Foreign Investors Remain Uncertain About Nominee Status

[george]

Foreign investors remain uncertain about nominee status

BANGKOK: -- Foreign investors in Thailand remain uncertain about the issue of 'nominee status' despite a clarification from the government on the matter by economics-related ministers, a top securities executive said today.

Artdanai Sucharitkul, President of the Foreign Securities Companies' Association, said foreign investors now have a greater understanding of the sufficiency economy following an explanation of the government policy on the matter by Deputy Prime Minister and Finance Minister MR Pridiyathorn Devakula at the "Open House with Economic Ministers" forum held Friday.

Mr. Artdanai said he viewed the explanation would help the investors understand what the Finance Ministry planned to do next year.

However, he said the investors are still worried about the lack of clarity in the government's stand on the issue of nominee status.

And they were doubtful how the Commerce Ministry would cope with many foreign companies investing in Thailand since they have a nominee structure.

He believed these companies would not shift their investment from Thailand, but that they would be more careful regarding further investment.

Mr. Artdanai said a process for these companies to adjust their nominee status needed to take at least one year since the Thai bureaucratic system moves slowly.

He also commented on internal problems arisen in MCOT Public Company Limited, saying the plunge in the share price reflected an abrupt change of the company's management.

--TNA 2006-11-10

[george]

Foreign investors grill Thailand on ownership

BANGKOK: -- Foreign business leaders grilled Thailand's post-coup leaders on Friday about a review of ambiguous foreign ownership rules some fear could undermine the basis of investment in the country.

"Over 100,000 foreign companies here are being affected by this issue. A lot of them are very, very upset," Richard Watson, a financial adviser based on the Thai tourist island of Phuket, told Reuters.

Thailand's Foreign Business Act is under scrutiny after graft investigators suggested the sale in January of telecoms firm Shin Corp (SHIN.BK: Quote, Profile, Research) by the family of ousted Prime Minister Thaksin Shinawatra to Singapore's Temasek may have broken the law.

The Act bars foreigners from owning majority stakes in most Thai businesses, but in practice gray areas have allowed non-Thais to invest with confidence since the 1970s.

Watson, who advises foreigners on buying Thai property, was among hundreds of foreign investors, analysts and executives who attended a forum to hear Thai economic ministers explain their plans for the next year.

Finance Minister Pridiyathorn Devakula said post-coup Thailand would be a model of good governance and foreigners need fear no big change in investment policies.

In a speech aimed a quelling concerns about the interim government's "sufficiency economy" policy, Pridiyathorn said the goal was sustainable growth without the excesses that plunged Thailand into the 1997 Asian financial crisis.

"We would like to reassure non-resident investors that we will maintain the existing practice of allowing the free flow of capital, which has been a policy of Thailand all along," he said.

The former central bank governor also played down new measures aimed at discouraging speculation on the baht, Asia's fastest-rising currency against the dollar this year.

On Tuesday, the Bank of Thailand asked banks to cooperate by not issuing or selling bills of exchange to non-residents. The measures take effect from November 15.

"The measure is not for limiting free capital flow, but to prevent certain financial houses taking advantage of this very thin foreign exchange market in Thailand in trying to corner the baht exchange rate," Pridiyathorn said.

WORRIED INVESTORS

But the issue uppermost in the minds of many guests was the foreign ownership law.

Under the law, foreigners wanting to invest simply have to set up a series of Thai holding companies with Thais as majority shareholders but with reduced voting rights, meaning they have no control.

Using wealthy Thais as investment partners means that a clause in the law barring the use of local nominees would be difficult to prove in court.

However, Temasek's $3.8 billion deal for Shin Corp, which fueled street protests against Thaksin that led to the September 19 coup, put the spotlight on the foreign ownership issue.

"Among big companies in Thailand, how many of them have got genuine Thai shareholders? Temasek and Shin have brought this to the surface," Watson said.

Commerce Minister Krik-Krai Jirapaet said on Tuesday a committee reviewing the Foreign Business Act would deliver its recommendations in 60 days.

"There is no simple solution to this issue," he said.

Thailand was committed to an open economy, but at the same time Thais needed help to compete against foreigners, he said.

"The question is how to strike a balance."

--Reuters 2006-11-10

[womble]

Eigher ban foriegn investment and enforce the laws that are there now.

Or change the laws to allow foriegn investment with certain protections in place to safeguard the locals.

Allowing foriegn investment is never going to be a vote winner in Thailand even though with the right safegurds in place it will be very beneficial. They can't keep hiding from this issue this government doesn't have to rely on votes at any time so now is the right time to make the decision to give some proper lows to protect these companys investments as opposed to making them continue to operate in this ridiculous grey area.

[Foggy Bottom]

"Among big companies in Thailand, how many of them have got genuine Thai shareholders? Temasek and Shin have brought this to the surface," Watson said.

Commerce Minister Krik-Krai Jirapaet said on Tuesday a committee reviewing the Foreign Business Act would deliver its recommendations in 60 days.

"There is no simple solution to this issue," he said.

Thailand was committed to an open economy, but at the same time Thais needed help to compete against foreigners, he said.

"The question is how to strike a balance."

--Reuters 2006-11-10

This one is going to get VERY interesting

"within 60 days" - will they deliver us a Christmas present as the easy (and possibly the ONLY) way out of the mess THEY created when trying to retain control? Or, will they destroy all seasonal cheer with a complete crackdown on any foreign involvement at all?

Thais needed to compete with foreigners - I'd say they do that very nicely thank you given the number of punitive laws that restrict what foreigners can and can't do - unlike in our countries where they can do whatever they want in this context.

Thailand's open economy is a one way street - our money in, and none going out - an "open-pit" economy may have been a better phrase.

"The question is how to strike a balance." = easy one of all to answer = EQUAL OPPORTUNITY for ANYONE - cut the protectionist khrap out of the legislation and truly open your doors the way other countries have done.

Given the current account deficits left by TRT, sale of land to foreigners will get you out of the poo in the same way it did for the UK after the last 3 recessions.

Blinkers OFF

Eyes OPEN

Engage BRAIN

Move MOUTH

Not too difficult is it?

[LaoPo]

Foreign investors grill Thailand on ownership

1. "We would like to reassure non-resident investors that we will maintain the existing practice of allowing the free flow of capital, which has been a policy of Thailand all along," he said."

2. "Finance Minister Pridiyathorn Devakula said post-coup Thailand would be a model of good governance and foreigners need fear no big change in investment policies."

1. Hmmm, that's exactly the problem...non-resident investors.

Thailand wants the -foreign- capital but gives very little, or next to nothing, in return.

2. And that's the problem: Thailand need BIG changes, instead 'no big changes in investment policies'

Very unintelligent economical politics.

That's why billions and billions flow into China every week and not into Thailand.

LaoPo

[Hollywood]

New York Times today. .. Intel to spend $1 billion on new computer chip factory in Vietnam.

[LaoPo]

New York Times today. .. Intel to spend $1 billion on new computer chip factory in Vietnam.

There you go.....

And Malaysia seems to understand 'business' also a bit better than Thailand....

Proton talks with foreign firms

http://news.bbc.co.uk/2/hi/business/6134954.stm

"But the government said that letting an outside firm take a 51% stake in manufacturing operations was possible."

"Malaysia's Second Minister of Finance Nor Mohamed Yakcop said government would make a decision on a tie-up within three months.

"We will do whatever it takes to make Proton viable. If we need to give them significant equity, we will give them significant equity." he said."

Thailand: wake up !

LaoPo

Edited November 10, 2006 by LaoPo

[ColPyat]

And add to that the increasing confusion over what exactly "sufficiency economy" means, and military officers sitting now on boards of state enterprises without having any background in business.

Does anybody have any clear idea how the economy is doing now in Thailand?

[wrecker]

The paradox is that the junta must come up with proof that Thaksin did something wrong. Nominee shares is probably the only way they will catch him. But by doing so they scoff at one of their biggest foreign investors Singapore. In the process they do not mind to upset multinational and small and medium businesses alike. The gentlemen do not see any problem themselves in investing their or the tax payers money that was leaked abroad, enjoying full protection.

On top of that they believe in fairytales in this situation the tale of sufficiency economy. As the world's number one rice exporter, a top car exporter, and a hub for electronics, they expect to squeeze everything out of Asean, Europe and the US, while making it extremely difficult for the outside world to enter the Thai markets.

It is an extremely shortsighted view, that did not even worked before John Meynard Keynes was born. This country will go to the drain. People in bangkok and the elite think that they are the country and the representatives of the Thai culture. The truth is that it are the thousands of poor villages that resemble Thailand. Nobody give a rats-ass about them. Lowering rice prices is great for city folks bad for the basis.

Junta beware, what you call an under current is a full blown Tsunami that will develop.

[LaoPo]

It's very sad that it seems that Thailand is 'losing' control of it's ambition, if there ever was one, to try and boost its economy by the 49/51% rule.

It seems that countries as Singapore, India, China and now Vietnam and Malaysia are a lot more agressive, progressive and aware of the possibilities in order to boost their economy by being more flexibel on foreign investment-rules.

If Thailand doesn't change their economical policies (very soon) I fear that the country will end up as an non-progressive 'island', losing most of the -new- business to their competitor-, neighbouring countries, and wil, thus, fall to (even) more poverty...

Sad!

ps: where the bl__dy heck are the brilliant economists from Thailand, educated on top-universities in the UK/Europe, USA and Australia ?

Surely, the most influential families in the country must have sent their children to these universities ?

LaoPo

Edited November 10, 2006 by LaoPo

[Maars]

I find this topic very interesting and from personal experience have to say that this DOES discourage foreign companies from investing. The company I work for has been trying to set up a company in Thailand since August 15th (18th??) and it is nigh on impossible ! The law firm we have been using has been looking at all different ways to circumvent the rules but their best advice now is to look elsewhere in Asean.............. Vietnam now becomes top of the list !

[Lancashirelad]

ps: where the bl__dy heck are the brilliant economists from Thailand, educated on top-universities in the UK/Europe, USA and Australia ?

I think you just already named the countries where they are living & working now. Putting their expertise to good use for the benefit of those countries & not their own.

Does anyone have the time & know how to track down an email address for the appropriate Thai Government dept? I think it would be a very good idea if this thread were forwarded to them, so they can see what intelligent foreigners think about their behind the times thought processes & methods.

Ofcourse realistically it will never happen, but it would be interested to see what would happen to Thailand's prosperity if every single foreign led company pulled out & moved elsewhere overnight.

Edited November 10, 2006 by Lancashirelad

[puyaidon]

Where have all the university graduates from abroad gone and why don't they do anything. Most go abroad for the grades and the title of the degree. Why learn anything when all that counts here is a title? As one of the previous posts said, Money in but no money out. Sadly, more and more companies will follow Intel and go other places. Planning and intelligence are not in the program for most of the managers here. They better plan on investment going elsewhere where people want the investment.

[cclub75]

A nice boomerang effect is coming, full speed.

As stated in the article, since many years, foreign investors have by passed the thai laws, regarding businesses ownership.

The point is : all the thais governments were OK with that situation : money was coming, and face was saved. Everybody was happy.

So now, where do they stand ?

My guess : they don't have a clue.

As he said : "There is no simple solution to this issue"

Indeed.

Thailand is not China. China can, because of its scale, impose its views and rules to foreign investors. The wheel has turned in their favor. They use it with great skill. And they must be laughing at the stupidity of the US or EU.

On the other hand, Thailand with now this fantasy of "self sufficiency economy" and the problem of foreign ownership... It's going to be really difficult to find a way out.

[hardy1943]

And add to that the increasing confusion over what exactly "sufficiency economy" means, and military officers sitting now on boards of state enterprises without having any background in business.

Does anybody have any clear idea how the economy is doing now in Thailand?

I do not think anyone knows. The same people stated 2 weeks ago because of the

tremendous increase in foreign investments that is why the Baht is so strong. Now this !!!

Thailand will get further behind because they are scared of anyone investing in their country.

In Vietnam Intel is just a start and one will see them surpass Thailand very soon because of their

open foreign policy and their willingness to expand their infrastructure.

We like the STATUS QUO here.

[LaoPo]

1. A nice boomerang effect is coming, full speed.

2. Thailand is not China. China can, because of its scale, impose its views and rules to foreign investors. The wheel has turned in their favor. They use it with great skill.

3. And they must be laughing at the stupidity of the US or EU.

1. Fully agree.

2. Agree once more. But Thailand has about 5% of the population of China.

Even if Thailand would have 5% of the billions, flowing into China, Thailand would be better off.

A lot better.

3. I don't agree. China and it's business partners need each other. One cannot live without the other and that's exactly the -economical- view Thailand is missing.

The view of the present government is one of self-protectionism, but economical self-protectionism

never works, on the contrary....it will bounce back hard, very hard, in the future.

And that future is around the corner, not far away, if the government does not change their policies.

Hmmm...maybe the ministers in place are afraid to take drastic steps..afraid of the comments they will get from, you know who....

LaoPo

[nyles]

And add to that the increasing confusion over what exactly "sufficiency economy" means, and military officers sitting now on boards of state enterprises without having any background in business.

Does anybody have any clear idea how the economy is doing now in Thailand?

I do not think anyone knows. The same people stated 2 weeks ago because of the

tremendous increase in foreign investments that is why the Baht is so strong. Now this !!!

Thailand will get further behind because they are scared of anyone investing in their country.

In Vietnam Intel is just a start and one will see them surpass Thailand very soon because of their

open foreign policy and their willingness to expand their infrastructure.

We like the STATUS QUO here.

For sure I am a conservative. I would not like to see Thailand grow into a new Singapore or Hong Kong in my lifetime at least. Selfish yes, but I like Thailand the way it is.

[animatic]

It is truely sad for Thailand and the Thai people,

that their leaders are so jingositically myopic,

that they can't see that investors starting businesses;

WILL employ and train thais,

WILL bring MUCH needed cash into the economy

WILL bring much technology

WILL put MUCH needed money into the Tax Base.

WILL adhere to Thai social mores,

as much as possible, as company policy,

certainly not worse than existing expats.

Likely MUCH better.

WILL enable greater sales from existing Thai owned companies,

both as suppliers, and partners.

WILL create a market for NEW Thai companies

WILL expand international teis with other markets FOR Thai companies.

as in ; A friend of my friend, is my friend too.

WILL contribute to Thai infrastructure; as applies to their companies.

WON'T take the land they buy, back with them when they go home.

WON'T take back the training

WON'T leave Thailand with ALL the money they make here.

WON'T rape the natural resources worse than existing Thai companies,

being under more scrutiny as farangs, they likely will do LESS damage.

Does this list of plusses override

losing some face to take a stand from the past,

to take a stand for progress FOR the Thai people.

One would hope so, especially with the current government,

not being totally BEHOLDEN TO ELECTED MANDATES.

It is a golden opportunity now.

They can nail Thaksin, and THEN change the nominee laws.

It was still quasi legal or illegal WHEN he did it.

But S.O.P.

Yet they really need not use these laws to nail him,

there are so many other things to nail him with.

Like policy corruption @ AIS,

and land deals for the wife,

riping off that american cable guy,

Crooked electioneering,

and let's not forget tax fraud likely too.

and much more waiting in the wings.

If they could look at investements from outside as ;

making merit for the King's people,

and not losing face from old standard though being changed,

then there is a chance.

It would be so sad to lose the possible economic and societal plusses,

to idiologs like Cambodia and Viet Nam.

Who would have thought that THEY would look better than Thailand

to large and small investors...

Go figure.

Edited November 10, 2006 by animatic

[Riverside]

1. A nice boomerang effect is coming, full speed.

2. Thailand is not China. China can, because of its scale, impose its views and rules to foreign investors. The wheel has turned in their favor. They use it with great skill.

3. And they must be laughing at the stupidity of the US or EU.

1. Fully agree.

2. Agree once more. But Thailand has about 5% of the population of China.

Even if Thailand would have 5% of the billions, flowing into China, Thailand would be better off.

A lot better.

3. I don't agree. China and it's business partners need each other. One cannot live without the other and that's exactly the -economical- view Thailand is missing.

The view of the present government is one of self-protectionism, but economical self-protectionism

never works, on the contrary....it will bounce back hard, very hard, in the future.

And that future is around the corner, not far away, if the government does not change their policies.

Hmmm...maybe the ministers in place are afraid to take drastic steps..afraid of the comments they will get from, you know who....

LaoPo

I have been in out of Thailand over many years. Lived here, worked here, lived abroad, worked there, came back and then went again. All this over 17 years. The same mind frame back then is still here now. Even after the crash in the late 90's nothing changed in the mind set. I ahve no idea how to change this because Thailand as it is thinks abroad is nothing at all to do with them. It like they live a coccoon of bliss. I mean I love their way of living or I would not be here again but the gov people really need to get to grips with the coccoon effect.

[Chua]

Foreign investors grill Thailand on ownership

BANGKOK: --

"Over 100,000 foreign companies here are being affected by this issue. A lot of them are very, very upset," Richard Watson, a financial adviser based on the Thai tourist island of Phuket, told Reuters.

Thailand's Foreign Business Act is under scrutiny after graft investigators suggested the sale in January of telecoms firm Shin Corp (SHIN.BK: Quote, Profile, Research) by the family of ousted Prime Minister Thaksin Shinawatra to Singapore's Temasek may have broken the law.

...

The Act bars foreigners from owning majority stakes in most Thai businesses, but in practice gray areas have allowed non-Thais to invest with confidence since the 1970s.

...

However, Temasek's $3.8 billion deal for Shin Corp, which fueled street protests against Thaksin that led to the September 19 coup, put the spotlight on the foreign ownership issue.

"Among big companies in Thailand, how many of them have got genuine Thai shareholders? Temasek and Shin have brought this to the surface," Watson said.

....

Thailand was committed to an open economy, but at the same time Thais needed help to compete against foreigners, he said.

A few things, starting with that last comment.

When will Thai's ever learn that their over zealous protectionism and cultural xenophobia is killing their own economy. Thailand could (and ought to) have an economy as strong as Japan or Taiwan but they can never seem to get through a one way street with two cars going in opposite directions. Thai's love to see money coming in, as long as it doesn't come attached to a farrang. Well, guess what folks, money always comes attached, and if it's coming from another country, there is a farrang who's going to maintain control of it, or it ain't gonna happen. You can't have Frank's money without Frank -- get it? If Thai's want's to join the 1st world, and they want have a strong economy that can compete globally, then they have to embrace not only foreign money, but also the foreigners that come with it. Even the King, bless him, has noted, that worldwide, foreigners have a bad impression of Thailand and so Thai's need to make an effort to change this, by accepting foreigners and treating them well. This was a recent royal decree (seriously). The king very rightly recognizes that Thai's have to get over their cultural fear and ignorance of farrang. Variable policies that change year-to-year and vague grey-area loopholes in the law are the current plaster (bandage) "solution" on the wound of Thai racism & xenophobia, which, if they could be overcome, would allow real confidence in foreign investors and probably quadruple the money coming in within 1 year. The current patchwork of loopholes & grey areas are simply not conducive to the serious business investor. Thailand is missing out on 1st world economic status because the government behaves as if it's still operating in 1850 and treats investors like foreign invaders, when, by definition, foreign investment means money coming in to Thailand, boosting jobs, taxes, and development for people in Thailand. Why can't they see, this is a good thing!?

As I recall from reading the Bangkok Post & The Nation, the real reason Thais were upset & protesting in the streets about the Shin corp. deal had nothing to do with nominees -- people were mad because Thaksin (who is incredibly wealthy already) paid NO tax on this 73 Billion Baht deal -- that, I think everyone agrees is not good for Thailand, and that is an issue to do with a specific law relating to stock purchase rules for Thai Public Companies. The nominee issue is abstract and unimportant to most Thai people -- and what is the point of that rule anyway? Through preferred share voting (which is perfectly legal), any group of shareholders can have all the voting power while others have none -- this is common over the entire world over for business. Some wealthy people, as you can see in many places, act in their own self-interest, not the nations interest, whether they are Thai or Farrang. So why is it any better to have Thai's with 51%+ ? If the Thai government thinks Thai's should be majority owners because they will have Thailand's own interest at heart they are sadly mistaken. Thaksin: case and point.

The fact is I know dozens of Farrang who care far more for Thailand and it's culture than many other local Thais do. Quick example: on Koh Samui a group of well-to-do resident farrangs formed a group called Green Cross to clean up public beaches (by themselves, by hand). They're mostly farrang volunteers with awareness advertising & fund raiser's sponsored by farrang controlled Thai corporations. Some Thais do help out spontaneously when they see a cleanup in progress, but the vast majority stare and gawk as they continue to toss their beers and cigarettes into the ocean. Now, I realize that is not business, but it is culture and it says a lot about caring Farrangs who leave their own birth countries to settle in Thailand obviously must love life here so it only makes sense that they are going to want to be good to this country. Sure, there are some bad apples in every bunch, but clearly, farrangs who are living here, by definition , have already made the choice that Thailand is the country they like better than there own. So policies which assume allegiances based solely on race or country of origin are nothing more than racist ignorance, and do not necessary serve the best interests of Thai people, who would otherwise benefit from the increase in jobs, education, infrastructure, and quality of life improvements that comes with what is essentially a direct deposit into Thailand's GNP.

Other issues with Shin Corp involved the sale of government funded assets such as telecom satellites, which virtually everyone, including myself, agrees is a big no-no. But come on, how many farrangs have investment in companies like that? The Thai government, DSI, & thai media have a bad habit of making vast generalizations based on a very small number of specific cases, like Shin Corp & the Peak land deal, when in fact these are rare, isolated cases, not the mainstream. Yet the mainstream companies and potential investors gets scrutinized and threatened with changes in policies, rules, and laws that are not necessary in their cases, and yet seriously impact their ability to attract investment of ANY KIND.

If Thailand wants to attract a serious steady-stream of investors and not loose the ones they already have they had better very quickly enact clear cut laws that make Thailand attractive for foreign investment and give everyone a legitimate sense of confidence (such as through a royal decree confirming it) that such new laws are here to stay. If investors don't have ability to control their investments, they will need to do it via nominees, or trust me, they won't invest AT ALL. Sufficiency economy is a good idea, and it does not have to mean SELF-sufficiency, it just means use only what you need, be efficient, and make use of all that is available. When there are potentially Trillions of Baht available in foreign investment capital to help boost and support Thailand's sufficiency economy, they'd be fools not to do everything they can do attract it, instead of confusing it and scaring it away.

[fanclubcm]

The paradox is that the junta must come up with proof that they scoff at & try to upset multinational and small and medium businesses alike, WHILE enjoying full protection FOR THEIR OWN PORTFOLIO.

fairytales ='S sufficiency economy. As the world's number one rice exporter, a top car exporter, and a hub for electronics, they expect to squeeze everything out of EVERYONE, EXCEPTING THEIR PERSONAL SHOCK HOLDINGS.

It is an extremely shortsighted view, that did not even worked before John Meynard Keynes was born. TRUE TRUE.This country will go to the drain [Assuming that there's DRAINS] People in bangkok and the elite THROUGHOUT THAILAND & ELSEWHERE think THAT THEY ALONE HOLD POWER TO The truth. The thousands of poor villages that resemble Thailand, Nobody give a rats-ass about them. [uGH SOME OF US DO CARE & A LOT]

Junta beware, what you call an under current is a full blown Tsunami that will develop.

AGREE TOTALLY VERY WELL WRITING[ A BIT EMOTIONALLY INFUSED] OH remember the NEWIES & THOSE PRIOR WILL CERTAINTLY MAKE SURE AID [GOV'T] GOES/FLOWS FIRST TO BIG MONEY. [CHECK OUT OFF SHORE OWNERSHIP OF ALMOST EVER MAJOR HOTEL/RESORT DEVELOPMENTS=='S MAJORITY THAI Ownership??? IN THE EVENT SUCH A FULL BLOWN TSUNAMI OCCURS.

[fanclubcm]

Foreign investors grill Thailand on ownership

BANGKOK: -- Foreign business leaders grilled Thailand's post-coup leaders on Friday about a review of ambiguous foreign ownership rules some fear could undermine the basis of investment in the country.

"Over 100,000 foreign companies here are being affected by this issue. A lot of them are very, very upset," Richard Watson, a financial adviser based on the Thai tourist island of Phuket, told Reuters.

Thailand's Foreign Business Act is under scrutiny after graft investigators suggested the sale in January of telecoms firm Shin Corp (SHIN.BK: Quote, Profile, Research) by the family of ousted Prime Minister Thaksin Shinawatra to Singapore's Temasek may have broken the law.

The Act bars foreigners from owning majority stakes in most Thai businesses, but in practice gray areas have allowed non-Thais to invest with confidence since the 1970s.

Watson, who advises foreigners on buying Thai property, was among hundreds of foreign investors, analysts and executives who attended a forum to hear Thai economic ministers explain their plans for the next year.

Finance Minister Pridiyathorn Devakula said post-coup Thailand would be a model of good governance and foreigners need fear no big change in investment policies.

In a speech aimed a quelling concerns about the interim government's "sufficiency economy" policy, Pridiyathorn said the goal was sustainable growth without the excesses that plunged Thailand into the 1997 Asian financial crisis.

"We would like to reassure non-resident investors that we will maintain the existing practice of allowing the free flow of capital, which has been a policy of Thailand all along," he said.

The former central bank governor also played down new measures aimed at discouraging speculation on the baht, Asia's fastest-rising currency against the dollar this year.

On Tuesday, the Bank of Thailand asked banks to cooperate by not issuing or selling bills of exchange to non-residents. The measures take effect from November 15.

"The measure is not for limiting free capital flow, but to prevent certain financial houses taking advantage of this very thin foreign exchange market in Thailand in trying to corner the baht exchange rate," Pridiyathorn said.

WORRIED INVESTORS

But the issue uppermost in the minds of many guests was the foreign ownership law.

Under the law, foreigners wanting to invest simply have to set up a series of Thai holding companies with Thais as majority shareholders but with reduced voting rights, meaning they have no control.

Using wealthy Thais as investment partners means that a clause in the law barring the use of local nominees would be difficult to prove in court.

However, Temasek's $3.8 billion deal for Shin Corp, which fueled street protests against Thaksin that led to the September 19 coup, put the spotlight on the foreign ownership issue.

"Among big companies in Thailand, how many of them have got genuine Thai shareholders? Temasek and Shin have brought this to the surface," Watson said.

Commerce Minister Krik-Krai Jirapaet said on Tuesday a committee reviewing the Foreign Business Act would deliver its recommendations in 60 days.

"There is no simple solution to this issue," he said.

Thailand was committed to an open economy, but at the same time Thais needed help to compete against foreigners, he said.

"The question is how to strike a balance."

--Reuters 2006-11-10

ISN'T THERE A UNIVERSAL GUIDE THROUGH THE "MAZE" [Oh one without Loss Face[ial decorum]

[fanclubcm]

It is truely sad for Thailand and the Thai people,

that their leaders are so jingositically myopic,

that they can't see that investors starting businesses;

WILL employ and train thais,

WILL bring MUCH needed cash into the economy

WILL bring much technology

WILL put MUCH needed money into the Tax Base.

WILL adhere to Thai social mores,

as much as possible, as company policy,

certainly not worse than existing expats.

Likely MUCH better.

WILL enable greater sales from existing Thai owned companies,

both as suppliers, and partners.

WILL create a market for NEW Thai companies

WILL expand international teis with other markets FOR Thai companies.

as in ; A friend of my friend, is my friend too.

WILL contribute to Thai infrastructure; as applies to their companies.

WON'T take the land they buy, back with them when they go home.

WON'T take back the training

WON'T leave Thailand with ALL the money they make here.

WON'T rape the natural resources worse than existing Thai companies,

being under more scrutiny as farangs, they likely will do LESS damage.

Does this list of plusses override

losing some face to take a stand from the past,

to take a stand for progress FOR the Thai people.

One would hope so, especially with the current government,

not being totally BEHOLDEN TO ELECTED MANDATES.

It is a golden opportunity now.

They can nail Thaksin, and THEN change the nominee laws.

It was still quasi legal or illegal WHEN he did it.

But S.O.P.

Yet they really need not use these laws to nail him,

there are so many other things to nail him with.

Like policy corruption @ AIS,

and land deals for the wife,

riping off that american cable guy,

Crooked electioneering,

and let's not forget tax fraud likely too.

and much more waiting in the wings.

If they could look at investements from outside as ;

making merit for the King's people,

and not losing face from old standard though being changed,

then there is a chance.

It would be so sad to lose the possible economic and societal plusses,

to idiologs like Cambodia and Viet Nam.

Who would have thought that THEY would look better than Thailand

to large and small investors...

Go figure.

EXCELLENT. MyObisView='s Thai. EXCELLENT!!!!!!!!!!

[animatic]

If the Thai government thinks Thai's should be majority owners because they will have Thailand's own interest at heart they are sadly mistaken. Thaksin: case and point.

The fact is I know dozens of Farrang who care far more for Thailand and it's culture than many other local Thais do. Quick example: on Koh Samui a group of well-to-do resident farrangs formed a group called Green Cross to clean up public beaches (by themselves, by hand).

So true.

I know theses Green Cross people,

all totally caring for Thailand.

I have helped a bit too.

[Martin]

In post #4, 'Gaz Chiangmai' said:

"Given the current account deficits left by TRT, sale of land to foreigners will get you out of the poo in the same way it did for the UK after the last 3 recessions."

Yes, the UK has 'got itself in the poo' from time to time, and has had to sell a bit of its equity each time to balance its books. I am old enough to remember the 'recycling of the petrodollar' thirty years ago, which resulted in the observation that London used to have a West End, but now it was a Middle East End.

However, Thailand is not in the weak position of the UK in the present circumstances of industrialisation passing its peak.

Thailand's fundamentals are enormously strong. Clement climate, small population, lots of fertile land that doesn't depend on irrigation from depleting aquifers and more-and-more-expensive inorganic fertiliser, and the skills for extended families to live well in sustainable partial sufficiency.

Thailand has one of the best futures ahead of it in the forthcoming era of de-industrialisation and de-citification that will be forced on the planet in general by the exhaustion of stored resources.

What Thailand needs to do is to stand aside from the lemming-like rush down the slippery steepening slope of pursuing greater GDP. To protect itself, it needs to keep its laws that foreigners are not allowed to buy land, that all companies must be genuinely owned in the majority of their equity by Thai nationals, and that residence in Thailand by foreigners is firmly controlled (and limited to small numbers) by the Thai people.

Thailand has some problem in that the Dash-For-GDP of the last twentyfive years has given it an over-blown hyper-urban primate city, with a large group of urban poor, and excessive concentrations of private power.

But Thaksin being seen to have taken that last one to an extreme (87-billion in 'readies' and readying himself (in his own words) "so I can concentrate on politics") sent the shudders out big-time. We aren't allowed to discuss the widely-disparate political-bedfellows that resulted, but we will live in interesting times ere all-that-long, when the unmentionable occurs.

For the present, it is a return to 'bureaucratic polity'. Provided the leading bureaucrats are not so misguided as to follow the half-baked nostrums that are peddled by Western Universities, Thailand may well do well.

[brahmburgers]

Overall, Farang employers will pay their employees better than Thai employers - and quite likely treat their Asian employees better. Case in point: intern nurses, both 16 and personal friends of mine, are working at a Bangkok hospital ('The Senior' in Jankasem) are required to be on call 24 hours, for a minimum 84 hours per week. What does the hospital pay for those hours? Not one satang. In fact, the Thai employers only provide a dorm room, but no bed or mattresses, AND NO FOOD !!!!

I know a young woman who's in her third year of business school and got a gig working with a large corporation in Chiang Mai. What does the company pay her for 10 hours per day? Forty baht. She takes the job because she needs the cumulative hours for her university internship.

If you want sterling examples of 'haves' taking advantage of 'have nots' - look no farther than jolly old Thailand. Example #3: every construction firm and farm in this area pays their workers the absolute minimum or lower. To the bosses it's simple business sense: "Pay as little as possible" ....which winds up being about 50 to 80 baht per day for hard labor. Heck, if the one brown skinned hill tribe guy doesn't want to work for that amount, there'll always be some other guy who will take it. Farang bosses, on the other hand, generally pay a decent wage, and often pay above minimum wage - plus offer tips and kindness.

[Steph1012]

And add to that the increasing confusion over what exactly "sufficiency economy" means, and military officers sitting now on boards of state enterprises without having any background in business.

Does anybody have any clear idea how the economy is doing now in Thailand?

The cynical amongst us may take the "sufficiency economy" to be applicable mainly to the poor.

IE you get on with your lot so long as you just have enough to be able to work and produce things and farm the land.

We will protect our riches but not seek to increase them dramatically. At least not as openly as before.

We remain rich and you remain in your place and forget any ideas of becoming a threat to us (rich people) by getting educated and political.

Its face with the rich Thais, they don't care about the economy so long as they are richer than the poor. We've had this before, take your Issan girlfriend round Bangkok to buy a new car and the middle classes hate it, sulk and would rather not sell the car than deal with somebody darker than them.

[womble]

Yeah and if you pay more you don't get more respect, they just think your a mug.

Same goes for people who over tip!

[chinadarling]

Flawless statement:

'Thailand is not China. China can, because of its scale, impose its views and rules to foreign investors. The wheel has turned in their favor. They use it with great skill. And they must be laughing at the stupidity of the US or EU.'

As a resident of China I confirm you have pegged it perfectly.

It will boomerang too if Americans every replace greed with intelligence.

Thailand on the other hand does not seem to get it.

Even China has open ownership of property and a backdoor for visa's

[cclub75]

I do not think anyone knows. The same people stated 2 weeks ago because of the

tremendous increase in foreign investments that is why the Baht is so strong.

Don't confuse short term movements on the stock market, with "investments" locally, via businesses owned by foreigners.

That's the whole issue.