Commerce Minister Apiradi Tantraporn said last week that a statement on the cooperation will be issued at the Asean Summit in Vientiane, which takes place from tomorrow until Thursday. Both sides will work to strengthen manufacturing and promote economic growth in the long run.

Update on RCEP talks

Asean and China as well as the other partner countries – South Korea, Japan, India, Australia and New Zealand – will give an update on the RCEP talks with a joint leaders’ statement.

The target is for the 16 member states of RCEP to finalise the free-trade negotiations this year so that RCEP can be implemented next year.

Asean and the six partner countries have agreed on the format of liberalisation of trade in goods.

The remaining issues are only about each country’s demands for liberalisation of trade in services and in investment, and some technical issues, which are expected to be discussed and finalised during the summit. The 16-member RCEP would become the world’s largest free-trade bloc with a population of 3.35 billion, or more than half of the world’s total.

Combined gross domestic product would reach US$22.9 trillion (Bt793 trillion), or 29 per cent of global GDP.

The RCEP countries account for 55 per cent of Thailand’s exports.

In 2014, trade with the RCEP countries was worth $2.6 trillion, or 57 per cent of Thailand’s trade with the world. The RCEP was the destination for $1.27 trillion or 56 per cent of Thailand’s exports, while imports from RCEP were $1.33 trillion or 58 per cent of total imports. Asean and China have also agreed to promote industry and expand production to serve rising demand globally.

The areas of focus are investment facilitation, investment-friendly environment and support for each side’s private enterprises to invest in various projects, special economic zones and the trading sector.

Malee Choklumlerd, director-general to the International Trade Promotion Department, said the Thai Trade Office in Tokyo had reported that the life-end industry was booming in Japan in line with the country’s ageing population.

Malee said in Japan in 2000, the number of deaths was about 1 million, and would increase to 1.43 million in 2020.

Increase in demand

The higher number of deaths had resulted in high demand, the director general said, for products aimed at services for when people die.

Malee urged Thais to recognise the benefits of the life-end industry in the Kingdom and penetrate it.

According to the Yano Research Institute, the industry in Japan is projected to be worth Bt590 billion this year, an increase of 0.3 per cent on 2015.

The industry’s value is hitched to products that include funeral services, transportation and pet funerals.

“The life-end industry also includes asset management, consultant agencies for heritage, medical and nursing services, |tomb reservations, flower decorations and souvenirs,” Malee explained.

“Each family will have to spend about Bt650,000 per household [on average].”

She said the great opportunities for Thai enterprises in the segment included clothing, shrines, fresh flowers, pet clothing, coffins, and souvenirs.

Malee said that Japanese had changed their attitudes and had modern mindset about preparing for death.

Thai firms should present their ideas and products to serve this niche market as a new trading channels, she said.

Under the new target, Thailand is expected to see export value between US$210.06 billion and $218.63 billion this year.

The new target is based on an average exchange rate of Bt35-37 per US dollar, compared with the earlier estimate of Bt36-38 per dollar.

Deputy Commerce Minister Suvit Maesincee said that after discussing the situation with the private sector, the ministry had decided that exports this year could, at worst, shrink by 2 per cent or, at best, expand by the same percentage. This is due to the sluggish global economy amid a changing Thai economic structure from relying mainly on export or trade in goods to trade in services and inward and outward investment. Thus exports will not grow as much as previously expected.

“The 5-per-cent figure was just a working target,” Suvit said, noting that in reality, export value declined by 2.28 per cent in the first eight months of this year.

He explained that global gross domestic product was expected to post its lowest growth in seven years at 3.1 per cent this year. Global GDP expanded by an average of 3.6 per cent annually from 2007 to 2011, dropping to 3.2 per cent a year from 2012 to 2015.

Average export growth in the world market has also declined con?tinuously from 10.1 per cent between 2007 and 2011 to minus 2.3 per cent from 2012 to 2015. As a result, Thailand’s exports will not grow as strongly as in previous years.

Suvit also said Thai exports could contract next year. With the changing world economic structure, Thailand would rely more on trade in services and support investment at home and abroad.

He said the government would strengthen its plans to promote trade in services, foreign investment, and innovation in order to add value to Thai GDP.

“The positive outlook for Thai tourism is based on the strong confidence of both tourists and the world’s most respected organisations such as the World Tourism Organisation and the World Travel and Tourism Council that Thailand is a safe and enjoyable destination,” said Yuthasak Supasorn, governor of the Tourism Authority of Thailand.

He said there were more air routes from Russia (Moscow, Vladivostok and Yekaterinburg), the Middle East (Tehran, Dubai and Doha), and Asia (Hong Kong, Mandalay, Luang Prabang and Vientiane). As well, the Golden Week coming up next month in China had created 39 charter flights with 7,594 seats heading to Bangkok or Phuket from nine cities in that country. The TAT and private tourism companies say they have been communicating with visitors and industry players in both times of calm and crisis to send the message that tourist safety and security are always a priority.

The global economic slowdown is expected to continue to hit some source markets in Europe, but Asians will continue to flock into the country, the TAT hopes.

Speaking at a conference on tourism recently, Yuthasak said that in the first nine months of 2016, Thailand’s tourism industry was expected to generate revenue of Bt1.88 trillion, a year-on-year increase of 14 per cent.

Of that total, some Bt1.25 trillion, up 17 per cent, was contributed by 24.94 million inbound tourists, an increase of 13 per cent. Another Bt629 billion, up 6 per cent, came from domestic tourism, with 111 million trips taken by locals.

Northeast Asia was the largest source market in the period at 17 per cent, the Americas at 15 per cent, Asean, South Asia and Europe at 10 per cent each, the Middle East at 8 per cent, and Africa at 5 per cent.

The Oceania market recorded 1.25-per-cent growth in the third quarter, bringing the overall performance up slightly, though there was a 0.7-per-cent drop across the nine-month period.

Yuthasak said TAT expected the final quarter of this year to generate revenue of Bt698 billion, a 16-per-cent increase from the same three months last year, comprising Bt468 billion from 9.01 million international tourists and Bt230 billion from domestic tourism.

Manit Boonchim, representative of the Tourism Council of Thailand, said the TCT’s tourist confidence index was 98 in the third quarter of this year, slightly lower than the baseline of 100. The index is expected rise to 102 in the fourth quarter.

Charoen Wangananont of the Association of Thai Travel Agents, whose members handled one-sixth of the total tourist arrivals to Thailand, said it would service 6.3 million tourists this year, up from 5.12 million last year.

The ministry reported that inflation in the first eight months of this year was slightly negative at minus 0.03 per cent, after August’s Consumer Price Index (CPI) edged up 0.29 per cent year on year. It was the fifth consecutive month of positive inflation, this time from higher food prices, especially cooked food, and higher tobacco duties.

Month-on-month inflation was slightly negative, at minus 0.04 per cent, from lower prices of fuel and some goods.

The ministry’s inflation projection for this year at zero to 1 per cent assumes price of Dubai crude oil to average US$35-$45 per barrel, higher than the previous forecast of $30-$40, but the baht’s appreciation will offset a higher oil-import value. The baht will range between 35 and 37 to the US dollar, compared with the previous forecast of 36-38.

Gross domestic product will grow by 2.8-3.8 per cent.

“Following positive signs of a recovery in inflation, the ministry will retain the inflation target for this year. Despite higher global oil prices, the baht’s appreciation will offset rising costs of fuel domestically,” Somkiat Triratpan, inspector-general of the ministry and director of its Policies and Trade Strategies Bureau, said yesterday.

He said the expected slight increases in the CPI in the remaining months should benefit the economy and encourage more spending.

Last month, prices of foods and beverages rose 1.88 per cent on lower supplies during the dry season and high demand for some foods, while non-food-and-beverage prices decreased 0.59 per cent.

Core inflation, which excludes volatile food and fuel prices, firmed slightly in August to 0.79 per cent year on year and 0.07 per cent month on month. Average core inflation in the first eight months of the year was 0.74 per cent, which was in line with the Bank of Thailand’s forecast of 0.5-3 per cent. A ministry survey during June and July found that more people were shopping online, mostly people aged 30-39 years who live in Bangkok and nearby provinces.

The poll of 4,653 respondents found that the top reason for shopping online was convenience. They also liked the many choices it offered.

The average value of online shoppers’ transactions was Bt501-Bt1,000. About 93 per cent of online shoppers buy from domestic companies. However, online shoppers still worry about goods not living up to their advertised specifications, delivery delays, damaged goods, not receiving their purchases, and lost contact with sellers.

Thailand lowered its quote to $424.85 per tonne, including cost, insurance and freight, after bidding $432 in the first round.

The Philippine National Food Authority’s government-to-government procurement committee awarded Vietnam Food Corp a quota of 150,000 tonnes and Thailand, represented by the Department of Foreign Trade, 100,000 tonnes.

Both countries had to submit offers for the second time after the first round was higher than the Philippine median price of $425 per tonne.

In the first round, Vietnam quoted $432.75 per tonne.

Chutima Bunyapraphasara, permanent secretary of the Commerce Ministry, “Winning the Philippine tender offer shows that Thai rice is competitive,” adding, “Rice traders should not pressure farmers to sell rice at too low a price, as the world markets still have high demand for rice.”

The Foreign Trade Department will assign the Thai Rice Exporters Association to ship this rice under quotas allocated to its members.

Charoen Laothammatas, president of the association, said 40,000 tonnes of rice of the 100,000 tonnes would be shipped to the Philippines this month and 60,000 tonnes next month.

Charoen said winning the Philippine order was difficult, as the quotation included the cost plus freight.

Rice exporters need to manage their costs and exchange rate, as the baht has fluctuated and appreciated sharply compared to other currencies.

TCEB president Nopparat Maythaveekulchai said the bureau was focusing on target markets. Asia – particularly India, China, Singapore and Malaysia – remains the primary area, representing 78 per cent of Thailand’s MI market, followed by Europe, the United States and Oceania. Eastern Europe including the Commonwealth of Independent States is a new emerging market.

The TCEB has also divided the MI market into three segments: corporate meetings (board meetings, annual meetings, regional meetings, corporate training, and group plant visits), premium incentives (executive retreats, high-tier incentives and company outings), and mega-size groups (more than 2,000 international delegates).

Nooch Homrossukhon, the TCEB’s MI director, said the bureau’s new “Meet in Style, Meet in Thailand” marketing campaign had five key attributes. These are meet at a delightful destination (fascinating history and culture as well as beach bliss), meet at breathtaking venues (lavish luxury), meet in sustainable ways (green meetings and corporate social responsibility), meet with energy (team building, exhilarating adventures), and meet around great flavours (culinary journeys).

In addition, the bureau has developed “double-city packages” offering international corporate clients the opportunity to discover the diversity of Thailand. The packages require a minimum of 200 delegates staying in Thailand for at least four nights in more than one city. The organiser will receive financial support of Bt100,000. Applications are open from October 1, 2016, until September 30, 2017, and travel must take place by December 31, 2017.

Another campaign is the “sustainable package”. It is open to groups of more than 200 international delegates staying in Thailand at least three nights, and incorporating CSR activities in their programme or organising events.

Earlier, the bureau launched the “Thailand BIG Thanks” campaign to tap MI groups of more than 2,000 international delegates.

Meanwhile, the TCEB will create an “afternoon with MI” approach for closer ties with industry partners. It will allow participants to hear more from industry partners in a cosy and relaxed ambience, allowing better information exchange, to discuss the industry needs and expectations, and then form a strategic plan.

Nooch said the TCEB had for the first time won a bid to be the host country for the SITE (Society for Incentive Travel Excellence) global conference, which will take place in Bangkok from January 11-13, 2019. This annual event will bring together about 400 entrepreneurs and top executives as well as buyers in incentive travel worldwide.

The government should use “avoided costs” to consider purchasing from other types of renewable energy such as biomass and biogas, he told the foundation’s seminar on unlocking renewable energy.

The “avoided costs” are the costs of importing liquefied natural gas (LNG) if those renewable power plants are not installed. The avoided costs of LNG imports should also be used as a benchmark for the government to negotiate gas prices with producers in new or renewed petroleum concessions.

The solar rooftop industry was set to grow very fast in Thailand since it had already provided worthwhile returns especially for commercial and manufacturing users promoted by the Board of Investment.

Piyasvasti, also chairman of PTT, said that if energy storage technology was developed further, the first casualty would be the electricity sector, not the oil and automobile industries.

Solar and wind farms would be able to supply their electricity on a “base-load” basis, which would threaten fossil-fuelled power plants.

“About the ‘clean disruption’ that some have said that a slow-mover might become the next ‘Kodak’, who knows if the fast-mover could become the next ‘Blackberry’,” he said, referring to the electric-vehicle revolution that promises to disrupt the car and oil industries.

Wandee Khunchornyakong, chief executive officer of SPCG, a leading solar energy firm, told the seminar that the only thing that the private sector would like to ask from the government was a stable policy.

“The government should let the private sector drive [renewable energy development],” she said.