Meanwhile, oil prices went up to more US$59 per barrel following Russia’s agreement with Saudi Arabia to extend by six to nine months a deal with Opec to reduce oil production.

However, the company reiterated its warning to investors about selling to make a quick profit.

The SET Index closes on Friday at 1,730.34 with a trade value of Bt61.33 billion.

On monday’s morning SET index opens 1,744.83  or up 14.49 points with trade value Bt11.97 billion.

Airbus and national flag carrier Thai Airways (THAI) signed a joint venture for MRO facilities at U-tapao Airport in Rayong province, in June 2018. Creating an MRO hub at U-tapao Airport, located in one of the three provinces in the Eastern Economic Corridor (EEC) special economic zone, has been one of the EEC’s flagship projects since its launch under the Thailand 4.0 policy in 2016.

Foreign investors see the potential for growth in Thailand’s aeronautical industry in the next two decades. This year, some 7,000 aircraft will fly across the Asia Pacific region, and the number is expected to reach 20,000 over the next 20 years, according to Airbus.

“Hence, there is a need to increase maintenance capacity in the Asian-Pacific region,” said Pierre Jaffre, president of Airbus Asia Pacific.

The government’s Thailand 4.0 policy and the development of the EEC, he said, present a promising opportunity for Airbus to meet this demand, and has led it to establish an MRO centre in cooperation with THAI in Rayong.

“Of all the EEC projects, the MRO hub at U-tapao Airport has the highest possibility for success,” said Phacharaphot Nuntramas, senior vice president for global business development and strategy group at Krungthai Macro Research.

This, he explained in an interview with The Nation, is because the aeronautical industry in Thailand has strong fundamentals with more opportunities to grow in the economic environment of the Asean region.

Particularly, he said, there has been a growth of smaller airlines such as AirAsia and Vietjet in the region, and the aircraft from these smaller carriers will require maintenance.

“The other key MRO centre in the region is located in Singapore, which faces the challenge of limited land space,” he continued. The growth of smaller airlines means that smaller-sized aircraft will be used more often, leading to a growth in the demand for maintenance space”

“This market trend presents an opportunity for the MRO centre at U-tapao to rise and become Southeast Asia’s new regional MRO hub,” Phacharaphot stated.

Looking at the big picture, the MRO centre is a key plank in the development plans of the aeronautical industry, said Thailand’s former ambassador to France, Sihasak, Phuangketkeow, who helped THAI and Airbus conclude the MRO deal last year, adding that Thailand needs to ensure the sector’s future growth.

Thailand has great potential in the sector, as the Kingdom is already a regional aviation hub and boasts a strong automobile and electronics manufacturing base on which to build an aircraft and spacecraft sector, he said.

The country has already developed legal instruments to encourage foreign investment, not only for the MRO sector but also for original equipment manufacturers (OEMs), said Sihasak who is now an advisor to the EEC project. “We are improving our ecosystem to accommodate S-curve technology industries,” he said.

The TIROS II with Airbus could also be spun off to encourage a future space industry in the country, as the technology transfer could help Thais to develop the sector, he said.

The biggest challenge to the long-term development of the MRO centre, like other projects in the EEC, is the imminent lack of skilled labour, Phacharaphot said. Sihasak agreed and added that the country also needed to compete with neighbouring Asean countries, notably Singapore, Malaysia and Vietnam which have had a stronger focus on the aviation and aeronautical industry.

“Our strength is that our workforces have a strong commitment to their work and our airbases with huge space, like U-tapao, are available,” he said. “We are also aiming higher to build an ‘aerotropolis’ in the region.” Research has shown that in the next 10 years, the targeted ‘S-Curve’ technological industries in the EEC will require an additional one million workers, with almost 500,000 jobs in demand in the next five years, according to the EEC office. The research also revealed that the aeronautical industry will demand an additional 30,000 skilled workers in the next half-decade.

To meet this demand, Phacharaphot suggested, the supply-side will need to quickly develop the appropriate curricula to build a capable labour force to support the growth of the aeronautical industry in the next two decades.

An alternative solution is to recruit foreign talent to, for example, operate the MRO centre in U-tapao. The government has been issuing “Smart Visas” since February 2018 to allow highly trained foreign talents working in the targeted ‘S-Curve’ technological industries to work in the Kingdom for up to four years without having to renew their visas yearly.

However, adoption of the Smart Visa has been disappointing, with only approximately 100 foreign talents so far having been issued the special visa in the past year, according to the Digital Economy Promotion Agency (DEPA).

More importantly, Sihasak said, both the government and private sector should have a clear joint vision and a strong will to get aboard the S-Curve technology industry. The country should have a national mechanism to move this sector forward, he said. “We cannot just wait for foreign investment and technology transfer to develop the aeronautical industry,” he said.

Opening an exhibition at Bangkok International Trade and Exhibition Centre yesterday, Somkid said that the research agencies’ downward revision of their estimates for the nation’s economic growth was normal as the Thai economy has slowed down on the back of political matters. With the political situation becoming more certain and the government on the eve of formation, the new prime minister will be able to continue driving government policy.

The Thai economy has very strong fundamentals and the Stock Exchange of Thailand (SET) Index has continued rising from capital inflows from foreign investors confident in the Thai economy.

In the event that the fiscal 2020 budget is delayed, it could affect the disbursement and investment budget in the latter half of this year, said Somkid. There will be a push on executing the government’s previously approved mega projects with a fast disbursement of funds in order to get that money circulating in the Thai economy.

Somkid has also asked the private sector to pay attention on adjustments as, based on the IMD World Competitiveness Ranking, Thailand’s private-sector competitiveness ranking did not go up. That reflected the Thai private sector’s need to adjust itself to cope with fast technological changes such as the internet of things and Big Data.

With Japanese industry having moved into Industry 5.0, which applies higher technology to enhance production efficiency, Thai private enterprises in several industries are in Japan’s supply chains, Somkid said.

If Thai private enterprises could not make adjustments in time, it may be difficult for them to link with Japanese supply chains in the future, he said.

Regarding the Pracha Rat project and the state welfare cards, Somkid said that he wanted to see large-sized private enterprises join the project in order to expand its ability to help low-income earners. Large-sized private enterprises will also be able to aid SMEs, which would be a good project, he added.

The department is awaiting the Securities and Exchange Commission’s consideration.

Ekniti Nitithanprapas, revenue director-general, said that digital transactions will be increasing and the department has to adjust itself.

The Libra token will be launched next year.

Now, the department has been using the digital system to facilitate taxpayers.

In particular, the department employs the digital system in the jurisdiction person registration, having a linkage with Department of Business Development for business operators’ online value added tax registration and allowing the private sector to develop Revenue Department’s digital system.

The problem for tax collection on online transactions in the digital world is that, by law, businesses which will be taxed must have a permanent residence in Thailand.

However, online business does not need to have a permanent residence in Thailand by being registered in any countries and will not levied a corporate income tax in Thailand.

“Now, the OECD [Organisation for Economic Cooperation and Development] is considering the problem and must have international cooperation. If only Thailand taxes, it will not succeed,” Ekniti said.

From the beginning of this year to May, the Revenue Department’s tax collection was Bt38 billion higher that its target, from higher tax collection efficiency with the digital system and rises in crude prices.

Ekniti expressed confidence that the tax collection will meet the target of Bt2 trillion in this fiscal year.

In regard to the single account scheme, about 67,000 businesses already registered for adjusting their balance sheets with a deadline on this October 1.

Ekniti said that the policy of the Palang Pracharat Party of a 10 per cent tax reduction in every tax ladder, means the department is studying its impacts to the fiscal stance, pros and cons, estimated revenue loss and types of revenue as substitutes.

The data indicates more Thais are embracing digital payments for making purchases both in stores and online as the country is pushing towards becoming a less-cash society.

Suripong Tantiyanon of Visa Thailand said: “This spending data validates the steady progress of the nation towards becoming a less-cash society. Thai consumers are becoming increasingly confident in using digital payments, supported by the governments push for the adoption of e-payments.”

Travelling inland or abroad has become a notable trend during Songkran. The data revealed that 39 per cent of Thai Visa cardholders spent within Thailand, 57 per cent used their Visa cards in their residential provinces and 4 per cent made purchases abroad with Visa cards during the holiday season.

“We are excited to see the greater adoption and usage of digital payments among Thai consumers. It is our hope that by sharing these insights, the payment industry at large can leverage this data for developing products and services that meet the ever-changing demand of Thai consumers, ultimately accelerating the country toward a less-cash society,” Suripong said.