Advance May 2014

A MONTHLY PUBLICATION OF THE AUSTRALIAN-THAI CHAMBER OF COMMERCE IN PARTNERSHIP WITH THE AUSTRALIA THAILAND BUSINESS COUNCIL www.austchamthailand.com May 2014

Thailand and the Southeast Asian Region in this edition

Recognising the Potential of Southeast Asia Business brief Thailand and the ASEAN Economic Community

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embassy news Australia, Thailand and Lao PDR Celebrate Lasting Friendship

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Australian Business Forum chamber events Thailand as a Platform for Bangkok Sundowners Launching Business in Myanmar at The Sukhothai Hotel

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Contents PATRON His Excellency James Wise Australian Ambassador to the Kingdom of Thailand PRESIDENT Leigh Scott-Kemmis Lee Hecht Harrison / DBM (Thailand) Ltd VICE PRESIDENTS M.L. Laksasubha Kridakon Baan Laksasubha Resort Hua Hin Sam McMahon NS BlueScope Steel (Thailand) Limited

6 business briefs 6 Recognising the Potential of Southeast Asia 8 Thailand and the ASEAN Economic Community: An Overview and Expectations 10 Behind the Scenes of Thailand’s Logistics Services

embassy news 12 Australia, Thailand and Lao PDR Celebrate Lasting Friendship

Australian Business Forum 16 Thailand as a Platform for Launching Business in Myanmar chamber events 18 Fraud-Related Crisis Seminar at Park Plaza Hotel, Soi 18 20 ESB Sundowners at Centara Grand Pratamnak 22 Bangkok Sundowners at The Sukhothai Hotel

AUSTCHAM MEMBERS 24 New Members and Updates

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From the Chamber Office 26 Message from the Executive Director

TREASURER Warwick Kneale Baker Tilly Corporate Advisory Services (Thailand) Limited DIRECTORS Shane Burt CEVA Logistics (Thailand) Ltd Josh Hyland AEC South East Asia Angus Kent Macquarie Securities Thailand Limited | Macquarie Group Limited Alan Polivnick Watson, Farley & Williams Rananda Rich Blackmores Ltd Simon Shale Visy Packaging (Thailand) Ltd & Visy Industries Wayne Williams Minor International Charles Wrightman Natural Ville EX-OFFICIO Greg Wallis Australian Trade Commission HONORARY ADVISOR TO THE BOARD David Armstrong ADVISORS TO THE BOARD Raine Grady Capital TV

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Chris Larkin CLC Asia

From the Board

COORDINATORS Paul Wilkinson Cooper International Engineering & Services Co., Ltd ESB Coordinator Email: paul.wi@cies-group.com Trevor Dick Indochine Asset Managmenet ESB Coordinator Email: trevor@indochine-asset.com Harry Usher Lady Pie Phuket Coordinator Email: Phuket@austchamthailand.com Australian-Thai Chamber of Commerce 20th Floor, Thai CC Tower 889 South Sathorn Road Bangkok 10120 Tel.: +66 2 210 0216 Fax: +66 2 675 6696 office@austchamthailand.com www.austchamthailand.com For more information on individual Board Member focus please visit www.austchamthailand.com/ boardmembers

Editorial Committee Rananda Rich, Janna De Vos, Gary Woollacott Marketing & Production Scand-Media Corp. Ltd 4/41-42 Moo 3, Thanyakarn Village Ramintra Soi 14, Bangkok Tel.: +66 2 943-7166/8 Fax: +66 2 943-7169 scandmedia@scandmedia.com Advertising Finn Balslev Email: finn@scandmedia.com Contributions to Advance magazine are welcome. Please submit content to communications@austchamthailand.com.

Opinions expressed in Advance do not necessarily reflect the views of the Chamber.

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President’s Message

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pril and May are the holiday months for Thailand. Heat levels are rising, and that combined with the current political disruptions only further intensify the challenges for business. Slowing growth in China will also contribute to a need for vigilance in the rest of 2014. During these times, Thailand needs effective Government leadership. So let’s hope a resolution to the current impasse is found quickly.

Friday 25 April was a special day for Australians and New Zealanders as we remembered the sacrifices made by so many men and women fighting to maintain the way of life and the treasured values of our countries.

Freedom cannot be taken for granted and we all must alert to the risks that lurk to our way of life. AustCham’s annual trip to Hell Fire Pass is a stark reminder of what can and does happen. Next year will be 100 years since that dreadful day at Gallipoli when so many young Australians and New Zealanders were lost and the horrors of war were forever ingrained in the psych of both nations. As Anzac day in 2015 will fall on a Saturday, we expect record attendances at Hell Fire Pass. Best to book early for next year.

In the corporate world we need to constantly work on high standards of governance. It is pleasing to see that the Thai Corporate score for governance is rapidly moving up the leagues tales in the region and in the world. The Thai Institute of Directors is playing a key role in the improvement in governance. Dr Bandit’s appeal to the Australians operating in Thailand to join the anti-corruption network should be accepted by us all.

We all know that a constant subject of conversation is the level of corruption in Thailand, but we appear to be reluctant to ion in the fight to counter the decease. We hear that HO will not let us; we hear that there are

legal constraints; we hear that it is a Thai issue only; we hear that there is no upside only downside by getting involved. This is a shame. If we do not fight for our beliefs and values, there is a risk that those beliefs and values will be undermined or even destroyed.

Let’s all do what we can by joining the network and showing that AustCham members are prepared to support what is right and what is good governance.

As Renee has covered in her message, the Chamber is hosting a conference covering the challenges Thailand faces in moving to the next level of economic development. The conference will also focus on how Australia can and has helped Thailand in this challenge. Very few countries have jumped over the middle income gap challenge and there is a host of material on the subject. One recurring theme is the role of commercial clusters in economic development.

An example in Thailand is the hospitality industry, where Australians have played key roles ranging from supply chain to design services. Many Thai organizations have now taken their skills and expertise outside of Thailand and are competitive globally. This is a great case study of what can be achieved when supporting skill sets and industry clusters become reinforcing and lead to up skilling and higher quality outputs on all fronts.

We have a lot of events over the month so a great opportunity to escape from the heat and to support your chamber. Enjoy.

Leigh Scott-Kemmis President, AustCham Thailand www.austchamthailand.com

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business brief

Recognising the Potential of Southeast Asia

By Sylvia Vorhauser-Smith

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outheast Asia has the potential to transform talent management practices. This has been my primary discovery over the course of the past year, as I researched and wrote a book about this intriguing region and its role in shaping fresh practices for how we engage and manage people across the global landscape.

During my remarkable research journey, I spoke with business and HR leaders across six ASEAN countries – Singapore, Malaysia, Thailand, Indonesia, the Philippines and Vietnam – to gather their insights and experiences in the region.

More than 50 multinational companies from a broad cross-section of industries shared how Southeast Asia is already framing new approaches to solving problems such as talent scarcity. While only scratching the surface of the depth and breadth of the region, the book – Talented Southeast Asia – shares much in terms of the region’s key challenges of developing, attracting and retaining talent.

Here is a brief look at the opportunities that are knocking in Southeast Asia.

Continuous Growth in the Region Long recognised and envied for its rich resources, today’s Southeast Asia offers continuous and strong growth, rich diversity and a vibrant workforce. For example: • Asia has been a shining star recently, showing resilience through the global financial crisis with consistent average annual GDP growth rates in the range of 5% to 8%.

• By 2050, the world population is estimated to be 11.8 billion and Asia will account for 45%, or 5.3 billion people.

This is an increase of 23% over the region’s population in 2013.

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• Forbes has found that nine of the 10 fastest growing mega-cities in the world are in Asia.

• McKinsey’s research also places 63% of the world’s 440 fastest emerging cities in this region – and many of these cities were previously unheard of. This growth will add a billion new consumers and a total purchasing power in excess of $10 trillion to the global economy.

• Asia is drawing the attention of a broad range of industries, due to its large and young workforce, which will number around 3 billion and represent 52% of the global workforce. By comparison, North America, South America and Europe combined will account for only 21% of the world’s workers.

• Income levels are rising as well, resulting in a new consumer class that is able to participate and contribute to the new economic wealth of their nations.

Incomes in emerging market countries rose on average by 96% in the 10-year period to 2010 and are forecast to rise 45% further by 2016.

Gathering Economic Steam In the shadows of China and India, the tiger economies of Southeast Asia have been flying beneath the global radar until recently and now are etching their way into the competitive global business arena.

Singapore has held a prominent role as a regional hub and gateway into Asia for decades, positioning itself firmly to create an attractive launch pad for multinational firms seeking proximity to the region from a stable and commercially sophisticated base. Now, the rest of the ASEAN is quietly but unrelentingly gathering economic steam.

Multinational corporations (MNCs) are flourishing throughout Southeast Asia, thanks to a number of opportunities and infrastructure changes, including:

• Rapid urbanization: The cities of Southeast Asia will support 81 million people by 2020, creating greater affluence through high workforce participation.

• Young talent: The population in the region is bucking the global trend toward demographic aging, with almost half below 30 years of age. This will provide an ongoing and steady stream of talent that will grow in experience and maturity each year.

• ASEAN Economic Community (AEC) launch: Poised to launch in 2015 under a newly accelerated roadmap for implementation, the AEC is designed to increase the area’s global competitiveness. The establishment of the AEC holds significant implications for labour mobility across the region, and member nations will benefit from the removal of trade and investment barriers and increased intra-ASEAN trade. The AEC heralds a new era of enhanced trade relations within the region.

Challenges to Be Overcome Achieving the goal of creating a collective community, as envisioned with the establishment of the AEC, is a key imperative to be competitive in the Asian region.

Observers note that, “If Southeast Asian countries do not operate as a bloc, some will be severely challenged in catching up with their peers across Asia.”

To be sure, the ASEAN 6 are confronted with challenges, from differences in language and culture to variability in governing ideologies and physical, legal and political infrastructure. With the exception of Singapore, the region has been plagued by a history of questionable business practices, corruption, cronyism and a challenging environment for foreign enterprises.

The pace of implementation remains frustratingly slow; although the strong commitment to economic and political reform

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is changing both the perception and the reality of practicing business in this region.

Even with the strong growth recently and an optimistic outlook, however, the Southeast Asian tigers, excepting Singapore, are still very much emerging economies.

For instance, World Bank estimates that, in Indonesia, the Philippines and Vietnam, more than 80% of the population lives on $5 per day or less.

While much remains to be done in the region to battle poverty, inequity, education standards, infrastructure needs and environmental protection, most multinational corporations recognize that their primary avenues for future business growth are in Southeast Asia and other emerging regions.

Emerging Talent Management for Emerging Regions Fundamental changes in workforce demographics, attitudes and expectations of work, technology advancements, and the pace of change are driving the reinvention of talent management across the world.

In Southeast Asia, the challenge of talent

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management is exacerbated by economic growth, adding scale and urgency to the drive for skills and experience.

A few key findings with implications for talent management in Southeast Asia, according to my research are: • Talent competition: Local companies headquartered in Asia have adopted and adapted many best practices introduced by their Western competitors and are able to present a value proposition to potential and current employees that competes favourably with the world’s leading multinationals.

• Talent free agency: Job-hopping has become synonymous with talent management in the region, and many well-educated, technology-savvy professionals consider themselves to be free agents in a buoyant labour market that cannot fulfil its quota.

• Talent deficit: Most employers in Southeast Asia recognize that sourcing the quality and quantity of talent they need is hard, and projections say it will get even harder. Some researchers place the talent shortfall as high as 61% on

average in the APAC region, compared to 45% in the Americas and 31% in EMEA. • Talent engagement: Employees in the 21st century have high expectations of their workplaces, and employees in Southeast Asia are no different. Engagement is fast becoming the centrepiece of a comprehensive talent management strategy and is being acknowledged as the root cause behind a multitude of organizational success factors.

A global work-in-progress, new talent management ideas and approaches are already emerging and will continue to emerge. Employers must find ways to rethink, reframe and reinvigorate talent management to evolve and thrive in this emerging world.

Sylvia Vorhauser-Smith is the Senior Vice President of Research at PageUp People.

She has more than 25 years of experience in corporate and entrepreneurial business environments and recently co-authored the book “Talented Southeast Asia”. For more information, please visit www.pageuppeople.com.

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business brief

Thailand and the ASEAN Economic Community: An Overview and Expectations

By Matthew Christensen, Kunal Bir Singh Sachdev and Thanyaluck ThongRompo

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hailand and Southeast Asia are currently in the process of going through substantial changes to meet the ASEAN Economic Community (“AEC”) framework that is expected to debut at the end of 2015. The subject has been covered extensively, but questions still linger. What is the AEC? Why is there so much hype regarding it throughout the region? And will it turn the ASEAN region into something similar to the European Union? These are just some of the questions we look to answer.

As the governing bodies of the Association of Southeast Asian Nations (“ASEAN”) continue their policy preparation for the emergence of the AEC, set to debut on 31 December 2015, uncertainty exists amongst both the ASEAN citizenry as well as the broader international community as to the potential implications of the AEC for businesses. Dr. Prasarn Trairatvorakul, the Governor of the Bank of Thailand, raised similar concerns by stating that “if we ask any of the 580 million ASEAN citizens what they think ASEAN will become in 2015, we are likely to get 580 million different answers”.

It is worth noting that the formulation of an ASEAN community is based on 3 pillars: (i) Political – Security Community; (ii) Economic Community; and (iii) Socio-Cultural Community.

To achieve the AEC, ASEAN has specified eight areas of cooperation with the goal of transforming ASEAN into a region with free movement of goods, services, investments, skilled labor and capital. The focus areas of cooperation are:

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• Human resources development and capacity building; • Recognition of professional qualification; • Closer consultation on macroeconomic and financial policies; • Trade financing measures; • Enhanced infrastructure and communications connectivity; • Development of electronic transactions through e-ASEAN; • Integrating industries across the region to promote regional sourcing; and • Enhancing private sector involvement for the building of the AEC. These areas of cooperation are intended to function similar to the European Union precursor, the European Economic Community, with respect to achieving regional economic integration with effective facili-

tation for trade and investment. However, though the EU serves as the most achieved model in modern history of regional cooperation, unlike their European counterparts, the majority of ASEAN nations are still in the developmental stages. As a community, ASEAN also lacks supranational policy making bodies such as the European Central Bank or the European Commission which are at the core of regional functionality. Lacking this infrastructure, ASEAN must forge a different path towards integration.

The full implementation of the AEC will see the ASEAN region achieve four characteristics on which the regional community will be built: (a) A single market and production base; (b) A highly competitive economic region;

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business brief

(c) A region of economic development; and (d) A region fully integrated into the global economy.

tion of professional qualifications for engineers, medical practitioners, accountants and others will enable professionals to work freely throughout the region.

Creating a single market and production base is considered the core characteristic of the AEC, and it is certainly where most changes have happened thus far. Effective implementation of the AEC will see a free flow of goods, trade, investments, capital and labor throughout the region.

This is being achieved through various regional agreements such as the ASEAN Free Trade Area Agreement, the ASEAN Comprehensive Investment Agreement and Mutual Recognition Arrangements.

Looking at the bigger picture, 2015 will see the ASEAN region move towards being a region that is fully integrated into the global economy. To achieve this goal, ASEAN has negotiated several free trade agreements with China, Japan, Korea, India, Australia and New Zealand. This is expected and thus far has been successful in achieving free movement of goods, trade, investments, capital and labor between ASEAN and its trade partners.

As a result, the movement of goods within the region will be subject to zero tariffs and will be facilitated through harmonized and standardized trade and customs procedures. 2015 should also see the elimination of intra-regional trade restrictions and an expansion in services in order to foster free market competition. Mutual recogni-

AustChamThailand Advance

Although it is unlikely that 100 per cent of ASEAN’s goals will be reached by 2015, a large percentage of them are expected to be achieved. Concerns were raised by the Asia Development Bank as not enough has been done to ensure that ASEAN becomes a region of economic development, especially for lower developed countries such as Lao PDR, Cam-

bodia and Indonesia.

How many of the characteristics of the AEC will be seen in 2015? At this stage it seems that by the end of 2015 ASEAN would have closed in on its target of creating a single market and production base. However, more cooperation is needed between the member countries to achieve the remaining goals. Rather than viewing the AEC on a pass/fail basis, it is worth taking a step back and looking at exactly what has been achieved thus far, and how the framework calls for further development and integration of the AEC. Investors and businesses would do well to prepare themselves for the AEC so that they may reap the benefits and face the challenges to come with confidence.

The authors of this article are representatives of DFDL, a leading international law firm specialized in emerging markets, with legal and tax expertise in countries across Asia. For more information, please visit www.dfdl.com.

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business brief

Behind the Scenes of Thailand’s Logistics Services

By Janna De Vos

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ogistics in Thailand can appear unsafe and ineffective at first glance.

Overloaded trucks and motorcycles, and un-roadworthy vehicles are common images associated with the country. In reality however, Thailand’s logistics industry is both sophisticated and highly efficient, and boasts some of the highest service standards by several world-leading companies.

Speaking at the second Australian Business Forum (ABF) in Pattaya, Shane Burt, Managing Director of CEVA Logistics in Thailand, gave us a glimpse of what it takes to set high logistics standards in a developing country. Drawing on the lessons he has learnt as a logistics provider, Mr Burt made some pertinent points about transportation, warehousing, staff, customs and selecting appropriate partners.

The provision of high quality transportation entails routine vehicle inspections, robust driver-safety tests, and monitoring maximum carrier loads. Although Thailand has laws relating to such factors, enforcement is often questionable, with ultimate responsibility falling on the logistics company. “You must constantly monitor procedures to ensure standards are met and reputation is upheld” said Mr Burt. This includes installing GPS tracking systems, testing drivers for drug and alcohol abuse, monitoring licenses, and regularly checking fuel consumption.

Warehousing is also important, with location being a key consideration. One should take into account flood plains, as well as Thai Government programs which divert water away from some areas towards others, said Mr Burt. Free trade zones can also provide certain benefits depending on product origin and destination.

The actual layout, design and construction of warehouses is also important and adequate research must be done to

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ensure that what you see is what you get.

Contracts and permits should be double checked to ensure that all legalities are transparent and the correct licenses are in place. Speaking from experience, Mr Burt said that CEVA had signed a lease on a property that did not have a building permit and have been in a legal battle with the property agency ever since.

Once warehouse location has been established, one must turn attention to human relations. Finding and retaining qualified employees can be challenging, admits Mr Burt. With staff motivation being driven primarily by remuneration, one must be prepared to offer attractive packages to attract or retain quality workers. Mr Burt adds that quality education and management skills still lack among the general workforce. Awareness and enforcements of health and safety standards is also an area that requires further attention. “But” said Mr Burt, “we have already seen some dramatic improvements, and with further training and cooperation we expect to see many more”.

Customs is another key factor for consideration. The Customs Department police the boarder to prevent illegal goods from entering the country and minimise stock dumping. One of the toughest challenges however is that patrolling can be inconsistent amongst officials. As an example, Mr Burt said that an auto manufacturer had shipped a cutting machine to Thailand with an agreed Harmonized System

(HS) code exempt from duty. Upon inspecting the machine, Customs identified a sewing component which had not been specified in the HS code, and subsequently charged the company one million Baht to clear the urgently needed machine. “The key lessons here are get your HS codes right, keep good relations, and always keep calm”, said Mr Burt.

As a final point, Mr Burt highlighted the need to understand Thailand’s trading restrictions when selecting a Thai business partner. Most ASEAN countries have foreign investment negative lists, so it is important to understand the structure of the company (e.g. preferred shares, limited voting rights), and know what the repercussions are should a partner fall ill or pass away, said Mr Burt. Engage a lawyer, ask questions, and make sure you understand the answers, he says.

At the end of the day, Thailand is a logistically savvy country. There are already a lot of businesses here, and as the domestic and regional markets continue to expand, the need for logistics providers will continue to grow. With a sound foundation of infrastructure, opportunities for the logistics market are plentiful, and we expect to see considerable developments in the future. For Australian companies looking to move into the region, taking on board Mr Burt’s learnings can not only save a lot of time, but may help when breaking into the Thai market.

AustChamThailand Advance

Learning environments for the 21st Century “Good Facilities do more than teach, they inspire.

They aspire to shape minds both inside and beyond the classroom.”

Pit Li Phan good school is a place where students are stimulated to learn and grow. It is a place that prepares them for life as wellrounded, global citizens in a future world we cannot yet imagine.

Facilities certainly do not make a school; it is essential however that students learn within a setting that supports their individual educational and pastoral needs. In modern pedagogy this learning environment is known as the Third Teacher, alongside adults and other children.

At Bangkok Patana School its mission of fulfilling the potential of every student is achieved through the excellence and expertise of the school’s teachers, curriculum and extra-curricular programme. The aim is to ensure that students aged between 2 ½ and 18 years consistently receive a diverse and engaging education both in and outside the classroom. In keeping with the third teacher philosophy, the Bangkok Patana environment also plays a key role in achieving their mission; the range of facilities are specially tailored to create an atmosphere that is safe, conducive to learning and supportive of student wellbeing.

In August 2014 the school will be unveiling its renovated Year 1 and 2 facilities. This area will be given a complete upgrade to provide a setting that stimulates and encourages children’s learning and development. Designed in consultation with the teaching staff, the remodelled facilities recognise the importance of the environment on the quality of learning. The new building will incorporate more open, collaborative work spaces for group learning and creative play as well as quiet breakout spaces. Other exciting new facilities include a physical development room, wet and dry activity room, ICT labs and a one-of-a-kind rooftop garden.

The redesign will provide Primary students with more outside play space and greater access to areas designed to foster social, behavioural and problem solving skills, that inspire imaginative play and present unique opportunities for larger scale learning.

Primary Principal Clare Sharp agrees. “Research indicates that exposing children to many experiences can help build up a bank of learning styles, which they can tap into depending on the activity. This is also true for buildings and the design and flow of a building can influence how we learn. We know that the children in Year 1 and 2 will benefit immensely as they move into their new learning environment, specifically designed to promote inquiry, encourage learning through doing and to develop creativity, collaboration and independence.”

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www.patana.ac.th |+66 (0) 2785 2200 | admissions@patana.ac.th | 643 Lasalle Road (Sukhumvit 105), Bangkok

embassy news

Australia, Thailand and Lao PDR Celebrate Lasting Friendship

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n 8 April 1994, HM King Bhumibol Adulyadej of Thailand, presided over the opening of the first ever friendship bridge between Thailand and Lao PDR across the Mekong River.

This bridge, which was built and funded

by Australia, is an enduring symbol of Australia’s commitment to its neighbourhood and of the ties that bind the people of Thailand, Lap PDR and Australia. This bridge has cultivated friendship, cooperation and networks across the Mekong and beyond.

To celebrate this anniversary, HE Mr James Wise, Australian Ambassador to Thailand, HE Mr John Williams, Australian Ambassador to Lap PDR, HE

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Soukan Mahalath, Mayor of Vientiane Capital, and Mr Wirat Limsuwat, Governor of Nong Khao Province, presided over four days of events in Nong Khao Province.

“As we look forward to the ASEAN Economic Community, the first Thai-Lao Friendship Bridge was an important early step in building of an ASEAN community and remains a demonstration of what can be achieved with goodwill and well-targeted investment in infrastructure”, Ambassador Wise said.

Ambassador Wise added, “Statistics demonstrate just how much the bridge has contributed to the economic prosperity and security of this region. In 1994, the year in which the

bridge opened, around 105,000 people crossed the bridge. Last year, almost 6 million people crossed the bridge. In 1994, total trade over the bridge was 4.8 billion Baht. Last year, total trade over the bridge was nearly 60 million Baht. The bridge has made a marvellous contribution to the economy and security of this region.

We Australians are very proud and very pleased to have been associated with this project and thank the organisers of the 20th anniversary celebrations for inviting Australia to participate.”

For more information, please visit www.thailand.embassy.gov.au

AustChamThailand Advance

Exceptional people.

Outstanding opportunities.

Academic excellence.

Shrewsbury International School helps children achieve the very highest academic success and to grow into balanced, happy, confident young people ready for the challenges of life at university and beyond.

We are currently accepting applications for Year 7 and Year 12 in August 2014. A limited number of places is available in other year groups.

Call 02 675 1888 or email admissions@shrewsbury.ac.th Be part of the Shrewsbury success story.

www.shrewsbury.ac.th

Australian Business Forum

Thailand as a Platform for Launching Business in Myanmar

By Janna De Vos

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ince Myanmar opened its economy to foreign investment, businesses from across the world have entered the market looking for new opportunities. Here in Thailand, access to an open Myanmar too presents plenty of new and better opportunities for business. In fact, Thailand, as a vigorous economy in the Southeast Asian region, offers a resilient platform for launching business in Myanmar.

Surprisingly, this topic has received little attention amongst business analysts and the media. As a new and mysterious player, Myanmar is often viewed as an isolated economy rather than one that is complementary to its Thai neighbour.

It is important to remember that Thailand followed a similar development trajectory thirty to forty years ago. It dealt with similar challenges, and in its development established sound foundations for business prosperity. Today, businesses that are looking to expand into Myanmar face many of the same challenges. Having experienced these before, businesses in Thailand are well placed to leverage their knowledge and resources to mitigate difficulties and ultimately reap the benefits of operating in Myanmar.

Speaking at the first Myanmar focused Australian Business Forum (ABF) – an initiative supported by funding from the Australian Government – John Hancock, Chairman of John W. Hancock Associates and Myanmar Investment Counsellor, John Anderson, Managing Director of Meinhardt Myanmar Co, Ltd and Thomas Kean, Editor at the Myanmar Times (English Edition), shared their expert knowledge and insight about using Thailand as platform for launching business in Myanmar.

Our speakers, together with David Armstrong, moderator and Honorary Advisor to the AustCham Board, spoke of six vital points as platform criteria.

1. Good source of the right people In business, people drive success. Finding the right people with the right background is essential to making a positive

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entry into a new market. In terms of cultural and social elements, Thailand is a great surrogate country with many similarities to Myanmar. Business people in Thailand know how to deal with the unexpected; they have learnt how to handle unusual circumstances; and have come to understand how to motivate people from point A to point B. It is these skills that are invaluable for entry into Myanmar.

People in Thailand also have access to extensive regional networks. As businesses move into Myanmar, they draw on their Thai networks for support. Meinhardt, a leading multidisciplinary engineering and project management consultancy, for example, used its extensive network from its Bangkok office to launch business in Myanmar. Businesses also have the opportunity to tap into the networks of other Thai corporations. Thai companies have been doing business in Myanmar for many years, and the relationships that have been established are substantial.

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Australian Business Forum

Best Criteria for a Platform Good source of right people Good source of required support services / supplies

Reasonable cost base Proximity

Ease of access Quality of life Other important items: Double Tax Agreements /

Investment Protection Agreements / Arbitration Enforcement

Source:

John W. Hancock Associates

offers extensive and reliable support services and supplies.

Infrastructure is highly conducive to business, extensive road networks stretch across the country, and telecommunication systems are well established. The legal infrastructure is robust, and business support such as legal, accounting and tax services are readily available and of high quality. This makes Thailand an attractive place to do business, and it also makes it an attractive base for launching business in Myanmar.

3. Reasonable cost base Compared to many countries in the region, including Myanmar, Thailand’s cost base is reasonable. Accommodation, food and travel are affordable and readily available. In Myanmar however, the cost of office and residential space is incredibly high and will continue to rise as demand increases ahead of the supply that will take some time to develop.

2. Good source of support services and supplies

4. Proximity and Ease of Access

The business environment in Myanmar is continually changing. Laws are constantly evolving, the internet remains costly and unreliable, and basic infrastructure is still being developed. Thailand in comparison, and particularly Bangkok,

It is incredibly easy to get from Thailand to Myanmar. Yangon is just over one hour flight from Bangkok, and there are several flights available every day. Thailand is also the only place from which you can reach Naypyidaw directly on a two and

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Australian Business Forum

a half hour flight from Bangkok. Obtaining business visas for both Myanmar and Thailand is also straight forward. For these reasons, it is incredibly easy to commute between the two countries.

5. Quality of life Many people who live in Thailand would agree that the quality of life here is exceptional. The quality and availability of food, accommodation, health care, transportation, sports and leisure, travel, culture and entertainment, and social activities is excellent. Bangkok, in particular, offers an abundance of entertainment and life-style facilities. It also houses some of the best international schools in the region: a good location for families of those regularly commuting to Myanmar. As the speakers agreed, Thailand has everything to attract businesses to use it as a platform to launch business in Myanmar.

6. Other important items In addition to all of the above, there are a number of other benefits in using Thailand as a platform to launch business

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in Myanmar. There is a double tax agreement and an investment protection agreement between Thailand and Myanmar that offer incentives. Both Myanmar and Thailand are parties to the New York Convention, are amongst the very few parties to the Geneva Protocol and Convention on the recognition and enforcement of foreign arbitral awards which has potential to be leveraged for enforcing an arbitration held in Thailand.

In each of the six criteria listed above, Thailand scores highly. It is also more appealing than other regional countries, such as Singapore and Malaysia that could also be considered potential platforms. It is therefore fair to say that Thailand is currently the best platform for launching business in Myanmar.

As Myanmar develops however, this situation is likely to change. We hope and imagine people in Myanmar will continue to learn new skills and develop local networks which will strengthen support services and supplies, reduce living and operating costs and improve quality of life. As these factors change, it is likely that Thailand will become a partner rather than a platform for doing business in Myanmar.

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Chamber Events

Fraud-Related Crisis Seminar Thursday 27 March at Park Plaza Hotel, Soi 18

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very year, thousands of businesses fall victim to fraudulent activity. Using company money for personal gain, falsifying documents and signatures, tampering with business accounts, and leaking information to competitors are just some examples of fraudulent activity that can make organisations suffer. Many of these acts go unnoticed for long periods of time.

When the cat is out of the bag, however, such activity can lead to huge organisational crises.

Learning how to detect, prevent and manage fraud and fraud-related crises is essential and will help you save a great deal of time and money in the long term.

On Thursday 27 March, AustCham welcomed members to a special seminar on fraud-related crises at the Park Plaza Bangkok Soi 18 Hotel. In this interactive seminar, Jeremie Duthel and Charlie Warren, Senior Consultants from Control Risks, addressed what fraud-related crises are, how they can be detected and why and how they should be managed.

Alan Polivnick, Partner in the International Litigation Group of Watson, Farley and Williams, complemented the presentation by providing a legal perspective on crisis management, focusing particularly on Thailand’s legal and regulatory infrastructure.

According to Control Risks, crises are “extraordinary events that require extraordinary effort and commitment to resolve them positively”. In other words, crisis management is much more than simply bringing in external legal counsel and hoping a team of public relations experts will manage communications and help minimise detrimental impacts Jeremie, Charlie and Alan explained that effective crisis management involves

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both pre-incident preparation and postincident managements. This entails focusing on the long term recovery of the business, developing specialist skills in the crisis management team, instilling response processes that enable analysis and scenario planning, and ensuring that assumptions and qualified facts are clearly defined.

It also involves understanding the legal environments in which your company operates and the jurisdictions that are applicable to your company and employees. Always being prepared and

having corrective and remedial action plans in place help to prevent a crisis.

The seminar was followed by a poolside cocktail reception, hosted by the Park Plaza Bangkok Soi 18 Hotel. Guests were greeted with a delicious welcome cocktail and were treated to a wonderful selection of canapés. We would like to extend a very special thank you to Park Plaza Bangkok Soi 18 for their exceptional hospitality. We would also like to thank our three presenters, Jeremie, Charlie and Alan, for engaging our members in their superb seminar.

AustChamThailand Advance

AustCham Gold Corporate Sponsor: SERVCROP

WORLD’S FINEST SERVICED & VIRTUAL OFFICES SERVICED OFFICES For the 1-10 man business Fully furnished prestigious offices 2 months deposit Dedicated receptionist answering your calls the way you would like Meeting rooms, multilingual secretaries Free private offices in our worldwide locations Fastest internet and IT support Lease terms from just 1 month From just THB 30,000

SERVCORP VIRTUAL OFFICE Everything but the Office Prestigious business address for your letterhead and business cards Local telephone number answered by your receptionist the way you would like Free business lounge everyday 2 MONTHS Meeting rooms, multilingual secretaries @ 1/2 PRICE No Further Obligation Access to private offices *Only for Virtual Office Monthly contract, no risk No deposit required if payment made by credit card From just THB 950 per month

W | servcorp.co.th Level 29 The Offices at Centralworld Serviced Office T | 02 207 2500 Virtual Office T | 02 207 2600

Levels 8 and 9 1 Silom Road Serviced Office T | 02 231 8000 Virtual Office T | 02 231 8100

Level 18 The Park Ventures Ecoplex Building Serviced Office T | 02 309 3400 Virtual Office T | 02 309 3500

SOUTH EAST ASIA | CHINA | AUSTRALIA | NEW ZEALAND | JAPAN | INDIA | MIDDLE EAST | TURKEY | EUROPE | UK | USA + 140 LOCATIONS ACROSS THE GLOBE

Chamber Events

ESB Sundowners Friday, 21 March at Centara Grand Phratamnak Eastern Seaboard Sundowners was held in conjunction with the American, British and German Chambers of Commerce in Thailand.

The event was held on the Rooftop of Centara Grand Phratamnak Pattaya at the beautiful Ruffino Outdoor Sunset Terrace. The evening was very well managed and guests enjoyed themselves. We would like to thank our catering and venue sponsor, Centara Grand Phatamnak Pattaya team for their delicious cuisine, spectacular venue and professional services. We would also like to extend our thanks to Central Food Retail Company limited for their marvelous wine. Lastly, Thank you all for supporting and attending the event, it would have been impossible without all of you.

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AustChamThailand Advance

AustCham Bronze Corporate Sponsor: Hemaraj land and development

Industrial Estate News

THAILAND: A Globally-connected Industrial Hub Over the past decades, modern infrastructure, efficient logistics, integrated supply lines and a world class port in Laem Chabang have transformed Thailand into the world’s 9th largest automotive producer, as well as a significant player in leading industries.

With its 25-year experience, Hemaraj Land And Development Plc. – Thailand’s leading developer of Industrial Estates, Utilities, Power and Property Solutions – is in a strategic position to contribute to the country’s industrial expansion and economic growth.

Hemaraj has been particularly instrumental in the development of Thailand’s automotive cluster. Five original equipment manufacturers (OEMs) representing seven automotive brands – Ford, Mazda, Chevrolet, GMC, Holden, Suzuki and MG - are among its key customers, accounting for 25% of Thailand’s automotive production.

“The Thailand Board of Investment offers attractive incentives for auto manufacturers, including the Eco-car Policy which is now on its second phase. Today, Thailand’s production is in balance with one-ton pickups and passenger cars.

With over 50% of its production exported, this solidifies Thailand’s position as the world’s number 8 automotive producer,” said David Nardone, President & CEO of Hemaraj.

Today, Hemaraj comprises seven industrial estates in strategic locations, with a combined land area of over 41,313 rai or 6,610 hectares. This represents USD 26 Billion in investments from all over the world, and the creation of rewarding and productive jobs for over 120,000 Thai people. Besides the Automotive sector, Hemaraj’s industrial estates provide facilities and services to other industrial clusters such as Petrochemical, Steel & Metal, Power and Electronics.

For more information on Hemaraj, visit www.hemaraj.com

AustCham Bronze Corporate Sponsor: Aurecon

COR_Advert_2014-03-25_Australian Chamber of Commerce in Thailand.indd 1

3/28/2014 9:48:57 AM

Chamber Events

Bangkok Sundowners Wednesday 2 April 2014 at The Sukhothai Hotel

On Wednesday 2 April, AustCham hosted its third Bangkok Sundowners networking event of 2014 at The Sukhothai Hotel in Bangkok. Situated in the buzzing heart of the city, the hotel combines traditional refinement with immaculate contemporary style. The event was a great success, with a lot of professional people attending to network with like-minded business professionals including, but not limited to, Australian business leaders.

On behalf AustCham Thailand, we would like to thank all members and friends who attended the Sundowners.

We would also like to thank our Corporate Sponsors, Wall Street English, for their support in holding the event.

Finally, a big thank you to The Sukhothai Hotel, our Venue Sponsors for the evening, for their wonderful hospitality.

We look forward to seeing you all again on Wednesday 7 May 2014 at Mode Sathorn Hotel, Bangkok.

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AustChamThailand Advance

Chamber Events

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1) Renee Bowman, AustCham Executive Director; HE Mr James Wise, Australian Ambassador to the Kingdom of Thailand; Santisuk Vuttara, The Sukhothai Hotel; David Cramond, Wall Street English. 2) Pitak Thasoon, The Sukhothai Hotel; Alan Render, Gilt Edge International; Pakakrong Promloi, St Regis Bangkok; Marc Spiegel, Vinarco International. 3) Olivia Park, TICON Industrial Connection; Shane Burt, CEVA Logistics, AustCham Director; Russell Pang, CEVA Logistics, Apinya Worarach; Arthit Meemaitree, Wall Street English. 4) Gary Woollacott, Opus Recruitment; Sam McMahon, NS BlueScope, AustCham Vice President; Jacquine Page; Kit Whalley, Interval International Singapore. 5) Satita Nantasrirat, Qube Consulting; Sisi Kochakorn, Meinhardt; Sammy Yousefi, Thailia Andrews, Qube Consulting. 6) Michael Berger, Antares Group; Nannapat Sriwalai, Grant Thornton; Issraporn Narin; Francis Goh, Microsoft Singapore; Karen Hochhauser, APM Group. 7) Wall Street English Team. 8) Matt Bartlett, Wall Street English; Nicole Eisenschenk, Wall Street English. 9) Kris Krishnakan,H&E Co.Ltd; Apichaya Prawantao, Unilever Thai Trading; Kritsanapong, Royal Thai Army. 10) Graham Storah, L-TAG Technologies; Maytaporn Moungluang, Parker Bridge Recruitment AustChamThailand Advance

May 2014

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AUSTCHAM MEMBERS and updates

AustCham Welcomes New Members C&C Industries P/L 42-44 Doyle Ave, Unanderra, New South Wales, Australia 2526 Phone: +61242725344 Email: jk@ccindustries.com.au Website: www.ccindustries.com.au

Products and Services: - Enclosures - KOENIGS Visual Isolators - Grafelube Bearings and Wear Slides

Representative: Mr John Koenig, General Manager

t+b solutions Co Ltd No 3081/16, Suite 211-212, 2nd Floor Piyarom Centre, Sukhumvit Road Bangjak, Pra Khanong Bangkok 10260 Phone: +662 743 7417-9 Fax: +662 361 7119 Website: www.tandbsolutions.com

tive coaching, assessment, accredited programmes and other necessary behavioural change elements to achieve the purpose.

Change of Representatives

Company Profile: C & C Industries is an Electro-Mechanical engineering and manufacturing company located in the industrial and mining region of Wollongong, New South Wales, Australia. Established in 1984 by Mr Colin Koenig, C & C Industries specialises in the following:

Primary Representative: Mr Peter Bull, CEO

• Design and Manufacture of Koenigs Visual Isolators • Manufacture of GrafLube self lubricating bearings and wearslides • CNC machining and turning • Water Jet Profile cutting

Company Profile: t+b solutions engineers solutions for customers that result in organisational performance improvement. Together with our partners we support clients across the globe.

Our main customer base is the heavy industrial and mining sectors, supplying to a large number of customers throughout Australia.

We believe that an investment in learning and organisational development is no different to any other investment; as such, it should have a payback period and an ROI. We believe that learning and organisational development are not ‘feel good’ actions but rather good business practice that results in a long-lived company.

With the use of CNC machining technology and waterjet profile cutting capabilities, our team of highly skilled engineers and tradesmen ensure products are manufactured to the highest quality and tolerance. With over 100 years of combined expertise in this field, C & C Industries prides itself on the quality of workmanship and ability to deliver on time.

If your application is ‘out of the ordinary’, then we can custom design a solution to conform to your requirements.

We focus on the purpose rather than the process. Purpose is what an individual or organisation is trying to achieve as a result of their investment in learning and organisational development.

- Mr Ian Khoo, Director is a new representative of ClasG (Thailand) Limited - Mr David Ames, Country ManagerThailand is a new representative of Linfox Thailand - Mr Richard Malpeli, Vice President Business Development is a new representative of Parker Bridge Recruitment Co., Ltd - Mr Jason Simpson, General Manager is a new representative of Ove Arup (Thailand) Ltd. Change of Company Name - Grand Mercure Fortune Bangkok change company name to Grand Mercure Bangkok Fortune - Natural Ville & Lenotre change company name to Natural Ville Change of Company Address Primaweld Consultants (Thailand) Ltd V.P. Capital Assets Co.Ltd. 10/95-97 6th floor., The Trendy building, Sukhumvit Road Soi 13 Klongtoey-Nua, Wattana Bangkok 10110

Products and Services: We offer engineering solutions, developing and executing training plans, execu-

AustCham Member Offer: Special Qantas Promotion Buy a Return Business Class ticket to Australia and obtain a FREE Bangkok Airways ticket on your return.

Conditions – These include: • Qantas Bangkok to Australia – ticket must be issued between 01 – 15 May 2014.

• For departure before 30 June 2014.

• Ticket must be perchased at Qantas office located at 21th Floor Charn Issara Tower 1 Rama IV. • Bangkok Airways FREE Return ticket available for Bangkok to Krabi, Phuket and Chiangmai.

• Other conditons apply Please contact us at 02 632 6611 for more detail.

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AustChamThailand Advance

V OLVO Volvo Truck & Bus (Thailand) The 13th Volvo Truck & Bus Thailand Convoy for Kids Charity Golf Event

Proudly supported by Friday, 6th June 2014 Location - Burapha Golf Club, Beung, Sriracha, Chonburi 20230, Thailand.

Time - Registration from 1000H shotgun start at 1230H. Format - 4 ball Texas Scramble - Flights determined by gross score.

Fee - 16,000* Baht per team of 4 or 4,000 Baht per player. No increase on last year’s price! *Price is for green fee, caddy fee, golf cart, quality Fenix Golf event shirt & cap, evening meal and beer.

Charity Golf day 2014

All proceeds will go The Sri Sangwal School which is part of The Foundation for the Welfare for the Crippled in Thailand.

Burapha Golf Club is easily accessible from Bangkok, Pattaya and Rayong areas.

Designed by award winning designers David Graham and Gary Panks, is in a pleasant setting and recognised as one of Thailand’s great courses.

To view the course web site see http://buraphagolfthailand.com/ For a map and driving instructions click here http://buraphagolfthailand.com/location.htm To register for the event, do so on line on the Austcham site by clicking here We are limiting the number of players to 144. Please book now to avoid disappointment.

For more information email golf@convoyforkids.com or contact any of our committee members shown below.

Mike Moir +6681 908 2243 : David Mills +6683 019 4772 : Kevin Lloyd +6681 375 3064 : Kititeb Jintaworn +66818372343

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FRONT

SILVER SPONSOR

50,000

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HOLE SPONSOR

20,000

ADVERTISING MATERIAL IN GOODY BAGS

75,000

LOGO IN ADVANCE MAGAZINE AND WEB SITE

CAP SPONSOR

LOGO ON EVENT BANNER

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TABLE IN REGISTRATION AREA

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LOGO ON TOURNAMENT CAP

FREE PLAYERS

100,000

LOGO ON TOURNAMENT SHIRT

PRICE (BAHT)

GOLD - COURSE SPONSOR

HOLES FOR ADVERTISING

SPONSORSHIP TYPE

Help us by sponsoring our event - see sponsorship benefits below

TAKEN

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PRIZE DONOR

Other sponsorships welcome To confirm sponsorship, send mail to golf@convoyforkids.com or contact any of committee members.

We hope to see you there

TAKEN

From the Chamber Office

Message from the Executive Director

T

he middle-income trap phenomenon describes a country that has moved from being an undeveloped low-income country but lacks the necessary innovation, education, economic vigour and technological advancements to progress to a high-income economy.

This concept has significant repercussions for business, and although government policy changes are indeed needed, the private sector also has immense power to influence economic prosperity.

On 25 June 2014, AustCham, in conjunction with the Australian Embassy Bangkok, will host a conference to explore the implications of Thailand being caught in a middle income trap. Titled ‘Enabling Prosperity: moving beyond the middle income trap’, this event will take place in Bangkok.

As many of you know, Thailand has very low unemployment levels with shortages of skilled and unskilled labour across many sectors. With demand already exceeding supply, low cost labour will be unsustainable, especially when competing against rapid economic prosperity in neighbouring countries. As wages reach equality, foreign workers will naturally gravitate back to their home country.

There are many opportunities for education and training in Thailand to be developed to meet market needs. In an increasingly global market, there is greater demand for skills in information technology, communication, English language, problem solving and leadership. Although the Thai government exercises control over the education system, the private sector is well positioned to drive training needs and develop human capital as a means to help launch Thailand to a highincome economy.

There is no doubt that the private sector continues to grow strongly, however with the majority of new businesses being small and medium-sized enterprises, there is a risk of under-investment in research and development, resulting in lower than desirable levels of innovation. Within the workplace, businesses can benefit from out-of-the-box entrepreneurial thinking, increase their level of investment in R&D, and maximise oppor-

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tunities in infrastructural and green technology developments.

Do we need a dynamic adjustment, not only within the public sector but across private industries as well to achieve this? With the environment constantly changing, not to mention the full formation of the ASEAN Economic Community (AEC), many will be concerned about how Thailand will fare in the international arena. Businesses can take advantage of new and changing circumstances and conditions and adopt regionalised rather than localised strategies. We can also take learnings from countries such as Korea, Japan and Singapore who embraced innovation, education, research and technology, allowing them to become high-income economies.

Whether you are a business owner or operator, a government official, or have a genuine interest in ensuring that Thailand embraces the concept of being an innovative economy, this is an event not to be missed. This conference will inspire action, encourage businesses to be vibrant and visionary, and promote innovation and creative thinking. It will provide information on what challenges and opportunities may need to be considered – and what tools and experience are available to drive success – so that businesses here are able to survive, and thrive, in a highly competitive global market.

Calendar of Events Thursday 1 May AustCham Office closed Monday 5 May AustCham Office closed Wednesday 7 May Briefing on Thailand’s Private Sector Collective Action Coalition Against Corruption

Time: 17:00-17:30 Venue: Mode Sathorn Hotel Bangkok Sundowners

Time: 18:00-21:00 Venue: Mode Sathorn Hotel Corporate Sponsor: Baker Tilly Thailand Limited Tuesday 13 May AustCham office closed Thursday 15 May BKK ABF

Time: 12.00-14.00 Venue: TBC Wednesday 21 May ESB ABF

Time: 16:30-20:30 Venue: TBC

Thank you to our April sponsors

This is just one of our many events occurring in May and June. Given our busy calendar, AustCham has decided to host our ‘Grand Ball’ on 15 November this year. Many of you will remember how successful the 2013 BlueScope Ball was and we hope to deliver an even bigger and better event in November.

Sponsorships opportunities still exist so please approach me for further details.

I look forward to seeing you at one of our upcoming events!

Warm Regards, Renee Bowman Executive Director, AustCham Thailand www.austchamthailand.com

Sponsorship opportunities are currently available for the conference in June. Businesses can also showcase their products via trade booths at the conference. Please email Renee at executivedirector@ austchamthailand.com for more information.

AustChamThailand Advance

International School Bangkok A leader in education and education technology since 1951. www.isb.ac.th