Veerathai said the tax breaks would be a smart short-term stimulus measure before major government projects were launched next year.
The Finance Ministry’s tax break proposal is expected to be considered by the Cabinet today.
The ministry wants the tax break to be increased to items of up to Bt30,000 after there was a Bt15,000 cap for the scheme last year.
Veerathai said temporary factors affecting economic activities were lower agricultural prices, mainly rice, the crackdown on zero-dollar tours resulting in the decline in Chinese tourists and the mourning period for His Majesty the King.
The government needs a short- term stimulus measure to fuel |economic growth in the fourth quarter, he said.
The tax breaks should be a short- term tool because boosting spending will impact on future domestic demand, he said.
There is also a remedial measure to spur economic growth, with the government handing out Bt12.5 billion to the poor, or between Bt1,500 and Bt3,000 each person.
However, Veerathai said a long-term measure relating to investments should also be considered because it would increase the efficiency of the agricultural sector.
The BOT this year projected the country’s gross domestic product would be 3.2 per cent and the country’s economy next year should grow further.
The central bank has no plan to adjust that figure just yet as it wants to see what happens with economic activities in the fourth quarter.
Currency volatility is being monitored, he said, with capital flows predicted to move to the US due to the policies of president-elect Donald Trump. He added that foreign currency management was an essential skill for traders.
Veerathai said that looking ahead, the geopolitical environment was a critical factor impacting on goods prices and currency exchanges in the region.

The money was generated from the auction of nine numbers.
Those numbers are 09-8888-8888; 09-5555-555; 06-5555-5555; 09-7777-7777; 09-6666-6666; 09-4444-4444; 06-1111-1111; 09-1111-1111; and 09-0000-0000.
The NBTC will transfer the money, minus expenses, to the state coffers.
The 09-8888-8888 number attracted most bidders, with the bid price starting from Bt6 million and surging to Bt 8.1 million in the final round.
No one bid for the two platinum numbers – 08-8888-8888 and 09-9999-9999, which started at Bt20 million.
There were a total of 10 bidders, with most mobile-phone number dealers.
Other bidders did not disclose their names.
There were 16 numbers put up for auction.
Fourteen of the numbers started at Bt6 million.
The auction was open to all interested parties including corporate companies and individuals not on a financial blacklist.
Each bid winner has to pay the money to the NBTC within 30 days.
Takorn Tantasith, the NBTC secretary-general, said the agency plans to hold another auction for the numbers not bought yesterday and for six and seven-digit numbers by the end of the first quarter next year.
There are 490,000 numbers in the system, which the NBTC will gradually allocate for future bids.

  Thanawat Patchimkul
Head of Research
DBS Vickers Securities (Thailand)

As the world awaits more stable market conditions, Thailand remains resilient.
It seems like global investors are continuing to rebalance their portfolios and remain upbeat about the US’s economic prospects.
After the US election, the US equity market has been in the limelight and has attracted significant inflows while bonds, emerging market equities and gold sold off.
Foreign investors have sold Bt31 billion worth of Thai shares so far in November. For the year today, they remain net buyers of Bt84 billion in the Thai equity market.
A similar situation is seen in regional markets, as their currencies weakened against the dollar and with their bonds and equities being liquidated on a large scale.
We believe the Thai market’s fundamentals are still strong. Thailand’s economic growth is performing below its potential but it still has solid fundamentals. Bloomberg cited the IMF’s forecast that projects Thailand’s foreign reserves hitting US$163 billion by the end of this year. According to a measure called assessing reserve adequacy, the Kingdom needs only $65 billion.
The country’s huge foreign reserves are believed to have helped Thailand withstand the funds outflows. In comparison, other emerging countries like Malaysia, Turkey, South Africa, and Mexico might have relatively weaker foreign reserve cushions.
DBS economists point out the strength of the Thai economy lies with its current account surplus, which is expected to reach 10 per cent of gross domestic product in 2016 despite the fact that this measure reached a record-high level of 8 per cent of GDP last year.
Given the country’s economic stability, we believe the Thai stock market will remain resilient going forward. Any broad-based weakness should be treated as an opportunity to accumulate solid stocks for long-term investment.
Given the volatile market conditions, we prefer dividend stocks and recommend ADVANC/INTUCH, JASIF, DIF, CPNRF, CPTGF, AP, LH, SIRI, BCP, TCAP, TISCO, and TMT as our top income-oriented picks.

Tisco Securities

After a surprise rally that resulted in the SET being one of the region’s best performing markets in 1H16, Thai equities now look like finishing the year with a whimper following various negative events (the zero-dollar-tour crackdown, the expected Fed rate hike, and the mourning period for the King).
Over the past two years, investors had plenty of reasons to ignore the Thai market due to worries over the health of HM the King, fears that anti-coup protests could lead to a new political crisis, lacklustre GDP growth and demanding valuations. However, as we move towards 2017, many of these downside risks have either been priced in or became irrelevant.
Ironically, the Prayut government’s policy of “pivoting” towards China may have helped shield the country from the impact of potential US policy changes under a Trump administration. In addition a weaker baht is good news for Thailand’s export industry and economic exposure to the US is limited.
Despite the likelihood of a US Fed rate hike in December, we believe the risk of fund outflows is not as bad as it was in 2015. Furthermore, we see a few positive catalysts that can drive the market higher in 2017. These include successful infra-project bidding, government stimulus measures, state enterprise reforms and progress towards the first general election in six years.
For now, we’re sticking with defensive stocks (hospitals, insurance, telecom and contractors/conmat). We have also added AOT and PTT to our top-picks list as we think these stocks are most likely to re-rate out of the five listed SOEs once the State Enterprise Bill is approved in March/April next year.
Our 2017 SET year-end target is now based on a forward 2018 P/E target of 13.8x. We also established a 2018 EPS target of 119. As a result, our 2017 target has been revised up by 3 per cent to 1650. Our 13.8x target is still a 0.5x standard deviation below the five-year historical mean forward P/E. Key risks to our call include macro shocks (such as a steeping yield curve from an accelerated Fed rate hike), a delayed Thai election and a worse than expected impact of the mourning period on Thailand’s tourism and consumption.

Research Department
Trinity Securities

This week, four key factors are expected to influence stock markets across the world.
They include an informal meeting between non-Opec and Opec tomorrow and an Organisation of Petroleum Exporting Countries meeting on Wednesday. We expect the Opec meeting to reduce the crude production capacity in a range of 250,000-750,000 barrels per day. If that happens, the impact will not be significant and crude may face sell on fact.
Another expected influencing factor is the global adjustment of MSCI on Wednesday. In this round, MSCI EM raises weight on Thailand slightly. Net foreign purchases are expected on the day but only one time.
Also,China’s PMI in November will be announced on Friday. Markets are expected the figure at 51.0. If the announced figure is significantly better than expected, commodities prices, particularly manufacturing metal, would rise again. The fourth influencing factor is Italy’s referendum on reform of the country’s constitution on December 4. If the vote is for no constitutional reform, Italy’s government, led by Matteo Renzi, would not be able to push for the urgent measures for economic reform and the Italian economy would face troubles. Renzi may resign as a result.
Investment strategy: The SET Index is expected to move sideways in a narrow range. Rises of the US bond yield will result in short-term pressure and the SET Index will see declining attraction in term of the earning-yield gap. A slowdown in investment in the overall picture. If investments must be made, select small and medium gaps with support themes.
1. Stocks with gains from baht depreciation: TFG, BR, SMT, SVI
2. Stocks with positive sentiment if the Cabinet approves tax measures late this year: BIG, COM7, JMART, KAMART
3. Stocks with gains from relief measures for low-income earners: GLOBAL, ROBINS, TNP, SINGER, TK, GCAP, DCC, DRT

 

Post-US election analysis indicates that most polls failed to foresee the Trump victory because they underestimated the power of white underprivileged voters who had never bothered to cast a vote before but got behind Trump this time. His main supporters are people who have only low levels of education and have earned average but stagnating incomes for the past two decades.
Trump’s campaign promised to bring back their jobs and dignity through the slogan of “Make America Great Again”. The interesting part is that his supporters were not turned off by his other campaign policy of cutting taxes for the rich.
Robert Shiller, the 2013 Nobel laureate in economics, explained that these people, who consider themselves at least middle class, do not like government policies that look like handouts. They don’t want a more progressive tax system that would give money to them. They just want their economic power back.
If Trump plans to be re-elected for a second term, he will need to fulfil his campaign promises: reducing the inequality gap without raising taxes, negotiating new trade deals, imposing higher tariffs on imports, building a wall along the Mexican border, and deporting illegal immigrants charged with criminal offences.
He aims to create more domestic jobs through the expansion of traditional heavy industries and through coal mining, but at the cost of higher production inefficiency and lower environmental standards.
Fiscal policy is also seen as a feasible method that President-elect Trump can employ to stimulate economic growth. So expect more investments in infrastructure as well as upgrading of existing infrastructure.
The question is this: Will the Trump administration be able to finance its rising expenditures while at the same time cutting tax revenues? Higher public debt is unavoidable in such a situation.
Trump’s administration can finance its new bonds by borrowing either from the private sector and households or from the central bank. Borrowing more from the private sector and households would mean that long-term market interest rates would have to be adjusted higher to attract more bondholders.
However, higher long-term interest rates could deter economic growth and as a result, lower employment. To avoid high long-term interest rates, the government may borrow from the central bank directly. Laura Tyson, a professor at the University of California at Berkeley, has pointed out that in very special situations, the central bank may purchase government bonds and roll them over in perpetuity when they mature. In this way, the government will be able to increase spending without having to increase taxes now or in the future, and still be able to maintain low interest rates.
The problem with this approach is that it would not only increase the risk of volatile inflation but would also destroy the confidence in the financial integrity of the central bank. On this last point, any policy changes away from the norm would be a big challenge to overcome.

Professor Arayah Preechametta is a lecturer at the faculty of economics, Thammasat University.

How to ensure that this HR technology will provide an efficient system of records and improve productivity by as much as 10 times? How do we ensure that this HR technology will enhance the company’s competitive advantage over its competitors? How do we ensure that this HR technology will act as an engaging tool for employees?
Worry not. All we need is the “right map” with the “right people” on board.
One of the most common factors contributing to project failures is unclear objectives. Having the “right map” will ensure that the project team stays its course and reaches the promise land and avoids the pitfalls that beset most projects. And with the right people you will have the pioneers who will make this happen.
Just like any good map, the project objectives should contain two crucial components: a destination and the way to get there.
In terms of HR system, destination is the grand vision of the senior management. It’s what success looks like when we achieve our mission. This vision must come from HR leadership and communicated to the project team. Typically, this is done through interviews prior to kick-off. This vision should be a short mantra, like provide learning capability to employees anywhere and any time, or provide real-time talent information to senior management.
The second component of this map is the guiding principle. This will form the basis for decision-making, general direction and day-to-day running of the team.
The main purpose of this guiding principle is to ensure maximum use of the new HR system. It will help prevent the project from getting bogged down by the cobwebs of the legacy system.
Similarly, the guiding principle should come from the head of HR and be communicated to all stakeholders and the team. Some examples of good guiding principles are: Adopt best practice offered by the new system, and keep the new process simple with a no-customisation policy.
A guiding principle will not only speed up the project, it will help to reduce the risk significantly, and thereby ensure greater chance of success.
Right people are the trailblazers. These trailblazers are crazy enough to go on a journey with you. Their craziness, sometimes referred to as “passion”, will help the team overcome future roadblocks.
Projects are never easy, no matter how good you are. Right people are less likely to give up when push come to shove. Their passion for the project will see to it that they deliver the goods in the face of adversity.
So get your pen and paper out and meet with your HR bosses, draw your map, and choose your trailblazers.

Suvit Chansrichawla is next-generation HR consultant under the brand Serendipity & Co, partner of the Curve Group in Thailand.

Hi-Way, which provides car-title loans under the Somwang Ngern Sang Dai brand, developed the Somwang Sabai Jai product last year, but decided to tone down this form of lending at the beginning of the second half of this year after learning that the government planned to introduce pico-finance for low-income earners, managing director Supachai Boonsiri said.
Somwang Sabai Jai currently has a loan portfolio of Bt200 million, which is deemed sufficient for controlling operating costs, he said.
Prevailing economic conditions were another reason for Hi-Way to slow down its micro-finance, as this type of lending is unsecured and the company might face rising operating costs from debt collection from borrowers who are small vendors, he explained.
While the cost is under control if a customer repays debt when the company sends a reminder alert, it rises beyond the target level if Hi-Way has to dispatch on-the-ground staff to pursue repayment.
Therefore, Hi-Way needs to review its micro-finance plan and be clear about the full conditions for operating a pico-finance business before deciding its next step, Supachai said.
Hi-Way will apply for a licence if it is able to lend to customers who work in a province where the company has an office, while the customer’s household registration is in another province.
However, if the pico-finance licensing conditions do not allow allowing operators to lend across provinces, Hi-Way might opt to take another look at its operations to see what it can do to enhance the way it controls risk and customer behaviour within the terms and conditions of its micro-finance licence, he said.
Tisco Bank, however, wants Hi-Way to focus on car-title loans and expand the vehicle segment to achieve the target set for the business over the next three to five years, he pointed out.
During the period, Somwang Ngern Sang Dai aims to have outstanding loans of Bt15 billion, compared to an estimated Bt8 billion this year, the managing director said.
About 95 per cent of its portfolio currently relies on four-wheel vehicles, he said, adding that to achieve its target, Hi-Way will attempt to expand its lending to fleet cars and motorcycles, which it hopes will account for 10 per cent and 25-30 per cent, respectively, within three to five years.
Auto-title lending entails taking out a short-maturity loan, under which customers can repay all the debt before the end of the term, which many choose to do.
The company therefore has to acquire new accounts to maintain its portfolio and expand its branch network to cover the whole country, he said.
Hi-Way targets having 300 branches within the next three to five years – double the current number.
Last year, Hi-Way missed its outstanding-loan target of Bt8 billion because many customers repaid their debt before maturity, leaving it with outstanding lending of Bt6 billion at the end of December, Supachai added.

Unveiled at COP22 in Morocco, the ‘Masdar Gen Z global sustainability survey’ is the first global poll of the attitudes among young people aged 18-25 towards climate change, sustainable development and renewable energy.
Carried out earlier this year to coincide with Masdar’s 10-year anniversary, the survey spoke to 5,000 post-millennials in 20 countries across the Middle East and North Africa, sub-Saharan Africa, the Americas, Europe and Asia.
The survey clearly illustrates the level of concern among young people about climate change, with 40 per cent of those interviewed naming it among the biggest challenges facing the world in the next decade, ahead of the economy (34 per cent), terrorism (32 per cent), poverty and inequality (29 per cent) and unemployment (29 per cent).
Eight in ten (83 per cent) post-millennials also said governments needed to listen more to young people about sustainability. A similar number (80 per cent) believed current leaders had not done enough to protect the environment.
They thought government and the private sector shared responsibility for developing clean technology (81 per cent), but they expected more government investment in renewable energy (84 per cent).
Almost two in three (59 per cent) said they were interested in working or studying in an area related to sustainability.
Patricia Espinosa, executive secretary of the United Nations Framework Convention on Climate Change (UNFCCC), said: “There is huge demand among our youth for corporate and public investment in clean technology and renewable energy. The winners in the green economy will be those who can harness this youthful idealism and combine it with regulations, long-term investment, cultural change and political action.”
The survey found that around half of Generation Z (46 per cent) had chosen to spend more money on products from a company that behaved sustainably, and 31 per cent had boycotted a company they perceived as following unsustainable practices.
Mohamed Jameel Al Ramahi, CEO of Masdar, said: “Over the last 10 years, the clean energy industry has become one of the world’s most exciting and dynamic growth markets. As we look ahead, the findings of our global survey provide an important insight into the action required to accelerate the adoption of renewable energy and clean technologies.”