Thai-German Trade War

[sharecropper]

If the Thailand-German spat becomes a full-blown trade war, who would lose the most, business-wise?

I assume Thailand, but don't know much about the trading relationship between the two, and wonder if any better-informed people can comment.

Thanks.

[prefabs]

All the pubs in Naklua would have to shut

[rgs2001uk]

The customer would lose, would have no alternative but to drink the fizzy euro pish that passes for Thai beer.

Best head off to Tops/Foodland and get stocked up with some fine German produce.

[beano2274]

Did anyone see the TV last night showing the Royal Convoy leaving the Funeral, where were all the cars from?

Can anyone imagine a convoy of Thairungs?

All big companies around the world are watching, as they are not gonna do business with a country which does not pay it's bills for work done.

[Richard4849]

Yes, I'm sure that television sets in board rooms around the world are tuned in to live coverage of this spat 24/7, and that the CEO's are on the edge of their seats.

[sharecropper]

A German company also lost hundreds of millions of US$ in investment in Manila airport, which was also recently arbitrated on, with an award against the government, after many years of refusal to pay.

Now the present Philippines government is worried about the drag that dispute has had and continues to have on inward investment, so these things do hurt the country in the end, and the money at stake here isn't that large really.

[lovelomsak]

Did anyone see the TV last night showing the Royal Convoy leaving the Funeral, where were all the cars from?

Can anyone imagine a convoy of Thairungs?

All big companies around the world are watching, as they are not gonna do business with a country which does not pay it's bills for work done.

Yes big companies are watching this very close I am sure.

This had me very worried a few days ago. I thought maybe more than a trade war. I had fears of the cold war coming to an end.

What really is noticable here to me is when the work was done in Thailand was a long time ago when people took a real chance on investing and helping Thailand to emerge to where they are now. Companies which invested back then are greatly responsible for the strong economy Thailand has now and this is the thanks they get.

Just last year I was so confident Thailand was on track to be a major player in world economics. Even more powerful than Japan. But now I see my dream fading sorry to say.

[Richard4849]

Just last year I was so confident Thailand was on track to be a major player in world economics. Even more powerful than Japan. But now I see my dream fading sorry to say.

That was some dream! Do you dream of spotted unicorns, too?

[lovelomsak]

Just last year I was so confident Thailand was on track to be a major player in world economics. Even more powerful than Japan. But now I see my dream fading sorry to say.

That was some dream! Do you dream of spotted unicorns, too?

Read my old posts I was the only one stating the baht wasnot going to drop. Look at how I supported my statements at that time, go take a look I was against the farang conventional posts and was right. i saw what all the rest of you didnot see. And if Thailand can clear this up quickly as ask by Germany they may still have a chance to be ok. The longer it lingers the more it hurts.

Germany is not arquing but letting Thailand either co operate or hang themsleves up to them.

[Richard4849]

I'm not sure what the value of the THB has to do with anything, but it will be a long time before Thailand catches up to Japan.

[lovelomsak]

I'm not sure what the value of the THB has to do with anything, but it will be a long time before Thailand catches up to Japan.

It has a lot to do with it. Strong economy strong currency not brain science. I willnot go into everything that was making Thailand a strong economy and strong currency for I am sure someone as wise as you already knows all this right.

[Richard4849]

There is no correlation between a strong currency and a strong economy! A common fallacy.

[IMA_FARANG]

Don't be silly....it has nothing to do with helping Thailand. It was and still is all for profit for the investors.

That contract was secured by paying bribes to the then current Thai politicians at the time it was awarded.

The reasons that the bribes were paid was that the German company expected to be allowed make a hefty profit by getting the rights to collect tolls on that Tollway and profit on those tolls. No taxes were to be paid on the tolls for a number of years either.

The reason the bribes were accepted by the Thai politicians was that at the time they were in power and they were able to promise the toll concession to the German company.

Unfortunately that particular goup of Thai politicians lost power and a new group of politicians was voted in.

These politicians wanted their cut too, but the Germans were unhappy with that because they thought they had already bought the Thai government's compliance with their original bribes.

So the Thai government did not allow the the Germans to get their toll collection concession, the German company left the roads not fully completed (there was a gap between connecting sections of a couple of centimeters...the concrete fills were never properly completed), and the Thai government didn't pay the Germans and their backers the toll revenue they had expected.

The German company and it's owner went bankrupt, and the investors took everything that was of any real value.

Now the bankrupt German owner is trying to find some way to get at least a part of his money back...by getting a court oder to sieze anything remotely Thai that might be of value...even if he can't prove it belonged to the Thai goverment or not.

At the time that Tollway was going to be the Tollway to the airort, because Don Muang was the intenational airport then. The toll concessions were where the real profit was to have been.

That's the true story of the "Thai-German problem".

Edited July 29, 2011 by IMA_FARANG

[Richard4849]

Don't be silly....it has nothing to do with helping Thailand. It was and still is all for profit for the investors.

That contract was secured by paying bribes to the then current Thai politicians at the time it was awarded.

The reasons that the bribes were paid was that the German company expected to be allowed make a hefty profit by getting the rights to collect tolls on that Tollway and profit on those tolls. No taxes were to be paid on the tolls either.

The reason the bribes were accepted by the Thai politicians was that at the time they were in power and were able to promise the toll concession to the German company.

Unfortunately that particular goup of Thai politicians lost power and a new group of politicians was voted in.

These politicians wanted their cut too, but the Germans were unhappy with that because they thought they had already bought the Thai government's compliance with their original bribes,

So the Thai government did not allow the the Germans to get their toll collection concession, the German company left the roads not fully completed (there was a gap between connecting sections of a couple of centimeters...the concrete fills were never completed), and the Thai government didn't pay the Germans and their backers the toll revenue they had expected.

The German company and it's owner went bankrupt, and the investors took everything that was of any real value.

Now the bankrupt German owner is trying to find some way to get at least a part of his money back...by getting a court for aything Thai that might be of value...even if he can't prove it belonged to the Thai goverment or not.

At the time that Tollway was going to be the Tollway to the airort, because Don Muang was the intenational airport then. The toll concessions were the real where the real profit was to have been.

That's the true story of the "Thai-German problem".

+1

That's how it works, in a nutshell. Greed, greed, greed.

[Wonderboy]

Don't be silly....it has nothing to do with helping Thailand. It was and still is all for profit for the investors.

That contract was secured by paying bribes to the then current Thai politicians at the time it was awarded.

The reasons that the bribes were paid was that the German company expected to be allowed make a hefty profit by getting the rights to collect tolls on that Tollway and profit on those tolls. No taxes were to be paid on the tolls for a number of years either.

The reason the bribes were accepted by the Thai politicians was that at the time they were in power and they were able to promise the toll concession to the German company.

Unfortunately that particular goup of Thai politicians lost power and a new group of politicians was voted in.

These politicians wanted their cut too, but the Germans were unhappy with that because they thought they had already bought the Thai government's compliance with their original bribes.

So the Thai government did not allow the the Germans to get their toll collection concession, the German company left the roads not fully completed (there was a gap between connecting sections of a couple of centimeters...the concrete fills were never properly completed), and the Thai government didn't pay the Germans and their backers the toll revenue they had expected.

The German company and it's owner went bankrupt, and the investors took everything that was of any real value.

Now the bankrupt German owner is trying to find some way to get at least a part of his money back...by getting a court oder to sieze anything remotely Thai that might be of value...even if he can't prove it belonged to the Thai goverment or not.

At the time that Tollway was going to be the Tollway to the airort, because Don Muang was the intenational airport then. The toll concessions were where the real profit was to have been.

That's the true story of the "Thai-German problem".

Would be interesting to know where you have this information from. As you wrote it, it looks like pure speculation on your behalf. You portray it as you know this, and not something you just find likely. If you can back up your claims, then do it.

WB

[Richard4849]

That is how it works in Thailand...one doesn't have to "prove" it. Everyone knows. There have been plenty of examples where it has all been exposed...the fire trucks, the airport scanners, ad infinitum. One does simply not get a contract like that here without paying some off the top.

[sharecropper]

Don't be silly....it has nothing to do with helping Thailand. It was and still is all for profit for the investors.

That contract was secured by paying bribes to the then current Thai politicians at the time it was awarded.

The reasons that the bribes were paid was that the German company expected to be allowed make a hefty profit by getting the rights to collect tolls on that Tollway and profit on those tolls. No taxes were to be paid on the tolls for a number of years either.

The reason the bribes were accepted by the Thai politicians was that at the time they were in power and they were able to promise the toll concession to the German company.

Unfortunately that particular goup of Thai politicians lost power and a new group of politicians was voted in.

These politicians wanted their cut too, but the Germans were unhappy with that because they thought they had already bought the Thai government's compliance with their original bribes.

So the Thai government did not allow the the Germans to get their toll collection concession, the German company left the roads not fully completed (there was a gap between connecting sections of a couple of centimeters...the concrete fills were never properly completed), and the Thai government didn't pay the Germans and their backers the toll revenue they had expected.

The German company and it's owner went bankrupt, and the investors took everything that was of any real value.

Now the bankrupt German owner is trying to find some way to get at least a part of his money back...by getting a court oder to sieze anything remotely Thai that might be of value...even if he can't prove it belonged to the Thai goverment or not.

At the time that Tollway was going to be the Tollway to the airort, because Don Muang was the intenational airport then. The toll concessions were where the real profit was to have been.

That's the true story of the "Thai-German problem".

Whatever the mood music, the Thai government lost at arbitration on the provisions of a contract for multimillion dollar services, which they professionally negotiated and freely entered into, which included those arbitration provisions that have come back to bite them in their backsides.

I suspect we may see similar shennanigans when it comes to the Steyr fire trucks in due course.

[wintermute]

Germany's GDP in dollar terms is $2.94 trillion

They are a world leader in industrial machinery, luxury vehicles, and an integral part of the EU's economy.

Thailand's GDP in dollar terms is $586 billion

The country does not lead in anything in particular but has a fairly robust manufacturing sector.

Germany would eat Thailand's lunch any day of the week. Plus the risk of pissing off Germany is that other EU nations can/will follow suit as well as the U.S. getting involved if it gets serious enough to levy international sanctions.

[thunder30101]

As long as thailand has a large pool of slave labor and corruption at every level of government companies will come looking to invest. Yes the thai exports fueled by cheap labor are great but not even close to being in the league of a country like japan and someday that labor wont be cheap anymore and companies will just move on to the next cheap emerging economy.

[waza]

Thailand is no longer the hub of cheap labour that it used to be. Watch where the clothing manufacturers go, they always jump first. At the moment they, including the Thai owned companies, are moving their manufacturing to Vietnam.

[Tonto21]

Did anyone see the TV last night showing the Royal Convoy leaving the Funeral, where were all the cars from?

Can anyone imagine a convoy of Thairungs?

All big companies around the world are watching, as they are not gonna do business with a country which does not pay it's bills for work done.

Yes big companies are watching this very close I am sure.

This had me very worried a few days ago. I thought maybe more than a trade war. I had fears of the cold war coming to an end.

What really is noticable here to me is when the work was done in Thailand was a long time ago when people took a real chance on investing and helping Thailand to emerge to where they are now. Companies which invested back then are greatly responsible for the strong economy Thailand has now and this is the thanks they get.

Just last year I was so confident Thailand was on track to be a major player in world economics. Even more powerful than Japan. But now I see my dream fading sorry to say.

'Lovelomsak' I may not be a student of economics, and I don't think I need to be to see Thailand never, or at least not for a very long time will even be a 1 watt generator, let alone a 'power house'. Just to give you two reasons; the education system, your work force will need to be educated, to reform education in Thailand would go against the ruling classes agenda and corruption…from the very top to the very bottom. Just my opinion.

Edited July 29, 2011 by metisdead

[kerryk]

Germany's GDP in dollar terms is $2.94 trillion

They are a world leader in industrial machinery, luxury vehicles, and an integral part of the EU's economy.

Thailand's GDP in dollar terms is $586 billion

The country does not lead in anything in particular but has a fairly robust manufacturing sector.

Germany would eat Thailand's lunch any day of the week. Plus the risk of pissing off Germany is that other EU nations can/will follow suit as well as the U.S. getting involved if it gets serious enough to levy international sanctions.

Debt as % of GDP

Germany 142%

UK 400%

Netherlands 471%

Ireland 1103%

Australia 200%

US 95%

Thailand 26%

[kerryk]

Thailand is no longer the hub of cheap labour that it used to be. Watch where the clothing manufacturers go, they always jump first. At the moment they, including the Thai owned companies, are moving their manufacturing to Vietnam.

Ford announced recently 1 billion investment in new plant in India not Vietnam,

[StreetCowboy]

Germany's GDP in dollar terms is $2.94 trillion

They are a world leader in industrial machinery, luxury vehicles, and an integral part of the EU's economy.

Thailand's GDP in dollar terms is $586 billion

The country does not lead in anything in particular but has a fairly robust manufacturing sector.

Germany would eat Thailand's lunch any day of the week. Plus the risk of pissing off Germany is that other EU nations can/will follow suit as well as the U.S. getting involved if it gets serious enough to levy international sanctions.

Debt as % of GDP

Germany 142%

UK 400%

Netherlands 471%

Ireland 1103%

Australia 200%

US 95%

Thailand 26%

I feel sorry for people that can't get a mortgage...

SC

[StreetCowboy]

I grew up in the West thinking that production was moved overseas to access cheap labour, but in fact, in my experience, it has been to subvert protectionist tariffs and barriers to free trade, and access local markets.

SC

[afarang]

Just last year I was so confident Thailand was on track to be a major player in world economics. Even more powerful than Japan. But now I see my dream fading sorry to say.

That was some dream! Do you dream of spotted unicorns, too?

Read my old posts I was the only one stating the baht wasnot going to drop. Look at how I supported my statements at that time, go take a look I was against the farang conventional posts and was right. i saw what all the rest of you didnot see. And if Thailand can clear this up quickly as ask by Germany they may still have a chance to be ok. The longer it lingers the more it hurts.

Germany is not arquing but letting Thailand either co operate or hang themsleves up to them.

Total rubbish .Many of us have been arguing about the strength of the Thai Baht, not necessarily here. What most do not realize is that the Thai currency is NOT a free floating currency. It is a "managed float" It is SET every day by the Monetary Policy Committee of the Bank of Thailand. To achieve the short term aims of that group

[muchogra]

Let's hope that a trade war won't develop. If it does, nobody wins. At the end, when it's resolved, hopefully amicably, someone may just come out as a hero.

Don't most people hope the politicians are born as orphans and never marry to produce offspring?

[kerryk]

Just last year I was so confident Thailand was on track to be a major player in world economics. Even more powerful than Japan. But now I see my dream fading sorry to say.

That was some dream! Do you dream of spotted unicorns, too?

Read my old posts I was the only one stating the baht wasnot going to drop. Look at how I supported my statements at that time, go take a look I was against the farang conventional posts and was right. i saw what all the rest of you didnot see. And if Thailand can clear this up quickly as ask by Germany they may still have a chance to be ok. The longer it lingers the more it hurts.

Germany is not arquing but letting Thailand either co operate or hang themsleves up to them.

Total rubbish .Many of us have been arguing about the strength of the Thai Baht, not necessarily here. What most do not realize is that the Thai currency is NOT a free floating currency. It is a "managed float" It is SET every day by the Monetary Policy Committee of the Bank of Thailand. To achieve the short term aims of that group

Like Swiss Franc, only as long as the bank is willing to buy foreign currency.

[StreetCowboy]

Let's hope that a trade war won't develop. If it does, nobody wins. At the end, when it's resolved, hopefully amicably, someone may just come out as a hero.

Don't most people hope the politicians are born as orphans and never marry to produce offspring?

I don't see what marriage has to do with politicians' offspring; or judging from the politicans, their parents.

EDIT: I don't mean that really, it was a cruel and ill-thought jibe, and I offer my most sincere apologies to Sir Cyril Smith and John Hume Robertson.

And that daft <deleted> whose name eluded me for a moment - the late Sir Nicholas Fairbairn "Outdated and of little use to me" , as he never said about our drink driving laws, despite claims to the contrary

And Tam Dalyell; who would flatter him with an opportunity to affirm his legitimacy?

SC

[sharecropper]

Total rubbish .Many of us have been arguing about the strength of the Thai Baht, not necessarily here. What most do not realize is that the Thai currency is NOT a free floating currency. It is a "managed float" It is SET every day by the Monetary Policy Committee of the Bank of Thailand. To achieve the short term aims of that group

Is that right? I have often wondered how the Baht could possibly not have had a run on it in some of the dire circumstances the country has found itself in recently.

I have even wondered whether the central bank intervenes in the market to buy the Baht to keep it so strong in times of crisis.