She said that after adopting |new technology and innovation, Thailand should be able to reduce the cost of logistics from a current 14 per cent of the total GDP to |12 per cent in the near future. Logistics currently accounted for an average 8 to 10 per cent of total production costs.

The conference and exhibition, being held until tomorrow at BITEC Bangna, demonstrates Thailand’s logistics capabilities at a world-class level.

Apiradi said that the exhibition is in line with the strategy for trade and logistics development for Thai service providers.

She said the standard of logistics services in Thailand will be raised, and local and regional |firms will be linked so businessmen can meet and exchange |ideas, learn about new technology and innovations and build alliances.

Exhibitors from 25 countries representing 415 leading brands are at the show. It includes a trade logistics symposium “Towards Logistics 4.0 Era” and a “World Transport & Logistics Forum”, which will show the latest logistics performance index giving an analysis of the capabilities of Aseancountries.

This year’s show is broader and more international in concept, while emphasising Thailand’s role at the centre of logistics in the Asean region.

The aim of the exhibition is to motivate logistic service providers to realise the importance of developing their capabilities and becoming professional, able to compete in the international market.

Isara Burintramart managing director of Reed Tradex Company, co-host of the event, has a range of innovations on display. They involve transportation, warehousing and IT, together with logistics providers, technology owners, solution providers and products and services.

Visitors can see Innovative Logistics 4.0 products such as intelligent robots working with accuracy at surprising speed. The robots help in the organisation and transfer of goods in areas where humans have difficulty working – in freezers, cold rooms and chemical warehouses.

Driverless forklift trucks from Europe demonstrate how they can operate an automated warehousing and storage system that can retrieve information with speed and accuracy.

At a seminar hosted yesterday by Bangkok Bank, Nattawin Pongpetrarat, vice chairman of the Thai Business Association of Myanmar, said a large number of infrastructure projects ranging from roads to ports to postal services were planned in Myanmar thanks to financial assistance from foreign donor countries.

Because of poor road infrastructure and a shortage of skilled labour, many companies are investing hugely in information and communications technology (ICT), promising potential for e-commerce and online services.

Nattawin also anticipates demand for expertise from Thai companies in agriculture and agricultural processing, as the agricultural sector is one of the top 10 contributors to the Myanmar economy.

Labour-intensive manufacturing businesses should also benefit from the low labour costs as well as the abundant number of workers. Benefiting from this will be those relying on high local content, as importing raw materials could take about a month aside from extra time needed for their transportation from ports to factories.

Concurrently, they should consider capacity-building schemes for the workers and be reminded of the poor electricity supply and the poor conditions of ports and roads, he said.

On tourism, as more than 20 of the 45 daily flights served by Yangon International Airport are from Thailand, Thai companies in the sector should consider excursion services for those travelling to Myanmar.

“Thai companies should capitalise on their expertise. Combined with local experiences, they will prosper,” said Nattawin, who has operated a furniture and garment business in Myanmar for more than 10 years.

He stressed that Thai companies need local partners. At a time when Myanmar has witnessed an influx of investment from more than 40 countries, Thai businesses with local partners will have an advantage over others in terms of market insights.

“The Myanmar economy is very dynamic. The conditions change rapidly and it is necessary to have someone on the ground to point us in the right direction.”

In her opening speech at the seminar, Thai Commerce Minister Apiradi Tantraporn highlighted local people’s trust as well as the country’s continued dependence on imports.

Sanan Angubonkul, head of the Thai government’s private-sector team tasked with boosting exports and overseas investment projects, said: “To satisfy domestic consumption, nothing is better than setting up factories in Myanmar and supplying the products for the market.

“As a plus, the United States’ reinstatement of its Generalised System of Preferences for Myanmar would also benefit their exports.”

Still, he warned that losses were likely unavoidable for the first three years, but if these investors can hold on, the prospects after that would be bright, as “Myanmar is darling of the world.”

The seminar is part of a public-private collaboration to boost Thailand’s direct investment, particularly in Cambodia, Laos, Myanmar and Vietnam.

Worawan Chandoeywit, adviser on social security to the Thailand Development Research Institute, floated the idea yesterday, based on research that found long-term-care expenditure for this group would increase by 235 per cent from Bt59.52 billion in 2017 to Bt199.72 billion in 2037.

During the period, the number of Thais older than 60 will have risen to 20 million from 11 million at present.

Understanding that this fund should not add to the government’s fiscal burden, the model asks for contributions mainly from the working-age population as well as local administrative bodies.

“It’s meant to be an alternative for the needy, without adding to the fiscal burden,” Worawan said. “We realise that if the government has to shoulder the cost alone, this will never happen. All parties should lend a hand, and this will surely improve elderly people’s quality of life.

“Some workers who make contributions may not live long enough to use the fund, but eventually this will benefit all households. Every household now has at least one elderly member.”

Worawan’s research covered households with sick and very old members in 12 provinces, tracking expenses on care-giving as well as medical supplies and equipment.

These elderly folk need 100 hours of care-giving services per month on average, at an average monthly cost of Bt15,000. These expenditures are entirely covered by the families, as Thailand’s three health-insurance systems cover only medical treatments.

Some families with access to government insurance schemes thus opt to keep elderly members in hospital. If there were assisted services at home, more hospital beds would be freed up and hence the government’s medical expenses would decline.

The government’s medical-care plan for the civil service costs Bt60 billion per annum, while the universal-coverage scheme will cost about Bt123 billion in 2017. Under the Social Security programme, health expenses were estimated at Bt30 billion in 2015.

Under Worawan’s model, of Bt59.52 billion in expenditures in 2017, actual expenses of the elderly would be Bt20.785 billion if local administrative bodies agreed to shoulder a similar sum. Therefore, the contribution from the working population would amount to Bt14.98 billion.

The model will be forwarded to the National Health Security Office. If it is accepted, the NHSO might establish a new department for elderly care, or a new law may be required if a separate unit is needed under the Public Health Ministry to supervise this matter.

The fund is meant to help finance the care-giving and supplies and equipment, for example Bt5,000 for a wheelchair and a 50-per-cent allowance for a caregiver.

Private-sector contributions would also be welcomed.

The expenses as well as nursing homes and other related services would fall under the supervision of a newly established regulatory committee.

Worawan is hopeful that her proposal will win support from local politicians, for whom the elderly are key voters.

“Some local governments organise tours for the elderly. That spending could be shifted towards this long-term scheme. The local governments should play a bigger role in this area, like those in many countries,” she said.

The ministry will call in Thaicom to discuss the ministry’s plan to reform the satellite-service industry by next month.

The MDE has to follow the Cabinet’s resolution by bringing the Thaicom 7 and 8 satellites under the ministry’s concession regime.

The ministry’s plan to roll out free broadband Internet access to 30,000 villages nationwide is expected to be delayed by three to four months, but the installation of the network should be completed by the end of next year, he said.

On July 11, the State Enterprise Policy Commission instructed TOT and CAT to complete the merger of their three core operations by hiring consultants separately for the merger plan within three months, setting up the consolidated companies within six months and transferring all assets to them within a year.

The commission, also known as the “superboard”, ordered them to merge their transmission and fibre-optics networks into the National Broadband Network Co with Bt15 billion of asset valuation.

Their Internet gateway and submarine-cable networks will become the Neutral Gateway Network Co with Bt5 billion of asset valuation.

Their Internet data centres will become IDC Co.

Prajin delivered a policy speech to the agencies and state enterprises under the MDE for the first time since it formally replaced the Information and Communications Technology Ministry last week.

The MDE has a Bt7.76-billion budget for the next fiscal year, which is 50 per cent more than the ICT Ministry was allocated last year.

It does not include Bt15 billion for launching the rural fixed broadband service for 30,000 villages and cable networks for the Asean digital hub project. TOT and CAT Telecom are expected to be awarded the contract to operate these projects soon.

Most of the budget, Bt3 billion, will be allocated to the permanent secretary’s office to implement the transition from the ICT Ministry to the MDE.

The ministry was set up as part of the government’s “Thailand 4.0” policy.

All agencies under the ICT Ministry except one have already been transferred to the MDE.

“Last year, exports of cut flowers were worth Bt200 million. Exports this year should increase as they penetrate the Japan and the Netherlands markets,” she said.

Under the FTA Fund project, flower farmers have been helped in developing new species to compete with other countries’ cut products, mainly from China after the FTA between Thailand and that country reduced tariffs on flower imports.

Flower farmers who have been supported under the project are in Chiang Mai, Chiang Rai, Phayao, Lamphun and Phichit provinces.

Marketing plan

The FTA Fund previously employed the agriculture faculty at Chiang Mai University to help develop new flower species and draw up a marketing plan for flower farmers. The marketing plan has been focused on Japan, which is Thailand’s largest flower-export market, and the Netherlands, the world’s leading flower producer and exporter.

Three new cut-flower species of orchid have been developed, called Starlet, Pink Melody and Lanna Angel. The FTA Fund has registered these plant varieties for copyright protection. The new species can be grown out of season from October to March; normally the old species were grown in August and September.

The FTA Fund has also helped farmers develop their local business in five communities in Chiang Mai for producing and exporting products. The new flower species have met the GAP (Good Agricultural Practices) and Global GAP standards after the FTA Fund helped develop their production quality and implemented a traceability system.

In the future, the flower-growing communities will be promoted as tourist attractions in the Northern region, Duangporn said.

The probe involves an AIS employee who allegedly breached the company’s policy on the security of customers’ personal data.

According to a statement AIS sent to the press yesterday, the employee in question was an IT specialist.

The subscriber, Chayapolprakorn Sattanarong, told the panel yesterday that he found a thumb drive in the postal box at his home. It contained a file of his call data and his locations. He filed a complaint at the AIS call centre and with AIS executives and later posted his situation on social media.

He said the file also contained 100 mobile-phone numbers of other people and their call-data records.

AIS has investigated the case. It told the panel that it had notified the Bang Sue police station on September 15 of the case and fired the employee involved.

The company insists it does not knowingly commit such privacy breaches.

AIS says it has stepped up measures to prevent such incidents from happening again.

NBTC secretary-general Takorn Tantasith said the panel would take 30 days to complete its investigation.

New business registrations rose by 26 per cent year on year to 6,200 last month, for a total of 42,911 companies in the first eight months, up by 3 per cent year on year.

Pongpun Gearaviriyapun, director-general of the department, attributed the rising number of new companies to the government measures to promote investment, mostly in the construction sector, while strong tourism growth was also encouraging new enterprises.

She added that her own department’s measures to facilitate new enterprises had also contributed to the establishment of new businesses.

The expectation that gross domestic product could grow by 3.2-3.5 per cent this year has also encouraged the setting up of new firms, she said.

Most of the new companies are engaged in construction, property development, machinery wholesaling, restaurants and food retailing, and consulting.

The department expects about 60,000-65,000 new companies to be established this year.

However, Pongpun said there remained some risks that could deter enterprises’ decisions to expand, including a sluggish export sector and fluctuating oil prices, as those factors could affect spending power.

Initial investment capital last month was up by a significant 46 per cent year on year to Bt19.36 billion.

The department also reported that 1,747 companies shut down last month, up by 13 per cent year on year. In the first eight months, the number of business closures dropped by 0.02 per cent year on year to 9,986.

A total of 641,396 companies are actively operating in the country, of which 1,144 are public companies.

Maung Aung, senior adviser to Myanmar’s Commerce Ministry, said the absence of sanctions would boost both trade and investment.

On commerce, Myanmar businesses will be able to trade with other countries with letters of credit, instead of relying on telegraphic transfers, while dollar-denominated transactions will also entail a lower cost, as local businesses will no longer need to use banking services in Singapore, he said. The adviser is convinced that bilateral trade will sharply increase and that this will create a large number of jobs, particularly in the garment industry.

“FDI [foreign direct investment] is really important for our country to grow further. But we have not received a large amount of investment from US companies as yet. Sanctions seem to be one of the main reasons for that. But in my view, trade is more important than FDI. Without any improvement in trading, we will not receive any large-scale investment,” he explained.

According to US Department of Commerce data, trade with Myanmar amounted to US$238 million (Bt8.31 billion) in the first seven months of this year. Exports to the US were valued at $122.9 million. Bilateral trade has been on the rise since 2012, when some sanctions were lifted.

Myanmar exports agricultural produce, marine products and industrial finished goods to the US, and imports personal goods, investment materials, and raw materials for household goods from the trade partner.

Clothing exports are expected to reap the biggest windfall from the further removal of sanctions.

According to the Myanmar Garment Entrepreneurs Associ-ation, the US used to be the biggest market for the nation’s garment industry, with export value to the destination in 2001 reaching $500 million – or about 60 per cent of a total of $817 million. In 2004, when sanctions were imposed, the overall export value dropped to $700 million and Japan became the biggest market.

The industry was resurrected after the European Union offered GSP to Myanmar in July 2013, which helped boost the overall export value for the sector to $1.65 billion last year.

Khine Khine Nwe, joint secretary-general of the Union of Myanmar Federation of Chamber of Commerce and Industry and secretary-general of the Myanmar Garment Manufacturers Association, warmly welcomed the US decision, saying it offered an opportunity for Myanmar garment exporters to re-enter the US market and companies to initiate or strengthen ties with American businesses.

However, local manufacturers should realise that under the EU’s GSP system, Myanmar can export all kinds of goods to the bloc, with “duty and quota free” trade preferences. Under the US’s system, it remains to be seen what items would be allowed to enter the US market with trade preferences.

According to the US-Asean Business Council, the GSP programme should remove duties on more than 5,000 product lines.

Alexander Feldman, president and chief executive officer of the council, said the lifting of sanctions would increase US private-sector participation in the Myanmar economy, which would substantially benefit the people of Myanmar, especially around CSR (corporate social responsibility) programmes.

“US companies have been interested in Myanmar since sanctions were eased in 2012, but have been constrained in engaging in Myanmar by the challenges of conducting due diligence and compliance with regulations around the Specially-Designated Nationals [SDN] list,” he said. “This action would remove the single biggest obstacle to US companies engaging in Myanmar and allow US companies to compete on a level playing field with competitors from Europe, Asia and elsewhere.”

Caution advised

Alison Stafford Powell, Baker & McKenzie sanctions expert and US partner, said that this level of sanctions relief could indeed lead to more investment, but US and non-US companies still needed to be cautious. “Non-US investors should also find it easier to procure financing from major international banks which, as a result of suffering huge fines for US sanctions violations, are extremely risk-averse to touching even lawful dealings with anyone who remains an SDN.

“KYC [know your customer] due diligence is still important though, as several SDNs remain and the prohibitions extend down to even unlisted entities that are 50 per cent or more owned by one or more SDN,” she said.

Thai businessmen in the garment and fishery industries, meanwhile, foresee brighter opportunities for investment from Thailand.

Vallop Vitanakorn, adviser to the Thai Garment Manufacturers Association, said cheap labour in Myanmar and GSP privileges for exports to the US were attractive.

However, he noted that most Thai companies still hesitated to move facilities to Myanmar as the new government had not yet provided clear rules and laws for promoting foreign investment.

Another concern lies with the country’s poor infrastructure, particularly electricity supply, he said.

“In the medium and long term, Myanmar will be the most attractive country to draw investment from Thailand, due mainly to its huge and cheap workforce, while Laos offers no labour supply and labour and utility costs in Cambodia are rising,” he added.

Panisuan Jamnarnvej, former president of the Thai Frozen Foods Association, said some upstream Thai companies may be enticed to move to Myanmar to take advantage of abundant raw-material supplies, but not large operators, which were still waiting for improvements in the nation’s road infrastructure and utilities systems. Myanmar companies will also need to embrace new rules if they want to reap benefits from the US policy changes, according to Khine Khine Nwe.

“We should not forget that we are streamlining into the global market and that is not easy. The requirements of the US companies, the demand of the customers, consumers, all are to be very well taken care of. We need to follow global standards, product quality and safeness, responsible business conduct, CSR, labour standards, occupational health and safety, environment, there are many. The door is open, the market is out there. But whether we can reach the market depends on our supply side effort to fulfil those requirements and the effort from the buyer side to assist us to come up to that level,” she stressed.

Udom Srimahachota, adviser to the Thai Hotels Association (THA) and owner of the Baan Talay Dao Resort in Hua Hin, said Hua Hin and Cha-am would remain popular destinations for tourists especially Westerners because they offered up to 30 per cent lower prices compared to other tourist destinations such as Phuket, Pattaya, and Koh Samui.

He said the bomb blasts in Hua Hin and six other tourist areas of the South had caused a short-term impact with local and foreign tourist numbers down, but foreign tourists had begun to return.

He said the average hotel occupancy rate for the entire year in Hua Hin was forecast at 55-60 per cent and was expected to climb to 70-80 per cent in the high season – a return to normal.

Udom said hotel operators had urged authorities to promote Hua Hin and Cha-am in emerging markets including China and India. More South Korea and Hong Kong tourists are also expected to descend on the destinations during the coming peak season.

“In order to develop Hua Hin and Cha-am to become international destinations, the private sector in the areas is calling on the government to develop a logistic system by developing an airport in Hua Hin as an international airport to link with neighbouring countries especially Singapore and Malaysia, as well as other provinces,” he said.

He said Hua Hin could also be promoted as a wellness destination and link to destinations including the newly opened Myanmar.

Christian Wurm, general manager of the Hyatt Regency Hua Hin and The Barai, said the hotel was confident of securing customers during the peak season at the same level as last season.

He based that on the number of in-coming bookings from core markets.

Wurm said half the property’s guests were local and the other half foreigners, mostly from Germany, United Kingdom, Scandinavia, Singapore, and Hong Kong.

The Chinese market is significantly increasing, he added.

“Hua Hin is represented as a wellness and golf destination. These services can attract many visitors,” he said.

Suchin Jienjitlert, vice president of THA and the operator of the River Kwai Village in Kanchanaburi province, said the hotel began targeting the Myanmar market this month by joining a travel consumer fair in Yangon in a bid to capture big-spending customers.

The hotel is offering a package to the Myanmar market that includes a Thai spa experience.

Many Myanmar visitors love visiting Bangkok for shopping, Suchin said.

“Myanmar is our new market. We are moving to take advantage of a new motorway being constructed that will link Kanchanaburi and Myanmar over the next five years,” Suchin said.

The Comsaed River Kwai Resort and Spa in Kanchanaburi said it had just completed a renovation worth Bt30 million in order to keep attracting free individual travellers and to increase its local meeting and confersence business.