The programme will run from February 1 to February 15 next year.

Finance Minister Apisak Tantivorawong said the Cabinet agreed with the return of VAT ( 5 per cent) to people who bought all products with debit cards, limited to a maximum amount of Bt20,000 and a tax return of Bt1,000.

However , the programme will exclude the purchases of liquor, beer and cigarettes, he added.

The VAT will be returned through Promptpay within 15 days after the date of purchase.

The move aims to encourage people to use e-payment and encourage shops to enter into the system which collects data of sales and payment or point of sale (POS) system and the Revenue Department’s tax system.

He added that the Cabinet also broadened the range of businesses eligible for the loans to the retail and revised the interest rate from three per cent to a minimum of minus 1.875 per cent.

Thanavath Phonvichai, director of the Centre for Economic and Business Forecasting at University of the Thai Chamber of Commerce, said the improvement was mainly due to higher confidence in tourism in the fourth quarter, the expected rise in incomes from the manufacturing and service sectors, as well as good trade performance as a result of higher prices of |products, excluding rubber and oil palm.

He warned that enterprises, particularly SMEs, may face difficulties in accessing commercial banks’ capital if the Bank of Thailand’s Monetary Policy Committee (MPC) hiked the policy rate in its meeting today.

About 200,000 of three million SMEs across Thailand are expected to take the risk of |saddling with non-performing loans due to rising borrowing costs.

“There is no reason for a rate hike amid the global economic slowdown as a result of the trade war, Brexit and centralised Thai economic recovery, while there’s no inflationary pressure,” he |said. He expects the proper time for the Thai rate rise is the first quarter of next year.

HSBC Global Research says the coming rate bump was presaged by the November 14 meeting where a minority of three members voted for a 25bp hike.

Only one more vote is required on December 19 to tip the balance in favour of a hike.

HSBC Global Research also anticipates that the central bank will revise down 2018 and 2019 growth forecasts, to 4.2 per cent and 4.0 per cent respectively, from 4.4 per cent and 4.2 per cent in the previous assessment. They attribute the revision largely to the downside surprise in the 3Q GDP reading.

Growth and inflation this year are set to meet the preconditions that the MPC set for policy normalisation this year, HSBC Global Research noted.

“We believe growth and inflation conditions are strong enough to support the start of monetary policy normalisation,” their statement added.

That said, the policy decision is unlikely to be unanimous, as some MPC members maintain a dovish view on growth. Somchai Jitsuchon, for example, has struck a dovish tone recently, citing an upsurge in trade protectionism and uneven domestic demand as risks to the economic outlook for next year.

HSBC Global Research also said it that it would be important to look out for any guidance on following the path of policy normalisation.

“We currently expect one 25bp rate hike in 2019, likely to occur in 2Q. But we also see the possibility that the central bank may signal a more dovish stance at this week’s meeting, guiding the markets towards a long pause following any rate hike.”

Kasikorm Research Centre also expects Wednesday’s MPC meeting will increase the policy rate from 1.50 per cent to 1.75 per cent. They attribute the bump in part to balancing the country’s economy and reducing the long-term risk.

“Although the country’s economy in the third quarter of this year grew only slightly, it still shows signs of growth in the fourth quarter of this year and for the next year. Increasing the policy rate will help the Bank of Thailand to manage the country’s risk from the global economy, and control the capital in and out flow that has now been impacted by the Federal Reserve Board (FED) interest rate increases three times in this year,” the research said.

However, the research centre believed that the pump would not reflect an ongoing policy to increase interest rates, but rather a temporary policy to maintain the country’s economic growth and manage the policy space.

Meanwhile, the FED meeting scheduled for December 18-19 also has signs that it would again increase its policy rate.

Singapore has returned to the global top 20 most expensive locations for expats as the 18th most expensive city in the world for expatriate workers.

Within Asia, Singapore is the 9th most expensive location.

This was one of the findings of the latest Cost of Living survey published by ECA International, the world’s leading provider of knowledge, information and software for the management and assignment of employees around the world.

In 2017, Singapore was the 21st most expensive city in the world for expatriates, up from 16th in 2016. Its 9th position within Asia remains unchanged since 2016.

“The Singapore dollar has performed strongly this year, resulting in a slight rise in Singapore’s rankings, up 3 places to become the 18th most expensive location in the world,” said Lee Quane, Regional Director – Asia for ECA International. “Singapore has long been considered one of the most expensive cities for expats to live and work in and this looks set to continue. However, the cost of living is still below that of other Asian locations with large expatriate populations such as Hong Kong, Tokyo, and Shanghai.”

ECA International has been conducting research into cost of living for more than 40 years.

Thai cities were among the biggest risers in the rankings, with Bangkok rising 32 places and entering the top 100 most expensive locations for the first time.

Quane said: “Over the past five years, Bangkok has climbed more than 80 places. The Thai capital now sits in 90th place in our cost of living rankings. The Thai baht has strengthened in recent years, as the economy has expanded and the political landscape has stabilised.

“This means that Thai locations are now significantly more expensive for expat workers than they have been in the past.”

According to Gartner Consulting, the aggregate business value derived from AI will rise from US$1.2 trillion (Bt39.3 trillion) in 2018 to more than $3.9 trillion (Bt 127.9 trillion) in 2022.

Despite common understanding about AI, its actual adoption is concentrated not only in the high-tech sector, but also in other businesses such as construction, trading and even agriculture, which have accelerated its adoption to acquire more effective business solutions.

For example, sugar and energy giant Mitr Phol has employed AI throughout its processes ranging from planting, harvesting, packaging and commercialising – all leading to better inventory management that has saved the company Bt12 million since adoption.

Albeit increasing in popularity, AI remains concentrated mainly in large corporates. For instance, a combined AI investment by a few large financial institutions amounted to over Bt10 billion in the past three years.

Why do smaller corporates rarely invest and develop their own AI, but instead wait for technological transfers from large corporates? Is it even necessary for them to develop AI by themselves?

First of all, AI development requires a vast investment of both capital and human resources. Firms have to invest in processing and data storage servers, network infrastructure, and management and monitoring systems. This requires a lot of experts such as data scientists and data engineers, who can be very expensive since they are currently in high demand.

Even if firms want to increase core compulsory skills through training, the process remains very costly and time-consuming. With such a large investment, firms with a smaller market share may not be able to achieve economies of scale, rendering their cost per unit extremely high. In addition, the results from AI development may take quite a long time to become apparent, which is not suitable for inchoate fast-growing firms.

Regardless of all the obstacles, small firms can still take advantage of AI technology.

A little bit of automation and data processing can tremendously help enhance SMEs’ efficiency. AI is not limited to a large investment and advanced technology like self-driving cars or automatic flight drones. There are affordable and accessible “off-the-shelf” AI options offered by tech juggernauts like Google, Microsoft and Amazon.

Thanks to the competitive environment, there are more than 1,000 newly generated AI features each year that SMEs can utilise to eliminate tedious routine work and enhance their competitiveness. Just applying through email at a relatively low expense, SMEs can begin the services immediately even when they are not at all familiar with AI.

For example, traditional merchants can employ Google Cloud speech-to-text to mechanically transform customers’ voice order request into order receipts, together with Amazon Polly to robotically chat with customers via phone.

To enhance customer satisfaction, they could use the facial-recognition feature in Microsoft Face to measure satisfaction levels and then use Amazon Forecast to analyse that data to come up with customer preferences. They can also utilise Microsoft Computer Vision for object recognition in inventory management.

Those services are ready-to-use and easy to implement with an affordable price tag. You can even use them for free for small volumes.

SMEs do not need the same technology as big corporates. They just need to apply the right technology to the right tasks to elevate business growth.

It is not about the development of AI, however; it is about acquiring the knowledge on how to use AI that should be the main focus for SMEs.

Views expressed in this article are those of the author and not necessarily of TMB Bank or its executives.

Biz Insight is co-authored by TOSPOL KAWSOMBUTWATTANA, NUTTAPONG NETJINDA, and DUANGRAT PRAJAKSILPTHAI. They can be reached at tmbanalytics@tmbbank.com

The Ombudsman-General, General Viddhavat Rajatanun, is concerned that Airports of Thailand (AOT) has failed to carry out his judgement in the matter of allocation of duty-free pickup counter space, due to a 2005 contract with King Power, and is prompting the Cabinet to sort it out.

The Thai Duty Free Shop Trade Association has joined the call for the Cabinet to ensure that King Power shares space with other duty-free operators, in line with government policy to promote trade and investment.

Drawing on Section 32 and Section 34 of the Organic Act on Ombudsman, Viddhavat had previously ordered that Airports of Thailand Public Co Ltd (AOT) pressure King Power to ensure the space is shared. According to the Customs Act, consumers have the right to collect goods at a pick-up counter at the airport after passing through Immigration, after first purchasing it at duty-free shops in town.

Viddhavat’s Office has now been notified by AOT that King Power has refused their direction to allow other operators to share the pick-up counter.

King Power argued that it does not have to share the space, according to the conditions under a March 2005 contract that remains in effect. The company has argued that under Condition No 2 of the contract, it has been recognised as the sole authorised licencee.

Allocation of business spaces to other operators would directly affect the volume of returns that the company had proposed to AOT at the time of bidding, based on the right to operate solely, the company has said. That would be unfair to the company and violate the contract in the event that an act caused a breach of the agreement, the company had responded, while reserving the right to take legal action on the issue.

But the Ombudsman has previously declared that allocating pickup space to other operators does not hurt King Power because the space is not used for business transactions. The company could continue to earn revenues in sales areas of the airport.

Viddhavat said sharing the space would be beneficial for consumers, as well as escalating national competitiveness, and is also compliant with government policy. That AOT has been unable to take appropriate action as suggested by the Ombudsman. The issue is considered insoluble and so an analysis by the Cabinet is necessary.

Rawittha Pongnuchit, president of the Thai Duty Free Shop Trade Association, wants to government to act quickly as a resolution has been much prolonged. AOT should not have granted a single company to be the sole operator of the pick-up counter at the airport. Consumers are being inconvenienced and competition decreased, while the lack of access goes against the government’s policy of promoting foreign trade and investment, said Rawittha.