The TCT has claimed that negative news reported by foreign news agencies had destroyed the industry so the council wanted the government to take responsibility for the problem.

Business Desk

The Nation

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