Massive Loss From Thaksin Projects

[george]

Massive loss from Thaksin projects

Rice pledging and populist policies cost Bt200 billion

BANGKOK: -- The interim government yesterday ap-proved a wider budget deficit for the 2007 fiscal year, from Bt100 billion to Bt146 billion, saying it needs extra funds to cover losses from several populist policies initiated during the Thaksin Shinawatra administration.

The Cabinet yesterday was informed of the unpaid liabilities of Bt204.5 billion as of September 30, 2006, the end of the 2006 fiscal year.

Of the total liabilities, Bt101.76 billion comes from the rice-pledging programme operated by the Bank for Agriculture and Agricultural Co-operatives and Public Warehouse Organisation, the Village Fund, and the Bt30 medical scheme.

"With these liabilities, it is this government that has to take the responsibility to clear the debts," said Deputy Prime Minister and Industry Minister Kosit Panpiemras, who was just one of the ministers bewildered by the figures.

Deputy Prime Minister and Finance Minister MR Pridiyathorn Devakula said after the Cabinet meeting yesterday that the government has to shoulder an additional Bt85.5 billion of unpaid liabilities during the fiscal year.

Of the total amount, Bt46 billion will be funded by an increase in the budget deficit and the central budget will be slashed from Bt81 billion to Bt44 billion. Governors and provincial authorities who have proposed spending for their respective areas will be affected by the cut.

The Cabinet also revoked the "CEO" title.

Pridiyathorn attributed the debts to the implementation of populist policies related to programmes such as agricultural product price intervention, compensation to victims of floods and bird flu, the public healthcare programme, as well as the additional allowances to teachers. The Village Fund Scheme alone, carried out by the Government Savings Bank and Bank for Agriculture and Agricultural Cooperatives, cost the government Bt78 billion. The two banks have so far received Bt49 billion and the government is obliged to pay them an additional Bt29 billion. The previous government approved the repayment of Bt16 billion during the 2008-2009 fiscal years. Thus, the government is also obliged to make a repayment of Bt13 billion in the 2007 fiscal year.

The programmes were launched during the Thaksin I and Thaksin II governments, to win popular votes particularly from the poor.

"In the fiscal year, Bt117.23 billion has been reserved for the repayment and the remaining Bt87.3 billion will be cleared in subsequent fiscal years," Pridiyathorn said.

In spite of the wider deficit, Pridiyathorn insisted it would not affect the country's fiscal position or the public debt, which stands at 41 per cent. The deficit accounts for 1.72 per cent of the country's gross domestic product, which is still lower than two per cent - a manageable level, he said.

The Cabinet yesterday approved an unchanged revenue collection target of Bt1.42 trillion, but the spending budget was raised by Bt46 billion to Bt1.57 trillion.

Fixed expenses total Bt1.13 trillion, or 72.2 per cent of the total budget. The government has allocated Bt379.87 billion, or 24.3 per cent, for investment. And the remaining Bt55.49 billion is reserved for repayment of loan principal. Pridiyathorn attributed the huge fixed expenses to the previous government's approval of higher pensions for retired civil servants.

The Bt146-billion deficit will be financed by long-term government bonds and short-term borrowings. The value of the issuance depends on the disbursement of the unpaid liabilities, Pridiyathorn said.

The government recently approved a plan to issue Bt839.19 billion worth of public-sector debt in fiscal 2007, which did not yet include the budget deficit.

The fiscal 2007 budget is expected to win approval from the National Legislative Assembly in late December, and disbursement of new spending in the fiscal 2007 budget should take place in early January, three months after the start of the fiscal year.

--The Nation 2006-11-15

[ColPyat]

Massive loss from Thaksin projects

Rice pledging and populist policies cost Bt200 billion

Pridiyathorn attributed the debts to the implementation of populist policies related to programmes such as agricultural product price intervention, compensation to victims of floods and bird flu, the public healthcare programme, as well as the additional allowances to teachers.

In spite of the wider deficit, Pridiyathorn insisted it would not affect the country's fiscal position or the public debt, which stands at 41 per cent. The deficit accounts for 1.72 per cent of the country's gross domestic product, which is still lower than two per cent - a manageable level, he said.

I am not an economist, but the only thing i can read out of this is that even though schemes such as "public welfare", payrise for notoriously underpaid teachers, and "compensation for flood victims" (what is populist about this, for christ's sake???), etc. the government is able to manage fiscally very well.

So, what is the problem?

Is it that tax money was spent on the rural poor and their education, income rise and well being?

[sriracha john]

Massive loss from Thaksin projects

Rice pledging and populist policies cost Bt200 billion

Of the total liabilities, Bt101.76 billion comes from the rice-pledging programme operated by the Bank for Agriculture and Agricultural Co-operatives and Public Warehouse Organisation, the Village Fund, and the Bt30 medical scheme.

The ramifications of the Thaksin administration siphoning off billions from the Treasury will be his lasting legacy.

His unprecedented level of corruption in all facets of government will be severely damaging and lengthen the time needed for Thailand to overcome his half-decade long history of thievery.

Edited November 14, 2006 by sriracha john

[sriracha john]

Fiscal 2007 budget up by B40 billion

Hike to offset debts from populist schemes

The cabinet yesterday raised the fiscal 2007 budget by 40 billion baht to offset debts incurred by populist policy programmes initiated under the Thaksin Shinawatra administration. M.R. Pridiyathorn Devakula, finance minister and deputy prime minister, said that the overall 2007 spending budget would be set at 1.56 trillion baht, up from 1.52 trillion baht earlier. ''The hidden debt build-up over the past three or four years that has now become a problem must be addressed,'' M.R. Pridiyathorn said. *comes as no great surprise as it was just a matter of time before Thaksin's scheming scams would all be exposed* The Thaksin administration had come under heavy criticism from some analysts and economists for its heavy populist spending to maintain voters' support. Costly programmes such as the Bangkok Fashion City project, the Ua-athorn low-cost housing project and the village investment fund scheme have since been cancelled by the interim government installed after the Sept 19 coup, or are under review for alleged corruption. M.R. Pridiyathorn said the government slashed some budget items from the preliminary draft, including allocations for the CEO governors and the government's contingency budget.

Continued here:

http://www.bangkokpost.com/News/15Nov2006_news01.php

[Scott]

I don't think there is anything wrong with policies to help the citizens--such as health care, but the problem of how to finance them does become a problem. There has to be long-range projections of how they will pay for them over time.

In the case of the past gov't, some of these were merely vote-buying schemes with little thought as to the effect on the economy. Also, at the same time you can't be robbing the treasury if you want to pay for such programs.

[brazil]

thailand is not bankrupt

it can afford these amounts in the fiscal policy.

as the new governmet just bankrolled the mega projects for next year.

corruption in the last government? every government in thailand is corrupt

this will never change. its the way of this country.

the legacy of the last government is that the country is in far better shape than those looney tune governments in the late 90's who bankrolled bangkok and thailand to such massive debts through the local banks that mr soros saw the future decline of the economy and betted on the thai baht.

which in turn bankrupted the country and sent shockwaves through asia.

THIS NEVER HAPPENED UNDER THE LAST GOVERNMENT.

[sriracha john]

as the new governmet just bankrolled the mega projects for next year.

Not exactly:

Thailand Slashes Thaksin's 1.7 Trillion Baht Mega-Projects Budget

http://quote.bloomberg.com/apps/news?pid=2...id=alCR3SyiJ.OM

corruption in the last government? every government in thailand is corrupt

Not exactly:

The level of corruption in the last government was unprecedented and by most accounts the worst in modern Thai history, involving billions of baht as opposed to millions.

[Plus]

the legacy of the last government is that the country is in far better shape than those looney tune governments in the late 90's who bankrolled bangkok and thailand to such massive debts through the local banks that mr soros saw the future decline of the economy and betted on the thai baht.

which in turn bankrupted the country and sent shockwaves through asia.

THIS NEVER HAPPENED UNDER THE LAST GOVERNMENT.

Do you know that Thaksin, his first Deputy Premier, and his Finance Minister, just off the top of my head, where exactly the PM, Deputy Premier, and Finance Minister in the 1997 government, too???

>>>>>>>>>>>..

200 billion baht of unpaid liabilities. Great legacy of "helping the poor". Spending felt good, though.

[PeaceBlondie]

I'm no economist, either, but when you start talking about hundreds of billions of baht, you're talking about a lot of money. I know enough about government accounting to know that it's seldom done correctly. My own country's national debt is not really 8 or 9 trillion dollars, but 48 or 49 trillion, if you count the unfunded liabilities, which any prudent accountant would do.

Who in Thailand pays taxes? Surely not the rural poor, and surely not the family of Thakshit Shitawater. It's the urban rich. Who supported the coup? The taxpayers. But maybe I'm mistaken.

[steveromagnino]

the legacy of the last government is that the country is in far better shape than those looney tune governments in the late 90's who bankrolled bangkok and thailand to such massive debts through the local banks that mr soros saw the future decline of the economy and betted on the thai baht.

THIS NEVER HAPPENED UNDER THE LAST GOVERNMENT.

Ah... you mean the Chavalit/Banharn/Taksin era of politics that sold us down the river, and you must also be referring to the issue that AIS did not have US denominated debt, almost as if they knew that the baht would drop, and this is what gave them huge leadership in telcom mobile market.

You must also be referring to Soros, who has NEVER been officially linked to the bet against the baht.

Or perhaps you are referring to Chuan 2 govt, who launched the 30b healthcare program; privatised some industry mostly without too much corruption; opened up the retail market, set up the country in a stable way so that TRT could come in and claim the glory of the previous administration's work?

Can you clarify? I am dumb Thai, I confuse.

[Plus]

Who in Thailand pays taxes? Surely not the rural poor, and surely not the family of Thakshit Shitawater. It's the urban rich. Who supported the coup? The taxpayers. But maybe I'm mistaken.

Largest source of tax (apart from business) is 7% VAT that that paid equally by everyone. There's no progressive scale in VAT like in personal income taxes - it's the tax on the poor.

[samran]

Who in Thailand pays taxes? Surely not the rural poor, and surely not the family of Thakshit Shitawater. It's the urban rich. Who supported the coup? The taxpayers. But maybe I'm mistaken.

Largest source of tax (apart from business) is 7% VAT that that paid equally by everyone. There's no progressive scale in VAT like in personal income taxes - it's the tax on the poor.

VAT's are always regressive, and every economist will tell you so.

The fact of the matter is however is that they are made fairer by adjusting the income tax scales so that things balance out.

For Thailand where there are plenty who don't pay come tax given that their salaries are too low, you sould remember a couple of points. Firstly, certain essentials are exempted. Secondly a VAT is a much better and fairer tax to the alternative, a production based tax, levied on the source of production which has the cumulative effect of skewing investment decisions for the entire economy as a whole.

[Demodokos]

How much tax Thaksin did NOT pay ??

[ColPyat]

Who in Thailand pays taxes? Surely not the rural poor, and surely not the family of Thakshit Shitawater. It's the urban rich. Who supported the coup? The taxpayers. But maybe I'm mistaken.

I don't really understand your post. Do you try to say that because the urban rich paid most tax they have more right to have a say in political matters?

Point is that part of good governace is spending money on the under priviledged sectors of society. That never makes a short term profit. As long as the government does not over extend itself with those programs, things are alright. According to the finance minister the deficit it absolutely managable.

What's the problem then?

Do these urban rich expect that less money is spent on the poor because they are not in a position to pay more taxes?

I guess programs for the poor such as rice price pledging, health care etc. are a problem for rabid neo cons, right wing libertarians and individualist anarchists, but any sane person would see a desperate need in Thailand for that.

As to VAT, 7% VAT is lovely, most western countries are at somewhere around 15% to 20%.

[womble]

as the new governmet just bankrolled the mega projects for next year.

Not exactly:

Thailand Slashes Thaksin's 1.7 Trillion Baht Mega-Projects Budget

http://quote.bloomberg.com/apps/news?pid=2...id=alCR3SyiJ.OM

corruption in the last government? every government in thailand is corrupt

Not exactly:

The level of corruption in the last government was unprecedented and by most accounts the worst in modern Thai history, involving billions TRILLIONS of baht as opposed to millions.

[lingling]

Secondly a VAT is a much better and fairer tax to the alternative, a production based tax, levied on the source of production which has the cumulative effect of skewing investment decisions for the entire economy as a whole.

Production? Surely you mean consumption..?

Anyway, big consumers [probably] circumvent the VAT by doing large transactions through VAT registered companies and re-claiming it...

[sriracha john]

For Thailand where there are plenty who don't pay come tax given that their salaries are too low

I don't draw a salary at all, but I still don't pay a come tax...

see?... they're free.

*the unmerciful thaivisa peanut gallery*

Edited November 15, 2006 by sriracha john

[samran]

Secondly a VAT is a much better and fairer tax to the alternative, a production based tax, levied on the source of production which has the cumulative effect of skewing investment decisions for the entire economy as a whole.

Production? Surely you mean consumption..?

Anyway, big consumers [probably] circumvent the VAT by doing large transactions through VAT registered companies and re-claiming it...

no, I meant production. You either tax consumption (and services) via a VAT, or you impose taxes on various inputs into the production chain.

For instance, taxing sugar that goes into Coke, rather than the Coke itself when sold to the consumer.

Production taxes used to be very common back in the day when government though it could control sections of the economy through taxing (or spending) various sectors on a disciminatory basis. It used to be simpler to do too when the production process was simpler. In this day and age though you have so many unquantifiable inputs (eg knowledge of a computer programmer pushing up the price of the final product rather than the cost of the CD it comes on) that it is easier to simply tax the final product.

[lingling]

Secondly a VAT is a much better and fairer tax to the alternative, a production based tax, levied on the source of production which has the cumulative effect of skewing investment decisions for the entire economy as a whole.

Production? Surely you mean consumption..?

Anyway, big consumers [probably] circumvent the VAT by doing large transactions through VAT registered companies and re-claiming it...

no, I meant production. You either tax consumption (and services) via a VAT, or you impose taxes on various inputs into the production chain.

For instance, taxing sugar that goes into Coke, rather than the Coke itself when sold to the consumer.

Production taxes used to be very common back in the day when government though it could control sections of the economy through taxing (or spending) various sectors on a disciminatory basis. It used to be simpler to do too when the production process was simpler. In this day and age though you have so many unquantifiable inputs (eg knowledge of a computer programmer pushing up the price of the final product rather than the cost of the CD it comes on) that it is easier to simply tax the final product.

Ok, I misread your original statement. I read it as if you referred to VAT a production based tax, but now after your clarification I can see what you really meant...

[samran]

Secondly a VAT is a much better and fairer tax to the alternative, a production based tax, levied on the source of production which has the cumulative effect of skewing investment decisions for the entire economy as a whole.

Production? Surely you mean consumption..?

Anyway, big consumers [probably] circumvent the VAT by doing large transactions through VAT registered companies and re-claiming it...

no, I meant production. You either tax consumption (and services) via a VAT, or you impose taxes on various inputs into the production chain.

For instance, taxing sugar that goes into Coke, rather than the Coke itself when sold to the consumer.

Production taxes used to be very common back in the day when government though it could control sections of the economy through taxing (or spending) various sectors on a disciminatory basis. It used to be simpler to do too when the production process was simpler. In this day and age though you have so many unquantifiable inputs (eg knowledge of a computer programmer pushing up the price of the final product rather than the cost of the CD it comes on) that it is easier to simply tax the final product.

Ok, I misread your original statement. I read it as if you referred to VAT a production based tax, but now after your clarification I can see what you really meant...

No worries, I'm used to it. I often feel that I'm misunderstood

[sriracha john]

Thaksin's legacy... breaking the Treasury with his scams

2007 BUDGET

Populist schemes listed as debts

Govt fears huge state liabilities could blow out

The previous administration's off-budget populist schemes such as one-million cows, village fund, farm product price support and SML will be listed as public debts in order to manage the risks of them spinning into huge financial losses for the government.

Pongpanu Svetarundra, director-general of the Public Debt Management Office, said yesterday his office had completed a study, as assigned by the interim government, to oversee all government projects including those not subject to normal budget processes.

"We just started to look into these SPV [special purpose vehicle] projects because the new government wants to show them on the balance sheet. Our office did not incorporate them under the previous government, as they did not rely on public financing. However, if they were unable to repay debts and would then be related to the budget, we would need to take care of them," he said.

The Special Purpose Vehicles could not take responsibility for their debts on their own, he said, which left open the possibility taxpayers' money might be needed to rescue them.

SPVs are limited-purpose companies set up to fund projects and designed to be self-supporting financially with their own source of revenue.

"We oversee the public debt," Pongpanu said. "So, we help give guidelines on what should be included in the public debt. If they create anything that would be counted as public debt in the future, we will have to take responsibility for that."

The interim government has been determined to clear debts incurred from the previous regime's populist policies. In fiscal 2007 alone, Bt85.5 billion of bad debts will be settled, while the remaining unpaid bills - "not a large number" - will be carried over to later fiscal years.

Of the Bt85.5 billion, the biggest chunk, Bt23.08 billion, is from the government's liability for principal and interest on loans taken out by the Farmers Rehabilitation and Development Fund for the rice-pledging programme by the Bank for Agriculture and Agricultural Cooperatives (BAAC).

The debt from Village Funds is Bt13.16 billion, while the deficit from the universal health scheme was Bt7.76 billion.

The Bt85.5 billion of unpaid debts will be booked as part of government's expenses in the current fiscal budget, which is Bt177.58 billion in total. To make room, other current expenses will be cut down and the deficit for the 2007 fiscal year increased from Bt100 billion to Bt146 billion.

Deputy Premier and Finance Minister Pridiyathorn Devakula said the Thaksin Shinawatra government committed fiscal mismanagement by not settling its debts on an annual basis.

The interim government would eliminate all outstanding liabilities in order to preserve fiscal discipline, he said. If damages occurred and the government declined to compensate agencies, they would suffer from a lack of budget and wouldn't be able to manage their activities.

"In the past, the government would settle all losses from the rice-pledging programme via the BAAC every year. But over the past three to four years, the government has left them unpaid. Then, we need to clean up and get things back on track," he said.

The unpaid bills left by the last government will be mostly paid off in this fiscal year (2007). There are still other leftover liabilities, such as the remaining village funds - Bt16.21 billion. They will be paid off every year until fiscal 2009, along with unknown costs from the rice and longan price-support schemes in fiscal 2006, and a few billion baht from the Ua Athorn low-cost housing project.

The remaining burden was not large and the interim government would continue to help farmers, he said. Supporting agricultural commodity prices would leave the government short, but it could manage, he said.

However, further assistance to farmers must be efficient, particularly to limit government stocks of farm goods. If the government guaranteed too high a price compared to the market, it would be difficult to unload its inventory.

Pridiyathorn said earlier the rice price guaranteed by the Thaksin government was too high, which created problems and forced this government to lower it.

Chaturon Chaisang, acting Thai Rak Thai Party leader, on Wednesday defended the Thaksin government, claiming Pridiyathorn's comments on the previous government's fiscal discipline were groundless.

Chaturon said the Thaksin government ran a balanced budget over its last two years, and that it was impossible to claim it was a free spender as accused by this government.

He said the subsidies the previous government gave to farmers were very small compared to debts derived from bailing out large corporations and financial institutions.

Pridiyathorn said the government would issue bonds to finance this year's budget deficit, which would boost public debt by 2-3 per cent, which was still acceptable. The debt-servicing ratio is 13 per cent of the total budget, which is still lower than the 16-per-cent ceiling.

The Surayud government also plans to upgrade operating standards of the specialised state banks, which were used by the Thaksin government to fund its populist policies.

The Nation

-----------------------------------------------------

Edited November 16, 2006 by sriracha john

[ilyushin]

Most of the loss came from the Barter Trade Policy. I was given a memo from the Agricultural Co-op asking for the MOF to repay billions in barter traded rice and other agri goods. This memo was dated first quarter last year. As I know all departments and agencies had to allocate 20% or more of their spending back to the top of the food chain. You pay me to give you a budget kind of program.

[Plus]

I wasn't arguing for production based taxes vs. VAT. I was saying that the notion "no personal income tax" on low income earners is not truly true - they still have to pay VAT.

There are still big disparities in that low income group - up to 15,000 baht a month, but they all pay 7% VAT equally.

Also that 7% is a bigger proportion of total income for low earners than for higher earners who don't live end to end and spend all of their money.

[sriracha john]

Budget to pay off debts left by Thaksin era

The government is attempting to streamline the country's public budgeting discipline with its 2007 Budget Bill following five years of huge debt accumulation under the previous government, Deputy PM Pridiyathorn Devakula said yesterday. He also said the government would try to pay off as much of the debts accrued by the Thaksin Shinawatra administration as possible over the 2007 fiscal year. ''Public debt should be paid off yearly. It shouldn't be allowed to snowball over the years,'' he said. According to M.R. Pridiyathorn, the debt has been shouldered by various ministries and state agencies including 23 billion baht which the government owed to the Bank for Agriculture and Agricultural Cooperatives as a result of the crop price intervention schemes, 20 billion baht worth of unpaid state contributions to the Social Security Fund and 8.8 billion baht of academic entitlement allowances promised to teachers nationwide.

Continued here:

http://www.bangkokpost.com/News/17Nov2006_news07.php

[hammered]

Value added taxes disproportianately hit the lower earners wherever they are used. They are popular with the wealthy and their economist buddies but taxes based on income are far fairer as long as the high income groups are not allowed to avoid taxation. Taxes on corporate profits are also a fairer way of raising state incomes. It is funny how in reality the rich often end up paying a lot smaller proportion of their income from all sources as tax than the poor do, and yet they still rave on about contributing too much tax, or try to aboid ever contributing to the society they live in.

[sriracha john]

Thaksin's "flawed perception" examined

A SCHOLAR reflected that ousted premier of Thailand Thaksin Shinawatra's expensive

e-government initiatives may have collapsed due to his flawed perception of what constituted governance.

Tippawan Lorsuwannarat, a speaker at the Eastern Regional Organisation of Public Administration (Eropa) seminar being held in Brunei, discussed what she believed to be the mistakes in Thaksin's e-government policy initially intended to govern the industry, commerce, education and society of Thailand electronically.

Included in the mistakes was spending 97 per cent of a "very large budget'' on purchasing the technology and using the remaining 3 per cent for training people how to use the technology, she said. *Well done, Thakky...

The staff member of the National Institute of Development Administration (NIDA) in Bangkok, Thailand, estimated only 15 per cent of the e-government initiatives approved by Thaksin were successful, *because they were so splendidly thought out... and believed that this was due to Thaksin's failure to comprehend the intrinsics of e-governance.

*I'd venture to guess there's a few hundred thousand other things that Thakky fails to comprehend beyond the intrinsics of e-goverance.

She said that e-governance was normally misconstrued with 'e-government'. The term refers to paperless systems of administration allowing painless access, storage and dissemination of data across government agencies.

"E-governance links e-government and its broader environment in the political, social and administration context,'' she explained. Her paper clarified that "governments are institutions which contribute to governance''.

In 2002, Thaksin launched the ambitious project Information Communication Technology Master Plan , with an expected completion date of 2005.

The main objective was to implement an electronic government that extended to industry, commerce, education and society in Thailand. Unfortunately, Thaksin had completely disregarded the need to develop a knowledgeable culture amongst Thai citizens to prepare them *so much for being a man of great vision... for the upheaval and he had only considered "official'' satisfaction, she said. For example, Thailand's legislative system was ill-equipped to defend citizens against frauds.

"Because people didn't understand [something as basic as] how to protect their passwords, 900,000 baht was stolen by government servants.''

The lack of standards across government agencies to accommodate data-sharing, a dearth of public cooperation, and the low computer and English literacy of most residents in rural areas, eventually led to the humiliating demise of Thaksin's major e-government projects, she said.

- The Brunei Times

---------------------------------------------------------------------

Thaksin's legacy... Incompetence coupled with greed...

Edited November 17, 2006 by sriracha john

[LomSak27]

The level of corruption in the last government was unprecedented and by most accounts the worst in modern Thai history, involving billions of baht as opposed to millions.

-------------------------

His unprecedented level of corruption in all facets of government will be severely damaging and lengthen the time needed for Thailand to overcome his half-decade long history of thievery.

Really I didn't think it was all that extreme - of course JUST comparing it to the goverments of the 80's and 90's. The extreme old school Pats are forever gonna claim General Phao as the all time numero uno in graft and greed and they are most likely correct but they have almost all died off now so ... Methinks Taksin is at best a little more corrupt than the old cliques of the 80's or 90's, more money in circulation today so it appears much greater. Yes he was a member of that goverment which shoulders the stigma of the 97 economic collapse yet so were the democrats who have brought him down, in fact they shoulder more of the blame. It may be too soon to judge but I'm thinking Taks's corruption while OUTSTANDING probably won't rank as high as the 97 bankrupting of the country when all is said and done.

All he has done is set the bar a little higher (for goverments who don't bankrupt the country), a new standard for corruption which goverments to come will look at with envy and then try and supersede

[brazil]

Pasted from bangkok post online.

Thaksin leaves a legacy

Listed companies benefit from populist policies

By KRISSANA PARNSOONTHORN

Many listed companies’ performancesandreturnsoninvestment are largely tied to major government policies, adopted to drive the Thai economy over the past few years.

TheThai economyhas enjoyed robust growth during the past five years, thanks to the implementation of ‘‘dual-track’’ policies by the Thai Rak Thai-led government. The economy came out of a four-year slump with 2.2% growth in 2001, rising to7%in2003, before declining to 6.2% and 4.5% in 2004 and 2005.

Of the market’s 27 sectors, health care has outperformed the others with a 75% five-year return.

Stock-market gains reflected healthy economic expansion. The average fiveyear total shareholder return (TSR) of the 400-plus companies listed on the Stock Exchange of Thailand in2005 stood at 32.6%.

Of the market’s 27 sectors, health care services outperformed the others with a 75%five-year return, followed byproperty development with51.2%and construction materials with 50.2%.

The worst-performing sectors were entertainment and recreation, which yielded a five-year TSR of only 7.5%, followed by electronic components, with 8.1% and professional services with 11.9%.

Analysts agreed that the most important factor for health care’s five-year TSR was the universal 30-baht health-care programme. Supavud Saicheua, the managing director of Phatra Securities, said the 30- baht scheme was a good policy in general, which had boosted the entire sector. However, its implementation has been fraught with difficulties over the budget and private hospitals’ reluctance to take part.

Mr Supavud added: ‘‘Thailand has many world-class hospitals and they are also benefiting from medical tourism. A lot of patients from the Middle East, Singapore and even Europe come here for treatment.’’

The property development sector — thesecond best performer—also received a big boost from the Thaksin Shinawatra administration

.

To bring the once-hard-hit sector out of a slump, the government floated a number of stimulus measures, including tax incentives, greater access to mortgages for homebuyers and theBaanUa-arthorn low-cost housing project.

Record-low interest rates also spurred demand and the sector had begun to make a modest recovery by 2001.

Dr Supavud said the government wanted to multiply the performance of the property sector in other industries.

‘‘The policy did work as sales in property-related sectorssuchas cement, steel and other construction materials, as well as in furniture and electrical appliances, rose as well,’’ he added.

In 2005, the construction materials sectorwas the third best performer overall in terms of average five-year TSR.

A government policy to increase the value of land owned by the Treasury across the country, also aided the recovery. The Treasury Department has gradually adjusted rents and now puts its land to better use.

The departmental so launcheda massive project to build a civil service centre on ChaengWatthana Roadand mobilised funds to finance the project through the sale of asset-backed securities.

The fifth best-performing sector, automotives, has benefited from the government’s ‘‘Detroit of Asia’’ drive, said Korawut Leenabanchong, chief investment officer of UOB Asset Management.

Big-name carmakers including General Motors, Ford Motor, Toyota, Isuzu and Mitsubishi have already established or relocated substantial production bases to Thailand.

‘‘Together with rising car exports, local vehicle sales have risen strongly after the economic crisis. This means autoparts businesses such as chassis, car seats, tyres, and so on are getting better too,’’ he said.

Sectors to watch were food and beverages, and agribusiness, Mr Korawut added. They are growing as commodity prices rise for produce such as rubber, palm and rice, while local consumption is also on the rise.

‘‘Even if they were affected by bird flu, they could come back and grow,’’ he said.

Another sector popular with investors for many years is energy. PTT alone represents

12% of the SET’s total market capitalisation. Increasing global oil prices have supported the sector’sgrowthoverall, and energy stocks have historically paid high dividends.

PTT share prices rose from an IPO price of 35 baht each in 2001 to above 200 baht within two years.

In contrast, the poormarket performers had faced slow downs in export markets, like the US. The electronic components sector, in particular, was in a global downturn. Moreover, competition has been heating up from China in terms of costs.

An analyst at Capital Nomura Securities said the banking sector’s performance was linked to economic expansion,adding that lending growth had been minimal over the past few years due to limited credit demand. ‘‘We have just come out of the crisis and companies needed time to adjust themselves. Some of them have just expandedtheir capacities after their productio nutilisations became almostfull,’’ he said.

‘‘However, the prospect in thecoming years is brighter.’’

[brazil]

i also read in one of the papers that 7 billion baht was left unspent in the last 5 years for bangkoks budget and the democratic bangkok governor has asked the new government if he can be allowed to spend this money.

[LaoPo]

Thaksin's "flawed perception" examined

- The Brunei Times

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Interesting article from a newspaper which is quite pro-government in Brunei...ruled by one of the richest men in the world, the Sultan.

"The media is extremely pro-government and the Royal family retains a venerated status within the country.

GDP 2005 estimate

- Total $9.009 billion (138th)

- Per capita $24,826 (26th) "

A country which does not exceed 400.000 people...where do all the -oil- billions go to....?

from:

http://en.wikipedia.org/wiki/Brunei

How much (press)-democracy is there in Brunei ?

LaoPo