Restrictions On Foreigners' Voting Rights Relaxed

[Arkady]

I have looked at all the posts and went through the boi web site and as such found no change in the new amendmant apart from the nominee situation.

if the law untill now has been "not understrood" and various schemes (prefered shares)were set up by lawyers to contirdict the law,... the FBA has now made it very clear what the law is.

it is realy very simple .

1.under thai law the Nominee sate is forbiden and it has allways been that way. they are now making sure that all those who did "not understand" it clearly do so from now on.

you can not nominate nominees to hold your shares!!! you need to have proper investors and proper share holders and not your lawyers wife, staff, cleaner etc...the thai share holder nust be able to prove capital investment in the company.

2.to conduct business in Thailand you must be a Thai or a thai company with Thai majority share holders and Thai majority voting rights. prefered share scheme is not legal.

3. forigners can invest in thailand trough BOI investment incentives and obtain 100% controll but they must be done through the BOI.

Thiland wants forign investment where the Thai people need it. they do not want a small time investors setting up a company with nominees for the sake of opening a resteraunt or bar and competeing with the locals. they dont want companies that are only set up to buy land for a farrang that wants to own a house in thailand.

4. forigeners wishing to conduct business in Thailand can only do what is permited under the lists.

if they wish to get a permit to engage in buisness that is noramlly not permited then they need to have a liscence.

all the other amendmants are designed to save face and allow all businesses that have previously attemepted to overide the law to confirm with it.

the message is clear. if you are a big investor and you go through the BOI they will give you everything however if you are a small time bar owner or a land buyer then get a permit or face the penalties.

This fairly accurately describes their intent. The only problem is that the intent is based on the thinking that was around in developing countries in the 70s and 80s as well as Thailand's own propensity to pander to the rich, as in the Elite Card. The world has now moved on and China, Vietnam, Singapore and Malaysia are now welcoming foreign businesses with very few restrictions. Thailand cannot develop competitively by continuing to focus on import substitution and exports of manufacturing and only welcome large mulinationals. It also needs to compete in services and to understand that effective industry clusters comprise businesses of all shapes and sizes. No one wants to have to be a minority shareholder in their own business and a lot of large corporations get caught up in this too. Often their exemptions through the BoI, specific industry laws or the Treaty don't cover all aspects of their business and they have set up nominee structures in order to have a complete operation here. It may surprise you to learn that Tesco Lotus, which is exempted from the FBA, is one of the companies being investigated along with Kularb Kaew. Why? Because their logistics operations and sales of fresh food are not exempted from the FBA. Is it feasible to operate a hypermarket without them? No? Exempted exporters are similarly not allowed to have their own logistics operations to get their goods to port. Why are exports of services e.g. offshore software development, barred under the FBA? Thai firms don't and can't do this business. So why stop foreigners from setting up and training to Thais to do it? The answer is that the industry started only in the late 90s and has not even come on the radar screens of Thai civil servants who are promoted on a time serving basis.

So you can see the whole thing is ludricous. It is Thailand's right to have whatever laws it wants but is the FBA even before amendment beneficial to the Thai people as a whole? In what sense is the present cabinet of embittered old bureaucrats qualified to represent the wishes of the Thai people?

[Arkady]

The Nation 12.4.07

"Skol pointed out that the ministry was also willing to answer questions from foreign investors but nothing could be changed, saying that it is "beyond the hearing" process."

The Cabinet past the first draft of the amendments without consulting foreign investors or even letting them see the draft. The Commerce Minister appeared at a meeting of the Joint Foreign Chambers of Commerce to present the amendments as a fait accompli after the Cabinet had passed them and made insulting comments about the president of the JFCC to Thai reporters after the meeting. Hearing process?

[ThaiGoon]

The Nation 12.4.07

"Skol pointed out that the ministry was also willing to answer questions from foreign investors but nothing could be changed, saying that it is "beyond the hearing" process."

The Cabinet past the first draft of the amendments without consulting foreign investors or even letting them see the draft. The Commerce Minister appeared at a meeting of the Joint Foreign Chambers of Commerce to present the amendments as a fait accompli after the Cabinet had passed them and made insulting comments about the president of the JFCC to Thai reporters after the meeting. Hearing process?

What insulting comments did he make? All I've read from Thai newspapers was that he pretty much said, this is Thailand so Thais make the law, with which I don't really agree especially when the law affects foreigners who invest in the country. But what else did he say to Thai reporters?

[george]

Thailand's trading partners urge scrapping tough business law

BANGKOK: -- Thailand's top trading nations on Thursdsay urged the country's army-backed government to scrap a new investment law that limits foreign ownership and punishes violators with jail terms.

The ambassadors from the United States and Japan, Thailand's largest export market and the biggest investor, held talks with a senior government official, warning the new law would affect foreign investments in here.

"They have expressed their concern that the new law will not do any good and will affect investment," Prasit Kovilaikool, the minister attached to the Prime Minister's Office said.

Apart from the United States and Japan, officials from the European Union, Canada, South Korea and several key trading nations attended the meeting to urge the government to scrap the new foreign business law.

--AFP 2007-04-12

[ChiangMaiAmerican]

Ever look at the Commerce Minister's CV? Guess who he used to work for? Wonder if wrecking the economy is part of the plan to bring back you know who?

From a 2005 copy of his CV:

From October 2001 to March 2003, he served as Advisor to the Prime Minister.

From 20 March 2005, was appointed (by you know who) Vice Minister for Tourism and Sports

Currently, he serves as Chairman of the Banpu Plc, Chief Negotiation for Thailand-EFTA FTA Negotiations, Member of the Board of Trustees of the University of the Thai Chamber of Commerce and Member of the Monetary policy Board, Bank of Thailand.

http://www.itd.chula.ac.th/cv-Eng.htm

Edited April 12, 2007 by ChiangMaiAmerican

[Arkady]

Ever look at the Commerce Minister's CV? Guess who he used to work for? Wonder if wrecking the economy is part of the plan to bring back you know who?

From a 2005 copy of his CV:

From October 2001 to March 2003, he served as Advisor to the Prime Minister.

From 20 March 2005, was appointed (by you know who) Vice Minister for Tourism and Sports

Currently, he serves as Chairman of the Banpu Plc, Chief Negotiation for Thailand-EFTA FTA Negotiations, Member of the Board of Trustees of the University of the Thai Chamber of Commerce and Member of the Monetary policy Board, Bank of Thailand.

http://www.itd.chula.ac.th/cv-Eng.htm

Before becoming Commerce Minister he was chief negotiator of the FTA with EFTA which now comprises only Iceland, Norway, Switzerland, and Liechtenstein. At the FCCT presentation where he made the famous remarks threatening foreigners who own "all of Phuket and Samui" through dummy companies he made some very caustic comments about Western countries, particularly the US, squeezing small countries in the Uraguay Round and at the WTO without ever giving any concessions themselves. He was Thailand's negotiator at the Uraguay Round and first permanent rep to the WTO. I think this bitter and twisted old man is trying to get his revenge, even though the US is not much affected by the FBA. Also note that he was an advisor to Thaksin from 2001 and 2003 and in the Thaksin Cabinet from 2005. In this context his "campaign" against Kularb Kaew which is effectively damaging the Thai economy but leaving Kularb Kaew unscathed is particularly interesting.

[Arkady]

The Nation 12.4.07

"Skol pointed out that the ministry was also willing to answer questions from foreign investors but nothing could be changed, saying that it is "beyond the hearing" process."

The Cabinet past the first draft of the amendments without consulting foreign investors or even letting them see the draft. The Commerce Minister appeared at a meeting of the Joint Foreign Chambers of Commerce to present the amendments as a fait accompli after the Cabinet had passed them and made insulting comments about the president of the JFCC to Thai reporters after the meeting. Hearing process?

What insulting comments did he make? All I've read from Thai newspapers was that he pretty much said, this is Thailand so Thais make the law, with which I don't really agree especially when the law affects foreigners who invest in the country. But what else did he say to Thai reporters?

After his presentation Thai reporters asked him to comment on Peter van Haren's (president of JFCC) response that the government should put the amendments on hold and commission a six month study to determine the effects of the amendments on the Thai economy before reviewing. The minister replied with words to the effect, "Oh him. He never understands anything." I would like to see his reaction if a farang government minister said the same thing about him when he was doing his job overseas. I think Pridyathorn was actually the one that said, "Thailand is a sovereign country" in this context rather than answer questions about the purpose of the law.

[Dakhar]

I've been thinking about having a custom boat built. A small boat around a 100K USD. Then I started looking for marina slips/docks for such a boat, I wanted a dock with live aboard facilities. I found that there really is not much offered in Thailand, especially in Pattaya.....

Now I am thinking, "Heck a marina would be a great investment....." then I read this thread, and "Poof" reality sunk in....

No, it was not the reality that I can not afford to invest, it was the reality that I can not afford to invest (throw away $) in Thailand. Sad really, from what little research I have done, boaters are not well served in Thailand. Genearally, due to the "sport" of boating, boaters have a lot of disposable income. Marinas can support towns, if large enough. But hey, TIT, and it will stay as such.

[george]

Envoys concerned over foreign business act amendment

BANGKOK: -- Ambassadors from Thailand's key trading partners voiced their concerns over the amended Foreign Business Act, fearing that it will affect foreign investment in the kingdom.

In a one-hour meeting with Prasit Kovilaikool, Thai Minister to the Prime Minister's Office at Government House, foreign envoys including those from the U.S., Japan, the European Union and South Korea, expressed their views on some major issues concerning voting rights and the contents of the revised version of the act.

The Cabinet endorsed the amendment to the Foreign Business Act on Wednesday under the terms of which companies engaged in restricted business sectors will be granted a grace period of three years in compliance with a limit of 49.9 per cent on foreign shareholders' voting rights in Thai companies from two years earlier.

Nominee shareholders are subject to higher penalties to prevent wrongdoing and to boost good governance in business operations.

In response to the kingdom's key trading partners'reaction, Mr. Prasit said the diplomats' viewpoints, particularly involving the fear that foreign investors would find themselves unwelcomed by the bill, will be forwarded to Deputy Prime Minister and Industry Minister Kosit Panpiemras.

However, he said, the interim government has already forwarded the amendment to the National Legislative Assembly which is expected to deliberate it next week.

The Minister to the Prime Minister's Office also said the foreign envoys did not express any objection to the amendment, but simply raised concerns over any possible negative impact on foreign investment in Thailand.

--TNA 2007-04-12

[Arkady]

The Minister to the Prime Minister's Office also said the foreign envoys did not express any objection to the amendment, but simply raised concerns over any possible negative impact on foreign investment in Thailand.

So after ambassadors representing most of Thailand's exports and foreign investment just said the amendments will negatively impact investment from their countries, which is already pretty strong diplomatic language, they have to go back and spell it out to this guy that that actually means they object to the amendments. What a buffoon!

[LaoPo]

The Minister to the Prime Minister's Office also said the foreign envoys did not express any objection to the amendment, but simply raised concerns over any possible negative impact on foreign investment in Thailand.

So after ambassadors representing most of Thailand's exports and foreign investment just said the amendments will negatively impact investment from their countries, which is already pretty strong diplomatic language, they have to go back and spell it out to this guy that that actually means they object to the amendments. What a buffoon!

Any CEO of a large -global- company would listen to his MAJOR clients.......if NOT, he will be sacked.

Not the CEO's of Thailand though...

LaoPo

[highdiver]

I've been thinking about having a custom boat built. A small boat around a 100K USD. Then I started looking for marina slips/docks for such a boat, I wanted a dock with live aboard facilities. I found that there really is not much offered in Thailand, especially in Pattaya.....

Now I am thinking, "Heck a marina would be a great investment....." then I read this thread, and "Poof" reality sunk in....

No, it was not the reality that I can not afford to invest, it was the reality that I can not afford to invest (throw away $) in Thailand. Sad really, from what little research I have done, boaters are not well served in Thailand. Genearally, due to the "sport" of boating, boaters have a lot of disposable income. Marinas can support towns, if large enough. But hey, TIT, and it will stay as such.

Dear Dakar

yopu are in the right place after all.

one of the targeted incentives by the BOI is ocean marinas. if you wish to invest and serious about it you will find that if you have such money as to build a proper marina The govermant of thailand will be happy to offer you land with beach access that you can own 100% tax incentives and much help.

There is alot of people on this forum who know to well what is the "best for Thailand" most of them are forigners who would love to see thailand as a investment heaven for forigenrs. that would be let the forigner do what he wants.

The Thai law has been in palce for many years, and everyone including those on this forum knew that there are many companies that were set up using every method to override the law.

the alien act is not new, however many forigenrs have done everything to overdie the law are now"""surprised"""

the govermant had made it very clear that they dont want small time investors buying the land and buisness under the feet of the local population. they do want serious investors to invest in thailand and if youu are serious there are many types of investments you can do. BOI investors are not affected by the alien buisness act and have special permission.

the same type of replies were in when they enforced the visa on arrival law. stay satid in the kingdom with out a business visa or work permit.

If any thing will promote investors confidence is a govermant that is set out to uphold the law and not allow anyone to come in and do what they feel like.

if you wish to invest in thailand then do so under the law.

i live in Samui and have witnessed the Alien invasion of the island. land prices are up 400% from 10 years ago. prices of construction are doubled. invasion of forest land and herds of forigners building projects for... forigners.

it is true that some of the Thai locals have made a lot of money. but a mojority of the islanders seem to be pushed out of the island and most of them could never afford to buy a house as the prices are to high.

[highdiver]

The Minister to the Prime Minister's Office also said the foreign envoys did not express any objection to the amendment, but simply raised concerns over any possible negative impact on foreign investment in Thailand.

So after ambassadors representing most of Thailand's exports and foreign investment just said the amendments will negatively impact investment from their countries, which is already pretty strong diplomatic language, they have to go back and spell it out to this guy that that actually means they object to the amendments. What a buffoon!

Any CEO of a large -global- company would listen to his MAJOR clients.......if NOT, he will be sacked.

Not the CEO's of Thailand though...

LaoPo

So would he say????.

Oh thank you dear Ambassadors who are represnting other govermants. we are sorry we need to take measures to uphold the law. We realy are sorry that we are trying to have law and order and that the ileagal forigners in thailand need to suffer the upholding of the law.

We are sorry that many of your dear subjects have decided to play it "dumb" and make direct investmants in Thailand that were made in conrtrare to the law.

We are sorry that you as ambassadors were aware of this and did nothing!!! to warn your citizens that they are breaching the Thai law.

At his point of time we would like also to thank your large hedge funds that decided to invest in our Thai baht abd have created and inflow of huge capital the is now destroying our export. We are sure that are very angry with us especialy now that your thailand imported sea food and rice is costing you more

We would like to sk those lovely countries that you represant to answer us how you treat Thai citizens that take ileagal residence and ileagal employment in your own countries. as it has come to our attention that Thai citizens are being jailed and deported and black listed. and that your esteemed countries are vary cautious about illeagalities concernig investment residnce and employment..

please oh mighty countries forgive us for having to put our own intrest beforew yours and having to make an attempt to controll our economy and not letting others do it for us.

We are sure that are very angry with us especialyy nopw that your thailand imported sea food and rice is costing you more

[ChiangMaiAmerican]

The Minister to the Prime Minister's Office also said the foreign envoys did not express any objection to the amendment, but simply raised concerns over any possible negative impact on foreign investment in Thailand.

So after ambassadors representing most of Thailand's exports and foreign investment just said the amendments will negatively impact investment from their countries, which is already pretty strong diplomatic language, they have to go back and spell it out to this guy that that actually means they object to the amendments. What a buffoon!

Any CEO of a large -global- company would listen to his MAJOR clients.......if NOT, he will be sacked.

Not the CEO's of Thailand though...

LaoPo

So would he say????.

Oh thank you dear Ambassadors who are represnting other govermants. we are sorry we need to take measures to uphold the law. We realy are sorry that we are trying to have law and order and that the ileagal forigners in thailand need to suffer the upholding of the law.

We are sorry that many of your dear subjects have decided to play it "dumb" and make direct investmants in Thailand that were made in conrtrare to the law.

We are sorry that you as ambassadors were aware of this and did nothing!!! to warn your citizens that they are breaching the Thai law.

At his point of time we would like also to thank your large hedge funds that decided to invest in our Thai baht abd have created and inflow of huge capital the is now destroying our export. We are sure that are very angry with us especialy now that your thailand imported sea food and rice is costing you more

We would like to sk those lovely countries that you represant to answer us how you treat Thai citizens that take ileagal residence and ileagal employment in your own countries. as it has come to our attention that Thai citizens are being jailed and deported and black listed. and that your esteemed countries are vary cautious about illeagalities concernig investment residnce and employment..

please oh mighty countries forgive us for having to put our own intrest beforew yours and having to make an attempt to controll our economy and not letting others do it for us.

We are sure that are very angry with us especialyy nopw that your thailand imported sea food and rice is costing you more

You forgot to add:

We would also like to tell you that any agreement we sign such as the Treaty of Amity with the US will only be enforced for Thais opening businesses in the US. Thai must aways be able to open business based on a reasonable investment amount that is based on the type of business wants to open in the US. A Thai must not be restricted in what work they can do for their business in your country. A Thai must be free to do business anywhere not just at a certain location n your country. A Thai must not be required to pay himself a high wage in your country. A Thai must not be required to hire Americans when they open businesses in the US. Thai rights are always superior. We will always find ways to violate the treaty when Americans open businesses in Thailand so they will have a difficult time obtaining the permits and operating in general. We don't want Americans to open busnesses in Thailand. We only want Thais to open business in your country. You must understand "This is Thailand" and we do not make deals we intend to keep. We only make deals so our people can have access to your market. Your people are all rich and we must be able to take their money. Your citizens cannot be allowed to earn money in Thailand. This would be wrong and against our national pride. We control the world and world trade and the sooner you stupid ambassadors understand then your stupid citizens who believe we are honest and honorable will stop trying to open businesses here. This is Thailand.

Edited April 12, 2007 by ChiangMaiAmerican

[Arkady]

The Minister to the Prime Minister's Office also said the foreign envoys did not express any objection to the amendment, but simply raised concerns over any possible negative impact on foreign investment in Thailand.

So after ambassadors representing most of Thailand's exports and foreign investment just said the amendments will negatively impact investment from their countries, which is already pretty strong diplomatic language, they have to go back and spell it out to this guy that that actually means they object to the amendments. What a buffoon!

Any CEO of a large -global- company would listen to his MAJOR clients.......if NOT, he will be sacked.

Not the CEO's of Thailand though...

LaoPo

So would he say????.

Oh thank you dear Ambassadors who are represnting other govermants. we are sorry we need to take measures to uphold the law. We realy are sorry that we are trying to have law and order and that the ileagal forigners in thailand need to suffer the upholding of the law.

We are sorry that many of your dear subjects have decided to play it "dumb" and make direct investmants in Thailand that were made in conrtrare to the law.

We are sorry that you as ambassadors were aware of this and did nothing!!! to warn your citizens that they are breaching the Thai law.

At his point of time we would like also to thank your large hedge funds that decided to invest in our Thai baht abd have created and inflow of huge capital the is now destroying our export. We are sure that are very angry with us especialy now that your thailand imported sea food and rice is costing you more

We would like to sk those lovely countries that you represant to answer us how you treat Thai citizens that take ileagal residence and ileagal employment in your own countries. as it has come to our attention that Thai citizens are being jailed and deported and black listed. and that your esteemed countries are vary cautious about illeagalities concernig investment residnce and employment..

please oh mighty countries forgive us for having to put our own intrest beforew yours and having to make an attempt to controll our economy and not letting others do it for us.

We are sure that are very angry with us especialyy nopw that your thailand imported sea food and rice is costing you more

This is arrant nonsense. The amendments represent a significant change in the law by classifying a company as foreign based on voting rights. It is not the case that the ambassadors were arguing to allow their citizens to continue breaking the law. The Alien Business Law was in fact amended by one of Thailand's more competent prime ministers, Anand Panyarachun, in 1991 in response to a Council of State ruling, since he wanted to make it absolutely clear that foreigners could have majority voting rights in companies classified as Thai under the act. As a result many foreign investors used preference shares to achieve majority voting rights since then. The ambassadors were pointing out that radically changing the law in this way would make their nationals less willing to invest in Thailand.

The Bank of Thailand is much more of a speculator on the Thai baht than hedge funds who cannot get hold of enough supply offshore, while the BoT can print as much as it wants. The main reason that the Thai baht is appreciating now is that investment has slowed down so much as a result of the coup, capital controls and the FBA amendments that imports of capital goods has slowed sharply creating less demand for dollars. Ultimately this will translate in less demand for Thai exports and less demand for baht. Then you will have your wish for a weaker baht but Thai exports will still go into a decline due to lack of competitiveness caused by lack of investment. The capital controls over time will result in exactly the opposite of what was intended due to an inability of policy formulators to think things through in a rigorous manner.

Thais investors are treated almost exactly the same as locals in nearly all Western countries and can buy land freely too. Many countries protect strategic industries like broadcasting and I believe that most posters agree that Thailand should continue to protect certain key industries but not the entire service sector. Why do you insist that Thais should continue to treat foreign investors much worse than Thai investors are treated abroad?

If you think that illegal Thai workers get a bad deal from Western immigration authorities, take a close look at the way the Thai authorities treat illegal workers and refugees from Burma, Cambodia and Laos.

[ThaiGoon]

while the BoT can print as much as it wants.

Errr, this part doesn't make much sense to me. From little that I know, the more money BOT prints, the more likely it will cause huge inflation, and that's not what any sensible people want. It might not be stated as a law, but the consequences of flooding an economy with printed money are pretty obvious to see. And they could be very devatstating and counterproductive.

Then you will have your wish for a weaker baht but Thai exports will still go into a decline due to lack of competitiveness caused by lack of investment.

This part doesn't make much sense to me either. If Baht weakens, Thai exports will be more competitve and more likely to grow more. They will most likely be able to sell more stuff, and as a result, this will fuel their investment. The last time Baht crashed in 97, it was the export sector that started to recover first, and they were essentially the drive that put Thailand out of the crisis.

[LaoPo]

The Minister to the Prime Minister's Office also said the foreign envoys did not express any objection to the amendment, but simply raised concerns over any possible negative impact on foreign investment in Thailand.

So after ambassadors representing most of Thailand's exports and foreign investment just said the amendments will negatively impact investment from their countries, which is already pretty strong diplomatic language, they have to go back and spell it out to this guy that that actually means they object to the amendments. What a buffoon!

Any CEO of a large -global- company would listen to his MAJOR clients.......if NOT, he will be sacked.

Not the CEO's of Thailand though...

LaoPo

So would he say????.

Oh thank you dear Ambassadors who are represnting other govermants. we are sorry we need to take measures to uphold the law. We realy are sorry that we are trying to have law and order and that the ileagal forigners in thailand need to suffer the upholding of the law.

We are sorry that many of your dear subjects have decided to play it "dumb" and make direct investmants in Thailand that were made in conrtrare to the law.

We are sorry that you as ambassadors were aware of this and did nothing!!! to warn your citizens that they are breaching the Thai law.

At his point of time we would like also to thank your large hedge funds that decided to invest in our Thai baht abd have created and inflow of huge capital the is now destroying our export. We are sure that are very angry with us especialy now that your thailand imported sea food and rice is costing you more

We would like to sk those lovely countries that you represant to answer us how you treat Thai citizens that take ileagal residence and ileagal employment in your own countries. as it has come to our attention that Thai citizens are being jailed and deported and black listed. and that your esteemed countries are vary cautious about illeagalities concernig investment residnce and employment..

please oh mighty countries forgive us for having to put our own intrest beforew yours and having to make an attempt to controll our economy and not letting others do it for us.

We are sure that are very angry with us especialyy nopw that your thailand imported sea food and rice is costing you more

I think you missed my point a little Mr. Highdiver; it's about foreign investment in Thailand. If the investors stay away because of a serious lack of confidence in the Thai approach towards their MAJOR business-partners, it's bad for Thailand.

The investors know their way in the region, don't worry. They have plenty of opportunities.

It's the Thai people who will suffer in the end, not the investors, and ALL the signs are there already.

LaoPo

[Dakhar]

So would he say????.

Oh thank you dear Ambassadors who are represnting other govermants. we are sorry we need to take measures to uphold the law. We realy are sorry that we are trying to have law and order and that the ileagal forigners in thailand need to suffer the upholding of the law.

We are sorry that many of your dear subjects have decided to play it "dumb" and make direct investmants in Thailand that were made in conrtrare to the law.

We are sorry that you as ambassadors were aware of this and did nothing!!! to warn your citizens that they are breaching the Thai law.

At his point of time we would like also to thank your large hedge funds that decided to invest in our Thai baht abd have created and inflow of huge capital the is now destroying our export. We are sure that are very angry with us especialy now that your thailand imported sea food and rice is costing you more

We would like to sk those lovely countries that you represant to answer us how you treat Thai citizens that take ileagal residence and ileagal employment in your own countries. as it has come to our attention that Thai citizens are being jailed and deported and black listed. and that your esteemed countries are vary cautious about illeagalities concernig investment residnce and employment..

please oh mighty countries forgive us for having to put our own intrest beforew yours and having to make an attempt to controll our economy and not letting others do it for us.

We are sure that are very angry with us especialyy nopw that your thailand imported sea food and rice is costing you more

No maybe he should say, "You know we as a nation are tired of being in the back of the bus, could you please tell us what we can do to encourage forieng ivestment, while still maintaining Thail principles/culture etc." "We would like to give our people more job oppertunities, expand the economy and in genearal improve our nation." "Could you please make some suggestions? "We are saddened to see our daughters grow up thinking.... Oh I hope one day I can escape from this place." "We would rather our daughters grow up wondering where they will go to college, rather than wondering how OLD the falang will be that she finally marries."

"We as a nation are getting tired of the same old bragging rights.... THE MOST RICE." "Frankly, we are tired of hearing that Cambodia is passing us by & we are shocked too by this." "Please help....."

That may of warmed some hearts and restored some faith.... rather than thumping chests and saying "Hit the road...."

Ultimatley forieng investment would lead to more jobs, increased economy, increased standard of living etc. But hey, like I have said TIT and it will remain as such.

[highdiver]

The Minister to the Prime Minister's Office also said the foreign envoys did not express any objection to the amendment, but simply raised concerns over any possible negative impact on foreign investment in Thailand.

So after ambassadors representing most of Thailand's exports and foreign investment just said the amendments will negatively impact investment from their countries, which is already pretty strong diplomatic language, they have to go back and spell it out to this guy that that actually means they object to the amendments. What a buffoon!

Any CEO of a large -global- company would listen to his MAJOR clients.......if NOT, he will be sacked.

Not the CEO's of Thailand though...

LaoPo

So would he say????.

Oh thank you dear Ambassadors who are represnting other govermants. we are sorry we need to take measures to uphold the law. We realy are sorry that we are trying to have law and order and that the ileagal forigners in thailand need to suffer the upholding of the law.

We are sorry that many of your dear subjects have decided to play it "dumb" and make direct investmants in Thailand that were made in conrtrare to the law.

We are sorry that you as ambassadors were aware of this and did nothing!!! to warn your citizens that they are breaching the Thai law.

At his point of time we would like also to thank your large hedge funds that decided to invest in our Thai baht abd have created and inflow of huge capital the is now destroying our export. We are sure that are very angry with us especialy now that your thailand imported sea food and rice is costing you more

We would like to sk those lovely countries that you represant to answer us how you treat Thai citizens that take ileagal residence and ileagal employment in your own countries. as it has come to our attention that Thai citizens are being jailed and deported and black listed. and that your esteemed countries are vary cautious about illeagalities concernig investment residnce and employment..

please oh mighty countries forgive us for having to put our own intrest beforew yours and having to make an attempt to controll our economy and not letting others do it for us.

We are sure that are very angry with us especialyy nopw that your thailand imported sea food and rice is costing you more

You forgot to add:

We would also like to tell you that any agreement we sign such as the Treaty of Amity with the US will only be enforced for Thais opening businesses in the US. Thai must aways be able to open business based on a reasonable investment amount that is based on the type of business wants to open in the US. A Thai must not be restricted in what work they can do for their business in your country. A Thai must be free to do business anywhere not just at a certain location n your country. A Thai must not be required to pay himself a high wage in your country. A Thai must not be required to hire Americans when they open businesses in the US. Thai rights are always superior. We will always find ways to violate the treaty when Americans open businesses in Thailand so they will have a difficult time obtaining the permits and operating in general. We don't want Americans to open busnesses in Thailand. We only want Thais to open business in your country. You must understand "This is Thailand" and we do not make deals we intend to keep. We only make deals so our people can have access to your market. Your people are all rich and we must be able to take their money. Your citizens cannot be allowed to earn money in Thailand. This would be wrong and against our national pride. We control the world and world trade and the sooner you stupid ambassadors understand then your stupid citizens who believe we are honest and honorable will stop trying to open businesses here. This is Thailand.

I dont know where you are from but have you ever tried to open a business in the good USA.

do you know how lomg it will take for an educted wealthy thai to get a Visa to the usa?

have you ever seen a thai behavior in a manor that American do inthailand.

The good old usa signed the treaty with thailand bu they are still viewing thais in Patronising eyes.

the deal is mostly serving American companies like nike who are making sneakers and apparel in thailand as it cost them less then to hire american citizen.

Do you know what happens to a business the is owned by a Thai that is cought employing staff with out a green card??

get real and learn the facts.,

[highdiver]

while the BoT can print as much as it wants.

Errr, this part doesn't make much sense to me. From little that I know, the more money BOT prints, the more likely it will cause huge inflation, and that's not what any sensible people want. It might not be stated as a law, but the consequences of flooding an economy with printed money are pretty obvious to see. And they could be very devatstating and counterproductive.

Then you will have your wish for a weaker baht but Thai exports will still go into a decline due to lack of competitiveness caused by lack of investment.

This part doesn't make much sense to me either. If Baht weakens, Thai exports will be more competitve and more likely to grow more. They will most likely be able to sell more stuff, and as a result, this will fuel their investment. The last time Baht crashed in 97, it was the export sector that started to recover first, and they were essentially the drive that put Thailand out of the crisis.

you are 100% corect.

i said it once and i will say it again. There is alot of people on this forum who know to well what is the "best for Thailand" most of them are forigners who would love to see thailand as a investment heaven for forigenrs.

if it serves the intrest of the forigners then the thais are ok but if it makes forigners loose money then the thais are very wrong and have no idea of worl economy.

[wolfmanjack]

The Minister to the Prime Minister's Office also said the foreign envoys did not express any objection to the amendment, but simply raised concerns over any possible negative impact on foreign investment in Thailand.

So after ambassadors representing most of Thailand's exports and foreign investment just said the amendments will negatively impact investment from their countries, which is already pretty strong diplomatic language, they have to go back and spell it out to this guy that that actually means they object to the amendments. What a buffoon!

Any CEO of a large -global- company would listen to his MAJOR clients.......if NOT, he will be sacked.

Not the CEO's of Thailand though...

LaoPo

So would he say????.

Oh thank you dear Ambassadors who are represnting other govermants. we are sorry we need to take measures to uphold the law. We realy are sorry that we are trying to have law and order and that the ileagal forigners in thailand need to suffer the upholding of the law.

We are sorry that many of your dear subjects have decided to play it "dumb" and make direct investmants in Thailand that were made in conrtrare to the law.

We are sorry that you as ambassadors were aware of this and did nothing!!! to warn your citizens that they are breaching the Thai law.

At his point of time we would like also to thank your large hedge funds that decided to invest in our Thai baht abd have created and inflow of huge capital the is now destroying our export. We are sure that are very angry with us especialy now that your thailand imported sea food and rice is costing you more

We would like to sk those lovely countries that you represant to answer us how you treat Thai citizens that take ileagal residence and ileagal employment in your own countries. as it has come to our attention that Thai citizens are being jailed and deported and black listed. and that your esteemed countries are vary cautious about illeagalities concernig investment residnce and employment..

please oh mighty countries forgive us for having to put our own intrest beforew yours and having to make an attempt to controll our economy and not letting others do it for us.

We are sure that are very angry with us especialyy nopw that your thailand imported sea food and rice is costing you more

You forgot to add:

We would also like to tell you that any agreement we sign such as the Treaty of Amity with the US will only be enforced for Thais opening businesses in the US. Thai must aways be able to open business based on a reasonable investment amount that is based on the type of business wants to open in the US. A Thai must not be restricted in what work they can do for their business in your country. A Thai must be free to do business anywhere not just at a certain location n your country. A Thai must not be required to pay himself a high wage in your country. A Thai must not be required to hire Americans when they open businesses in the US. Thai rights are always superior. We will always find ways to violate the treaty when Americans open businesses in Thailand so they will have a difficult time obtaining the permits and operating in general. We don't want Americans to open busnesses in Thailand. We only want Thais to open business in your country. You must understand "This is Thailand" and we do not make deals we intend to keep. We only make deals so our people can have access to your market. Your people are all rich and we must be able to take their money. Your citizens cannot be allowed to earn money in Thailand. This would be wrong and against our national pride. We control the world and world trade and the sooner you stupid ambassadors understand then your stupid citizens who believe we are honest and honorable will stop trying to open businesses here. This is Thailand.

Before i opened my business here in Thailand I asked the Thai Embassy in Washington DC what the Treaty meant to me. They sent me a letter stating that an American Citizen has the same rights in Thailand as a Thai Citizen. Excluding the right to vote of course. When I brought this letter to the Lawyers I was using to set up my company they laughed. It did not take me long to realize this was not the case.

[Arkady]

The Minister to the Prime Minister's Office also said the foreign envoys did not express any objection to the amendment, but simply raised concerns over any possible negative impact on foreign investment in Thailand.

So after ambassadors representing most of Thailand's exports and foreign investment just said the amendments will negatively impact investment from their countries, which is already pretty strong diplomatic language, they have to go back and spell it out to this guy that that actually means they object to the amendments. What a buffoon!

Any CEO of a large -global- company would listen to his MAJOR clients.......if NOT, he will be sacked.

Not the CEO's of Thailand though...

LaoPo

So would he say????.

Oh thank you dear Ambassadors who are represnting other govermants. we are sorry we need to take measures to uphold the law. We realy are sorry that we are trying to have law and order and that the ileagal forigners in thailand need to suffer the upholding of the law.

We are sorry that many of your dear subjects have decided to play it "dumb" and make direct investmants in Thailand that were made in conrtrare to the law.

We are sorry that you as ambassadors were aware of this and did nothing!!! to warn your citizens that they are breaching the Thai law.

At his point of time we would like also to thank your large hedge funds that decided to invest in our Thai baht abd have created and inflow of huge capital the is now destroying our export. We are sure that are very angry with us especialy now that your thailand imported sea food and rice is costing you more

We would like to sk those lovely countries that you represant to answer us how you treat Thai citizens that take ileagal residence and ileagal employment in your own countries. as it has come to our attention that Thai citizens are being jailed and deported and black listed. and that your esteemed countries are vary cautious about illeagalities concernig investment residnce and employment..

please oh mighty countries forgive us for having to put our own intrest beforew yours and having to make an attempt to controll our economy and not letting others do it for us.

We are sure that are very angry with us especialyy nopw that your thailand imported sea food and rice is costing you more

You forgot to add:

We would also like to tell you that any agreement we sign such as the Treaty of Amity with the US will only be enforced for Thais opening businesses in the US. Thai must aways be able to open business based on a reasonable investment amount that is based on the type of business wants to open in the US. A Thai must not be restricted in what work they can do for their business in your country. A Thai must be free to do business anywhere not just at a certain location n your country. A Thai must not be required to pay himself a high wage in your country. A Thai must not be required to hire Americans when they open businesses in the US. Thai rights are always superior. We will always find ways to violate the treaty when Americans open businesses in Thailand so they will have a difficult time obtaining the permits and operating in general. We don't want Americans to open busnesses in Thailand. We only want Thais to open business in your country. You must understand "This is Thailand" and we do not make deals we intend to keep. We only make deals so our people can have access to your market. Your people are all rich and we must be able to take their money. Your citizens cannot be allowed to earn money in Thailand. This would be wrong and against our national pride. We control the world and world trade and the sooner you stupid ambassadors understand then your stupid citizens who believe we are honest and honorable will stop trying to open businesses here. This is Thailand.

I dont know where you are from but have you ever tried to open a business in the good USA.

do you know how lomg it will take for an educted wealthy thai to get a Visa to the usa?

have you ever seen a thai behavior in a manor that American do inthailand.

The good old usa signed the treaty with thailand bu they are still viewing thais in Patronising eyes.

the deal is mostly serving American companies like nike who are making sneakers and apparel in thailand as it cost them less then to hire american citizen.

Do you know what happens to a business the is owned by a Thai that is cought employing staff with out a green card??

get real and learn the facts.,

What happens to a business owned by a Thai in the US caught employing illegal aliens is the same as happens to businesses doing the same thing owned by Americans or other nationals.

US visa regulations have unfortunately become stricter since 9-11 but the same applies to all non visa waiver countries, not just Thailand. My Thai friend who is not at all wealthy and doesn't have a bachelors degree got a 10 year US visa last year within three weeks with one short interview. Wealthy and educated Thais should have no problems at all getting a 10 year visa, if they fill out the forms correctly and provide the required documentation first time.

I don't know what behaviour you are referring to but a Thai senator was jailed in the US for smuggling narcotics and several other senior Thai politicians, including one nominated to be prime minister in 1992, have been denied visas to the US for the same reason. A Thai citizen well connected at home was convicted of paying illegal political contributions in Washington. Thais have been jailed in California for running sweatshops where they illegally imprisoned their fellow Thai citizens. Is the type of unfair treatment of Thais you mean in the US?

You are obviously extremely ignorant about the athletic footwear business in Thailand. Nike and Reebok only had large production in Thailand in the late 80s and early 90s when labour in Korean and Taiwan got too expensive. Unlike Korea and Taiwan there was almost no investment in R & D by Thai footwear producers which meant that Thailand quickly lost out to cheaper labour in Indonesia, then China and Vietnam. Today Nike and Reebok's manufacturing in Thailand has been very much scaled down and could be discontinued completely without any impact to them. Go ahead and see who loses! You also don't understand that they do not own their own production facilities, since it is far more efficient to contract locally owned footwear manufacturers. Even if they wanted to build their own factories in Thailand, they could do this with BOI promotion and wouldn't need the treaty. In fact Nike and Reebok have never had anything more than small rep offices in Thailand which were allowed to be foreign owned under prime ministerial regulations promulgated by PM Prem Tinsulanonda in the mid 80s to boost exports, not the treaty.

You are the one who should get real and learn the facts. BTW I am not an American.

[ThaiGoon]

In fact Nike and Reebok have never had anything more than small rep offices in Thailand which were allowed to be foreign owned under prime ministerial regulations promulgated by PM Prem Tinsulanonda in the mid 80s to boost exports, not the treaty.

Really? A brother of my friend's used to work as a supervisor at one of the Reebok factories in Thailand. They never had anything more than small rep offices in Thailand? Really?

[ThaiGoon]

In fact Nike and Reebok have never had anything more than small rep offices in Thailand which were allowed to be foreign owned under prime ministerial regulations promulgated by PM Prem Tinsulanonda in the mid 80s to boost exports, not the treaty.

You are the one who should get real and learn the facts. BTW I am not an American.

Athletic Footwear Factory List

(By Major Producing Country)

http://business.nmsu.edu/~dboje/AA/reebok/...FactoryList.htm

[ChiangMaiAmerican]

The Minister to the Prime Minister's Office also said the foreign envoys did not express any objection to the amendment, but simply raised concerns over any possible negative impact on foreign investment in Thailand.

So after ambassadors representing most of Thailand's exports and foreign investment just said the amendments will negatively impact investment from their countries, which is already pretty strong diplomatic language, they have to go back and spell it out to this guy that that actually means they object to the amendments. What a buffoon!

Any CEO of a large -global- company would listen to his MAJOR clients.......if NOT, he will be sacked.

Not the CEO's of Thailand though...

LaoPo

So would he say????.

Oh thank you dear Ambassadors who are represnting other govermants. we are sorry we need to take measures to uphold the law. We realy are sorry that we are trying to have law and order and that the ileagal forigners in thailand need to suffer the upholding of the law.

We are sorry that many of your dear subjects have decided to play it "dumb" and make direct investmants in Thailand that were made in conrtrare to the law.

We are sorry that you as ambassadors were aware of this and did nothing!!! to warn your citizens that they are breaching the Thai law.

At his point of time we would like also to thank your large hedge funds that decided to invest in our Thai baht abd have created and inflow of huge capital the is now destroying our export. We are sure that are very angry with us especialy now that your thailand imported sea food and rice is costing you more

We would like to sk those lovely countries that you represant to answer us how you treat Thai citizens that take ileagal residence and ileagal employment in your own countries. as it has come to our attention that Thai citizens are being jailed and deported and black listed. and that your esteemed countries are vary cautious about illeagalities concernig investment residnce and employment..

please oh mighty countries forgive us for having to put our own intrest beforew yours and having to make an attempt to controll our economy and not letting others do it for us.

We are sure that are very angry with us especialyy nopw that your thailand imported sea food and rice is costing you more

You forgot to add:

We would also like to tell you that any agreement we sign such as the Treaty of Amity with the US will only be enforced for Thais opening businesses in the US. Thai must aways be able to open business based on a reasonable investment amount that is based on the type of business wants to open in the US. A Thai must not be restricted in what work they can do for their business in your country. A Thai must be free to do business anywhere not just at a certain location n your country. A Thai must not be required to pay himself a high wage in your country. A Thai must not be required to hire Americans when they open businesses in the US. Thai rights are always superior. We will always find ways to violate the treaty when Americans open businesses in Thailand so they will have a difficult time obtaining the permits and operating in general. We don't want Americans to open busnesses in Thailand. We only want Thais to open business in your country. You must understand "This is Thailand" and we do not make deals we intend to keep. We only make deals so our people can have access to your market. Your people are all rich and we must be able to take their money. Your citizens cannot be allowed to earn money in Thailand. This would be wrong and against our national pride. We control the world and world trade and the sooner you stupid ambassadors understand then your stupid citizens who believe we are honest and honorable will stop trying to open businesses here. This is Thailand.

I dont know where you are from but have you ever tried to open a business in the good USA.

do you know how lomg it will take for an educted wealthy thai to get a Visa to the usa?

have you ever seen a thai behavior in a manor that American do inthailand.

The good old usa signed the treaty with thailand bu they are still viewing thais in Patronising eyes.

the deal is mostly serving American companies like nike who are making sneakers and apparel in thailand as it cost them less then to hire american citizen.

Do you know what happens to a business the is owned by a Thai that is cought employing staff with out a green card??

get real and learn the facts.,

Here are the rules. You obviously don't know what you are talking about. Hiring an illegal alien in Thaland will get you imprisoned and deported too but that isn't what I was talking about. Thailand refuses to acknowledge that a Treaty of Amity business owner, "shall enjoy the right to control and manage the enterprises which they have established or acquired within the territories of the other Party, and shall be permitted without discrimination to do all things normally found necessary and proper to the effective conduct of enterprises engaged in like activities." Thailand insists that treaty investors have no rights of management. An investor is treated as aqn illegal alien if he attempts to ecerct management contorl over hios investment in Thailand even though the treaty gives him the right to do so. In fact he can even be arrested for thinking about exerting control since the Thai definition of work specifically includes thinking and specifically excludes conpensation as part of the definition. Further, an investor who turns over control of his company to a Thai is asking to have his investment stolen since Thailand lacks laws to protect minority investors. Thais do make treaty investments in the US and they are treated well unlike the way Thailand treats US investors. In the US Thais don't report to the Ministry of this and that to be told rthe treaty has no force of law. I have a close friend who is an immigration attorney and has clients from Thailand with US businesses. You defense of Thailand's behavior is hollow.

Info on the Treaty Investor visa (Treaty of Amity in the USA)

E-2 Treaty Investor

1. 
   
   1. 
      
   2. Available only to individuals who are nationals of countries with E-2 investor treaties with the U.S.
      
   3. Corporations (except for publicly traded companies) must have majority of shares owned by individuals who are treaty nationals.
      
   4. E-2 visa available to investor owner to direct the enterprise, essential managers and certain key employees.
      
   5. Processing for E visas is at Embassy or Consulate and does not require prior petition approval by BCIS; it is also possible to change from another non-immigrant category by applying to BCIS in the U.S.
      
   6. Visa issued for up to five years—admission is normally for one or two years.
      
   7. Investment must be substantial. Substantial not defined and there is no specified minimum amount. The amount should be proportionate to the type of business and can be determined by the amount of capital reasonably required to establish similar business.
      
   8. Some recourse financing may count toward amount of investment. However at least 50% of the investment must be in cash or though loans which are not secured by the investment.
      
   9. There are no specific restrictions on the type of investment; for example: restaurants; apartment buildings; real estate management and development; software development; import /export; retail stores; franchises; entertainment production and development; health care; equipment lease; auto sales and any other legal business or service can qualify.
      

http://www.americanimmigrationlaw.com/index.php?/aim/aop/investor/

Edited April 13, 2007 by ChiangMaiAmerican

[Arkady]

while the BoT can print as much as it wants.

Errr, this part doesn't make much sense to me. From little that I know, the more money BOT prints, the more likely it will cause huge inflation, and that's not what any sensible people want. It might not be stated as a law, but the consequences of flooding an economy with printed money are pretty obvious to see. And they could be very devatstating and counterproductive.

Then you will have your wish for a weaker baht but Thai exports will still go into a decline due to lack of competitiveness caused by lack of investment.

This part doesn't make much sense to me either. If Baht weakens, Thai exports will be more competitve and more likely to grow more. They will most likely be able to sell more stuff, and as a result, this will fuel their investment. The last time Baht crashed in 97, it was the export sector that started to recover first, and they were essentially the drive that put Thailand out of the crisis.

Point 1 is that in intervening against an appreciating baht the BoT has a huge advantage because it can print baht to sell in exchange for dollars and therefore cause massive losses to foreign speculators who have to scrabble around for limited amounts of baht available in the offshore market. This is another reason why the capital controls were mind boggling. Dealing with a declining baht in the market is much harder because they can only international reserves to sell in exchange for buy baht back. That's why the BoT lost nearly its foreign reserves in 1997. Printing money for intervention in the fx markets does not necessarily cause inflation because it is a short sharp shock tactic. It is not the same as deliberately printing money to fund fiscal incontinence or monetize government debt as happened in Western countries in the 80s. This goes on over a long period of time and the numbers are much greater.

Point 2 is that Thailand's manufactured exports have been dependent on investment to move to higher value added, since they can no longer compete on labour intensive products. Depreciating the currency would help but things have changed since 1997. The Chinese government has invested billions to build modern infrastructure and promote industry throughout the country. Their currency has not appreciated much vs the dollar yet, so they are unassailable on labour intensive manufactures. Now they are attracting such huge amounts of foreign investment that it becomes harder and harder to compete with them on higher value added manufactures. Vietnam is now following suit. Remember that the 1997 devaluation of the baht was around 40%. A devaluation of that size causes massive dislocation in other sectors and is not something that Thailand should crave at all. A smaller devaluation of say 10% would give a temporary boost to exports but might anyway be followed by countries like Indonesia. At the end of day moving up the value added ladder in exports is crucial to maintaining market share and this is an investment intensive business. Right now investment is not happening and that is contributing to the strength of the baht. The other huge problem facing Thai exports is lack of government investment in education. With such a poor educational system, compared to Korea and Taiwan, how will Thais be able to work in higher value added industries, even if they get the investment? Thai export performance recently has been distorted by the strong revival of agricultural exports due to strong commodity prices. In the BoT numbers there is a discernable shift of workers back to agriculture and away from other industries. If you strip out the effect of agricultural exports which can quickly go into decline, as they did in the 80s, sustainable growth of Thai exports doesn't look nearly as promising. Anyway just depreciating the currency without addressing crucial structural problems in the export sector is not the quick fix that Thai policy formulators would like people to believe.

[Arkady]

In fact Nike and Reebok have never had anything more than small rep offices in Thailand which were allowed to be foreign owned under prime ministerial regulations promulgated by PM Prem Tinsulanonda in the mid 80s to boost exports, not the treaty.

You are the one who should get real and learn the facts. BTW I am not an American.

Athletic Footwear Factory List

(By Major Producing Country)

http://business.nmsu.edu/~dboje/AA/reebok/...FactoryList.htm

Exactly. Check out the shareholder lists of those companies. I had dealings with several of them in the 90s and most are owned by the Thai-Chinese Chokwattana family of the Sahapattana Group. Some like Bangkok Rubber, Pan Asia Footwear and Wongpaitoon are or were listed on the SET. As far as I know Nike and Reebok have always had a policy not to invest in overseas manufacturers but you can check this with the copious public information available on them on the Internet. They are designers and marketers, not manufacturers. Yes, they have to have their own production people to ensure quality. They second people like your brother's friend to work in their contractors' factories but there are only interested in production and delivery - certainly not management control. Ask him.

[ThaiGoon]

Point 1 is that in intervening against an appreciating baht the BoT has a huge advantage because it can print baht to sell in exchange for dollars and therefore cause massive losses to foreign speculators who have to scrabble around for limited amounts of baht available in the offshore market. This is another reason why the capital controls were mind boggling. Dealing with a declining baht in the market is much harder because they can only international reserves to sell in exchange for buy baht back. That's why the BoT lost nearly its foreign reserves in 1997. Printing money for intervention in the fx markets does not necessarily cause inflation because it is a short sharp shock tactic. It is not the same as deliberately printing money to fund fiscal incontinence or monetize government debt as happened in Western countries in the 80s. This goes on over a long period of time and the numbers are much greater.

How's that a short sharp tactic, when you don't really know much Baht you need to inject into the market to weaken the currency and you don't know how long the whole process will take either? You know that?

Point 2 is that Thailand's manufactured exports have been dependent on investment to move to higher value added, since they can no longer compete on labour intensive products. Depreciating the currency would help but things have changed since 1997. The Chinese government has invested billions to build modern infrastructure and promote industry throughout the country. Their currency has not appreciated much vs the dollar yet, so they are unassailable on labour intensive manufactures. Now they are attracting such huge amounts of foreign investment that it becomes harder and harder to compete with them on higher value added manufactures. Vietnam is now following suit. Remember that the 1997 devaluation of the baht was around 40%. A devaluation of that size causes massive dislocation in other sectors and is not something that Thailand should crave at all. A smaller devaluation of say 10% would give a temporary boost to exports but might anyway be followed by countries like Indonesia. At the end of day moving up the value added ladder in exports is crucial to maintaining market share and this is an investment intensive business. Right now investment is not happening and that is contributing to the strength of the baht. The other huge problem facing Thai exports is lack of government investment in education. With such a poor educational system, compared to Korea and Taiwan, how will Thais be able to work in higher value added industries, even if they get the investment? Thai export performance recently has been distorted by the strong revival of agricultural exports due to strong commodity prices. In the BoT numbers there is a discernable shift of workers back to agriculture and away from other industries. If you strip out the effect of agricultural exports which can quickly go into decline, as they did in the 80s, sustainable growth of Thai exports doesn't look nearly as promising. Anyway just depreciating the currency without addressing crucial structural problems in the export sector is not the quick fix that Thai policy formulators would like people to believe.

This part still doesn't make much sense to me. First you claim that Thailand can no longer compete on labour intensive products, then you said there's a strong revival of agricultural exports which basically are labour intensive.

Also, I wasn't saying that Baht depreciation will be the cure for all. That's obviously absurd. I was just saying that your earlier claims that Thailand will be basically screwed either if Baht appreciates or depreciates just doesn't make much sense. To claim that Thai exports will still go into a decline even if their prices will become more competive thanks to weaker Baht is just absurd to me. That's my whole point. I wasn't saying that it's the cure for all. You also failed to take into account the facts that Thailand also has realized the importance of R&D to shift their economy from being labour intensive to skill intensive to technology intensive and so on, and has tried to address the issue with the establishments of Science National Parks (look at one of my recent threads.) To suggest that Thai will never be able to compete is just absurd. There's still a long way to go before Vietnam can even catch up with Thailand (for another 15 years at least.) Also the business climate is always changing. There's always opportunities for new products, technologies and types of goods. There's so much variety that not a single country (even the USA) can dominate the world in every sector of business. And that's where the oppotunities lie for every country in this world. Sure Thailand is having some serious problems with the education system right now. But it's downright stupid to beleive that it will stay this way forever. Right now Thailand has the tenth most number of international students in the US at about 10,000. And these people will come back and be the drive for the changes in Thailand. It's not as hopeless as you believe.

[ThaiGoon]

Exactly. Check out the shareholder lists of those companies. I had dealings with several of them in the 90s and most are owned by the Thai-Chinese Chokwattana family of the Sahapattana Group. Some like Bangkok Rubber, Pan Asia Footwear and Wongpaitoon are or were listed on the SET. As far as I know Nike and Reebok have always had a policy not to invest in overseas manufacturers but you can check this with the copious public information available on them on the Internet. They are designers and marketers, not manufacturers. Yes, they have to have their own production people to ensure quality. They second people like your brother's friend to work in their contractors' factories but there are only interested in production and delivery - certainly not management control. Ask him.

So it's not specific to only Thailand as you made it out to be then.

And I'd like to add one more thing. The 10,000+ Thai students I was talking about are just the ones currently studying in the US. There are thousand others who are studying in England, Germany, Japan and Australia. And yeah, they will come back to Thailand.

Also another factor that will still make some labout intensive Thai products competitive is the fact that they can always differentiate themselves from other similar products like Thai jasmine rice, Thai orchid, handicrafts etc. So the labour intensive sector isn't exactly as doomed as you made it out to be. And I can't wait to post on here when the Japanese automakers decide to invest in eco-car manufacturing in Thailand, and see what you will say about it.

Edited April 13, 2007 by ThaiGoon

[ThaiGoon]

Arkandy, you said "Thailand quickly lost out to cheaper labour in Indonesia, then China and Vietnam. Today Nike and Reebok's manufacturing in Thailand has been very much scaled down and could be discontinued completely without any impact to them", but apparently according to the link I posted aboove, Thailand still has five of what Reebok called "major" manufacturers versus four in Indonesia and one in Vietnam.

Edited April 13, 2007 by ThaiGoon