Japanese Companies Not Shifting Production Bases Elsewhere: JETRO

[webfact]

Japanese companies not shifting production bases elsewhere: JETRO

BANGKOK, Dec 14 - The Japan External Trade Organization (JETRO) affirmed 100 per cent of Japanese private companies in Thailand will continue to use the country as their production bases, according to Thai Labour Minister Padermchai Sasomsap.

The minister said after meeting president of Bangkok-based JETRO Setsuo Iuchi on Wednesday.

However, the president said that SANYO Semiconductor (Thailand) laid off employees and will be relocating its production base abroad, as SANYO is no longer Japanese, was already bought and owned by an American firm, which had previously had plan for a relocation.

The company is now part of Nasdaq-listed ON Semiconductor Corporation, which acquired SANYO Semiconductor Co, a former subsidiary of Sanyo Electric, and other assets related to Sanyo Electric's semiconductor business earlier this year.

Meanwhile, Mr Iuchi said that in order to help alleviate problems of Thai entrepreneurs after the flood crisis, Thai workers are welcomed for job trainings in Japan for as long as six months.

JETRO is also organising a job fair in Thailand next month to help about 11,000 employees losing their career during the flood to find new jobs at companies in the country's north and northeast, with the readiness to support all laid-off workers. (MCOT online news)

-- TNA 2011-12-14

[geriatrickid]

So much for the statements of doom and gloom from some in TVF.

[lovelaos]

So much for the statements of doom and gloom from some in TVF.

Someone will put a spin on it Probably mentioning Mr. Thaksin

Edited December 14, 2011 by lovelaos

[animatic]

Spin from the Minister.

Lets see how it plays out in the coming weeks.

JETRO is like a chamber of commerce, doubtful that

the Japanese oligarchs are telegraphing their moves

to this guy in an substantive way.

Edited December 14, 2011 by animatic

[givenall]

So much for the statements of doom and gloom from some in TVF.

Someone will put a spin on it Probably mentioning Mr. Thaksin

Why don't the Japanese company say that themseves. In my experience dealing with Japanese companies, they are very ambiguous about committing anything so fast

Edited December 14, 2011 by givenall

[tailspin]

pretty interesting statement....it mentions Japanese private companies....what about the publically listed ones which are the biggest employers?

[FOODLOVER]

Not owned by Japanese? This is great news!

Edited December 14, 2011 by FOODLOVER

[webfact]

Japan job fair for flood-hit workers

The Nation

The Japan External Trade Organisation (JETRO) is joining with Thai agencies to host a job fair in January to provide opportunities for flood-affected workers, Labour Minister Phaderm-chai Sasomsap said yesterday after a discussion with JETRO president Setsuo Iuchi.

Phadermchai said the fair would give the unemployed access to vacancies in Japanese firms in Thailand.

Setsuo said that those Japanese companies not hit by floods in the North and East were able to employ 11,000 workers. He insisted that almost all Japanese investors would stay in Thailand.

JETRO also wants more young Thai workers to be sent for training in Japan, and fill vacancies at care homes and health spas.

Phadermchai also explained measures to deal with immigrant workers affected by the floods. He said the ministry would allow Burmese workers who returned home during flooding to return to their old jobs. They are not allowed to work for new employers, he added.

-- The Nation 2011-12-15

[rotary]

If this B300 a day minimum wage comes in these factories will be leaving at a fast pace. I am not saying B300 a day is a high wage. It is just a fact they can get labour in other countries thats just as good for a cheaper wage.

[witsawakorn]

If this B300 a day minimum wage comes in these factories will be leaving at a fast pace. I am not saying B300 a day is a high wage. It is just a fact they can get labour in other countries thats just as good for a cheaper wage.

Got any facts to go with that? What makes you think that all the Japanese companies only pay the legal minimum anyway? Which countries are cheaper? Pure speculation I think

[Mosha]

If this B300 a day minimum wage comes in these factories will be leaving at a fast pace. I am not saying B300 a day is a high wage. It is just a fact they can get labour in other countries thats just as good for a cheaper wage.

Got any facts to go with that? What makes you think that all the Japanese companies only pay the legal minimum anyway? Which countries are cheaper? Pure speculation I think

At the time the 300Bt was announced, Thai media were announcing an expected flood of immigrant workers from Cambodia. Does that give you a clue?

[MaiChai]

Its simple economics. Your factory gets flooded and the insurance company pays out. Whats the choice? Rebuild or relocate to a cheaper location? If it were me, I would relocation to the cheaper location, taking all functioning equipment with me. One thing for sure: Thailand is not going to get any cheaper and its a tough economic world out there. Its survive or go out of business. Example: look how cheap digital cameras have become; not much margin for profit there.

Now the Japanese are a bit different. They have the face saving thing, and if you look at the current problems at Olympus, you will see that they will do anything to hide the fact they are loosing money. Its not the first time this has happened with Japanese companies. You might consider anything US to bloated, but they know how to run businesses efficiently, and don't have any problems making the required cuts and savings to ensure the business survives. Olympus are lucky they are experiencing a renaissance at the moment with their PEN cameras.

[Chopperboy]

If this B300 a day minimum wage comes in these factories will be leaving at a fast pace. I am not saying B300 a day is a high wage. It is just a fact they can get labour in other countries thats just as good for a cheaper wage.

Most of the Japanese companies will be paying over the minimum already, as they need to attract semi-skilled workers from a pool that was already short by 60,000+ workers.

If a factory full of computerized machines gets flooded, all you really have left is 4 walls and a roof. Its no more economic to repair flooded machines than it is to repair a car that went into the sea.

[witsawakorn]

If this B300 a day minimum wage comes in these factories will be leaving at a fast pace. I am not saying B300 a day is a high wage. It is just a fact they can get labour in other countries thats just as good for a cheaper wage.

Got any facts to go with that? What makes you think that all the Japanese companies only pay the legal minimum anyway? Which countries are cheaper? Pure speculation I think

At the time the 300Bt was announced, Thai media were announcing an expected flood of immigrant workers from Cambodia. Does that give you a clue?

It gives me a clue that 300 Baht a day is an attractive wage to a Cambodian worker but it gives no clue as to where might be a better( cheaper) place for Japanese companies to set up factories. Cambodia has one of the highest Electric power costs in the world and hasn't even got an integrated National Power Grid.As far as I know Cambodia doesn't have too many established Industrial Estates where factories can buy power, steam, water etc and with waste water treatment plant Workers in Japanese factories in Thailand have already been trained. It's back to square one if they move somewhere else. As I alluded to earlier the increase in minimum wage only impacts people who are already getting paid less than Baht 300 per day. It doesn't mean that all Japanese (or any other) factories suddenly have an increase in costs sufficient to drive them away from Thailand. Many factories also get BoI incentives in Thailand including corporate tax holidays and reduced duty on imported equipment as well as guaranteed Work Permits for foreign staff

[TheGhostWithin]

The information given above in the official news releases is simply inaccurate. if you read between the lines of some of the latest comments coming from those companies both originating from Japan AND elsewhere, there definatwly are a few large corps. looking at other shores. Torota recently annouced in a press release, that as a result of the Japanese Tsunami and the flooding in Thailand, Toyota would be looking to create a more diverse supply chain to prevent the failure of 1 market affecting the whole supply chain. Those in government should be smart enough to read through the lunes: you didn't protect our estates, now we are rebuilding capacity, but not in Thailand.

The floods the main cause, though speculating that the increased minimum wage is also to blame. These companies are here to make money, not friends... just the same as the Thai government wants them here to profit from them. Big international companies decreasing their presence locally is a sign of market retrenchmenor at theleast a market peak.

[roamer]

I always believe press releases.

[witsawakorn]

Its simple economics. Your factory gets flooded and the insurance company pays out. Whats the choice? Rebuild or relocate to a cheaper location? If it were me, I would relocation to the cheaper location, taking all functioning equipment with me. One thing for sure: Thailand is not going to get any cheaper and its a tough economic world out there. Its survive or go out of business. Example: look how cheap digital cameras have become; not much margin for profit there.

Now the Japanese are a bit different. They have the face saving thing, and if you look at the current problems at Olympus, you will see that they will do anything to hide the fact they are loosing money. Its not the first time this has happened with Japanese companies. You might consider anything US to bloated, but they know how to run businesses efficiently, and don't have any problems making the required cuts and savings to ensure the business survives. Olympus are lucky they are experiencing a renaissance at the moment with their PEN cameras.

The economics might not be as simple as you think. If the factory was established with bank finance it probably isn't your decision anyway as it will belong to the lenders. Also if it was built under Board of Investment promotions you might find that you have to pay back some of the benefits that you received before you can take your insurance check to another country.The US knows how to run business efficiently? Sure they just close the factory, put every one out of work and rebuild the factory in Mexico. The business survives but at what cost? I assume that Thailand is still pretty cost compettitive given that GM recently built a new engine factory here as I am sure you know as an expert in the subject. Presuming that GM is still an American run company I guess that Thailand was the most efficient location for the factory