Foreigners Could Pose A New Threat To Thailand

[george]

CEOs sound foreigner alarm

BANGKOK: -- Thai chief executives are concerned about the large amount of foreign capital flowing into many industries and they say that foreigners could pose a new threat along with uncertainties about oil prices and global trade imbalances.

And they are concerned about a shortage of labour in the manufacturing sector and that it will carry on over the next two years.

Speaking at a CEO Forum on the economy, five chief executives from different sectors said that the economic situation this year was likely to improve from last year. However, they expect competition to intensify, particular in the property and steel markets.

Anant Asvabhokin, chief executive of Land & Houses Plc, said at the seminar yesterday that the property sector would improve this year as interest rates are set to peak and may even decline later.

The cost of construction materials is expected to increase by only 4-5 per cent this year. But foreign capital is likely to intensify competition and might wipe out small and medium players, Anant said.

“Foreign capital has been injected the most into the property sector, particularly from Singapore. For example, a Singaporean company City Development has already bought up to seven or eight buildings in prime areas in Bangkok. So, small and medium players will face much more difficulty,” Anant said.

Sawasdi Horrungruang, chief executive of Nakornthai Strip Mill Plc, took it a step further, saying that foreign capital threatens the steel industry as well.

“Business nowadays is not a fight against Thais but against foreign capital. We have to make up our minds about future change. Now, it’s cut-throat business competition. No mercy. FTAs [free trade agreements] or the WTO [World Trade Organisation] have nothing to do with free and fair. We have to catch up,” Sawasdi said.

He believes that developing a better logistics would cut energy costs as it has done in developed countries. In addition, he warned that if the United Nations ponders boycotting Iran, the world’s oil prices might shoot up to US$80 (Bt3,153) per barrel.

Thiraphong Chansirir, chief executive of Thai Union Frozen Products Plc, said that although the overall economic picture seems to be improving, small businesses are faced with stronger competition and a shortage of labour.

He said that FTAs with Japan and the US would benefit the food sector. Once tariff barriers are lowered, Thailand will be able to export more to these two giant markets.

“However, although the overall picture of exports seems to be improving, the number of operators will decline. This is because mergers and acquisitions will wipe small operators,” Thiraphong said.

Thiraphong also warned that if the government does nothing to solve the shortage of labour in the manufacturing sector, Thailand would face a reduction in production capacity for exports over the next two years.

Kosit Panpiemras, executive chairman of Bangkok Bank, warned that businesses should prepare for volatility resulting from global trade imbalances. He said world growth over the past year, particularly in the US and China, was boosted by consumption and government spending. This was also happening in conjunction as the US current account and fiscal deficits grew.

He warned that businesses should prepare for volatility in currency and money markets if the US stops its current tight monetary policy or China ceases to make its foreign exchange regime more flexible.

“This year is the year that we should not look at only one side [growth]. We also need to strengthen the foundations of business. We need to manage risk and cost,” he said.

Kosit said that the economy in the first half of this year would be boosted by strong momentum but was likely to meet with uncertainty and volatility in the second half.

Vicha Poolvaraluck, executive chairman of Major Cineplex Group Plc, said the economic outlook for this year was positive, particularly in the movie business.

--The Nation 2006-01-19

[Sir Burr]

Don't understand why they are getting their knickers in a twist.

Western countries compete against each other vigourously to attract foreign investment.

[LaoPo]

Don't understand why they are getting their knickers in a twist.

Western countries compete against each other vigourously to attract foreign investment.

Agree!

Protective and Nationalistic article if you ask me. Are they afraid too much money is drifting into Thailand (amongst the other Billions) from Singapore....Mr. TS's ?

And what the concern about shortage of workers is concerned: Isn't that the same thing the EU countries faced decades ago when the Italians, Portugese, Spanish, Turkish and Marocco workers were needed in the North?

Thailand has quite a few neighbour countries who would be glad to supply workers (and therefore more capital flowing into their (poorer) countries.

Old story, or as we say in Europe: "Vintage wine in new bags...or Fresh wine in Vintage bags"

It's all about economics and WORLDWIDE trade and business.

WE are global people now and there are no more boarders.

LaoPo

[sierra01]

Take away the foreign capital and what have you got?

[Heng]

I thought FDI was drying up and the economy "was ready to crash?" Which way is it going to be?

[astral]

Don't understand why they are getting their knickers in a twist.

Western countries compete against each other vigourously to attract foreign investment.

The Thai's are notorious for their Xenophobia.

The chinese who are here want to keep out the rest, is what it boils down to.

That is why all these immigration rules exist. Farangs are small fry in this battle.

Not sure where the shortage of labour idea comes from?

There are plenty of youths around who need jobs, but cannot get them because

they slipped through the gaps in the education system without completing Mor 3.

No certificate, (Woot Mor 3), no chance of a job in factory.

Edited January 19, 2006 by astral

[ratcatcher]

Don't understand why they are getting their knickers in a twist.

Western countries compete against each other vigourously to attract foreign investment.

The Thai's are notorious for their Xenophobia.

The chinese who are here want to keep out the rest, is what it boils down to.

That is why all these immigration rules exist. Farangs are small fry in this battle.

Not sure where the shortage of labour idea comes from?

There are plenty of youths around who need jobs, but cannot get them because

they slipped through the gaps in the education system without completing Mor 3.

No certificate, (Woot Mor 3), no chance of a job in factory.

Good comments!

The Chinese Thais, like Thaksin, have got the rest of Thailand sewn up. They like it that way.

Then someone smarter comes along and they whinge to the government (which I imagine is also mostly Chinese-Thais) asking for rules and protection etc. A company like the C.P.Group doesn't worry too much as they've got massive investments in China as well.

As for labor shortages, I agree, when you run out of Thai applicants, open up to Burmese ,Lao and Khmers. It works in the rest of the world , why not here. (Why not? Xenophobic Thais) These days you practically need a degree in marketing to sell shoes at Robinson's even though 90% of the people in the department stores can barely utter a sentence in English.

The Thais are proud of their history, even though they've been invaded by the Burmese many times, they managed,through negotiation, to keep the British and French at the borders.

However Thailand has been colonized economically by the Chinese, much like Singapore.

I do stand to be corrected.

[britainmal]

The Thai's are notorious for their Xenophobia.

This statement basically sums up everything.

Thai chief executives are concerned about the large amount of foreign capital flowing into many industries and they say that foreigners could pose a new threat along with uncertainties about oil prices and global trade imbalances.

Foreign investment poses a threat to the Thai Chief's executive's control over the Thai economy. Basically, They want to dominate the economy and they think just because They are Thais they should have be able to do it without fair competition. Don't forget The Thai Chief executives are just as rich.

They are concerned about a shortage of labour in the manufacturing sector

He forgot about the people from Burmese ,Lao and Khmers. They are more focused on deporting these people instead of looking how useful they are to the Thai Economy and actually respect them for it. In the West these people would have a voice, but in Nationalistic Thailand they don't.

Business nowadays is not a fight against Thais but against foreign capital......

Let me correct that statement, He meant to say, "My Business monoploy in Thailand is under Threat, since I am starting to lose my free ride status."

However, they expect competition to intensify, particular in the property and steel markets.

There monopoly in the Thai econmy may be undermined.

Thiraphong Chansirir, chief executive of Thai Union Frozen Products Plc, said that although the overall economic picture seems to be improving, small businesses are faced with stronger competition and a shortage of labour.

I don't think Mr. Thiraphong Chansirir Company does not have to worry about small business and Labour shortages , but his monopoly in the Thai Economy. Don't forget a few years ago he bought the largest US Tuna company Star Kist.

Foreign capital has been injected the most into the property sector, particularly from Singapore. For example, a Singaporean company City Development has already bought up to seven or eight buildings in prime areas in Bangkok. So, small and medium players will face much more difficulty,” Anant said.

Small and medium are already facing stiff competition from The rich Thai companies buying up prime areas making them expensive for the Poorer Thai business. The main issue is that Rich Thai Monoploy buying up the poor Thai non-monopoly. It is not about a foreign Threat, but The Thai Monolpoly starting to use lose their dominance power.

The Thais are proud of their history, even though they've been invaded by the Burmese many times, they managed,through negotiation, to keep the British and French at the borders.

However Thailand has been colonized economically by the Chinese, much like Singapore.

They are in denial of their history and the motto is Spread the lies how good we are as a nation even if it is not true. For example the colony issue, The West is free sex heaven but Thailand is not, Thai women dress conserative and Farang women dress too sexy. Lies Lies and more Lies, Thai society needs to stop living in world of denials and admit the truth. I know they can't fool us.

Edited January 19, 2006 by britainmal

[marquess]

As a Farang why bother to invest in Thailand anyway, when there are no laws to protect your investment? If the Thais think they know best! Then leave them to it.!

[opothai]

britainmal

good summary

in a word the thai elite 'selfish'

'it's my football and if you're not going to play my way i'm taking it home'

[Sojourner]

The foreign money is not coming from the West, it's from China, Japan, Singapore and Australia. It's a new ball game and the usual targets are no longer on the radar screen. As far as being a colony of a Western power, you are right. However Thailand gave up half of their land to the British and French to keep them out. Later the Japanese slid in and Thailand declared war against the United States. Toothless tigers if you ask me.

[MyNameIsFarang]

The Thais are proud of their history, even though they've been invaded by the Burmese many times, they managed,through negotiation, to keep the British and French at the borders.

However Thailand has been colonized economically by the Chinese, much like Singapore.

I do stand to be corrected.

Nearly every kilometer of the border of the modern Thai state was dictated by either the French or the British. And the Thais did not "manage" anything. That Thailand was not directly colonised has only to do with the fact that both colonial powers desired a buffer between their spheres of influence.

[LaoPo]

in a word the thai elite 'selfish'

Is that something new?

LaoPo

[toptuan]

That is why all these immigration rules exist. Farangs are small fry in this battle.

Not sure where the shortage of labour idea comes from?

Thaksin keeps screaming to upgrade English-learning in Thai schools, by bringing in more native speakers. In my university English Department, my bosses are always asking me to help recruit more native speakers as well. We're always seriously short of English-speaking foreign instructors to fill the needed teaching posts.

I don't have the heart to tell my bosses that immigration makes it so d*mn-near-impossible to work here legally, that not many westerners I know have the patience to put up with such a schizophrenic system: "we want you / we don't want you."

In my first year of teaching, I took 13 trips to Laos, and spent a total of 30,000 baht (transportation, hotels, application fees, etc.) just to try to keep my visa and work permit current. Heck, I was only making 15,000 a month at the time! And it wasn't because of ignorance on my part. I learned the rules backwards and forwards (thanks to good resources, including this web-site).

The big problems were: 1) getting several inept school administrators to coordinate the necessary documents to get a longer-term visa and work permit, and 2) immigration/labor dept. bureaurocrats who delighted in coming up with non-existent requirements to throw a monkey wrench into the process. "Where's your class schedule?" "I want to see copies of all your Thai and American tax returns for the last five years." Rubbish.

After three years of trying my best to legally abide by the system, I feel like a war veteran who deserves any medals they might give out for negotiating the maze (with a LOT of bloody dead-ends). I now go see immigration/labor only once a year (as it should be), but I feel like I sure paid my dues. How can I, in good conscience, encourage my western friends to fight such a ridiculous battle for such peanuts in return? You gotta have another reason for coming here and fighting the system (for example, a relationship? )

So back to the opening post, our xenophobic friends have nothing to worry about--just keep the status quo in the government agencies. That'll successfully continue to turn away thousands more who would have worked or invested here otherwise.

[Johpa]

Don't understand why they are getting their knickers in a twist.

Western countries compete against each other vigourously to attract foreign investment.

Yes, well "First World" countries and their corporations can compete against each other, but Thailand, and like smaller countries, are not able to compete much at that level: it is not a level playing field. So assets are purchased (often after a currency devaluation) and profits continue to be siphoned out, except now by non-Thais. It is little wonder that the first region to be impacted by IMF "open market" ideology, South America, is now moving "leftwards" economically.

[cclub75]

“This year is the year that we should not look at only one side [growth]. We also need to strengthen the foundations of business. We need to manage risk and cost,” he said.

--The Nation 2006-01-19

Hum... that's a very bright and deep comment from a CEO. Sales, costs, risks... impressive indeed.

"It's a long way... " says the song....

[astral]

They are concerned about a shortage of labour in the manufacturing sector

He forgot about the people from Burmese ,Lao and Khmers. They are more focused on deporting these people instead of looking how useful they are to the Thai Economy and actually respect them for it.

The "labour" from these countries is just that.

Uneducated labourers, fine for building houses etc

but unsuitable as factory workers. As another poster points out

you virtually need a degree for that, well almost.

Edited January 20, 2006 by astral

[Phil Conners]

Their (the Chinese's) day will come. Remember Indonesia. It's a matter of time before the Thai's wake up and smell the roses.

[Heng]

The Chinese still run Indonesia, and there, the Chinese still haven't changed the laws to better cater to their own. A bit different from Thailand though, where all the laws are already in our favor AND we treat the locals a lot better than how the Indonesian Chinese treat the pribumi.

Edited January 20, 2006 by Heng

[britainmal]

The Rich Thai companies can compete against Western companies. They are investing oversees buying up western Companies. Don't just look at Thailand as small and poor.

The "labour" from these countries is just that.

Uneducated labourers, fine for building houses etc

but unsuitable as factory workers. As another poster points out

you virtually need a degree for that, well almost.

Do You really need a degree to be a factory worker? The answer is No and their is no

requirement under Thai law. The problem is just

like Western Countries is that the career fields

They(Thais)are choicing is getting more

sophisticated. (For

example, instead of Laborous work they choice to work as Taxi drivers or in the

tourist field) easy money and not so tiring. This is only in the begaining stages and Thai's are still uneasy about foreigners filling in their jobs even the cheap labour jobs. As far as needing a degree to sell shoes in Robinsons, this is for the reason to keep out all those uneducated Thais's from the provinces from coming to Bangkok flooding the job market that is why even to work in a Thai massage shop you need to spend money and take a course before you can start to work.

[Jim 50]

The Thai Execs do not want to pay higher wages or compete with foreign capital.

Can't blame them for trying to extend the sheltered privileged lives they were born into. Maybe some day a college grad can make as more than a couple of hundred USD.

[PeaceBlondie]

Is the title of the thread misleading? Is it foreignERS - people - that worries these Thai CEO's, or is it foreign direct investment - foreign money? I think it's the latter. The comments by the CEO's seldom mentioned an influx of qualified foreign laborers.

It goes back to a lot of roots in the Thai culture, not the least of it being education. The 19th century methods of Thai education - rote instruction, the ajarn is never wrong, don't ask questions, don't think too much, don't be serious - still leave students who DO finish Matayom 6 or a Thai university, unprepared for the global economic system.

The Thai CEO's, as others have pointed out so well, are disturbed that Thailand is no longer its own little private schoolyard where the Thais of Chinese extraction make all the decisions. Thailand has intentionally entered the international economic system of multi-national corporations, countless investors with countless trillions of baht to invest, and with the power to direct those baht.

Wake up, Thailand, and discover a century for which you are woefully unprepared. Even your factory workers can't calibrate their instruments or solve a production problem.

[Jersey_UK]

As far as needing a degree to sell shoes in Robinsons, this is for the reason to keep out all those uneducated Thais's from the provinces from coming to Bangkok flooding the job market that is why even to work in a Thai massage shop you need to spend money and take a course before you can start to work

For me the entry level qualifications required for even the most mundane of jobs is quite the dumbest thing ever. It would not matter so much IF the bits of paper meant a lot.

But fortunately not my problem