Business as usual for Thai firms in Cambodia

November 7, 2009
The Nation

FTI seeks urgent measures to resolve conflict; warns of rapid degeneration

The government is being urged to support Thai businesses that have a presence in Cambodia even though the latest tensions between the two countries have not yet affected them.

"Despite reports of no effects now, the situation could degenerate quickly. Aside from supportive measures, the government should try to end this conflict quickly through diplomatic means," Federation of Thai Industries official Thaworn Techakraisri said yesterday.

FTI chairman Santi Vilassakdanont also expressed concern about border trade, which constitutes 80 per cent of bilateral trade between the countries.

The two-way trade amounted to US$2.13 billion (Bt71 billion) last year. Major Thai exports are sugar, fuel, pigs and cement. Major goods imported from Cambodia include cassava, maize and scrap aluminium.

To date, all business activities are continuing as usual.

Pongsak Viddayakorn, an executive adviser to Bangkok Dusit Medical Services (BDMS), said company executives were not concerned about the diplomatic rift possibly hurting healthcare operations in Cambodia.

BDMS operates Royal Angkor International Hospital in Seam Reap and Bangkok Hospital Medical Centre in Phnom Penh.

He said the hospitals are partially owned by Cambodian officials, and since the rift was not at the grass-roots level, the company's healthcare services should not be affected.

However, if the worst comes to the worst, the company is prepared to evacuate all physicians, nurses and medical staff to Thailand on Bangkok Airways.

BDMS founder and CEO Prasert Prasarttong-osoth is also the founder of Bangkok Airways.

At present, BDMS still plans to add 100 beds to the present 50 in the Phnom Penh property. Pongsak said the economic environment played a bigger role in investment decisions than did diplomatic relations.

Meanwhile, a source at pharmaceutical manufacturer Thai Nakorn Pattana, owner of the Phokeethra Country Club in Seam Reap, said the hotel-sponsored Johnnie Walker Cambodian Open golf tournament would still take place from November 19-22 as planned.

The source said the tournament had the full backing of the Cambodian government and that the rift would not affect the company's new Bt2-billion hotel in Phnom Penh or its Bt400-million golf course.

Krung Thai Bank president Apisak Tantivorawong, while expecting a solution soon, reported no unusual movement at the bank's two Cambodian branches.

Na Bhengbhasang Krishnamra, vice president of Siam Commercial Bank - owner of the Cambodian Commercial bank - said it was business as usual yesterday at the Cambodian properties and that there were no signs of huge withdrawals. The unit, which has a 10-per-cent share of the local lending market, deals mostly with Thais in Cambodia. With four branches throughout the country, the 18-year-old bank employs 60 Cambodians and has $100 million in assets.

Na Bhengbhasang said there was a contingency plan to evacuate all 11 Thai staff to Thailand if need be.

During a videoconference yesterday with commercial counsellors throughout Thailand, Deputy Commerce Minister Alongkorn Ponlaboot said the counsellors in Phnom Penh had not been recalled and urged all businessmen to remain calm.

He said some 40 Thai businessmen continued to operate normally in Cambodia but that a contingency plan was in place if needed.

"We're worried about the diplomatic trouble, but I want to emphasise that the commercial counsellors and other staff are working as usual," said Alongkorn. "We hope the prime minister will speak with Prime Minister Hun Sen in Tokyo [during the Greater Mekong Subregion meeting]."

The ministry is monitoring border trade in seven provinces. Alongkorn will lead a survey team to Sa Kaew province today.

Si Sa Ket province yesterday decided to delay next Wednesday's planned opening of Chong Sa-Ngam Market in Phu Sing district by at least six months, said the border-trade coordinator for the provincial chamber of commerce.

He said the delay was advised by Second Army Region commander Lt-General Wiwalit Jonsamphan and that the chamber had agreed for security reasons.

Bank of Thailand Governor Tarisa Watanagase expects a solution soon, given the long relationship between the two countries. Moreover, the conflict is only at the national level and both countries' citizens are acting in good faith with each other.

Export-Import Bank of Thailand chairman Narongchai Akrasanee said there should be no effect on trade, due to Cambodia's economic potential.

His bank has extended a Bt1.3-billion loan to finance road, railroad and other infrastructure projects in that country and another Bt1 billion to private companies involved in tourism and infrastructure-construction projects there.

Logistics operators have felt no impact from the diplomatic tussle, given that there are no land-transport links between the two countries.

Triple i Logistics Group CEO Tipp Dalal said problems would arise only if the conflict dragged on.

TNT Express Worldwide (TNT), which has a substantial land-transport on the Asia Road Network (ARN), yesterday said its business remained normal.

"The recent events do not affect TNT's services on the ARN [connecting Thailand with Laos, Vietnam, Cambodia and southern China]. TNT continues to provide the same high level of solutions for customers doing business in Thailand and Cambodia," said a high-ranking TNT official.