SMEs will suffer most if political conflict hits Thai economy

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SMEs will suffer most if conflict hits economy
Watchara Pussayanawin
The Nation


Violence will kill thirst for shopping and this will hurt manufacturers, big and small.

BANGKOK: -- The Federation of Thai Industries has expressed concerns that political conflicts are likely to put pressure on the economy, fearing that small and medium-sized enterprises could suffer the worst impact.

FTI vice chairman Tanit Sorat said the country could be heading for a dead end as political conflicts undermine confidence in the parliamentary system. Opinions vary widely, with no reconciliation in sight.

He said no one knew how the dispute over the amnesty bill would end, which could prevent the fragile Thai economy, which is also affected by the global economic situations, from making a recovery.

SMEs, given their limited liquidity, will likely be the first to see adverse impacts if the Thai economy does not recover strongly, he said. The government therefore should use its energy to solve the economic problems rather than concentrating on legal amendments.

"I have never seen anywhere in the world that does not adhere to the principle of rule of law, with no confidence in the judicial and parliamentary systems but only in their own opinions. In the past seven years, the nation has seen enough suffering. No one makes reconciliation," Tanit said.

If the political chaos continues next year, the economy can be expected to slow further, he said.

About 120,000 new graduates failed to get jobs this year, signalling a crisis, he said. If politic turmoil remains along with an economic slowdown, that could lower new employment.

Based on a survey of FTI members, most had not hired new employees in the past three to four months.

Payoongsak Chartsuttipol, chairman of the federation, said the private sector could not reach an analytical conclusion on the current political chaos, which arose from objections against the amnesty bill, but believed all would be concerned over the foreign-investment climate if violence occurred.

Udom Wongviwatchai, secretary-general of the Board of Investment (BOI), said there might not be impact on investment, as periodic political problems have long been a fact of life in Thailand, and some foreign investors might wait for the situation to resolve itself.

Udom expressed confidence that if foreign business interests really needed to invest in Thailand they would do so regardless of what was going on in the political sphere, and the BOI's investment-promotion policy would not be changed.

Total investment in Thailand is expected to reach the Bt1-trillion target this year. In the first nine months, about 1,431 projects have applied for BOI privileges, down 6.3 per cent from the same period last year. In terms of value, however, total investment was up 0.7 per cent, to Bt737.8 billion.

Next year's target for applications has not been determined yet, Udom said, explaining that it remained to be seen how the global economic situation progressed. He expected the 2014 target would be close to this year's at no more than Bt1.3 trillion to Bt1.4 trillion.

On the FTI proposal that the BOI postpone enforcement of its new promotional policy to 2016, he said the federation had acknowledged the new policy since 2012 and a two-year adjustment period should be sufficient.


-- The Nation 2013-11-02

[Tatsujin]

Those SME's are ALREADY being affected by the situation here. It's only going to get worse.

[boomerangutang]

Money, money, people, money. I'll tell you what suffers the most in Thailand: Nature

Natural habitat and animals have been losing every battle with humans. That should be the headline story, but Thais are incapable of perceiving such things.

Perhaps the Shinawatre gov't could do one good thing before they slink out the back door with bags of billions of baht: They could begin the process for establishing Thailand first big national park, and earmark funding for keeping poachers, squatters, and loggers out.

[pisico]

"does not adhere to the principle of rule of law, with no confidence in the judicial and parliamentary systems but only in their own opinions."

Accurate and telling statement of the myopic nature of Thais.

Yellow shirts: LET'S TAKE OVER THE AIRPORT FOR AS LONG AS WE WANT! Why? because....

Red shirts: LET'S TAKE OVER RATCHAPHRASONG FOR AS LONG AND DO AS WE WANT! Why? because...

Rubber plantations owners and workers: LET'S PARALYZE THE SOUTH IN PROTEST! WHY? because...

LET'S OCCUPY PARLIAMENT HOUSE GROUNDS AND SURROUNDING AREAS TO PROTEST THE AMNESTY LAW! WHY? because...

Not the rule of law but the rule of mob mentality.

Edited November 2, 2013 by pisico

[Thai at Heart]

Not if it leads to burning down big office blocks in Bangkok, or a violent coup.

Then it will be MNCs and publicly writes quoted companies that will get walloped.

[Sydebolle]

120'000 failed to get jobs this year?

Well, I suggest that this lot of newcomers might want to be a little less picky and start at salaries below THB 25'000 as they - despite this excellent education system of theirs - know absobloodylutely nothing about what working means.

But in a country where some students even prostitute themselves for smart phones and purple hair not much else can be expected - I was told

[davejones]

"does not adhere to the principle of rule of law, with no confidence in the judicial and parliamentary systems but only in their own opinions."

Accurate and telling statement of the myopic nature of Thais.

Yellow shirts: LET'S TAKE OVER THE AIRPORT FOR AS LONG AS WE WANT! Why? because....

Red shirts: LET'S TAKE OVER RATCHAPHRASONG FOR AS LONG AND DO AS WE WANT! Why? because...

Rubber plantations owners and workers: LET'S PARALYZE THE SOUTH IN PROTEST! WHY? because...

LET'S OCCUPY PARLIAMENT HOUSE GROUNDS AND SURROUNDING AREAS TO PROTEST THE AMNESTY LAW! WHY? because...

Not the rule of law but the rule of mob mentality.

That reminds me of FRANCE. Farmers and other groups are always trying to paralyze the country if they don't get their way.

The right to protest is seen by many/most as what should be allowed in a democracy. You have demonstrations of all sorts in almost every country. In Europe you often have riots in the streets.

I don't really see what's different here.

[davejones]

120'000 failed to get jobs this year?

Well, I suggest that this lot of newcomers might want to be a little less picky and start at salaries below THB 25'000 as they - despite this excellent education system of theirs - know absobloodylutely nothing about what working means.

But in a country where some students even prostitute themselves for smart phones and purple hair not much else can be expected - I was told

You mean just like in the USA, UK and other Western countries. In the UK at the moment companies are lining up workers from Romania because Brits can't or won't do the work. Many Brits are so stupid that they can't get jobs at all. There are unemployed and uneducated people in all countries. This isn't a Thai problem.

In case you don't know, many women in the USA will prostitute themselves for much less than the cost of a smart phone. Just read the ads.

Edited November 2, 2013 by davejones

[Patje]

"does not adhere to the principle of rule of law, with no confidence in the judicial and parliamentary systems but only in their own opinions."

Accurate and telling statement of the myopic nature of Thais.

Yellow shirts: LET'S TAKE OVER THE AIRPORT FOR AS LONG AS WE WANT! Why? because....

Red shirts: LET'S TAKE OVER RATCHAPHRASONG FOR AS LONG AND DO AS WE WANT! Why? because...

Rubber plantations owners and workers: LET'S PARALYZE THE SOUTH IN PROTEST! WHY? because...

LET'S OCCUPY PARLIAMENT HOUSE GROUNDS AND SURROUNDING AREAS TO PROTEST THE AMNESTY LAW! WHY? because...

Not the rule of law but the rule of mob mentality.

That reminds me of FRANCE. Farmers and other groups are always trying to paralyze the country if they don't get their way.

The right to protest is seen by many/most as what should be allowed in a democracy. You have demonstrations of all sorts in almost every country. In Europe you often have riots in the streets.

I don't really see what's different here.

Look at Brussels, they have demonstrations almost on daily base because the protesters see it as the capital of Europe, nice to live there !!!

[NeverSure]

But there is no unemployment in Thailand.

Should graduating from college guarantee one a great job?

In a country which prohibits most foreigners from owning a business, are they surprised there isn't more investment in jobs?

In a country with mass corruption, political instability, and no rule of law, who would invest anyway?

[davejones]

In a country with mass corruption, political instability, and no rule of law, who would invest anyway?

Higher risk offers higher rewards, so this suits many people/companies. You could equally ask who would invest in a developed country where growth in stagnant. The growth in developing countries (considered more corrupt by some), is so much higher than growth in developing countries that it is worth the risk to many. It just depends on whether you want a low-risk, low-return investment, or high-risk, potentially high return investment. There are always people willing to invest, even in war zones.

[A1Str8]

Don't worry nothing will hit the Thai economy. Yingluck just announced that they want to maintain peace.

[boomerangutang]

I don't call it 'rule by mob'

Perhaps 'rule by demonstration'

Even in Thailand; Just because there's a large group of people demonstrating, does not automatically mean it's 'a mob'. There are big differences between how the Yellows and the Reds demonstrate. One group is relatively peaceful and cheerful. The other is hyper intense and destructive.

In the big picture, it's good to have outlets for groups of people who are pissed off. Much better than places like China, N.Korea, Zimbabwe or Burma, where demonstrations can get very ugly quickly.

Sometimes good things can come from demonstrations.

[thailiketoo]

But there is no unemployment in Thailand.

Should graduating from college guarantee one a great job?

In a country which prohibits most foreigners from owning a business, are they surprised there isn't more investment in jobs?

In a country with mass corruption, political instability, and no rule of law, who would invest anyway?

No problem owning a business in Thailand. Check out http://thailawyers.com/foreign-business-in-thailand/

Who invests in Thailand?

Thailand, the world’s second largest exporter of hard disk drives (HDD)

Who indeed would do business in Thailand? Well, Daihatsu, Ford, General Motors, Honda, Isuzu, Mazda, Mercedes-Benz, Mitsubishi, Nissan, Tata, Toyota, Volvo and thousands of others.

Edited November 3, 2013 by thailiketoo

[davejones]

But there is no unemployment in Thailand.

Should graduating from college guarantee one a great job?

In a country which prohibits most foreigners from owning a business, are they surprised there isn't more investment in jobs?

In a country with mass corruption, political instability, and no rule of law, who would invest anyway?

No problem owning a business in Thailand. Check out http://thailawyers.com/foreign-business-in-thailand/

Who invests in Thailand?

Thailand, the world’s second largest exporter of hard disk drives (HDD)

Who indeed would do business in Thailand? Well, Daihatsu, Ford, General Motors, Honda, Isuzu, Mazda, Mercedes-Benz, Mitsubishi, Nissan, Tata, Toyota, Volvo and thousands of others.

Great answer.