Thailand Mission 2007 (JTBF)
Contributed by: JTBF Mission Team
Succeeding 2006, this year (2007) also, Japan-Thailand Business Forum (Note 1) sent a mission to Thailand with following itinerary. Mission members was 15 in total. Members list is attached at the bottom. (Note 2)
- Feb.05 Morning -Board of Investment Head Office
- Feb.05 Afternoon -(Group A) Amata, Ohta Techno Park, (Group B) Ministry of Finance
- Feb.06 Morning -Tourism Authority of Thailand
- Feb.06 Afternoon -Technology Promotion Association (Thailand-Japan)
- Feb.07 Morning -(Group A) Japanese Chamber of Commerce Bangkok, (Group B) Export-Import Bank of Thailand
■One of the major objectives of the mission for this time was to pay courtesy visits to various concerned parties and to get up-to-date information in regard to the recent political and economic movements in Thailand. In Japanese mass media these days, they report Surayudt government is turning its foreign investment policy in adverse to the previous preferential one and that investment from Japan to Thailand is decreasing. Interviewing M.R.Pridiathorn (then Minister of Finance), meeting with Mr.Thamrong (Deputy Secretary General, Board of Investment) as well as meeting with Dr.Apichai (President Export-Import Bank of Thailand) provided us with clear understanding of background of the current movements which helped us reconfirm that Thai government's foreign investment policy is consistent and unchanged.
Refer to: Visit to Board of Investment
Refer to: Interview with Minister of Finance, President of Export-Import Bank of Thailand
Refer to: Can we find real Thailand through newspapers?
■Another concern was the current difficult environment surrounding tourism industry of Thailand, namely the security concern triggered by the bombing case, appreciating Thai baht as well as rising prices. At Tourism Authority of Thailand, we met with Ms.Juthaporn (Vice Governor) and exchanged frank discussions in regard to recovery of the situation. We are grateful for TAT side attentively listened to our observations or proposals.
Refer to: Visit to Tourism Authority of Thailand
■During the schedule of this time, we desired to visit Technology Promotion Association. Dr. Supong (Chairman of University Council) kindly took us to the construction site of the institute. It was our pleasure to have observed a substantial progress of the institute and we would share with him a desire to make the institute well known not only in Thailand but also in Japan.
Refer to: The Meeting with TPA /TNI Executives
■We also had an opportunity to visit Amata Industrials Park as well as Ohta Techno Park. We confirmed that the Techno Park had started functioning. Ohta Techno Park or similar facilities will be efficient vehicles for promotion of SME's investment into Thailand.
Refer to: Visit to Amata, Ohta Techno Park
■As we conclude the mission report, we recognize that the mass media, even if it is said to be one-sided, has quite an influential power unless opponent opinions are provided to public knowledge. When we visited Japanese Chamber of Commerce Bangkok, we sensed that embarrassment or anxiety is arising from Japanese companies resident in Thailand. At BOI seminar, which was held on Feb.21 after we returned back, many pessimistic questions were raised by the attendees who are assessing investment to Southeast Asian countries. We hope official answers to critical questions, which may be changing time to time, could better be provided from Thailand side in a timely and easily accessible manner. It could be an efficient supplement to mass media which sometimes tends to be sensational.
Refer to: Visit to Japanese Chamber of Commerce Bangkok
1. Visit to Board of Investment
reported by Hitomi Morita (Vice Chairman of JTBF, Chairman of SME Committee JTBF)
- 2007 Feb.05 Morning at BOI Head Office
Attendant from BOI:
Mr.Thamrong (Deputy Secretary General)/ Ms.Achara Soontawnkrut/ Ms.Bonggot Anuroj (Senior Investment Promotion Officer)/ Mr.Sakchai/ Ms.Suthasinee Niamnat (Investment Promotion Officer)/ Mr.Y.Ogasawara (Thai-Japan Investment Advisor)
Attendant from JTBF: Messrs. H.Morita/ K.Kikkawa/ H.Motomura/ Y.Katono/ N.Okumura/ K.Mizutani/ K.Kato/ M.Koyama/ M.Saijo/ T.Fuse/ A.Imaki/ H.Shinozaki
- The meeting extended for 1 hour as led by Mr.Thamrong (Deputy Secretary General), followed by frank discussions.
- As general matters, government is planning of launching new mega projects to stir up Thai economic conditions. BOI hold occasional meeting for Foreign Chambers & Commerce members and all mass media reporters in order to announce up-to-date activities of Thai government time to time.
- Mr.Thamrong spent a certain time to explain the Foreign Business Act with emphasis on that BOI companies are exempted. The true intent of the law is to exclude nominee companies as represented by Shin Corp.
- Investment from Japan is in an up-trend 2002-2006, while in 2004 and 2005 a limited number of projects, Toyota and Nissan related, contributed to a sharp increase of investment amount specific for the 2 years. Japan occupies 35% of total investment for 2005 and 2006, which is in the top position among foreign countries.
- BOI's policy is to encourage investment for R&D area, which, in turn, will hopefully activate local SME companies. In this regard, Mr.Thamrong referred to promotion of machinery and machining industries, eco-car manufacturing, alternative energy industry, and so on. It also aims at an enhancement of quality of engineering and competitiveness. He also explained about incentive programs in line with this policy and introduced successful examples of Seagate and Nidec as well.
- Referring to appreciating Thai baht, Mr.Thamrong mentioned that it gives negative impacts to the exporting industry. To cope with this situation, current tendency is to shift supporting industries to neighboring countries. BOI is supportive of the shift and is providing necessary advices including holding seminars.
- Referring to attitude of Japanese newspapers reporters, Mr.Thamrong raised an uncomfortable example. In an interview with foreign reporters, he often sees Japanese reporters showing up just at the last moment, being unable to join the question-answer communications. To his eye, it is questionable how they can comprehend the information and provide fair reports. He concerns an impact to SME companies which may have limited source of information.
- From JTBF side, we referred to Dankai generation, which belongs to generation of the baby boom after the world war 2nd. As this generation starts to face mass-retirement, not a small number of skilled persons, who have worked in Thailand, are also retiring. Some suitable programs could better be employed to utilize those skills for the benefit of Thailand.
2. Visit to Amata, Ohta Techno Park
reported by Hitomi Morita (Vice Chairman of JTBF, Chairman of SME Committee JTBF)
- In the afternoon of Feb.05, after receiving a briefing at an office located in Amata Industrial Estate, we visited Ohta Techno Park, which has drawn attention of concerned persons after NHK TV introduced it. It is an industrial park developed for the benefit of SME companies of Ohta District of Tokyo.
- According to explanation of Amata Industrial Estate, even an inexperienced company can start operation easily because the Industrial Estate are ready to provide factory building, accommodations as well as managerial supports and services.
- When we visited, just one company named "Nambu", manufacturer of hydraulic cylinders for use of car , had been in operation and 2 other companies were under preparation for start of operation. Mr.Nomura (Managing Director) told he was busy with receiving many guests every day. He also told even though the Industrial Estate can provides supports, there still are many things Nambu have to solve/overcome by themselves.
- We understand Ohta Techno Park or similar facilities will be efficient vehicles. In the mean time, for SME companies who want to come start operation, they need to be able to manage various subjects as a matter of course.
3. Interview with Minister of Finance, Governer of Export-Import Bank of Thailand
reported by Hiroshi Motomura (Chairman of Finance Committee JTBF)
2007 Feb.05 Afternoon at Ministry of Finamce
Attendant from JTBF: Messrs. H.Motomura/ M.Koyama/ A.Imaki/ H.Yoshimatsu
2007 Feb.07 Morning at Expot-Import Bank of Thailand
Attendant from JTBF: Messrs. H.Motomura/ A.Imaki
- In an interview with M.R.Pridiyathorn (former Minister of Finance) which took place on Feb.5, we raised a straightforward question whether or not Thai government has turned its foreign investment policy in adverse to the previous preferential one. His answer was clear and "No".
- Revised Foreign Business Act has been reported based on misperceptions. The intent is just to shut loopholes of the law of which Shin Corp or so-called nominee company took advantage. Nothing of a sort of bashing foreign investment. No impact to BOI companies at all.
- He continued to explain in reference to "30% reserve regulation". Appreciating baht, if it continues to be outstanding compared to other Asian currencies, might give serious impacts to foreign direct investment (FDI) which is a leading force of Thai economy. The regulation was a difficult choice to calm down the exchange rate. It is not expected to be a long-term one.
- On Feb.7, we visited Export-Import Bank of Thailand to meet with Dr.Apichai (President) and other 3 executives. After reconfirming that Dr.Apichai's explanation about FDI policy was consistent with M.R.Pridiyathorn, we went into discussing a subject of investment to border countries. We shared increasing importance of investment to Laos, Cambodia and other border countries that must encouraged further and importance of the new logistics flow which may be brought in by the 2nd Mekhong Bridge.
- Switching the subject, we introduced that. in Japan, 7 millions of population which belong to "Dankai" generation (baby boomers after the world war 2nd) are starting to retire and that not a small number of them are interested in Thailand as candidate location of long staying abroad after retirement. The number of 7 millions was a surprise to him. In view of potential resource of foreign currency flow into Thailand, he said he will welcome proposals for promotion of this kind.
- It was meaningful that we were able to confirm with 2 reliable executives responsible for policies that foreign investment policy is consistent and unchanged. However, pessimistic or negative observations, which are dominant in mass media, seem to be expanding among concerned persons such as SME management. Our role is to deliver our message based on what we have confirmed. Hopefully, it will help mitigate the concerns.
4. Visit to Tourism Authority of Thailand
reported by Kazumasa Mizutani (Chairman of Tourism Committee JTBF)
2007 Feb.06 Morning at TAT Head Office
Attendant from TAT:
Ms. Juthaporn Rerngronasa (Vice Governer for International Marketing)/ Dr. Prakit Piriyakiet (Executive Director, ASEAN)/ Mr. Jamlong Ratanapan (Executive Director)/ Mr. Eurblarp/ Mr. Yanyong/ Mr. Pongthong Intrata (Marketing Cooperation promotion Section)/ Mr. K.Shikano (Advisor on the Japanese Market)
Attendant from JTBF:
Messrs. H.Morita/ K.Kikkawa/ H.Motomura/ Y.Katono/ N.Okumura/ K.Mizutani/ K.Kato/ M.Saijo/ K.Yoshida/ A.Imaki/ H.Shinozaki
- Ms.Juthaporn (Deputy Governor for International Marketing) welcomed us and hosted the meeting. The meeting was held for more than one hour and JTBF members were impressed that Ms.Juthaporn closed the meeting by emphasizing that “today, we have had more fruitful meeting than expected”.
- First, we brought up the idea of diversifying travel courses, Bangkok to/from border countries. The idea was proposed to Thai Ambassador three years ago and was shared also with the previous Governor of TAT. Ref. Development of Tourism Industry in Thailand. It was considered to comply with new Governor’s policy of emphasizing “quality than quantity”.
- We went into discussion of 3 negative impacts which Japanese tourists are mostly concerned namely appreciating Thai baht, inflation and security measures against bombing. Images of Thailand as a “price competitive country” have been diluted recently. So, it is recommended to put forward Thai tours’ historical merits such as friendliness, comfort and delicious Thai food under this difficult circumstance. In terms of security, mass media gave tourists too much fear because of their sensational reporting of incidents. TAT had better work with TAT Tokyo office to provide tourists with correct information sufficiently to mitigate their fear.
- Regarding the new airport, JTBF members frankly pointed out several problems based on their own experiences. The new airport is an edifice of modern design and good construction. On the other hand, it gives less human impression. Shopping mall is bright and fancy, but waiting rooms are dark and gloomy. Not enough toilets nor signs guiding to the toilets. Greeting place at the exit of immigration counter is not wide enough and crowded with those who are calling for taxi/ limousine ride. Don Muan was better organized..
- A fairly long time was spent for "long stay" subject. JTBF explained how Japanese people think about the long stay for reference.
(a) Japanese senior people have become more interested in long stay overseas as an option of their life style. And the number of the senior generation is increasing. Especially, 6.8 million baby boomers (born in 1947 to 1949) are beginning to get retired at the age of sixty starting this year.
(b) What they want is “less expensive, near to Japan and warm weather”. They become more interested in ASEAN countries, more in Thailand. On the other hand, each people has own idea and tastes in terms of objectives, period, and housing. It is less effective to offer one-patterned arrangement.
(c) Why not TAT or TLM aim at these targets as potential growing revenue source. TLM is concentrated in hardware, such as housing and TLM pｒｉｖｉｌｅｇｅ card (Blue Diamond TLM privilege Card), but unlikely meeting with direct needs. Malaysia, Philippines and Indonesia are more enthusiastic than Thailand and are trying to make attractive offerings.
(d) For the time being, it will be important to better understand the real needs. Then, JTBF would propose two points.
- Following proposals were made:
(a) More information exchange with Japanese institutions of long stayers promotion, including Japan long stay foundation.
(b) Setting up a long stay section at TAT Tokyo office with staffing in charge of consultation.
5. The Meeting with TPA /TNI Executives
reported by Kazuo Kikkawa (Vice Chairman JTBF, Chairman of Educational Support Committee JTBF)
- 2007 Feb.06 Afternoon at TPA Pattanakarn
Attendant from TPA/TNI:
Dr. Supong Chayutsahakij (Chairman of University Council)/ Prof. Krisada Visavateeranon (President of TNI)/ Mr. Rangsan Lertnaisat, Dean (Fuculty of Information Technology)/ Dr. Bandhit Rojarayanont (TPA Director General)/ Mr. Koichi Mizutani (Lecturer of TNI)/ Ms. Yukiko Yabuuchi (Adviser of TPA)
Attendant from JTBF:
Messrs. H.Morita/ K.Kikkawa/ H.Motomura/ Y.Katono/ N.Okumura/ K.Mizutani/ K.Kato/ M.Saijo/ K.Yoshida/ T.Fuse/ H.Shinozaki.
- Briefing by TPA side after explanatory video was projected.
1.TNI consists of 3 faculties (Engineering, Information Technology, and Business Administration) and Graduate School.
2.Total construction cost for 1st and 2nd phase will be 500 million Baths. The half amount will be expended by TPA from their reserved fund.
3.The construction of 1st phase ( A bldg. for Administration Library and B Bldg. for Schooling) will be completed by the end of February, 2007 as scheduled.
4.The entrance examination for the fresh students was held in the end of the last January. 600 persons have passed the examination. The accepted students have higher level of the academic ability than expected. In Thailand system, they have 3.6 point in average against 4.0 point max. TNI take into consideration that some of them will enter Chulalongkorn University when they succeed in the entrance examination of the latter.
5.Out of 600 successful students, 120 were qualified to receive scholarship after interview and examination for scholarship. The amount of scholarship is expected to be 8 million baht/year for four years from the Japanese enterprises and 2 million baht/year from the Thai enterprises.
6.At the initial stage, the number of the students are not many, and TPA can cover the lecturers by themselves, so TPA will not require much technological assistance from the Japan side.
7.JTBF is specially requested to assist in finding the place for internship in Japan, when the TNI students need in the professional course.
- In coming March, Dr. Supong and President Mr. Krisada will visit Japan for discussing future plans. ( JTECS will hold the meeting with TNI Supporting Committee)
- Observation of the construction site of TNI buildings.
1.The first stage of the construction will be completed in the end of February, which includes the building A for administration and B for schooling. JTBF mission observed A Bldg. only.
2.The construction works are actually undertaken by Tokyu Construction Co., although the contractor’s name is Ch. Karnchang Tokyu.
6. Visit to Japanese Chamber of Commerce, Bangkok(JCCB)
reported by Hisashi Shinozaki (Secretary General, JTBF)
- Feb. 7th, 2007 morning at JCCB Head Office
Attendant from JCCB:
Mr.Kenji Shirasaki (Vice President)/ Mr.Keisuke Matsumoto (Secretary General)
Attendant from JTBF:
Messrs. H.Morita/ K.Kikkawa/ Y.Katono/ N.Okumura/ K.mizutani/ K.Kato/M.saijo/ K.Yoshida/ H.Shinozaki
- Mr. Shirasaki pointed out that according to the JETRO’s survey made last fall, the country interest towards Thailand dropped to 4th ranking among S.E.Asian countries. Also he observed that the ranking would have been worse if the following four factors had been taken into consideration ; 1) Appreciating baht 2) Last year end’s bombing 3) Amendment of Foreign Business Act 4) The reserve requirement on short-term capital inflows.
- If the value of Thai baht remains at high level for a certain period of time, the investments into Thailand may be discouraged accordingly. Thailand, however, will continue to be an attractive country to Japanese companies and people because of her wonderful culture and hospitality, Mr. Shirasaki said.
- We received the private short comments on current Thai politics as follows :
From Mr. Shirasaki ; The present Thai government’s policies seem to be directed to internal concerns only and lack external policy. Probably due to such prevailing observations, feeling of the disappointment accumulates among Thai people.
From Mr. Matsumoto ; There is a sign of rising trend of the nationalism in Thai society.
- JCCB extends support to TNI by donating scholarship of 8 million baht per year for 4 years starting from 2007.
- Another Japanese school will be opened in Sriracha/Phataya area in 2009. JCCB is constructing the schoolhouse.
Note 1: Japan Thailand Business Forum is an association consists of persons who have once worked in Thailand as executives of various Japanese companies as well as government offices located in Thailand. It was organized 4 years ago for a purpose of exchanging frank opinions with Thai authorities in regard to tourism, economy, investment and other various subjects.
Note 2: JTBF mission members
- Mr. Hitomi MORITA, Vice Chairman, former President of Fujikura Thailand
- Mr. Kazuo KIKKAWA, Vice Chairman, former President of Tomen Thailand
- Mr. Hiroshi MOTOMURA, Finance Committee Chairman, former General Manager of Bank of Tokyo Mitsubishi , Bangkok
- Mr. Yukio KATONO, Long Stay Committee Chairman, former President of Mitsubishi Electric Thailand
- Mr. Norio OKUMURA, Public Relations Committee Chairman, former President of IBM Storage Products Thailand
- Mr. Kazumasa MIZUTANI, Tourism Committee Chairman, former General Manager of JAL, Bangkok
- Mr. Hitoshi Yoshimatsu, Planning Committee Chairman, former General Manager of Sakura Bank, Bangkok
- Mr. Kanji KATO, Long Stay Committee member, former President of Fujitsu Thailand
- Mr. Mitsutoshi KOYAMA, Finance Committee member, former General Manager of Sakura Bank, Bangkok
- Mr. Kenichi YOSHIDA, Long Stay Committee member, former President of Mitsui Toatsu Chemical
- Mr. Masakazu SAIJO, SME Committee Member, former President of Shindengen Thailand
- Mr. Takashi FUSE, SME Committee member, former President of Nissho-Iwai Thailand
- Mr. Akira IMAKI, SME Committee member, former Office Manager of Long Term Credit Bank, Bangkok
- Mr. Riichi Ishii, former President of Marubeni Thailand
- Mr. Hisashi SHINOZAKI, Secretary General, former President of Kanematsu Thailand