The British Embassy and the British Chamber of Commerce in Thailand (BCCT) say a lack of confidence in the unclear regulations in the Foreign Business Act will prompt British investors to move their investments from Thailand to other countries with potential.

They called on the government to clarify its investment and trade policies, in order to encourage foreign investors.

British Ambassador David Fall and BCCT chairman Mark Fraser met with Commerce Minister Krirkkrai Jirapaet yesterday to ask for information on the new government's trade policies.

In a 90-minute discussion, both Fall and Fraser expressed concern about several issues related to the facilitation of trade and investment for foreign enterprises.

There are 229 British companies in Thailand, including Tesco Lotus, Boots and Marks and Spencer. In the first nine months of the year, Thailand enjoyed a trade surplus with the UK of US$1.57 billion (Bt57.54 billion), with Thai exports growing 20.5 per cent to $2.51 billion and imports dropp4.25 per cent to $938 million.

Fall was concerned that Thailand would limit foreign investment in the retail business in Thailand after conflicts between small retailers and multinational retailers.

He was also worried that amendments to Thailand's Foreign Business Act might restrict UK companies investing in the country. In particular, UK-based retail giant Tesco has been offended by small retailers' attempts to stop its expansion in Thailand. Small retailers have said the aggressive expansion has forced them to close up shop.

Krirkkrai explained that the ministry had set up a special committee to monitor retail and wholesale businesses and study the amendments to the Foreign Business Act.

Board of Trade chairman Pramon Sutivong will lead the Foreign Business Act's Amendment Committee. Thai Chamber of Commerce vice president Sompob Amartayakul has been named chairman of the Retail and Wholesale Business-Monitoring Committee.

The two Britons also asked the ministry to give a clear explanation of the government's sufficiency-economy policy. They are particularly concerned that the unclear details of this policy could confuse British investors.

Krirkkrai said the government would facilitate all foreign investors based on independent conditions but that the policy would create more mutual benefits and concentrate on moral-based activities.

"The government will carry on bilateral and multilateral trade pacts if their benefit is in favour of Thailand," he said.

In addition, Krirkkrai asked the British Embassy to help negotiate with other European Union members for a fair chicken-export quota.

The EU implemented a new quota system for chicken imports in August that increased import duties on salted chicken, cooked chicken and turkey. The union is considering new conditions at the moment.

Krirkkrai said that since the UK was an EU member, a word from them could help Thailand gain a fairer import quota.

Tesco Lotus is a major importer of Thai chicken into the EU market.

Meanwhile, the Industrial Estate Association of Thailand has urged the government to launch road shows to restore confidence among investors, secretary-general Thawit Techanavakul said after a meeting with Deputy Prime Minister and Industry Minister Kosit Panpiemras.

"The Board of Investment should extend privileges, in order to attract more investment. The maximum tax-exempt period should be extended from eight years to 10 or 12, equivalent to what is offered now by our competitors in the region," he said.

Petchanet Pratruangkrai

The Nation