Giant backlog nixes Toyota expo orders Repair services will be featured instead

Toyota will not take any orders at the Thailand International Motor Expo, as the huge backlog from before the flood crisis has prompted the company to drop all sales and marketing activities.

Honda, whose Ayutthaya plant has been completely inundated, will display its cars built locally and accept orders despite a pre-flood backlog for 37,000 units, mostly for Brio, Jazz and City models as yet undelivered.

The expo will be held at Impact Muang Thong Thani from Dec 1-12.

Toyota's plant was not directly hit by the flooding but still had to suspend production due to a supply disruption after the deluge overwhelmed parts factories in Ayutthaya and Pathum Thani districts.

It will offer car maintenance activities at this year's motor expo to help its customers with flood-damaged vehicles.

"We've decided to skip regular sales and focus on teaching customers how to take care of their cars after the floods. 

Our mechanics will be on hand throughout the event to give advice and demonstrate how to fix and repair damage to Toyota vehicles. 

This is crucial, as our customers are now very much concerned about their cars' post-flood condition and safety," said Vudhigorn Suriyachantananont, a senior vice-president of Toyota Motor Thailand (TMT).

Toyota staff will provide information about dealers nationwide for future contact by potential customers.

A senior TMT official said the huge backlog has discouraged the company from accepting any more orders.

Toyota's three auto plants in Samut Prakan and Chachoengsao provinces restarted production on Nov 21 after being suspended from mid-October.

The source declined to give an exact number for the backlog but said the customers will have to wait only another month or two for their passenger car delivery, three months for pickup trucks and six months for pickup passenger vehicles.

A senior executive at Honda Automobile (Thailand) said despite having been amid the worst of the flooding, all of its models will be showcased at the expo and new orders will be taken.

"Our staff will be there to explain our current situation to customers placing an order," said the executive.

Honda still cannot estimate when it can clear up its 37,000 back orders, as there remains no clear outlook for the reopening of its swamped Ayutthaya plant.

It is insisting that it be allowed to import foreign-built automobiles from outside Asean tax-free to compensate for production losses at the Ayutthaya plant.

It says its situation is diffferent from other carmakers in that its plant has been completely devastated, and it cannot produce any cars.

As well, the car imports, if permitted, would allow Honda dealers nationwide to continue their operations.

The plant remains inaccessible to Honda staff, thus preventing them from surveying the extent of the damage.

However, an industry observer estimated next year's second quarter for the plant's reopening.

Private investment to get a shot in the arm next year

The Finance Ministry is preparing an economic stimulus package to heal the flood-ravaged economy, more than doubling private investment to 15% of gross domestic product (GDP) from 7% now, says the Fiscal Policy Office (FPO).

"The finance minister wants 2012 to be the 'Year of Investment', and to this end attractive investment promotion measures will be offered as a package," said director-general Somchai Sujjapongse.

He said the department is studying efficient ways to promote investment by Thai companies domestically and abroad.

The ministry is also seeking to waive import duties for auto parts and vehicles in a bid to ease the burden of flooding on the hardest-hit industry.

The tax reform process will also be continued to accommodate investment, while small and medium-sized enterprises will be provided with productivity improvement packages.

Dr Somchai admitted that the lack of a long-term water management plan could undermine the investment privileges but expressed confidence the government's working groups will come up with one soon.

As well, the Board of Investment and the Finance Ministry are continuing to amend their investment privilege criteria by shifting the focus to strategic industries rather than broad promotions.

The flood-affected investors will continue to enjoy their current privileges for another 1-2 years beyond the normal seven years.

Dr Somchai said Thailand will never get out of its "middle-income trap" unless the investment value is on a par with the savings amount.

Like other economic think tanks, the FPO has cut its GDP forecast to between 1.7% and 2% from a pre-crisis estimate of 4.5%.

However, it is more optimistic about next year, forecasting 5% GDP growth on an aggressive injection of funds that will result in a deficit of as much as 400 billion baht.

Thailand will have room for an additional 400 billion baht, not including the new public investment programme that will allow the country to spend more, Dr Somchai added.

Thai Rath Columnistmae Look Chan

Why can't Bangkok Governor Sukhumbhand Paribatra hold a daily meeting with officials from the Flood Relief Operations Command (Froc)?

Since the flood crisis began in July, the Bangkok Metropolitan Administration (BMA) and Froc have pursued their own anti-flood strategies.

While Froc is in charge of the overall flood relief operation, the BMA is responsible for protecting the inner area of Bangkok.

This overlapping of authority between the two agencies is aggravating the hardship of people living outside Bangkok's floodwalls. 

Even if the Froc wants to drain more floodwaters from the suburbs through the city's canals, it cannot do so without the consent of Governor Sukhumbhand.

This problem can be fixed if the governor and the Froc director meet for close consultations every day. Water management experts from both sides must also join the meeting.

Forced to live with polluted floodwaters for over two months, thousands of people living outside the floodwalls have lost their patience. A quick solution must be found before this crisis explodes.

Reaching out for flood relief

Skal Club of Hua Hin and Cha-am, in cooperation with the Rotary Club of Royal Hua Hin, presents "Reach Out, Rebuild and Restore", a flood charity fundraising concert at the Grand Ballroom of Hyatt Regency Hua Hin on Saturday at 6:30pm.

Aspiring Thai singer Sathida Prompiriya and Canadian musician Paul Bankes will perform during the ‘‘Reach Out, Rebuild and Restore’’ charity concert at Hyatt Regency Hua Hin on Saturday at 6:30pm.

The concert will feature Sathida "Nan" Prompiriya, the first Thai winner of five gold medals at the World Championships of Performing Arts 2011, with Canadian Paul Bankes on guitar.

The proceeds from this fundraising concert will go directly towards the rehabilitation of Wat Kong-sa Primary School in Ayutthaya, which was severely affected by flooding.

Skal is a network of local clubs with international associations. The overwhelming majority of members join Skal to network with their peers in their community. The club has more than 10,000 members across the spectrum of the travel and tourism industry.

Tickets cost 1,500 baht, including pre-show cocktail buffet and wine.

Flood losses force Dhipaya to miss profit goal

SET-listed Dhipaya Insurance expects to fall short of its net profit target this year because of flood losses, but remains upbeat to achieve its revenue target of 14 billion baht.

"Despite the flood, our performance based on written premiums displayed up to 40% growth and we expect to reach 14 billion baht as set," said Somporn Suebthawilkul, the company's managing director.

For the first nine months of the year, the company reported written premiums worth 8.04 billion baht, a rise of 36% from the same period last year, with 1.96 billion from motor insurance, 2.67 billion from miscellaneous business, 794.75 million from fire coverage, 165.15 million from marine and cargo, and 2.43 billion baht from personal accident.

However, the company reported a profit drop to 437.38 million baht for the period compared to 591.96 million in the first nine months of 2010.

The profit drop was mainly due to a new regulation of the Office of the Insurance Commission requiring insurers set aside a minimum reserve for claims incurred despite those claims not yet being reported through actuarial method.

Dhipaya estimates insurance losses of 6 billion baht from the flood, with 4 billion from the seven flooded industrial estates and 2 billion from motor insurance and others. 

Net loss to the company is expected to be about 300 million baht, as a majority of the insurance premiums were reinsured.

It set a net profit target earlier this year of over 700 million baht, which Mr Somporn admitted Dhipaya could not meet. Last year net profit was 572.88 million baht, slightly higher than the 547.88 million it recorded in 2009.

"Despite insurance losses and the profit dip, the company's financial status remains strong," he said. "We see no need to raise new capital to pay out the claims."

Shares of Dhipaya (TIP) on the Stock Exchange of Thailand yesterday closed at 20.10 baht, up 10 satang, on trade worth 755,000 baht.

PTT's Pailin sees flood crisis as a leadership opportunity Government should study the flood cause

"Krisis" in Greek denotes points of change. But as conditions change, positives can be taken from a crisis, including the ongoing flood in Thailand, says Pailin Chuchottaworn, PTT's president & CEO.

Dr Pailin won CNBC’s 10th Asia Business Leaders Award for Talent Management last week because of his work at IRPC.

Over 600 people have lost their lives, with the Central Plains and seven industrial estates swamped. Foreign investors, especially Japan, are upset about a lack of water management plans and prevention, and the government set up two commissions to work on broad strategy and restoring confidence.

Strong reassuring leadership during a crisis can determine whether the response will be a success or failure, said Dr Pailin.

"The flood impact is severe and far-reaching. It changed our mindset about whether Thailand is safe from disasters. I believe an opportunity arises three to six months after every crisis happens. But we must grab that opportunity."

Public discontent against the government's handling of the earthquake and the nuclear crisis forced Naoto Kan to resign as Japan's prime minister, and criticism of George Bush's handling of aid and repair during the Hurricane Katrina aftermath was a factor for voters in the next federal elections.

In Indonesia, Susilo Bambang Yudhoyono's stewardship in rebuilding Aceh after the tsunami in 2005 garnered him international praise and led to a second term as president in 2009.

One of the government's top priorities after the flood should be to understand its cause and impact, similar to what Japan did in the aftermath of the Tohoku earthquake in March, he said. 

Japanese officials dispatched experts to examine buildings destroyed by the powerful quake to determine better construction methods and land hit by the tsunami to understand the quake's impact.

"We need to understand what caused the flood in order to prevent it," Dr Pailin said.

To win a staff's confidence and ensure they work toward a common goal, a leader needs comprehensive knowledge, patience and foresight, he added.

Dr Pailin won CNBC's 10th Asia Business Leaders Award for Talent Management last week, because as president of IRPC since 2009 he turned around its balance sheet from 18 billion baht in losses in 2008 to 6 billion profit in 2010.

He said three to six months after IRPC posted huge losses he persuaded the staff it needed to change.

"IRPC at that time was similar to a big ship close to a reef, about to collide with hidden rocks. In order to avoid them, the business needed to separate into smaller pieces to follow their own objectives, similar to smaller boats weaving around the rocks."

Dr Pailin was chosen for president of PTT in September 2011. While he wants PTT to be included in the Forbes 100, the global financial crisis changed the corporate focus to sustainability rather than rapid growth.

"PTT's strategy is to have a long value chain and strong internal management," he said. "Being large is important for an oil company in increasing business leverage, such as when we bid. But size should be the effect, not the cause."

Little justice in show trial

The most important international trial of our time began last week in Cambodia. It adjourned after just two days, and will resume in its halting way again next week. 

The three top surviving men of the most murderous regime in the history of Southeast Asia were in the dock. Nuon Chea, Ieng Sary and Khieu Samphan are too feeble to be able to feel the legal consequence of their actions that the tribunal will eventually pass. 

The question is whether the trial of these three old men can truly bring closure to a country denied justice for 36 years.

The enormity of the crimes of the Khmer Rouge have long been known, but never widely addressed or, in many cases, acknowledged. 

The joint Cambodian-international tribunal which called the three Khmer Rouge survivors to the dock last week, took decades to establish a trial system which should have taken a few months. 

The Cambodian government was the chief stumbling block, particularly Prime Minister Hun Sen. Foreign governments, including Thailand, were sometimes reluctant and never enthusiastic about establishing the special courts to try the men and women who slaughtered or actively encouraged the deaths of at least 2 million and probably more of their fellow Cambodians: at least a third of the country's population was decimated.

Civilians crowded the tribunal last week, most of them survivors of a three-year, nine-month regime now known as the Killing Fields. 

Many wept, some rushed from the court as the Cambodian, then the British prosecutors, outlined the case against the old men who will be found guilty of crimes against humanity. 

There were no new charges, no revelations of the horrors of the 1975-1979 regime. The crimes of that era, however, still have the power to shock, and the pain on the faces of the survivors was obvious.

Because Mr Hun Sen delayed even this small tribunal for so long, most Cambodians today have no memory of the days of the killings fields. 

But the three men facing the tribunal were among the tiny handful of hardliner, xenophobic communists who were responsible for the fact that when the Khmer Rouge fell to a Vietnamese invasion in January 1979, every living Cambodian knew one or more victims killed by the regime.

The leader, Pol Pot, died in his bed in a remote province. But Nuon Chea, "Brother No. 2" to Pol Pot, was the top policymaker. Ieng Sary, 86 and just as enfeebled, was the foreign minister and unapologetic face of the "Ongka" to the world, including the United Nations. 

Khieu Samphan, 80 and still able to walk without aid, is the intellectual and probably psychotic author of the Khmer Rouge policy of emptying cities, killing doctors and destroying money.

If the three men live long enough to be judged guilty and given a sentence of life imprisonment, that will be the end of it. 

Mr Hun Sen said that if there were to be more trials, there could be civil war, meaning that he fears inquiries of just how close he was to the top as a Khmer Rouge military commander during the black years. If the Cambodian people ever are to get justice, it is now or never.

To their credit, many of the court officials and tireless Cambodian and foreign workers have labored for decades to see at least some Khmer Rouge in the dock. 

The trial of a functionary, chief torturer Duch, 68, was completed in July 2010. He was sentenced to 35 years in jail.

Overall, both international and local law have failed the Cambodians. They deserve more light to be shed on their most terrible times.

Bias, by any other name, still blinds you to the facts

A question for you: during the flood emergency, which leader wasted valuable time on useless staged photo-ops, seeking political benefit rather than trying to combat the disaster?

Bangkok Governor Sukhumbhand Paribatra (right) politely listens to Prime Minister Yingluck Shinawatra. The two were at the Department of Drainage and Sewerage in Bangkok on Nov 4, for a briefing on floodwater drainage plans.

A) Prime Minister Yingluck Shinawatra, or

B) Bangkok Governor Sukhumbhand Paribatra.

Now that the floods are beginning to recede and _ hopefully _ tempers to ease, we should be able to have the discussion.

Currently, politics in Thailand and in the United States are highly polarised, even vicious. That condition is made worse by what behavioural scientists call "my-side bias". 

Part of this phenomenon should be familiar to any follower of Manchester United, Liverpool or any of the great Premier League clubs, the strong will for "my side" to win and the despair and rationalisation if it does not.

But, my-side bias goes well beyond just rooting for your team. It is all too human to seize on information or reject it depending on how it fits into your preconceived notions. 

The bias has long been with us. At the same time Siddhartha Gautama was developing Buddhist teachings, the Greek historian Thucydides observed that "it is a habit of mankind... to use sovereign reason to thrust aside what they do not fancy".

Since the 1960s, scientists have demonstrated that virtually everyone has a bias for facts confirming their existing beliefs and against any contrary evidence. 

In financial circles, this is called "confirmation bias". Pessimists who are convinced that the end is near counsel you to buy gold. Optimists say now is the time to get into the next big boom. 

Neither has much interest in the data cited by the other. Confirmation bias only makes individual investors go broke.

But, in politics, my-side bias can sunder entire societies. Not everyone is biased to the same degree, but science has shown that we all work with some bias and, as among many in the US and Thailand, that bias now appears to be growing more extreme.

In the US, some 45% of Republicans believe that Barack Obama (a Democrat) was born overseas and thus ineligible to be president. This isn't for want of information. The press has reported extensively on the issue, pointing to contemporary birth notices in Hawaiian newspapers and to his birth certificate, now available online.

But facts don't matter to the "birthers". It is just that they don't like Mr Obama (as a Democrat, as an African American, as a liberal, etc) and they are not prepared to listen to any positive information.

Though there are many important principles in play in Thai politics, earlier pronouncements on yellow-shirt TV and later speeches from red-shirt stages also were also littered with untruths every bit as ridiculous as Mr Obama being a foreigner in his own country.

Yet, both yellow and red propaganda was eagerly lapped up by people prepared to believe anything about those they opposed.

My-side bias can lead people to very ugly actions. During Republican presidential debates, the audience _ opposed to Mr Obama's healthcare reforms _ cheered the prospect that a person who fell ill without insurance should be left to die.

Texas Governor Rick Perry received a wild round of applause when a questioner pointed out he had authorised a record number of executions and that some of the prisoners might have been innocent. 

When a gay soldier called in a question from an Iraq war zone, many in the audience booed. Fortunately, a few tried to shush the booers.

I would hope that the same reaction would greet those who brazenly claim that Thai soldiers who spend their days in the water trying to help their fellow citizens solely as a cynical bid for power.

My-side bias has little to do with intelligence. Indeed, experiments in the US show that those endowed with agile brains can be just as stubbornly blind to facts. 

Witness the continuing denial of global warming among groups of stubborn scientists despite masses of evidence (2001-2010 was the hottest decade on record, followed by 1991-2000). 

Theses scientists discount or ignore data that contradicts their existing belief and eagerly embrace any information that supports their view (a few of the world's glaciers may be expanding, data is conflicting on ocean temperatures and the like.)

And thus it is in Thailand. Scholars and experts have written in these pages advancing A) as the answer to the question I posed above. 

Others have written just as firmly in support of B). Particularly amusing are Thai analysts who have written from abroad offering purportedly authoritative analyses of what is going on here.

 Most have obviously picked "facts" they want to believe from like-minded friends or on Facebook, and have ignored everything contrary to their belief.

And now to the answer, who was just posing and who was effective during the crisis?

The answer is that any leader is elected to lead. Part of leadership is coordinating as effectively as possible the many different agencies and bureaucrats who each have their own agendas. Part of leadership is getting reliable information to the public so people can make their own best decisions.

But, part of leadership is also motivating the public and the workers who toil at the necessary tasks. An army does not hire a general to fire a gun, but to plan and to coordinate and motivate the troops. Similarly, a society doesn't elect a leader to really fill sandbags or to cook for those in distress.

So, from the same set of facts, Thais can passionately argue both sides of the question: one leader was doing their best in hard circumstances and the other was grandstanding.

The real answer should come from a sober analysis of effective leadership, of coordinating agencies and assuring accurate information. "I don't like his/her look or his/her background" should not be part of it.

But, as humans, many of us will chose sides. The simple truth is that people feel before they think. If those feelings are strong enough, they will happily set facts aside and carry on with their heart, not their head.

To turn down the political volume in Thailand and in the United States, let me propose a maxim for each of us:Try not to trust everything you believe.

Researchers design steady-handed robot for brain surgery

Neurosurgeons may one day get help in operating rooms from a robot with movements 10 times steadier than the human hand to perform delicate brain surgeries, the EU said Monday.

Surgeons operate on a patient in July 2011 in Baghdad. Neurosurgeons may one day get help in operating rooms from a robot with movements 10 times steadier than the human hand to perform delicate brain surgeries, the EU said Monday.

The European Commission touted the EU-funded ROBOCAST project as a breakthrough in robotic neurosurgery that could in future help treat tumors, epilepsy, Parkinson's disease and Tourette syndrome.

Developped by British, German, Italian and Israeli researchers, the robotic hand, guided by a surgeon, has 13 types of movement compared to four available to human hands during minimally invasive surgery.

It even has "haptic feedback", or physical cues that allow surgeons to assess tissue and feel the amount of force applied during surgery, the European Commission said in reporting the EU-funded ROBOCAST project.

The robot has only been tested on dummies so far, performing keyhole neurosurgery, in which a probe enters a tiny hole in the skull to manipulate tissue or collect blood and other fluids.

"Robots can reduce surgeon's tremor tenfold, making them especially useful in protecting the delicate and important brain matter," the commission said.

The European Union, marking European Robotics Week, said it was funding a parallel project involving three robots to assist surgeons operating on patients who must stay away during neurosurgery.

The EU's executive Commission has already spent 400 million euros in around 100 robotics projects. Brussels says global demand for robot-related products was worth around 15.5 billion euros in 2010, including 3.0 billion in Europe.

SRT told to reclaim Chatuchak Minister refuses to bend in BMA contract battle

The Transport Ministry has insisted it wants the State Railway of Thailand to reclaim the rights to manage Chatuchak Weekend Market after its management contract with City Hall ends at the end of this year.

Transport Minister Sukumpol Suwanatat said he issued a clear policy to the SRT but he had not received a report about the Bangkok Metropolitan Administration's (BMA) move to renew its contract with market vendors without the consent of the SRT.

ACM Sukumpol was responding to Chatuchak market vendors who have complained about the confusion over contract renewals because the SRT and the BMA cannot agree on the contract to manage the market.

A group of vendors will go to Government House to submit a petition to Prime Minister Yingluck Shinawatra asking her to solve the problem.

The SRT last Friday posted a notice at the market to advise vendors who wanted to renew their contracts to submit documents to the SRT by the end of December.

The BMA had earlier advised vendors to renew their contracts by the end of December as well.

Vendors say both agencies have almost doubled the rental fees for contract renewals. More importantly, they are not sure which agency they should contact for the renewals.

Deputy Transport Minister Chatt Kuldiloke, who supervises the SRT, said the ministry wanted the SRT to manage the market by itself so it would have sufficient funds to partially compensate it for losses from managing the railway system.

It would be able to gain more income from the market than by letting the BMA manage the contracts.

Pol Lt Gen Chatt brushed aside the BMA's claim that the policy change not to renew contracts must be approved by the cabinet since the BMA's area lease contract was made under a cabinet resolution on Oct 24, 1979.

"That's too long ago," he said. "Over time, the BMA has received appropriate gains and compensation from moving the market from Sanam Luang to Chatuchak while the SRT is still in the red."

Between 300 and 400 vendors have contacted the SRT to renew their contracts.

Taweesak Suthiserm, SRT's asset management director, said the SRT had informed the BMA five years ago that the railway agency reserved its right to cancel lease contracts.

The SRT board earlier resolved that the lease contract value, if it is renewed, must not be less than 420 million baht a year with a 15% increase every five years.

The board required the BMA to renew contracts by Oct 31 this year.

However, he said, when the deadline was reached the BMA had not used that right.

"So we will send a letter to the BMA to return the area as soon as the contact is terminated," Mr Taweesak said.

Chatuchak Market director Arun Sricharoon questioned why the SRT was claiming rights over the market area despite the fact that the BMA's management contract has yet to be terminated.

He said the BMA governor MR Sukhumbhand Paribatra had sent a letter to the SRT on Oct 26 to negotiate the new rate of lease fees.

The BMA asked the SRT to charge the lease fee at Chatuchak market at the same rate with that of Aor Tor Kor market of 79.4 million baht per year with a 15% increase every five years.

The SRT did not accept or reject the proposal but instead announced it was reclaiming the right to the area.

The BMA insisted that any change to the contract policy must be approved by the cabinet first, he said.

Sukumpol denies claim of train plan irregularities

Transport Minister Sukumpol Suwanatat yesterday denied there were any irregularities in the electric train projects, saying this meant there was no need for an inquiry into the implementation of the projects.

ACM Sukumpol was responding to remarks by Deputy Prime Minister Chalerm Yubamrung, who linked the high-profile robbery of transport permanent secretary Supoj Saplom's home to alleged corruption in Bangkok electric train contracts under the previous Democrat-led government.

The transport minister said there was no evidence to substantiate Mr Chalerm's claims and said that an investigation into the projects was not necessary.

At the National Anti-Corruption Commission, questions about all that cash.

ACM Sukumpol on Monday signed an order establishing an inquiry panel to probe Mr Supoj's alleged unusual wealth.

The panel, headed by PM's Office permanent secretary Thongthong Chandrangsu, will focus on Mr Supoj's alleged unusual wealth and will attempt to trace the source of the money and the exact amount of money he had, ACM Sukumpol said.

Mr Supoj was transferred to an inactive post in the prime minister's office following the Nov 12 robbery of his home.

The suspected burglars earlier told police they took 200 million baht in cash from the house, according to reports, but had seen much more there.

ACM Sukumpol said implementation of the electric train projects was transparent. He would go ahead with those projects despite Mr Chalerm's allegations.

Mr Chalerm earlier told parliament that the cash kept at Mr Supoj's home had come from the Purple Line and Red Line electric railway projects in Bangkok.

He also told reporters that the Nov 12 robbery of Mr Supoj's home was the result of a conflict relating to the construction of the projects.

But ACM Sukumpol said Mr Chalerm's allegations were merely aimed at attacking the previous government and in his opinion there was insufficient evidence to back up his claims.

He expressed confidence that the ministry's dust-free roads project was transparent, saying he had asked the chiefs of the Supoj-helmed Rural Roads and Highways Department, which is in charge of the project, to explain the project and found no graft involved.

Democrat Party leader Abhisit Vejjajiva yesterday said he was not worried about Mr Chalerm's threat to dig up alleged irregularities in the electric rail projects during the Democrat-led government.

Mr Abhisit said he would not mind if Mr Chalerm wanted to expose alleged graft in those projects. Everyone must work in a straightforward manner and be ready to come under scrutiny.

Meanwhile, Metropolitan Police Bureau commander Winai Thongsong said police were stepping up the hunt for the gang leader and two other suspects in the Supoj robbery still at large.

Weerasak Chualee, 36, the alleged leader, has reportedly fled to Laos and the two other suspects are believed to be in hiding along the Thai-Burmese border, Pol Lt Gen Winai said.

Eight of the 11 people involved in the robbery have been arrested, he said.

Rehabilitation to cost B755bn National priorities 'may need adjusting'

A new World Bank report estimates public spending on post-flood rehabilitation in Thailand could reach 235 billion baht by 2014, but experts say this would still not exceed the country's public debt ceiling.

"The government can accommodate this flood-related damage and loss with the existing public debt ceiling. Whether it decides to raise funds from foreign or domestic organisations is up to the discretion of the government, but scope remains for borrowing,

" Kirida Bhaopichitr, a senior economist at the bank, said of the preliminary assessment of post-flood recovery rehabilitation.

Thailand's public debt now stands at 40.2% of gross domestic product (GDP), while the debt ceiling stands at 60% or 600 billion baht.

The private sector is expected to need most of that at 520 billion baht and the public sector the other 235 billion.

The production sector will require the lion's share of the money, with the finance and banking sub-sector taking most of that, followed by the manufacturing sub-sector and water-resources management.

"The state can accommodate these projects alongside existing plans. However, implementation may involve some reprioritisation as to what would be best for the country's recovery," said Annette Dixon, the World Bank's country director for Cambodia, Laos, Malaysia, Thailand and Burma.

"Given that the scale of this disaster is unprecedented in terms of the provinces it hit, the number of lives affected and impacts on the economic infrastructure of the country, it would be only prudent for the government to focus on what is most needed for recovery and to enable the country to remain competitive in the future."

Total damage and losses are estimated at about about 1.36 trillion baht _ 1.28 trillion or 94% in private damage and 81.4 billion in damage to the public sector.

The World Bank estimates Thailand's GDP growth at 4% next year and 5.6% in 2013.

"The country can also take this as an opportunity to 'build back better' _ not just building back but doing it in such a sustainable way as to enable it to withstand volatility in climate change in the future as well," said Ms Dixon.

The assessment report is preliminary. A revised version will be submitted to the government at the end of next month.

Meanwhile, HSBC predicts V-shaped growth for the Thai economy after the floodwater recedes _ 4.5% next year after a year-on-year contraction of 5% in this year's fourth quarter.

Frederic Neumann, co-head of Asian economic research, said the research house has cut this year's GDP growth to 1.7% from 3.9% projected earlier.

The key engine will be government spending after the crisis, with a 1% increase expected in state expenditures to help boost the country's real GDP by 0.2 percentage points in the following quarter, he said.

Dr Neumann expects the Bank of Thailand will cut its policy rate by 0.25 percentage points next month from 3.5% now while maintaining the one-day repurchase rate to ease economic pressure.

Yingluck rides out censure ANALYSIS: PM resilient, but political landscape will change as banned politicians re-enter scene

Prime Minister Yingluck Shinawatra appears not to be in any great danger despite the public's perception that her government's Flood Relief Operations Command (Froc) has failed to handle the consequences of the flood crisis.

Chaeng Watthana canal 

People row boats along swamped Chaeng Watthana Soi 14 in Bang Khen district yesterday while a long wooden walkway is built as floodwater remain high.

Despite the censure debate on the government's alleged mismanagement of the floods on Sunday, observers say Ms Yingluck still enjoys the strong support of her voter base and her elder brother, ousted prime minister Thaksin Shinawatra, and she should continue to stay in power.

Justice Minister Pracha Promnok, as head of the Froc, survived a vote of no-confidence yesterday after a censure debate on Sunday which focused on the Froc's alleged mishandling of the flood response and corruption related to the procurement of relief supplies for flood victims.

Altogether, 273 MPs from the Pheu Thai and government coalition parties voted in favour of the justice minister, while 188 MPs, mainly from the Democrat Party, the Bhumjaithai Party and a smattering of small parties cast a vote of no-confidence against him. Five MPs abstained from voting and 15 did not cast votes.

Prime Minister Yingluck has repeatedly said she is willing to work for the public good, but when the country was facing its worst flood disaster in decades, she handed the job of dealing with the crisis to Pol Col Pracha instead of taking charge of flood management efforts herself. This has led people to believe she was trying to skate around the problem.

Businesses and investigators feel that the government has allowed politics to interfere with the country's administration, which has hampered efforts to coordinate flood relief and, in fact, worsened the crisis.

During the censure debate, MPs from the government went so far as to claim that the floods were part of a plot by the previous Democrat Party-led government to rock the stability of the present government.

Even though flood-weary people have given a thumbs down to the Froc's crisis management, Ms Yingluck and the Pheu Thai-led government still have the strong backing of about 15 million voters who gave them a mandate to run the country during the July 3 election.

But, the flood crisis has affected the confidence of foreign investors who are threatening to relocate their production bases to other countries because they are concerned the country could be hit by the massive floods again next year as long as the government is unable live up to its flood management responsibilities.

Moreover, many insurance companies have signalled that they will review their flood underwriting and may increase insurance premiums.

This prompted the government to send former deputy prime minister Virabongsa Ramangura, chairman of the government-installed Strategic Committee for Reconstruction and Future Development, to travel to meet executives of leading insurance businesses in London in a bid to restore confidence in Thailand.

The issue of bringing Thaksin back to Thailand is regarded as another political risk that could land the government in hot water.

Analysts say that Thaksin, the de facto leader of Pheu Thai, wants to return to Thailand to reclaim his power rather than operate behind the scenes through his proxies as he is now doing.

Politics are also expected to heat up in the middle of next year when the five-year political ban against the 111 former Thai Rak Thai executives is lifted.

The ban on the executives will expire at the end of May and the seasoned politicians are set to return to the political landscape, likely intensifying the struggle for political power.

But, Ms Yingluck will be able to keep her seat in spite of strong forces against her, given that the Pheu Thai Party commands a majority in the House, and she has the support of Thaksin as well as more than 15 million voters.

Cebu Pacific lowers airfares to Bangkok, China

MANILA, Philippines - Cebu Pacific, the leading budget carrier in the country, is slashing prices of its flights to Bangkok by as much as 57%.

Cebu Pacific is holding a seat sale from November 29 to December 1, for flights from December 15 to March 31, 2012. Clark to Bangkok fares are P888, while Manila to Bangkok fares are P1,488.

"We encourage passengers to make this Christmas even more festive with holiday shopping in Bangkok. They will not only get to get the best value for money with the gifts they buy, but the lowest possible Bangkok airfare with this seat sale,” said CEB VP for Marketing and Distribution Candice Iyog, in a statement.

From late October to early November, Bangkok experienced heavy flooding, but the Tourism Authority of Thailand assured that businesses and hotels in downtown Bangkok are now back to normal operations.

At the same time, Cebu Pacific is holding a seat sale for selected domestic and China routes, for travel from January 1 to March 31, 2012.

This includes P88 seats from Manila to Roxas, from Davao to Cagayan de Oro, and from Zamboanga to Tawi-Tawi. 

There are P288 seats from Manila to Cauayan or Tuguegarao, from Cebu to Clark or Zamboanga, from Davao to Zamboanga, and from Cagayan de Oro to Iloilo.

Flights from Manila to Butuan, Cagayan de Oro, Coron (Busuanga), Davao or General Santos are also priced at P888.

Flights from Clark to Hong Kong are only P488, while flights from Manila to Hong Kong or Macau, and from Cebu to Hong Kong are P888.

Manila to Guangzhou or Taipei flights are P1,488 seats, while P2,488 seats are available from Manila to Beijing or Shanghai.

Bangkok Residents Clean Up after Flood

A Thai volunteer, left, pours detergent as others sweep a road during a cleaning drive after flood waters receded in Bangkok, Thailand, November 20, 2011.

Residents of Bangkok, Thailand were hard at work cleaning up their city Sunday, during a "Big Cleaning Day" campaign launched by the city.

Sunday saw blue skies, dry weather and hundreds of people with brooms sweeping mud and debris from homes, while teams of volunteers removed rotting piles of garbage from the streets, as flood waters finally began receding from the center of the capital.

Thai government officials say flood waters have been receding steadily and that most streets in Bangkok, should be dry in two weeks.

Thai Flood Victims Face Challenges Returning Home

A man smokes a cigarette outside his flooded home in a slum just outside Bangkok, Thailand, November 21, 2011.

Thailand’s historic floods are now slowly receding. But in Bangkok, scores of evacuees are reluctant to go home. As the government discusses how to compensate flood victims for their losses, residents who are facing the task of rebuilding their lives speak out.

At the height of the floods, the Chaeng Wattana evacuation center in Thailand’s capital housed over 3,800 people. Many are now going home.

In drier times, Det is a volunteer coordinator for Bangkok youth groups. In recent weeks, though, he has been working here, helping evacuees.

Some people have gone home only to find that there’s still water in their area. The water is stinky, and they have no money or equipment, and so they came back here and asked if they could stay a while longer,” said Det.

After a month of sleeping on a tile floor, 49 year-old Sunan Jitsawang has made the decision to return home. The 15-kilometer journey takes two hours in a specially outfitted bus capable of driving through the deep water.

Just outside her house, drainage pumps are working around the clock. Although water has receded by one meter in her Bangkok suburb Rangsit, it still has a long way to go. 

Her 10-person household includes her elderly mother, who has been suffering from severe asthma and back problems.

“I don't know about the future because I have not had time to think about it that much. My main concern is about money. Very few members of my family are working and I don’t know where I’m going to get all the money to repair the house,” said Sunan.

Thailand's costliest floods so far have totaled at least $320 million. Many neighborhoods have been flooded for weeks, the stagnant water mixing with sewage and trash. Insurers are still tallying the damage.

"Basically, as far as we can guess of the almost 20 million houses around Bangkok and in central Thailand which were affected by this flood, only about less than one percent are insured for flood, and mostly have no coverage for flood," said Jeerapan Assavathanakul, with the General Insurance Association.

Sunan said she would have just stayed in her flooded home had her mother not been ill, and she's eager to get her life back together.

“We will not claim much for insurance - just help to replace things that were lost like beds and cabinets. Right now we are sleeping on the floor, and there are snakes and centipedes,” she said.

Now that Thailand's flood victims are returning home, many may find that the ordeal of moving on has only just begun.

Thailand Flood Impact Lingers

Just over five months since the historic flooding began in Thailand, the water levels to the north and in parts of Bangkok have begun to recede. Meanwhile, the massive runoff continues to place southeastern regions on high alert.

Even with a history of flooding, elaborate sluice gates, and complex irrigation systems, no one seems to have been truly prepared to handle the rain and runoff, which quickly covered an area the size of Kuwait. 

As human and financial tolls continue to mount, global supply chains are revisiting disaster management strategies and the costs of agglomeration.

Low consumer confidence in mature economies means soft enterprise purchasing, yet emerging economies continue to expand. 

The global electronics supply chain has been in a push-pull situation and has responded with leaner inventory, localized and low-cost manufacturing strategies, conservative utilization levels, and a scaling back by many in capital expenditures to build, improve, or expand production capabilities.

When the flood warnings in Thailand were issued, there was a small window during which some finished products and some equipment could have been moved to higher ground. 

However, the majority of the equipment in these industrial high-tech parks is immovable. Little time was available to seal buildings to withstand well over 10 feet of rushing and now standing water, where fish and crocodiles swim over loading docks.

Lean inventory management, the agglomeration from localized manufacturing, and a historic natural disaster have created a major global supply chain disruption for the semiconductor and electronics industry. 

Not only were major manufacturers caught in the floodwaters, but the smaller but still critical component suppliers were also shut down. 

Furthermore, there has been a huge toll on employees, many of whom face not only emotional hardship, but also the loss of logistical infrastructure in areas north of Bangkok.

Assessments are still pending for almost all semiconductor and electronics companies that operate in Thailand. The end of November may bring better visibility into the duration of production halts and the enormous efforts required to rebuild, power, and restart electronics manufacturing in the affected regions.

Meanwhile, we do know that the effects are global, deep, and costly. Hard disk drives (HDD), both external and internal, are already in shortage situations that will likely worsen during the first quarter and hopefully ease during the second half of next year. 

As a result, production costs and purchase prices are rising for HDDs and PCs, in particular. But the price hikes have extended to other sectors, such as automotive, optics (including digital cameras and fiber optics), LEDs, packaging, and test and assembly equipment for the semiconductor and electronics industry.

On the financial side, reduced margins and lost sales due to lost production volume will take a bigger bite out of revenues for many companies beginning this quarter and likely lasting through the second quarter of 2012 at least. 

For some small and midsized companies in an already extremely challenged economic arena, this "perfect electronics storm" caused by lack of product and limited production may prove insurmountable.

On the positive side, we'll likely see serious re-examination of current business practices to make global supply chains more dynamic, more diversified, and stronger.

Bangkok: Visiting The Flooded City

Thai volunteers take part in a clean-up along a major road in Bangkok 

In the weeks leading up to my Southeast Asia trip, I became a flood junkie, reading anything I could get my hands onto regarding the situation in and around the Thai capital. 

Some reports compared Bangkok to post-Katrina New Orleans, others stated that once monsoon season ended, the city would take exactly 10 days to completely drain. 

Insiders and locals I spoke to said that the most important part I could play as a traveler was to go on my trip and support the local economy.

I didn't change my plans and returned to Bangkok, a city of fascinating juxtapositions and one of Asia's most vibrant capitals. 

And I can report that its current state is a composite of everything I had read: The flooding is everywhere and nowhere.

The biggest difference I noticed on my first morning, waking up in a river-view room at the Mandarin Oriental: The Chao Phraya River was silent. 

Instead of the incessant, traffic jams of small-to-supersized boats making their way up and down and across this Thai lifeline, there were just a couple of hotel shuttles drifting quickly, and often sideways, down the gushing water. 

Other than the changed river-picture, however, everyday life continues in central Bangkok as always: buzzing, relentless. Many of the sights and temples, like the Grand Palace, Wat Po and Wat Arun are lined by sandbags, but all is dry and open for business.

Locals, including the staff of many of the luxury hotels lining the river, who cannot afford rents in central Bangkok, have, of course been hard-hit. 

Especially suburbs to the north remain badly flooded and the government is being accused of leaving these poorer neighborhoods intentionally underwater and instead focusing their efforts on keeping central Bangkok dry. 

On my first day the International Herald Tribune reported a blast set off by residents in the northern Pathum Thani district, reportedly meant to both sound protest and shift sandbags so that water would begin draining.

"Instead of saying Hello, we now say, 'How's your house?'" explained my wonderful tour guide on our walking tour my first day. 

He spoke to many of the vendors, who come from all over Thailand to sell their goods in the capital. The floods destroyed the orchid plantations of the center, but left the roses and marigold fields intact. 

The vegetable plantations of the north were also fine, while some of the rice fields, in the central west were badly damaged. 

Amazingly many locals he spoke with seemed to take everything with incredible poise, even humor. One merchant told of a housing advertisement he had seen, which stated: "Even higher-floor apartments can be conveniently reached -- by boat."

I asked my guide, who is one of the most entertaining and informed specialists I have ever toured with, whether a lot of his clients had canceled their trips in recent weeks. 

He said no, many just cut the Bangkok portion of their trips shorter. (The only noticeable change to a Bangkok itinerary is the fact that the klongs, the smaller canals, are closed off and river tours via boat are not possible.) 

Chiang Mai, Chiang Rai and the Golden Triangle are not effected; nor are the islands, like Koh Samui and Phuket.

"It's wonderful to see that tourists remain supportive and continue coming here," he said. "It's so important for the local people."

And the local people remain some of the kindest, most hospitable hosts one can imagine. Whether it's the vendors at one of the sprawling food markets trying to explain their wares in broken English and a lot of pantomime, 

or the thoughtful staff at the Oriental, at every turn someone is making you feel welcome and interested in learning more about the culture. 

Hopefully the flooding situation will continue to greatly improve over the coming weeks and travelers will return in healthy numbers. I, for one, am glad to be here and catch--and support--the city at the end of this challenging, momentous time.

Some great finds on this trip: the Indian Market, a maze of color, fabrics and spices in the middle of Bangkok; the solid Golden Buddha at Wat Trimitr, a fascinating story of discovery 

(it was hidden beneath stucco for decades); and Taling Pling, a low-key Thai restaurant where the locals outnumber the visitors. 

I also returned to some of my old-time favorites, like Indian restaurant Hazara, the incredible Distill Bar a top of the State Tower and the pool oasis at the Mandarin Oriental, still the best place to recharge from Bangkok's colorful, unique vivacity.

Singaporean suspect in Bangkok stabbing 'may surrender soon'

Bangkok police received an anonymous phone call on Sunday, informing them that the Singaporean thought to have killed his wife's lover would surrender in a few days.

Bangkok Metropolitan Police Bureau spokesman, Major-General Piya Uthayo, told The Straits Times last night that the police in the Bangkok suburb of Sutthisan received the call from a man who asked what would happen if the Singaporean were to turn himself in.

Maj-Gen Piya said the police could not be sure if the caller was the suspect, whom he named as Hsu Wei Hua.

'We told him that the Singaporean can go to any police station. Then the man said that maybe the Singaporean would surrender in a few days,' he added.