BUSINESS & TRAVEL
HEADLINES [click on headline to view story]:

Kunming eases strict customs, taxes on Thai goods

Power bills likely to edge up this year

Debit card business likely to grow considerably: KRC

Thailand’s Election Result - good news for Tourism?

Kunming eases strict customs, taxes on Thai goods

The government of China’s Kunming city has eased its strict customs procedures and value-added tax collections applied on imported Thai products.
Speaking after visiting the city and meeting with senior officials of state agencies there at the end of December, Thailand’s Deputy Permanent Secretary for Commerce Pissanu Rienmahasarn said the local government of Kunming had agreed to relax the customs rules on examination and quarantine of imported products including vegetables, fruits and meat from Thailand.
In addition, it had reduced the value-added tax collections on various kinds of Thai products shipped to Kunming for trans-shipment to other Chinese provinces.
Mr. Pissanu said the two sides would set up a sub-committee to determine a common practical approach, which is expected to be declared in the next few months.
The relaxation of the rules is considered a significant achievement, he said, adding that in the past Thai exporters of products to each province of China had experienced both a strict examination and the quarantining of their products.
Some produce, particularly fruits and vegetables, had been kept in quarantine for such a long time that they spoiled, despite the fact that Thailand and China had reached a free trade area agreement covering produce in 2003.
Mr. Pissanu added that Thailand has a project to develop a Thai product distribution centre in Kunming, where a 20-storey building for the centre is already under construction.
The centre is expected to be a key place for distribution of Thai products to Chinese consumers in Kunming and other provinces of China.
Kunming, capital of Yunnan province, is China’s gateway to Southeast Asia. Currently, the Chinese government is promoting the city as an economic zone.
“More importantly,” according to Mr. Pissanu, “Kunming people are close to Thai merchants and know Thai products well”.
“Consumers in the city have high purchasing power, making the city suitable as a place where Thailand can distribute consumer products such as clothing, leather and other OTOP goods,” he said. (TNA)


Power bills likely to edge up this year

Electricity bills are likely to edge up further this year due to surging oil prices and lower water levels in hydro-power producing dams, according to Mr Sombat Santijaree, Governor of the Electricity Generating Authority of Thailand (EGAT).
He said the surge in global oil prices to US$100 per barrel would not have an immediate effect on Thailand’s power bills as the price of natural gas, which accounts for 70 percent of fuel for power generation, had not instantly risen in tandem with the oil prices.
However, Mr. Sombat conceded that a continued oil price rise would have an impact on consumers’ electricity bills.
At the same time, water levels in Thailand’s hydro-power dams have fallen to just 80 percent of their full capacity. This could result in decreased generation of the country’s lowest cost hydro-power.
How much the power bills would be raised depended on the decision of the sub-committee supervising the fuel tariff charge. EGAT is not in a position to identify how much the FT will increase charges in the new round starting from February to May.
Mr. Sombat said EGAT had attempted to manage power generation to ensure the lowest cost by allowing power plants with low production costs to operate at full capacity first. (TNA)


Debit card business likely to grow considerably: KRC

Thailand’s debit card business is likely to continue its growth by as much as 24 percent this year, but its popularity among the public remains limited, according to the Kasikorn Research Center.
The leading think tank said the implementation of the marketing policy for the debit card business in Thailand had gained momentum since early last year.
It forecast the number of debit cards this year would increase by 24 percent to around 22.75 million from 18.35 million last year because of a successful marketing campaign to expand the debit card customer base.
KRC viewed that spending through debit cards would continue to grow satisfactorily if operators were able to adopt a similar suitable marketing strategy to stimulate cardholder spending.
In addition, an interest rate increase for credit card loans to 20 percent per annum might encourage customers to turn to spend more through debit cards in the future.
It projected that spending through debit cards this year would increase by 19.7 percent to around Bt44.9 billion from Bt37.5 billion last year.
However, according to a survey carried out by KRC however, most consumers did not want to change their ATM cards into debit cards nor use the debit cards for payments. They still preferred to use credit cards for payments as they could obtain more incentives than if they used debit cards. (TNA)


Thailand’s Election Result - good news for Tourism?

Andrew J. Wood
Two weeks ago almost 70% of eligible voters turned out to exercise their rights in the country’s first general election following the September 19, 2006 military coup, which ousted former Prime Minister, Thaksin Shinawatra.
The People’s Power Party (PPP), that rose from the ashes of Thaksin’s Thai Rak Thai party were the winners, with 48% of the vote, with the Democratic Party in second place with 34%. Five other parties made up the remaining 18%.
The challenge now is to form a coalition government under the PPP leader, who is also a former Bangkok Governor, Mr. Samak Sundaravej. It will not be an easy task. Firstly there is the hurdle of the Election Commission who may suspend or ban MP’s accused of cheating in the run up to the election. Their findings will not be made known for two weeks. Secondly, as the horse trading starts, and the smaller political parties jockey to form a coalition with a working majority, it is still unclear who PPP will fall into bed with and how long the love affair might last.
The outcome of the election did not, as constitutional planners had hoped, enable the smaller political parties to gain a foothold. The re-written constitution allowed for a greater number of smaller constituencies in the hope that smaller parties may have a greater influence. However the truth is that we still endure a polarized two party system and the outcome is a pointer to the rivalry between the two major parties. The PPP sweeping the board in the North and Northeast whilst the Democratic Party dominated densely populated Bangkok and the whole of the South.
The coup leaders, the Council for National Security (CNS), backed by the army, are not happy with the outcome. Many of the richer educated masses in Bangkok that initiated the demonstrations against Thaksin, which ultimately led to his demise, are also not happy. The voters in the poorer North are pleased as they hope that Thaksin will return to power, the man that gave them food to eat and money in their pocket and initiated populist policies, such as the 30 Baht ($1.00) healthcare scheme.
Mr. Samak Sundaravej, who many thought had not been a particularly successful Governor of Bangkok, makes no secret of the fact that he is a supporter (some say mouthpiece) of the former premier. He has even gone so far as suggesting an amnesty for the politicians of the former TRT party.
So was it all worth it and how will this effect travel and tourism?
Few argue that a military junta has been bad news for Thailand Inc. Losses to private industries of 500 billion Baht ($14.7 billion) have been circulating for some time. The corporate and MICE markets have been badly affected by companies unwilling to conduct their business in a country ruled by an unelected military dictatorship.
Following the December 23 election this is now a thing of the past and the industry has reacted cautiously over the result. The local stock market however surged 29 points (3.7%) following the election.
Tourism in 2008 is expected to generate an additional 1 million visitors, up from 2007’s estimate of 14.8 million. With a new government in place it is hoped that commerce and industry will be a top priority for the new government. Investor confidence was blunted under the old regime and many believe there is a brighter future. The new government will be under considerable pressure to perform and with an electorate worried how the new government will deal with Mr. Thaksin’s expected return to Thailand from his self-imposed exile.
Thailand’s Tourism will fare better in 2008, however the swing doors of opportunity that opened to Thailand’s neighbors, following the coup, countries like Vietnam and China, may be difficult to swing closed, in the highly competitive market of attracting tourism dollars.
Longtime Thailand resident, Andrew J Wood is General Manager of the Chaophya Park Hotel Bangkok and Skal International Councillor for Thailand.