TNBR 2013-04 by Thai-Norwegian Chamber of Commerce

Thai-Norwegian Business Review 2013 – 04

Thai-Norwegian Chamber of Commerce

Thailand’s challenges IPR & labour skills Ann Ollestad, Norway’s new Ambassador to Myanmar

Contents President’s foreword

Norway’s first resident ambassador to Myanmar

Cover story: Labour skills & IPR

Yara challenged by copycat brands

Intellectual protection tips for the small business owner

The AEC and Labour – will you be able to find those elusive employees?

Sunset thinking: Pushing Thailand into the value-added sector

Unraveling the details as AEC creeps closer

Patents and IPR, often a long road ahead

Patents as a tool for business and innovation

Overview of IP tips and watch-outs in Thailand

IPR strategies in Southeast Asia for European SMEs

Aibel: Trained and ready for competition

NERA: Training is their lifeblood

Setting Thailand on a Productive Course

Change of government in Norway

Helping those away from Norway: An interview with Brita Ve Magnusson

Norway-Asia Business Summit

Green light for Thailand-efta free trade negotiations

McKinsey Global Institute looks at Myanmar

Finnair: Overcoming the curse of Mercator

Gauging global auto supplies

Dinner talk with Telenor’s Sigve Brekke

Thailand’s economy at a glance

Getting to know the members

Welcome New Members of Thai-Norwegian Chamber of Commerce! 54 Members’ directory

57 Editor: Thitikul K. Opdal Advertising: Anders Magnusson Journalists: Eric Baker, Ezra Kyrill Erker, Nellie Willow, Anton Benzon Graphic Design: Andrew Spaulding www.norcham.com

H.E. Ann Ollestad, Norway’s new Ambassador to Myanmar

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President’s foreword Thailand has for the past years been marked by colours; red, yellow, pink, green and even black. We are presently experiencing a division and polarisation in Thai society, a division reflected in these and many other colours. Thailand used to reflect the colours of the rainbow, - a country where people of all faiths, races and social standing, would work together in unity; may “the Rainbow Effect “return! Thailand also faces another important challenge: how to stay competitive? With the increase in minimum salaries and lack of skilled labour, Thailand must urgently focus on innovation, technology and education. Only by investing in these fields can the country keep its competitive edge. In these colourful times, how can we secure the confidence of foreign investors? With the ASEAN 2015 approaching, Intellectual Property Rights (IPR) will be an important and challenging focus area. The foreign business community can help investors by supporting the work done through each individual Chamber of Commerce. Under the Joint Foreign Chambers of Commerce (JFCCT), a 29 chamber umbrella organisation, we can promote good and honest business practices and support rule of law and transparency. We congratulate Stanley Kang on his promotion as the Chairman of the JFCCT and give him our full support. Since the last issue of Business Review, Norway has a new Government, lead by our second female Prime Minister, Ms. Erna Solberg, from the conservative party Høyre. We expect to have Ms. Monica Mæland, the new Minister of Trade and Industry, at our upcoming Norway-Asia Business Summit on 25-29 April 2014 so mark the dates! We have recently marked two important anniversaries among our members: Out heartfelt congratulations go to Finnair who recently celebrated her birthday, a young and vibrant lady of 90 born on 1 November 1923. Another vibrant member of the Chamber, Dr. Kristian Bø turned 80 on 20 October. Kristian has been with the Thai Norwegian Chamber of Commerce since the start in 1996. On a sadder note, another of our founding and honorary members, Mr. Tove Bjerkan, 91, passed away quietly at his home in Sattahip. May he Rest in Peace. On 12 December Ambassador Katja Norgaard will again host the popular Seafood under the Stars; an excellent opportunity to bring your guests for a Norwegian seafood feast in a magical garden setting. Happy colourful reading! Vibeke Lyssand Leirvåg Conselvan President Thai-Norwegian Chamber of Commerce

Thai-Norwegian Business Review

Norway’s first resident ambassador to Myanmar

mbassador Ann Ollestad comes from a position as Ambassador at the Ministry of Foreign Affairs in Oslo where among other issues she has been working with energy questions. She was previously Norway’s Ambassador to India and Bhutan (2007-2011). Before her posting to India, she was Director General at the Ministry of Foreign Affairs. Previously she has been posted to Paris, Bonn and Geneva.

Ambassador Ollestad is married to Norwegian India-expert, business consultant and author Geir Falkenberg who will be joining the Ambassador in Yangon. The Ambassador visited Myanmar with her family in December 2011 and became fascinated with the hospitality and openness of the people, the vast cultural and historical heritage of the country and its splendid nature. Anton Benzon met Ambassador Ann Ollestad in Oslo recently, just after the announcement that she would be taking up the position as Norway’s first resident Ambassador in Myanmar. What are your “grand plans” or focus areas in relation to the Norwegian business sector’s engagement with Myanmar? I have no grand plans, but I think it is important to point out that Norway has a long history with Myanmar, through our support to democracy and humanitarian work, our early engagement with the Government and our strong supporter of the reform process. Norway was the first Western country to lift the sanctions and we have had political visits to Myanmar before any of the other western countries. We have also supported the on-going peace efforts and have been at the forefront in seeing the potential in the reform process. President Thein Sein showed his gratitude to Norway during a press conference in his most recent visit to Norway in February this year saying: «rather than preach from thousands of miles away, they talk to us candidly and openly, and work with us in finding solutions» What is your impression of the political process in the country you will soon be settling down in?

Thai-Norwegian Chamber of Commerce

A lot has been going in the right direction for Myanmar in the recent years. The country has initiated three large and important reform processes: transition from military rule to democracy, liberalisation of the economy and the peace process. Ceasefire agreements have been signed with almost all the non-state armed groups, political prisoners have been released and the parliament is working actively to modernise laws and legal frameworks. However Myanmar faces major challenges in the years to come, as a country in need of economic growth, distribution of wealth and political solutions to the ethnic conflicts. We have also seen tensions surfacing particularly in Rakhine State between Buddhists and Muslims but also in other parts of the country. The country is also in a strategic geographic location between the two giants: China and India. Where do you see the biggest challenges for Myanmar? It will be crucial to ensure that the vast resources of the country will benefit its population as a whole. The parliamentary elections in 2015 will be decisive. The 2014 census will also be important as well as its Chairmanship of ASEAN in 2014. This will be a great opportunity for Myanmar, but also a demanding one. Why is Norway, a small country far away from Myanmar an important partner for Myanmar? That Norway now is establishing an Embassy with a present Ambassador shows that the cooperation with Myanmar is a high priority for the Norwegian government. Apart from the Norwegian government’s support to the peace building process and democratisation, collaborations have also started in the fields of natural resource management, climate and environment as well as inclusive economic development. This platform establishes mutual confidence and cooperation giving Norway a unique position - both to support actively the democratization process and to assist the Norwegian business sector. This will prove to be a challenging and interesting balancing act that must be handled well. Norwegian businesses have been at the forefront and have seen the potential of the Myanmar market. Since the sanctions were lifted in the spring of 2012- there has

Ambassador Ollestad has previously visited Myanmar as a tourist. Here seen on tranquil Inle Lake in Myanmar. Photo: Geir Falkenberg

President Thein Sein showed his gratitude to Norway during his recent visit to Norway saying: â&#x20AC;&#x153;Rather than preach from thousands of miles away, they talk to us candidly and openly, and work with us in finding solutionsâ&#x20AC;? been a continued and increasing interest from Norwegian industry. Myanmar has clearly expressed that they would like cooperation and investment - and that Norwegian companies have much to contribute. Perhaps the most important industry initiative, Telenor, aims to roll out telecom services across the country within the next year. It also appears that oil, gas and hydropower are important. Local knowledge and focus on responsible investment is particularly important in this phase, capacity building and knowledge transfer are vital priorities. I think we will see more Norwegian companies coming in, but we have to be realistic; it will take time. For the time being Myanmar is a challenging market for even the big companies, but once the basic conditions are in place, medium sized Norwegian companies with some experience from other countries in Asia will also see Myanmar as a natural market.

How can Norwegian businesses, both large and small continue to positively engage (themselves in) Myanmar? Norwegian companies entering Myanmar take with them a value system built on the highest standards of corporate social responsibility including democratic principles, transparency, basic human rights and respect for the environment and the individual. Norwegian representatives should recognise their unique opportunity to act as role models for successful and competitive, yet socially and environmentally sustainable investments. As such, they have the potential to set the standards for future investors. A dynamic, vibrant private sector is critical for long-term sustainability through value creation. Better standards of living will help to build a stronger foundation for the democratic development of Myanmar. In addition, transfer of knowledge and technology will contribute to strengthening the local capacity. What is Norway doing to draw the interest of Norwegian companies to look at Myanmar as a future base and a future market? Several of Norwayâ&#x20AC;&#x2122;s multinational companies such as DNV, Jotun, Telenor, SN Power, Statoil, Wallenius Wilhelmsen and Yara, to mention a few, are already in Myanmar or about to enter Myanmar. To draw the attention of more medium-sized companies, Myanmar is a central theme at the

Thai-Norwegian Business Review

Continued from page 7

Asia-Norway Business Summit which will take place in Bangkok and Yangon 25-29 April 2014. Started in 1998, the Norway-Asia Business Summit has evolved into a meeting place for Norwegian industry in the region, the support apparatus of the Norwegian government and the diplomatic missions in the region and as such, it truly represents the recently revitalised “Team Norway” concept.

business enquiries concerning Myanmar. The larger companies have already established direct contact with the embassy in Yangon, and we do what we can to assist them, especially in the political and regulatory unchartered waters. The result is that Norway can show a united business front in dealing with the challenges of entering a new and relatively difficult market.

How is the “Team Norway” concept applied in Myanmar?

You have earlier been posted as Ambassador to India. How do you see you can draw on your experience from this “giant” in Myanmar? Are there similarities?

Team Norway is not a new idea. The ministries, the embassies abroad and the various players within the government’s support apparatus have traditionally worked well together. In the case of Myanmar, the embassy works closely with a number of organisations under the Team Norway umbrella, notably the Honorary Consulate in Yangon, Innovation Norway, INPOW, INTSOK, Norad, Norfund as well business organisations such as the Norwegian Chambers of Commerce and Business Organisations in the Region in addition to Norwegian non-governmental support organisations. Innovation Norway through its Bangkok representative office, in close co-operation with the embassy in Yangon, currently handles the day-to-day

In general I would say that having lived in the region for five years has given me an invaluable insight into complex and fast growing markets. India is the largest democracy in the world with a multi religion and multi-cultural country and a fast growing middle class. This experience, I will of course take with me in my new post as Ambassador in Myanmar, a country in great transition. I believe we will see many similarities considering both countries complex multi ethnic composition as well as both having a young and aspiring middle class. It is also interesting to note that one of the largest telecom companies in the world, Telenor, has established itself in India and now wishes to enter Myanmar.

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Cover story

Labour skills & IPR This issue of Business Review deals mainly with critical issues for todayâ&#x20AC;&#x2122;s Thailand; labour-related issues as well as protection of Intellectual Property Rights (IPR). Thailand is now at the crossroads; the government is forced to rethink foreign investments as the past position as a low cost production base suitable for labour intensive work is no longer sustainable due to the increased cost of doing business. Thailand needs to move up the production value chain and thereby also re-educate and improve labour skills in order to avoid being stuck in the middle income trap. Labour intensive industries such as mass producing garment factories are moving across the borders into Thailandâ&#x20AC;&#x2122;s neighbouring countries. Yet there are companies which have opted to stay in Thailand and instead introduce automation in combination with what always has been Thailandâ&#x20AC;&#x2122;s strength: meticulous high quality repetitive production. Intellectual Property Rights has also come into focus. In the past, Thailand was known as a country with lax IPR legislation and street markets filled with pirated goods, anything from brand name luxury articles to pirated software and foreign medicine, much produced across the northern borders and into China. In order to attract foreign investors in businesses where protection of IPR is a must, legislation needs to be strengthened and improved. Finally, the ASEAN Economic Community coming into effect at the end of 2015 will put demands on Thailand as well as other ASEAN countries, both in terms of workforce and IPR issues. Living up to such demands should mean that Thailand can strengthen its position on the world arena.

Read on and find out what Thailand is doing to stay competitive.

Photo by Jeerawut Rityakul, Shutterstock.com

Yara challenged by copycat brands

t the end of 2009, Yara decided to cancel the distribution agreement with the partner that had imported Yara’s (former Norsk Hydro) fertilizer products since 1972.

In the aftermath of the cancellation, the former partner decided to market their own fertilizer using a brand with a viking ship similar to that of the Yara viking ship and earlier versions of the logo. The partner continued using the Thai wording of “Viking Ship” (Rua Bai Viking), which has been the Thai brand name for Yara’s (Hydro’s) products since 1972. The ex-partner has since 2009 used two different Viking ships logos, one of which is very similar to the Hydro logo from the 1960s.

“This shows that it is possible to fight IPR infringement outside the court. We are confident that we will win the appeal, but in the meantime we have through our own commercial activities ensured that we are not dependent on the final outcome of the case”. Axelsen points out that this is far from ideal and that not all companies have the financial resources required to take the measures to protect its IPR. “I hope that in the future, the lead time for settling IPR cases will be significantly reduced. This would enable us to focus our effort and resources more on our knowledge based strategy, which is to increase farmer profitability through Yara’s crop nutrition solutions”.

“This caused significant brand confusion in the Thai market, and lot of efforts were made to clarify what was the original viking ship from Norway”, Bent Axelsen says. Yara filed a law suit in 2010 and won the case in March 2011. The ruling was appealed, and two years later the company is still waiting for the appeal judgment of the Supreme Court to be issued.

Ex-partner trademark I

Ex-partner trademark II

Hydro original 1960s trademark

“As of today, we do not expect the appeal judgment to be issued before 2014. This clearly demonstrates that intellectual property protection has limited value in practice when it takes up to five years to get a final verdict”. “Brands are key to a successful business in Thailand”, Axelsen claims. “Therefore we needed to take action in order to protect our brand. We started scaling up our marketing efforts in 2012 and in 2013 the marketing budget was tripled.” In addition to increasing the activity level in the field with 1,700 farmer meetings, the company made two TV commercials and branded 350 dealers with a standard Yara dealer package. This has paid off. Yara now has the strongest brand name for natural rubber, fruit and vegetables and is expected in 2013 to achieve a growth rate of more than 20% in a relatively flat market.

Thai-Norwegian Chamber of Commerce

Happy Thai fruit farmer, Photo: Panchamaporn Yoddumnoen/Yara

Yara current trademark

Intellectual protection tips for the small business owner text by Eric Baker

f you’re running a small business in Thailand and someone mentions the subject of intellectual protection rights (IPR), your first response is probably to shrug. After all, the country is infamous for its illegal copies of products, and even if you wanted to do something, it would cost a lot of money to pursue a violator and law enforcement tends to be less than vigorous.

But fortunately there are a number of low-cost preventive measures small and medium-sized enterprises (SMEs) can take, a number of which were highlighted at a recent seminar sponsored by the European-ASEAN Business Centre in Thailand (EABC). The first step is to determine what can be protected, so some descriptions are needed. A patent covers protection for something that is new—a product has to be invented. A trademark is a sign that distinguishes a good from a competitor’s. An industrial design patent protects the design but not the function. Soft IP does not have a specific definition but is generally thought to cover know-how and trade secrets. Literary or artistic rights, or copyrights, do not protect the idea but rather the expression of it, meaning it protects the book but not the ideas written in it. A lot of businesses, even SMEs, are considering expanding in the region with the ASEAN Economic Community (AEC) slated for 2015. But companies should know just as there are big differences between the economies of ASEAN, the same can be said for IPR, as the laws are different for every country, said Franck Fougere, managing partner at Ananda Intellectual Property and co-director of Orbis Limited. In fact, Myanmar has no IPR laws at this time. The ASEAN Working Group on Intellectual Property Cooperation is working on harmonising regulations for the region, adopting an action plan that includes a training module for the acquisition of IP rights, exploitation and enforcement, as well as effective IP search and registration. One goal is that by 2015 all ten member countries will sign the Madrid Agreement on International Trademark systems, while another is by the same date seven members have acceded to the Hague Agreement on Industrial Design.

“Don’t assume just because all the IPR laws are different here than in Europe, it is a good idea to use pirated software.” Part of the motivation is to increase actual protection, but it is also to streamline the process, said Mr Fougere. To protect one trademark across three classes throughout the EU costs EUR 1,700, while to do so in every ASEAN country would cost about €10,000, he added. In determining what to protect, Mr Fougere said several companies overlook the copyright, which is a mistake because it can be easier to protect the software than the machine. Protection involves employment contracts and non-disclosure agreements, which form the basis of defense for employers against employees and should be mandatory for all SMEs, said Jakub Ramocki, an IP Business Adviser with the ASEAN IPR SME Helpdesk. Completing the timely filing and registration of IPR files is also key, as registration is needed for the protection to have legal effect. The next step is risk mitigation, which means companies need to learn everything they can about the local laws. “But part of this is also common sense,” said Mr Fougere. “Don’t assume just because all the IPR laws are different here than in Europe, it is a good idea to use pirated software. You wouldn’t believe how many small businesses fall into this trap, and we have to advise them to get licences for all their programmes.” SMEs should also learn to be flexible, which could mean understanding that turning a competitor into a business partner is sometimes the best solution when it comes to IPR squabbles, he said. Companies should also check the freedom to operate in a country by checking the availability of IPR before use and filing. “SMEs need to anticipate possible registration and ownership issues,” said Mr Fougere. “A very frequent

Thai-Norwegian Business Review

Continued from page 11

mistake is registering a patent in the name of the company, which often is 51% Thai-owned. “Also foresee future business developments and new products, such as linking your IPR strategy to securing domain names and social media IDs. Companies spend thousands of dollars on building an online identity, but not the USD 10 for registration.” To be sure, there are challenges. For instance, it takes 13 years on average for a patent in Thailand to be filed, he said. And most countries in the region, including Thailand and Myanmar, operate on a first come, first served basis for IPR.

Civil litigation is rarely used in Thailand, mainly because of the difficulty in proving actual damages, the lack of a formal discovery process, and delays in prosecuting the case, said Mr Ramocki. Possible outcomes include injunctions and award damages, but preventive injunctions are rarely granted It takes 13 years on average for a here because of the difficulty patent in Thailand to be filed. in proving the emergency of the case to a judge, while damages awarded are typically quite low, he said.

“There are already IP squatters in Myanmar, who are people that take your product and register it in another country,” said Mr Fougere. “Myanmar is something of a frontier in this regard, as its economy just opened up and it is formulating its first ever IP laws as we speak.” “In some countries, such as the Philippines, you have to file a declaration of use, meaning you have to use the product you are protection or you could lose that defense. Another obstacle is penalties for counterfeiting, which vary widely in ASEAN, from USD 10 in Myanmar and USD 4,500 in Cambodia to USD 12,500 in Thailand and a maximum of USD 100,000 in Singapore.” Enforcement of IPR in Thailand can be lax because authorities lack training and resources, there is high turnover, and of course corruption, he said. “Often the corruption occurs when police receive money from counterfeiters in exchange for tip-offs before a raid occurs,” said Mr Fougere. “One solution could be landlord liability laws, which could mean the owner of MBK mall could be liable if fake products are sold there. Thailand doesn’t have this law yet, but Singapore, the Philippines, Indonesia and Malaysia do.” Other tips include joining forces, such as trade associations or chambers of commerce, to help save on enforcement costs. Companies can also join together to lobby, and such efforts are taking place now in Thailand, he said. “If you take an original bottle and fill it with a fake liquid, this is currently not a crime in Thailand,” said Mr Fougere. “But companies are lobbying to change this situation.

“Businesses should also stay persistent about protecting their IP rights, as counterfeiters know which companies are aggressive about IPR.”

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Some companies no longer attempt raids against counterfeiters, such as Nokia in China, which adopted the strategy of working solely with customs officials because it found the process to be more effective, said Mr Fougere. In Thailand a company can register its IP rights on the Thai Customs Department website, also known as the Customs Watch List, and file a request with the department to detain a specific shipment. “The best way to stop counterfeits is at the border,” said Rolf-Dieter Daniel, President of EABC and the head of STAEDTLER Thailand, a pencil company. “It also helps to use official logos and design marks on your products.” Finally, companies should know if they receive a direct e-mail from someone saying they need to protect their IP rights or they are in violation of IP rights and need to take action, this is most likely a scam and the sender is either after money or is probing to see how sensitive the recipient is about IP, said Mr Fougere. They should always refer such mattes to authorities and/or seek professional advice. Fortunately an agency exists that helps small businesses in the region, and most of its services are free: the ASEAN IPR SME Helpdesk. It provides information on its website, documents, worksheets, legal advice, web seminars, and a list of required documents for IP filing. It can be found at www.asean-iprhelpdesk.eu.

Because many of these matters are detailed and complex, it is recommended you contact a lawyer or IP agent if you plan to take action or need help.

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The AEC and Labour – will you be able to find those elu by Andrew Durieux

t is well known that the ASEAN Economic Community (AEC) is due to commence full operations at the end of 2015. What is not so well known is a number of the details of what the AEC implementation actually means for company owners, employees and normal citizens in Thailand.

There are high hopes for general improvements, but along with this expectation there is a lack of knowledge and much confusion about how the AEC will operate. This is due to many inaccuracies reported in the media, often stemming from information provided by various politicians and ministry employees in speeches and presentations, who themselves are not well informed or whose departments have not yet made the final One the key areas that causes most concern is the area of labour – or more technically correct “Free movement of Skilled Labour”. The use of the word Skilled is very important, and it should not be mistaken for free movement of people, which is a more correct description of the situation in Europe where borders have mostly been removed, purchasing of land permitted for citizens of any country in any country, and even social security payments can be provided to citizens of other countries that base themselves in a host country. Within the AEC agreements, and despite news articles and some speeches to the contrary, there is no intention to do away with borders within ASEAN, or to allow general widespread movement of individuals, and there is no agreement for one government to make payments to citizens of other countries for such things as health care, unemployment or retirement benefits. Thais should not fear an invasion of foreigners from the neighbouring countries, or needing to support any such workers – any more than they should today. The Skilled concept within the AEC is really aimed at supporting trade, and specifically the Free movement of Services concept covered under the AFAS agreement.

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Where ASEAN services providers wish to operate or provide their services in another ASEAN country, they need to use one of the four modes of operation. These are shown below in the table and are accepted by the WTO and within the ASEAN context:

Mode 1: Cross-border supply Criteria

Supplier Presence

Service delivered within the territory of the Member, from the territory of another Member

Service supplier not present within the territory of the member

Mode 2: Consumption abroad Criteria

Supplier Presence

Service delivered outside the territory of the Member, in the territory of another Member, to a service consumer of the Member

Service supplier not present within the territory of the member

Mode 3: Commercial presence Criteria

Supplier Presence

Service delivered within the territory of the Member, through the commercial presence of the supplier

Service supplier present within the territory of the Member

Mode 4: Presence of a natural person Criteria

Supplier Presence

Service delivered within the territory of the Member, with supplier present as a natural person

Service supplier present within the territory of the Member

For Mode 3 and Mode 4 services the table shows that an individual or company may need to be located in the host country to be able to deliver the service. An example of this would be hairdressing which needs to be delivered in-person, whereas a call centre operator could provide a service from a home country via a telecommunications link.

usive employees? Thais should not fear an invasion of foreigners from the neighbouring countries.

The Free Movement of Skilled Labour is therefore aimed at allowing service providers to move individuals with the needed skills from one country to another as needed for their customers, and to allow individuals to provide their skills in locations where they are needed for the highest price they can obtain. It is currently not intended as a solution to the needs of factory and white collar employers struggling to fill many vacancies. Within the AEC Concept the Free Movement of Skilled Labour takes the forms of Mutual Recognition Agreements (MRA’s). Currently there are 8 MRA’s covering Accountants, Engineers, Surveyors, Architects, Doctors, Dentists, Nurses and a Tourism MRA that actually covers more than 30 types of work within the Tourism sector. It is important to understand that the MRA’s are all different, and all also allow host countries to apply their own rules and limitations. It is also only applies to citizens of ASEAN countries working with other ASEAN countries. Within the MRA’s are also a series of tools by which countries can limit or control the skills or individuals, and which can clearly be used to protect such things as home employment and national security.

their own language. There are other limitations or controls also, such as the requirements to have been a registered member of a home country’s industry body for a period of time before applying to move under the MRA’s. The effect of the systems established in the MRA’ is that, in reality, there will be very few changes from the number of foreign Engineers employed in a country like Thailand, so the fear that many Thais have today about Thailand being inundated by foreigners is completely unfounded. Equally, the limitations mean that employers or individuals looking to benefit from this concept are likely to be disappointed given the current implementation described. The Joint Foreign Chambers is trying to obtain further information from the Thai government in relation to the implementation details (i.e. how will an employer in Thailand actually goes about bringing in an ASEAN Engineer, and how will an ASEAN citizen complete paperwork for their work permits and visas). The JFCCT is also looking to hear from members of the chambers in relation to what other skills our members are looking for. We would like to highlight or request additions to the current list of eight MRA’s be made as soon as possible. Please let the Thai-Norwegian Chamber of Commerce know what skills you are looking for and how other ASEAN nations might fill these gaps. We are also making recommendations suggesting that work permits be not required for these individuals, or that these individuals are counted as “Thai” for the 4-to-1 rule and capitalisation figures which remain problems for many of our member companies. We will keep you informed as we find out more details.

The MRA’s also allow each host country to enforce any visa and work permit rules, and may still use tools such as the Thai system of limiting the number of “farang” workers per local employee. Critically the MRA’s also allow for each country to apply their own internal tests, and this means that a host country may choose to administer such a test in

Thai-Norwegian Business Review

Sunset thinking: Pushing Thailan text by Eric Baker

tanley Kang, the new Chairman of the Joint Foreign Chambers of Commerce in Thailand (JFCCT), is optimistic about the country trying to transform its economy as it inches toward the ASEAN Economic Community (AEC). All he has to do is point to his own company.

He sees a lesson there for Thailand, and is hopeful that the AEC will help shift Thai attitudes toward competition and innovation. “The JFCCT believes the AEC will change Thailand because the rest of the world will change how it looks at us,” said Mr Kang. “We believe removing trade barriers is going to help Thailand in the future, but it has to make some changes to improve competitiveness.”

Mr Kang is the Senior Manager of Tuntex Textile (Thailand), which has its base in Taiwan, and is the first Asian Chairman of JFCCT.

One obvious way to improve labour skills is improving education, he said, though this is easier said than done. “The education system in Thailand is much better than it was before,” said Mr Kang. “I know this because I’ve lived here for 33 years and I used to go to school here. But I know the progress is slow. What the chambers are trying to do is link education to a purpose so students get usable skills.

“People told us the textile industry was finished in Thailand,” he said. “They said the era of cheap labour is over and all the textile companies will move to Myanmar, Vietnam and China because they have cheap and ample labour. But we told these people they were thinking about it the wrong way. You have to adapt if Thailand’s wages increase, and switch to value-added products. “We don’t believe textiles are a sunset business. We think that is sunset thinking.” Instead Tuntex Textiles went to work. The company had been making polyester fabric in Thailand for years, and however much it made, it could always sell it because demand exceeded supply. But in the 1990s when China started to develop, the country started to do more textile manufacturing for export, and it became more difficult for Tuntex to export to China and elsewhere, he said. “We realised we had to make something special, something that people would specifically order,” said Mr Kang. “So we entered the international brand supply chain, making functional fabrics that are moisture-wicking and UV-protectant. Now 100% of the materials we make are micro-fibres. In the last five years, environmental protection has become a lot more important to customers, so we use a lot of recycled products in our fabric too.” “We spent more on innovation and research and development. Without these, we would have been out of the market the last 10 years.

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“I believe you receive two types of education in school: wisdom and usable skills. But we feel you need something you can use that can contribute to society after you graduate. We talk to schools all the time about teaching students something they can use, because many of them make it easy to graduate.” Another way to improve competitiveness is automation, he said. “In the textile business, we looked at buying an auto-cutter, but declined because it was too expensive. Eventually after more study, we decided to try it even though it would be much cheaper to just hire more manual cutters,” said Mr Kang. “We were shocked that it improved efficiency by 30% because it was more precise than our manual cutters and other employees weren’t sitting around waiting for the material to be cut. I would say to other manufacturers, if you’ve never tried automation, you don’t know what you’re missing. “A lot of foreign companies thinking about investing in Thailand always ask ‘It’s okay if wages increase, but how are you increasing efficiency?’ I always feel companies and management are responsible for increasing the efficiency of employees. You have to have good teachers. You can’t wait for good students. There are a lot of industries that have cheaper labour costs but they are inefficient. This means the outcome will be the same as a higher-wage company that is more efficient.”

nd into the value-added sector

“We don’t believe textiles are a sunset business. We think that is sunset thinking.”

Stanley Kang

He added that while Tuntex Textile emphasizes training, which can often mean bringing in foreign experts from abroad, the company is still dedicated to using Thai employees over the long term. The foreign experts are here in the short term to transfer their know-how to our employees, said Mr Kang. “One of the things that working for major international brands such as Adidas, Haggar and Perry Ellis have taught us is that our costs are their costs,” he said. “They are always pushing us for lower prices and competitive products, and Thailand opening up to other countries and the AEC will have the same competitive effect.” “When people ask me about Thailand’s economy and foreign competitors, I always say ‘If you want to run fast you have to open your eyes.’” As for JFCCT, the goal remains to find mutually beneficial ways for the chambers to work together. “Each chamber is looking for ways to protect their own interests,” he said. “But it’s not the JFCCT’s job to protect any one interest. It’s in our interest to attract more foreign investment here. I’m doing this because I believe what’s good for foreign business in Thailand is good for my business.”

“There is a tradition of working together here in Thailand, and I believe when all the different chambers gather we can find common interests. There is a large international community here, and that’s a positive, as different cultures foster different ideas. Companies like that foreigners are accepted here and it offers comfortable living. You also don’t find many natural disasters here—there are no earthquakes and most of the floods are man-made management problems. The one drawback is energy, as the country has to import an increasing proportion for its power supply.” Mr Kang noted Ambassadors from Chile and Finland joined the chamber’s recent meeting, and if Chile joins the 29-member consortium, it would become the first Latin American member. “The Chilean Ambassador told me everyone believes wine is the top import for Chile here, but it actually makes up a very small percentage. Still, the reputation of wine is good because it opens doors for us,” said Mr Kang.

Thai-Norwegian Business Review

Unraveling the details as AEC creeps closer text by Eric Baker

he Thai Department of Trade Negotiations recently held a seminar on ASEAN Economic Community (AEC) Trade and Investment, in which the Joint Foreign Chambers of Commerce of Thailand (JFCCT) participated. The goal was a more accurate understanding of the rules, progress and interpretation of the AEC guidelines ahead of their enactment on Dec. 31, 2015. The Business Review attended the seminar and we’ve summarised some of the key points.

What is the definition of an ASEAN citizen or company for the purposes of the AEC? An expat who is the juridical person of a company is entitled to the benefits of AEC services and investment even if that person is not a citizen of an ASEAN member country, said Arkkapat Varnapruk, a trade officer with the Department of Trade Negotiations. Companies set up in Thailand by expats would be considered Thai companies, he added. Siriporn Narkjure, a senior investment promotion officer with the Board of Investment (BoI), said there are only four instances when an ASEAN investor can be denied benefits under the ASEAN Comprehensive Investment Agreement (ACIA): (1) if the company is not engaged in substantive business operations in its ASEAN base; (2) if the company is owned by an agreement-denying ASEAN member state; (3) if there are diplomatic relations between the ASEAN country you are based in and the one in which you want to expand; and (4) if your company breaks the law such as misrepresenting its shareholding structure. Ms Siriporn added that currently Thailand is the only ASEAN member that does not grant benefits to foreignowned ASEAN-based investors. Will there be a single customs window and reduced border checkpoints for goods? A Thai national single customs window has to be completed before an ASEAN single window can be created, said Bussaracum Kaewfanapadol, a legal officer with the Customs Department. Now 12 Thai agencies are working to implement a national single window, but a trans-border logistics single window has not been completed and seems

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a long way off. The department already sent a draft bill to Parliament, and it is negotiating with Customs departments in other countries. Will there truly be free movement of skilled labour under the AEC? The point was danced around by the panelists, but as of right now it is highly unlikely that there will be free movement of labour under the agreement. Although eight professions have worked out mutual recognition agreements (MRAs) on the qualifications of professional services, if one of those professionals wants to move to another country to practice, they are still subject to all licensing and tests of that career’s professional organisation or union, which are going to be in the native language. The eight fields are engineering, physician, nursing, surveying, accounting, dentistry, architecture and tourism. So if a qualified Vietnamese nurse wanted to work in Thailand she’d have to spend several years learning Thai first to be able to pass the licensing. The professional organisations or unions have no incentive at this point to loosen their regulations for other ASEAN citizens, and the government cannot force them. “The MRAs are meant to facilitate the movement of people, not harmonise or liberalise licensing rules,” said Mr Arkkapat. As a silver-haired gentleman with a thick accent whispered to me on the way out: “Even in the EU, you think a Romanian doctor would be licensed to practice in Germany? Forget it.” The ACIA attempts to open up investment across ASEAN borders in five sectors. Does that mean the Foreign Business Act will be changed? Andrew Durieux, the head of JFCCT’s AEC committee and a collaborator on the seminar, put it more bluntly: “We have two businessmen in the back who are owners of 5,000 factories in Thailand. They plan three to five years in advance, so we need some clarification on these rules or they may end up opening new factories in one of Thailand’s neighbours.” The five sectors that will allow freer flow of investment are agriculture, fisheries, forestry, mining and manufacturing. The Foreign Business Act is unlikely to be changed, said Ms Siriporn, because ACIA doesn’t set targets. “It is up to each member state to liberalise their sectors,” she said. “To do this you have to consult with the government and

Velkommen, välkommen, tervetuloa, welcome ...

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AD_ThaiNorwegian_Opening_eng.indd 1

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the private sector. In Thailand, we plan to open up 60% to foreign ownership in these sectors, but not 100%.”

Do all goods freely flow through ASEAN borders without tariffs now?

She added that ACIA is only one option, and foreign investors could still utilise the old BoI system to apply for investments in Thailand.

In January of 2010, tariffs were eliminated on most products for the original six ASEAN member countries. In 2015, the same will happen for Cambodia, Laos, Myanmar and Vietnam. The two exceptions are sensitive products, which charge a 5% tariff on various largely agricultural products depending on the country, and highly sensitive products, in which Malaysia, Indonesia and the Philippines request much higher tariffs on rice and sugar only, though these will also drop eventually.

Thailand has a labour shortage. Will the rules change for migrant labour as they have in the EU? The short answer is no. “We must remember Schengen took almost 30 years to set up because of all the different rules for each state,” said Anan Pikultipsakorn, counsellor with the Department of Consular Affairs. “Thailand has exempted visa requirements for citizens of all ASEAN states except Myanmar, only because they have not done the same for Thais. Is the AEC going to change tourism regulations? Citizens of 48 countries can visit Thailand for 30 days without a visa currently. “No changes to this structure are scheduled, though ASEAN members are negotiating for a single ASEAN travel visa,” said Mr Anan. “As of Dec. 27, 2012, visitors to Thailand and Cambodia can apply for one single-entry visa that allows entry to both countries. If this pilot programme proves successful, future single-visa schemes may include Myanmar, Laos and Vietnam.”

The general impression one felt leaving the seminar is that while the ASEAN member states are working toward some of these AEC goals, not much progress is being made either because the states themselves are weak or ASEAN agreements hold very little weight. Several agreements have been signed, but other than reduction or elimination of tariffs, few of the deals have seen any enforcement. To be fair, member governments face many obstacles from vested interests in making these pacts a reality, but one can’t help but think of the frequent ASEAN criticism that none of the members want to give up power, so the alliance itself ends up powerless. For more government information on the AEC, go to dtn.go.th

Thai-Norwegian Business Review

COPYING IS A THREAT

TO LONG-TERM EVOLUTION OF KEY TECHNOLOGIES Original Patented Product

Pirated Product

Respect patents and intellectual property ELTEK is a company designing and manufacturing power systems for telecom and other demanding industries. A key value for Eltek is technological leadership. In order to live up to this ambition we are investing heavily into R&D and have close to 200 engineers employed in Norway. The technological leadership is an important Watch the competitive advantage, which Eltek protect through patents. In the market today movie... there are many companies with little respect for patents or other intellectual www.eltek.com/rail property. rail@eltek.com

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Patents and IPR, often a long road ahead by Anton Benzon

n most modern industries, technology leadership is key. And thus significant parts of a company’s earnings go directly back to their R&D, to ensure that the company stays in the forefront. Key innovations are valuable assets, and need to be protected to avoid copying and plagiarism. There are local, regional and global rules on how to handle such intellectual property rights (IP), but this is a complex bureaucratic jungle and it can be both costly and time consuming to enter a new market. Unfortunately, there are also cultural differences in how people respect IP rights protected by patents or trademarks. In addition, there are less innovative actors in the market who constantly seek to utilise others inventions for their own benefit.

In modern technology, innovation happens on many levels; from small parts of a design to completely new products. This makes the process of applying and validating the patents complex, costly and time consuming. When a new invention is identified one has to decide in which countries the patent shall be applied for. Each country or region has a cost and the strategic importance have to be evaluated. The application often ends in a long queue and it may take up to three to four years to get the patent approved, depending on the country. Once the patent is approved, it is important to evaluate and decide on the next step covering valuation of the patent in specific countries. This is when the money really starts to roll, especially if key markets consist of many countries. In order to optimise investments in patent protection, clear patent strategies should be developed. Applications should only be done in regions respecting patents, with legal systems that can handle disputes and in markets of key importance. Patents can also meet opposition; either during the application process or up to a certain period after a patent has been granted. Upon such an opposition, the application process can be prolonged by up to two years.

“We are investing a lot in new technology and in protecting our solutions and will do what it takes to protect it” In other words; it can take more than five years from a patent is applied for until it is fully operational. When a patent is valid, the owner of the patent can demand that any sales or marketing activities of equipment infringing with the patent be stopped. The patent owner can also demand that any installed equipment be removed from the market. Most professional organisations stipulate in their contractual obligations that costs caused by patent issues shall be borne by the supplier. However, there is no doubt that also the buyer will be seriously inconvenienced by such incidents. Most companies are consequently reluctant to procure equipment for which there is a risk of a future patent issue (valid patent or patent pending), and they are obliged to do a thorough evaluation of the case before doing so. Unfortunately, in real life, this is not always followed. In the battle for cost reductions today, IP rights and potential challenges tomorrow are often set aside. Morten Schøyen, CMO at Eltek emphasized that Eltek is a company that takes pride in being the technology leader in the Telecom power business. The compnay has remained in the forefront, and driven the technology development of the industry. Eltek’s breakthrough with their HE (high Efficiency) product family sets a new standard in the industry, and is the first time Eltek actively has patented their technology. “Telecom Power has become a commodity and differentiation through technology leadership is becoming increasingly important. We are investing a lot in new technology and in protecting our solutions and will do what it takes to protect it” said Morten Schøyen, . Eltek is today present in many South and Southeast Asian telecom markets in addition to xx countries in Europe. The company, like many other industrial players, has taken note of the world’s economy easterly shift and opportunities in the Asian markets including Myanmar are consequently targeted aggressively.

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Patents as a tool for business an by Siraprapha Rungpry Consultant, Tilleke & Gibbins

Intellectual Protection registration is required only for patent and trademark protection, not for copyright and trade secret protection.

lmost everyone nowadays is familiar with the words “intellectual property” and “patents.” This is largely because intellectual property (IP) is a vitally important part of developing and maintaining a profitable business.

Having recognised the importance of IP protection, you also need to understand the types of protection you can obtain and the benefits of each. There are several types of IP—including patents, copyrights, trademarks, and trade secrets—each of which offers different legal rights and protections. For instance, copyright protection and patent protection are very different. If you are thinking about “filing” or “registering” your IP, you are probably thinking about obtaining a patent as opposed to a copyright. Why? Because registration is required only for patent and trademark protection, not for copyright and trade secret protection. Another key point is that patents only give you legal protection in the country where they are registered. There is no such thing as an “international patent” that will give you protection in every country in the world. This means a patent must be applied for in each country where you aim to obtain legal protection. The Patent Cooperation Treaty (PCT) system, which Thailand recently joined, allows you to apply for a patent in several PCT member countries by submitting a single application via the PCT system. Although this is certainly helpful for businesses, it does not actually give you an “international patent,” as you still need to pursue patent registration in each country separately. Once the patent is granted (the process usually takes a few years), the patent owner will enjoy the exclusive right (i.e., monopoly) to exploit the patented invention in the country in which the patent has been granted for a specified period of time. In Thailand, the total protection period is 20 years from the filing date for an invention patent and 10 years from the filing date for a petty patent or design patent.

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From a business perspective, patent protection should be viewed as a tool for achieving specific business goals. The question is how to apply this potentially available tool productively and efficiently. Remember, filing and maintaining patents costs money, so the proper management of patents is crucial. The questions that business owners need to ask themselves include: •

How can a company generate and identify new ideas and innovation that would be worth patenting?

•

How is patent ownership determined?

•

How do employee-inventor(s) get rewarded?

•

How can the company profit from the patent to protect and grow the business?

The main benefit of having a patent is to give your company limited-time exclusive rights to the patented invention and, in turn, prevent your competitors from copying the invention, entering the market, or otherwise competing with your company. This benefit can only be fully realised, however, if your company has a strong patent (patents are best drafted by professionals) and has an effective patent enforcement plan in place so that the company can quickly detect and take legal actions against an infringer. In any event, it is important to keep in mind that without being able to reap the benefits a patent can offer, an issued patent is merely a piece of paper that costs money to maintain year after year.

nd innovation Patent ownership and employee remuneration is another big issue. Section 11 of the Thai Patent Act clearly stipulates: “The right to apply for a patent for an invention made in the execution of an employment contract or a contract for performing a certain work shall belong to the employer or the person having commissioned the work unless otherwise provided in the contract.” This means the patent rights to an invention created within the course of employment belong to the company unless the company and the employee-inventor(s) have agreed otherwise. This point must be clearly communicated to all employees to prevent any misunderstanding. In some cases, employees may think they own the invention. But companies also need to be aware of Section 12 of the Thai Patent Act, which stipulates: “In order to promote

inventive activities and give a fair share to the employee, the employee-inventor shall have the right to remuneration other than his regular salary if the employer benefits from the invention.” Therefore, even though the company owns the patent rights, the employee-inventor is entitled to extra remuneration, provided that the company benefits from the patented invention created by the employee. In light of this legal obligation, companies may consider putting in place a welldesigned reward system to create incentives for employees to come up with innovative ideas and inventions that would benefit the company’s business growth and development. Undoubtedly, with careful planning and effective management, patents will be a very useful tool to drive business and foster innovation.

Bridging Societies is our business Nera Networks provides wireless transmission solutions to communication network owners in most market segments including: • Mobile • Broadcast • Enterprises and Internet Service Providers • Government and Educational institutes • Defence • Offshore and Utilities • Retail Payment Solutions Nera (Thailand) Ltd. 26th Floor, 253 Asoke Tower 253 Sukhumvit 21 (Asoke) Road Klongtoeynua, Wattana Bangkok 10110 Tel: +66 (0) 2664 1464, Fax: +66 (0) 2664 4002 www.nera.no

Overview of IP tips and watch-o

n 2008 and 2009, Thailand respectively signed the Paris Convention for the Protection of Industrial Property and the Patent Cooperation Treaty so as to be in line with the international standards provided in the Trade Related Aspects of International Property Rights (TRIPs) Agreement as per the World Trade Organisation (WTO) requirements (see the WIPO website for more details on each treaty). Thailand is currently undertaking a vast programme of reforms as regards major Intellectual Property (IP) laws, in particular the Trademark Act and the Copyright Act.

In 1997, Thailand established the Central Intellectual Property and International Trade Court (CIPITC) which has exclusive jurisdiction to adjudicate civil and criminal cases involving IP. The experience of the judges has been improving over the years, namely through training for court officials, judges, customs authorities, and other IP enforcement agencies (notably DSI and the Royal Thai Police). The launch of the National IPR Centre of Enforcement (NICE) in March 2013 was a welcome development aimed at ensuring well-coordinated efforts in the prevention of IPR violations in Thailand. An IP database to keep track of the status of infringement cases, court decisions and repeated offences shall also be set up in the near future, which should improve the overall level of IP enforcement in Thailand. In March 2013, the EU and Thailand launched negotiations for a comprehensive Free Trade Agreement (FTA), which comprises Intellectual Property Rights as a key focus area, and should strengthen the economic ties between Thailand and Europe even further.

•

Copyrights TIPS and WATCH-OUTS in Thailand •

Software, music and movie piracy are still rampant in Thailand, and Thai government officials are fighting a long-running battle against pirated music CDs, digital movies and computer software. According to the Thai Department of Intellectual Property (DIP), 369,920 pirated movie DVDs, 142,257 pirated music CDs, and 54,409 pirated copies of software were seized in 2012.

•

Though copyright is automatically awarded to the creator as per the Berne Convention, it is still advisable to voluntarily register copyright with the DIP because this will make court proceedings easier should it be necessary to enforce these rights.

Patents TIPS and WATCH-OUTS in Thailand •

While applications for Design Patents and Petty Patents are still largely dominated by domestic applicants, applications for Patents of Invention are mostly filed by foreign applicants. Since 2011 the trend among foreign applicants has been to file fewer direct national applications, and instead there has been a sharp increase of applications through the PCT route. Accordingly, the backlog has been increasing over the years, which has become worrisome: among the 23,000 pending applications made in 2012, only 1,000 have been granted so far. Therefore it is recommended for EU SMEs to apply via the direct national application system rather than the PCT route where possible, as the application waiting time may be reduced.

•

This makes sense however only if parallel applications of the same patent which have been filed in other countries are expected to end up with quick grants, because in Thailand the examination of foreign patent applications depends on the outcome of any patent application already filed abroad at other Patent Offices. Otherwise, filing an application for a Petty Patent in place of a Patent of Invention should be considered, if

IP TIPS and WATCH-OUTS in Thailand •

Intellectual Property Rights are territorial in nature, which means that registration in a European or Southeast Asian country’s jurisdiction are not automatically enforceable in Thailand, and therefore registering your rights in each country in which you plan to operate may be necessary. In Thailand, IP rights applications are received and processed by the Thai Department of Intellectual Property (DIP).

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Thailand operates under a ‘first-to-file’ system, meaning that the first person to file an IP right in the Thai jurisdiction will own that right once the application is granted, subject to the provisions to the Paris Convention.

outs in Thailand the invention is eligible, and if a 10-year protection is sufficient.

•

Unlike many trade secret protection systems, Thailand also offers voluntary recording of trade secrets with the DIP. Only basic, non-essential information need be provided and the recordal can serve as evidence in enforcement proceedings.

•

Thai law does not yet grant data “exclusivity”, which would guarantee additional market protection for originator pharmaceutical companies (i.e. companies that have discovered and developed pharmaceuticals). This means that in Thailand regulators, such as health authorities or generic drug applicants, are not prohibited from using the originator pharmaceutical companies’ data to approve generic versions of the originator’s product.

Trade Marks TIPS and WATCH-OUTS in Thailand •

In Thailand, there is some protection for ‘well-known trade marks’, however in practice it can be difficult to prove that this applies to your trade mark before a court.

•

A way to cancel a bad-faith registration is by proving that the mark was unused for a period of 3 years prior to the petition for cancellation, in which case you can file a petition of cancellation on the grounds of ‘non-use’.

•

Thailand is a pioneer of Geographical Indications (GI) protection in Asia and GIs can be registered for continuous use with the need to renew every 10 years.

Trade Secrets TIPS and WATCH-OUTS in Thailand •

Information can be enforced as a trade secret in Thailand if it satisfies the following 3 criteria: i) it is non-public information; ii) it can offer a business advantage to the owner, and; iii) the owner can prove they took measures to protect the confidentiality of the information.

Take-away message: Whatever the efforts of the authorities to improve the implementation and enforcement of IPR in Thailand, timely application by EU SMEs for grant and registration of their IP before the DIP is still crucial in order for EU SMEs to have a chance of defending and enforcing their rights. The ASEAN IPR SME Helpdesk is a European Commission co-funded project that provides free, practical, business advice relating to ASEAN IPR to European SMEs. To learn about any aspect of intellectual property rights in South-East-Asia, visit our online portal at www.asean-iprhelpdesk.eu. For free expert advice on ASEAN IPR for your business, e-mail your questions to: question@aseasn-iprhelpdesk.eu. You will receive a reply from one of the Helpdesk experts within five working days. The ASEAN IPR SME Helpdesk is jointly implemented by DEVELOPMENT Solutions, the European Business Chamber of Commerce Indonesia and the European Business Organisations Worldwide Network.

Thai-Norwegian Business Review

IPR strategies in Southeast Asia

he principle issues surrounding Intellectual Property Rights (IPR) development, protection and enforcement are essential to all aspects of your business. Your IPR strategy should be considered one of the main pillars of your business, not unlike your business strategy or HR strategy. A strong IPR strategy and proactive preparation not only helps to prevent IPR-related issues, but may also result in increased revenue as well as more effective and quick enforcement in the case of an infringement.

What is IPR? Intellectual Property Rights are legally enforceable rights over the use of inventions or other creative works. They confer a right to exclude others from their use. Securing your IPR will help you to prevent and enforce against infringers profiting from your innovation or brand by passing it off as their own. IP falls into the categories of registrable and non-registrable IP rights. Registrable IP rights are territorial, which means they have to be claimed and asserted in each country individually. Registered IP in another country is not automatically recognised across the ten countries of the ASEAN region (Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Viet Nam); therefore, it is strongly recommended that you register your IP assets in the country you wish to operate in before entering the market. The best way to prevent IPR-related issues is to use a layered, holistic IPR protection strategy, which includes protection both by registration of your registrable rights and other methods such as contractual protection (confidentiality agreements, IP protection clauses in employee agreements) and internal security measures (limited access to certain work areas, etc.). The main types of IP rights are: 1. Copyrights Copyright protection is generally provided for written, oral, musical, dramatic, choreographic, artistic, architectural,

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photographic, cinematographic, audio-visual, graphic works and computer software. While you do not need to register your copyright for protection, you may voluntarily register to prove ownership in some South-East Asian nations such as Indonesia, Malaysia, Thailand and Vietnam. 2.Trade marks A trade mark is a sign or name that serves the specific and primary purpose of identifying the goods or services of a producer, thus allowing the consumers to distinguish goods or services of one producer from those of another. You can register either by filing an application directly at the national administrative offices of respective South-East Asian countries, or by filing an application at the World Intellectual Property Organisation (international application). If you are making an international application, your trade mark may have to be registered in your home country before requesting the extension of the trade mark to an ASEAN country.

Intellectual Property Rights are legally enforceable rights over the use of inventions or other creative works.

3. Patents A patent is a set of exclusive rights granted to the inventor of a technical solution of a product for a limited amount of time. There are varying patent systems across the ASEAN region; most countries cater for the equivalent of invention patents, which are granted for innovations in the field of technology that are new and inventive over other existing products on the market. Many of the South-East Asian countries such as Vietnam, provide for utility model patents (similar to Utility Patent systems in many European countries) which are generally granted more quickly and require a lesser degree of inventiveness. The original shape,

for European SMEs pattern, colour, or a combination of these in an object, can also be protected by design patents some in ASEAN countries. For specifics in each South-East Asian nation, read our IP Country Factsheets by visiting: www.aseaniprhelpdesk.eu/?q=en/country-factsheets. 4. Trade Secrets Nearly all businesses in all industries and sectors possess trade secrets – a non-registrable form of intellectual property that can ensure your business advantage over competitors. Precisely because a business does not wish to publically disclose their trade secrets by registering them as copyright, trade marks or patents, means a sound internal strategy to prevent them from being accidentally leaked or stolen is essential. If publically divulged, trade secrets enjoy no legal protection, but providing this does not happen they can in theory remain secret (and hence, protected) for an infinite term. The recipe for Coca-Cola is perhaps the classic example of a well-kept trade secret; had the company patented the formula, it would have become public knowledge as soon as the patent had expired. Trade secrets are not currently recognised by all IPR systems in the ASEAN region, but there are practical steps your business can take to keep your crucial information secret. The ASEAN IPR SME Helpdesk project is co-funded by the European Commission’s Directorate-General for Enterprise and Industry under the Competitiveness and Innovation Framework Programme (CIP). The Helpdesk provides support for European Small and Medium sized Enterprises (SMEs) to both protect and enforce their IPR in or relating to South-East Asia. It offers free information and services in the form of jargon-free, first-line, confidential advice on intellectual property and related business issues, plus training, materials and online resources.

The Helpdesk’s free services for European businesses include: Helpdesk Enquiry Service – Confidential Advice Individual SMEs and SME intermediaries can submit IP enquiries directly to the Helpdesk via phone, email or in person, getting access to a panel of experts to receive free and confidential first-line advice.

Training The Helpdesk arranges training on South-East Asia IP protection and enforcement across Europe and South-East Asia, tailored to the needs of businesses, including: •

General IP issues, including IP registration and establishing an IP protection strategy.

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Practical business challenges such as choosing an ASEAN country business partner, attending a trade fair and licensing.

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Helpdesk IP Clinics offering businesses free 20 minute one-on-one consultations with an IP expert are available at most training events.

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Train-the-trainer resources for SME service providers and intermediary bodies (Trade Associations, SME Networks etc.) to improve the awareness of intermediary representatives about the scope and tools offered by the Helpdesk for the benefit of their SME members and clients.

Materials Country specific IP Factsheets, industry and businessfocused guides and training materials address ASEAN country IP issues by: •

IP topic, including patents, trademarks, copyrights, licensing, dealing with counterfeiting (currently under development).

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Business focus, including IP as a business asset, technology transfer, finding the right lawyer (currently under development).

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Sector-specific, including textiles, medical devices, ceramics and clean technology (currently under development).

Online Services – Website: www.ASEAN-iprhelpdesk.eu The multi-lingual online portal provides easy access for all EU SMEs to Helpdesk information and services, including Helpdesk guides, E-learning modules, videos, event information, podcasts and live webinars.

Continued from page 27

Take-away message: Protecting intellectual property rights is central to maintaining your business’ competitive edge and leveraging value from your innovations. IPR systems differ between Europe and the ASEAN region, and it is essential to plan your internationalisation to the region no matter what level of engagement you foresee. The ASEAN IPR SME Helpdesk is on hand to provide free, practical advice to your business no matter which stage of operations you are at, and always remember, ‘Know Before You Go’.

The Dos and Don’ts of IPR Strategy long (e.g. 12-18 months for Thailand), it means that there is no real use to apply for a trade mark in the respective country. ASEAN states mostly use the first-to file system (as opposed to the first-to-use), which means that the party who files an application first is the one most likely to become the owner of the trade mark. Awareness of these issues is paramount when devising an entry strategy to the country’s market.

DO: •

Identify and prioritise your key IP assets. Know which ones are important for your business and how you can effectively protect them.

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Register your IP before entering ASEAN markets. You can deal with infringement more efficiently if you already have protection in the territories.

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Consider putting into place protective measures for your know-how and other unregistrable and registrable rights, such as: •

Signing agreements with business partners which include IPR protection, clearly defining the ownership and transferability of IP.

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Signing non-disclosure agreements with business partners and employees to safeguard your IPR and business secrets.

DON’T:

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Presume that your IPR is automatically protected in ASEAN countries if you already have registrations in other countries

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Assume that IPR is only confined to products. Brochures, websites and other promotional materials can be infringed as well.

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Presume that because the time to get a trade mark granted in ASEAN region countries can be

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•

Rely on others to register your IPR for you. Don’t leave this to your sourcing partner or manufacturer; do it yourself with the help of an ASEANexperienced IPR lawyer.

The ASEAN IPR SME Helpdesk is a European Commission co-funded project that provides free, practical, business advice relating to ASEAN IPR to European SMEs. To learn about any aspect of intellectual property rights in South-East-Asia, visit our online portal at www.asean-iprhelpdesk.eu. For free expert advice on ASEAN IPR for your business, e-mail your questions to: question@aseasn-iprhelpdesk. eu. You will receive a reply from one of the Helpdesk experts within five working days. The ASEAN IPR SME Helpdesk is jointly implemented by DEVELOPMENT Solutions, the European Business Chamber of Commerce Indonesia and the European Business Organisations Worldwide Network.

Aibel: Trained and ready for competition by Eric Baker

come here say that have not seen anything like it in the region.”

ibel (Thailand) is one of the most successful oil and gas construction companies in Thailand, the only one to earn pre-qualification status for Statoil in Norway, and Managing Director Jim Ryan chalks that up to an emphasis on training.

The training for Aibel starts on the first day of work, as every employee has a full day of safety training before being allowed in the yard. The next day is a skills test to see if workers can actually use the tools they will be using, as Mr Ryan said you cannot depend on what is written down on a job application in Thailand.

But Aibel was not an overnight success, as the company spent years building up a culture of training.

Aibel also puts an emphasis on productivity, as it has a meeting after every project for a few days with clients, contractors and managers going over what worked as well as what went poorly.

“When we get a customer who demands really high-quality products, like Statoil, we spend a lot of time training our employees so they get it just right,” said Mr Ryan. “And sometimes work in this field is cyclical, so maybe a worker will go to another yard months later and revert back to their old habits, because maybe the next client doesn’t have such strict standards. Then when the worker returns to Aibel, we often have to retrain them to get rid of the bad habits.” Aibel builds, among other projects, floating production storage and offloading (FPSO) units for use in the offshore oil and gas industry for processing hydrocarbons and storing oil. Most of the rigs are 1,000 to 2,000 tonnes, although one of its largest projects was Gudrun, a $750 million, 11,500-tonne unit for Statoil that Aibel finished on time and under budget for delivery to the North Sea. “The North Sea is perhaps the toughest rig environment in the world, and these units must last for 20 to 30 years, so there is an emphasis on quality,” he said. “For example, if a structure is carbon steel, and the piping is stainless steel, the structure’s beams will inevitably start grinding against each other and if these grindings land on the pipe, eventually you will have corrosion. We are one of the few companies in the area that coat everything with a silver fireproof paper to prevent corrosion. A lot of the vendors that

“When we get a customer who demands very high-quality products/ specifications, like Statoil, we spend a lot of time training our employees so they get it right the first time”.

Aibel’s FPSO Gudrun being readied for transport to Norway. Photo: Thor Jørgen Udvang

Thai-Norwegian Business Review

Continued from page 29

NERA: Training

“We are very good about following up on our mistakes,” said Mr Ryan. “I can see every year we spend fewer hours doing the same work. We also use new technology to increase productivity and lower the amount of labour needed.” All of Aibel’s workers are Thai, he said, so the company is looking forward to the ASEAN Economic Community because it should provide more access to qualified engineers. “A lot of our competitors are expanding, and more companies are looking to enter the market as well,” he said. “We are at the upper end of the wage scale, as upstream pays more, so the government’s minimum wage hike didn’t affect us that much, and if anything we are making it harder for others to compete with our wages. Every so often an oil company may come in and poach one of our engineers by paying him double or triple the wages, but when there’s a tightening in the labour market we play the same game. Mr Ryan said the Board of Investment is a good start, but is limited in how much it can help. “An article just came out in the Bangkok Post about how Thailand ranked 18th in the World Bank’s Ease of Doing Business report,” he said. “That is good, but Singapore was No.1 and Malaysia jumped from near Thailand to No.6, so I think the government should look at what Malaysia did and try to follow it.” Unsurprisingly, Mr Ryan is highly enthusiastic about Aibel’s future in the region, noting “if you gave me twice the yard space tomorrow I could fill it”. But he cautioned that companies really have to know what they’re doing in this environment, as even some competitors nearby are closing down. “All the clients we meet with now are really focused on a safety culture, so if you don’t have that, it will be difficult to survive,” he said. Everything Aibel (Thailand) constructs is for export, with Aibel Norway and Modec in Japan taking the lion’s share of business. Aibel started in Thailand as ABB Offshore Systems because it wanted an office in Asia for competitive pricing. The company had a lot of experience in downstream production, but not much in upstream, said Mr Ryan. An US asbestos lawsuit in 2004 led ABB to sell off some of its assets, leading to the creation of Aibel (Thailand), and since 1999 the company has been focused on topside modules for FPSO.

Thai-Norwegian Chamber of Commerce

by Eric Baker

or service-oriented organisations, training is often their lifeblood. They cannot survive if their employees are improperly trained. NERA (Thailand) is no different, specialising in sensitive electronic draft capture (EDC) credit card terminals. The company not only sells the machines, it also handles service, so they have to be available 24 hours a day to troubleshoot. “Imagine a customer has just filled up his car at a petrol station and tried to pay for it with a credit card. The transaction didn’t go through and the customer doesn’t have cash, so the merchant is calling us up and the customer is annoyed because he is in a hurry,” said Maj. Choakdee Dhamasaroj, the Senior Vice-President and country manager of NERA (Thailand). “Training is a big part of what we do, because our call centre staff have to be composed on the phone when dealing with angry merchants, and they have to know the technical details of the machine so they can get the problem cleared quickly.” The government minimum wage hike to 300 baht per day affected NERA as well. “We had a lot of people jump to another job,” he said. “This is a high-stress job, so I understand it. You have to have someone available 24 hours a day, and during heavy calling periods, such as when a telecom company is having a problem, we can receive up to 1,000 calls a day. But this means you have to train other people, and this takes time, and it puts more of a burden on the existing employees because they have to pick up the slack while the newcomers learn the system. If they can’t solve the problem on the phone, they have to send an engineer out to the merchant.” NERA dealt with the exodus by raising its daily wage to 400 baht in an effort to keep its trained staff, but Maj. Choakdee said turnover is still 20%, which he deemed unacceptable.

g is their lifeblood dentally drops a terminal on the floor at a merchant, it could also switch into that mode. This is where our call centre technicians and engineers come in, as they have to know have to get the machine running again.” Maj. Choakdee noted Thailand has a shortage of software engineers, so combined with the high turnover, it can make managing a workforce of this size a problem. NERA gets around this problem by having a large number of employees all over the world, including in every country in Southeast Asia, plus China and Taiwan.

Maj. Choakdee Dhamasaroj, Senior Vice-President and country manager of NERA (Thailand).

“Thailand should open up its business visa system so people can move around more easily for work.”

The firm has almost 100 locals working for the company plus three subcontractors, but Maj. Choakdee noted it’s still hard to keep up with all the work. NERA has four branches in Chiang Mai, Khon Kaen, Pattaya and Phuket, which serve as logistical hubs for all the credit card terminals it sells in Thailand. The terminals first have to be programmed, and he said not many programmers use C programming in this region, so that also limits the workforce available to NERA. “You have to ensure that all the money is going to get sent to where it is supposed to go, that is the most important thing,” he said. “But these machines are also a little delicate. Part of that is by design, so that if someone tries to break into one of the terminals to take some data, it automatically goes into shutdown mode. Yet that also means if someone acci-

“Our solution is to build up competency in every country,” he said. “We survive as a project-based business. That means sometimes you have downtime in a particular country. But then when you get a big project somewhere, you have a pool of talent you can call in. And we also use that downtime to make sure all our employees are properly trained. “We have one Pakistani programmer, and another Indian national, and they have to apply for visas every time they come here to work on a project. Thailand should open up its business visa system so people can move around more easily for work.” Despite the hassles in finding and keeping employees, Maj. Choakdee is bullish on the future of the industry, with Kasikornbank its largest customer, buying over 40,000 terminals this year. More Thais are using credit cards to pay, and NERA installs about 300 terminals per day. He estimates the company has 130,000 terminals throughout Thailand. NERA also sells telecom and satellite equipment, and has worked with computer networking and security systems as well. Headquartered in Bergen, Norway, it started as a manufacturing arm of the ABB Group. Through a series of buyouts and sales, NERA was born, with its initial sale garnering 1 billion kroner. As the telecom markets became saturated, Maj. Choakdee said NERA started to move toward EDC terminals. The terminals operate using GPRS technology on Thailand’s cellular infrastructure, so Maj. Choakdee pointed out how reliant the company is on dtac and AIS.

Thai-Norwegian Business Review

Setting Thailand on a Productive by Eric Baker

ompetition is like a workout. You have to strengthen your business just like your muscles, and then you can beat your competitors. So says Nandor von der Luehe, the long-time head of the Joint Foreign Chambers of Commerce in Thailand. Nandor von der Luehe remains Vice Chairman of Thailand’s Board of Trade. Thailand is still a great place for business, he said, but it needs to work on its productivity and intellectual protection issues if it wants to remain competitive. “Productivity is the big problem, as Thailand is lacking behind its rivals,” he said. “This has been our position from the start on the minimum wage hike. I think everyone agrees we should help the less fortunate. But the measure had a domino effect on wages. And since everyone wanted higher wages because the guy below him was getting higher wages, but productivity didn’t increase, all the prices went up too because businesses just passed the costs along, and minimum wage earners didn’t end up with any more money in their pocket. “You can increase productivity either through higher education, proper training, or use of machinery. Getting rid of inefficiencies like repeating the same process two or three times because somebody doesn’t know how or cannot do the process can really help improve productivity.” Thailand just changed its strategy for which industries and foreign direct investment the Board of Investment (BOI) is going to promote, veering away from labour-intensive sectors, but Mr von der Luehe said the country needs to do more than change a strategy for it to have a lasting impact. Thailand spends 0.22% of its GDP on research and development (R&D), while OECD countries on average spend from 2% to 2.5%, with Japan and Korea at the top end around 3.7%. “The country spends too little on R&D if it is serious about wanting to overcome the middle-income trap,” said Mr von der Luehe. “The second problem is access to finance, as many small companies cannot get the

Thai-Norwegian Chamber of Commerce

Nandor von der Luehe , Vice Chairman of Thailand’s Board of Trade

“You can increase productivity either through higher education, proper training, or use of machinery.” capital they need. This has been a problem for years, especially in a country like Thailand where the banking sector is an oligopoly. Thailand has about 4,500 large companies, 12,000 medium-sized firms and 2.9 million small businesses. Unfortunately, the term SME— small and medium-sized enterprises—has these two

e Course sectors lumped together, but the needs of a small business are completely different than the needs of a mid-sized company. And while the big companies and most of the mid-sized ones have no problem accessing capital, very few are helping small businesses.

“The other problem is that the Government Pharmaceutical Organisation manufactures generic drugs, but it was created to oversee other drug companies. Well how can a competitor oversee its rivals? The telecom industry used to have the same thing with CAT and TOT.

“And as much as the government says it wants to move away from labour-intensive industries, the BOI still doesn’t have a strategy to change from the manufacturing to the service sector. They keep getting pulled back. Part of this is because the BOI works under the Ministry of Industry, and this is a shortcoming. It used to be under the Prime Minister’s office and the head of the board had a C11 ranking. Now the secretary-general only has a C10 ranking. This doesn’t sound like much, but think about Thailand and how important face and clout are here. If the secretary-general is giving a presentation to a room full of C11s and he’s a C10, they are not paying as much attention as if he was perceived as an equal. And these ministries often have vested or competing interests influencing their policies, some of which keep the BOI anchored to manufacturing.”

“But I would say it’s better than 20 years ago. I work in the watch business, and it’s a fact that you can find fakes everywhere in Thailand. I always say the person who buys an original brand-name watch and the person who buys a fake are two different kinds of people, and that the counterfeiting is not really costing the watch companies that much money. But of course it harms their brand, and it also harms the reputation of Thailand.”

The BOI also wants to move to value-added products as a way to prod the economy forward, but Mr von der Luehe said despite some advantages such as a fortunate geographic location and good basic infrastructure including roads and deep-sea ports, Thailand still lags on some major issues such as telecommunications. “Broadband penetration is still lacking,” he said. “Thailand keeps saying it wants to be a hub for regional operating headquarters (ROH), but it needs to realise even the most attractive tax rates are not enough if you don’t have the right infrastructure and business environment. There are studies that show broadband penetration can make up to 10% of a company’s decision on where to set up a ROH.” He added that a lack of intellectual protection could be hurting Thailand in ways it hasn’t even considered. “Intellectual protection is a big issue for drug companies,” said Mr von der Luehe. “Some of the big drug companies have said they’re willing to allow cheap drugs here but they want their patents protected. Thailand is trying to promote itself as open to value-added products, but why would a company come here to spend money on R&D if the government cannot ensure its results won’t be leaked?

Despite his suggestions, Mr von der Luehe is still upbeat about Thailand’s future. He said he hopes the imminent ASEAN Economic Community (AEC) will make Thailand change its attitude because other markets will force the issue. “Thailand still has a lot of walls up because businesses are worried they will lose out if competition comes in,” he said. “But they need to realise competition is not something where you lose out. I was at a conference recently and a professor at Chulalongkorn University said ‘Thai capital is lazy.’ I asked him to repeat this because I didn’t understand his point, and he meant that Thai businesses are happy with their return in the status quo, so they don’t want to change. But we have to change this mindset and help local businesses realise they can have an even greater return if they open up to the AEC. “The service sector has not opened up even though the Foreign Business Act was passed in 1999. And let’s say you have a foreign business in Singapore that’s a big part of the economy—it cannot invest in Thailand, which is the only country in ASEAN following this course. “My hope is that slowly but surely this is changing. But we still have outdated, restrictive policies like the work permit system for executives coming in to check on their operations, as a WP10 is required. We can’t have this if Thailand wants to be more competitive.”

Thai-Norwegian Business Review

Change of government in Norway

ollowing the general election in Norway on 9 September 2013, the parties Venstre (social liberal party), the Christian Democratic Party, the Progress Party and the Conservative Party won a historically strong majority in the Storting (Norwegian Parliament). As a result, the four parties agreed to work together to ensure that this new political majority was reflected in government policy. Venstre and the Christian Democratic Party decided not to take part in negotiations on forming a new government. Thus, a minority government was formed by the Conservative Party and the Progress Party and appointed on 16 October, with Conservative Party leader, Ms. Erna Solberg, as Prime Minister, and Progress Party leader, Ms. Siv Jensen, as Minister of Finance. The Solberg coalition government has 18 members, 11 from the Conservative party and 7 from the Progress Party. Half of the members are women. In her inaugural address to the Storting 18 October 2013, Prime Minister Solberg stated that “The Government’s values are based on the principles of democracy and the rule of law, and on our Christian and humanist cultural heritage.” On the economy, she said that “The Government will base its policy on the principle that wealth must be created before it can be shared. One of the Government’s priorities will therefore be to strengthen the competitive-

Prime Minister Ms Erna Solberg, Conservative Party

Thai-Norwegian Chamber of Commerce

ness of Norwegian companies. Having a job to go to gives people opportunities for personal development, social contact and financial security. For the country it provides a more secure basis for financing the welfare state. A high level of employment is therefore an important goal.” She added that “The Government will pursue a policy that promotes continued high employment. The competitiveness of Norwegian companies must be strengthened. The Government will therefore develop infrastructure faster and reduce taxation. The Government will also reduce the red tape that companies have to deal with, and direct more attention to knowledge and research. This will give Norway more strings to its bow in economic terms, as well as a more secure society.” On Norway’s relations with the outside world, she emphasised that “The Government will base its policy on international law, international solidarity and universal human rights. Norway has a duty to combat need and poverty in other parts of the world. The Government will maintain a high level of aid. At the same time, the Government will make some changes to development policy. Foreign policy, climate policy and trade policy must all pull in the same direction as development policy. There will be greater emphasis on geographical and thematic concentration and on achieving results. The success of development policy must be measured first and foremost in terms of the real development achieved. Democracy, the rule of law and human rights will be at the core of the Government’s foreign and development policy.”

Prime Minister

Ms. Erna Solberg

Conservative Party

Minister at the Office of the Prime Minister, responsible for EEA Affairs and EU Relations,

Mr. Vidar Helgesen

Conservative Party

Minister of Finance

Ms. Siv Jensen

Progress Party

Minister of Local Government and Modernisation

Mr. Jan Tore Sanner

Conservative Party

Minister of Defence

Ms. Ine Marie Eriksen Søreide

Conservative Party

Minister of Foreign Affairs

Mr. Børge Brende

Conservative Party

Minister of Trade and Industry

Ms. Monica Mæland

Conservative Party

Minister of Transport and Communications

Mr. Ketil Solvik-Olsen

Progress Party

Minister of Agriculture

Ms. Sylvi Listhaug

Progress Party

Minister of Fisheries also Minister for Nordic Cooperation Affairs

Ms. Elisabeth Aspaker

Conservative Party

Minister of Justice and Public Security

Mr. Anders Anundsen

Progress Party

Minister of Education and Research

Mr. Torbjørn Røe Isaksen

Conservative Party

Minister of Children, Equality and Social Inclusion

Ms. Solveig Horne

Progress Party

Minister of Petroleum and Energy

Mr. Tord Lien

Progress Party

Minister of Health and Care Services

Mr. Bent Høie

Conservative Party

Minister of Labour and Social Affairs

Mr. Robert Eriksson

Progress Party

Minister of Culture and Church Affairs

Ms. Thorhild Widvey

Conservative Party

Minister of Climate and the Environment

Ms. Tine Sundtoft

Conservative Party

Thai-Norwegian Business Review

infinity

the history and evolution of the world the thoughts and graphic narration of children 9 to 11 years

THE EARLY LEARNING CENTRE FAMILY OF SCHOOLS THE CITY SCHOOL Ages 3-8 years 18 Soi Arkaphat, Sukhumvit Road 49/4, Bangkok 10110 Tel: (662) 381-2919, 391-5901, 712-5338 Fax: (662) 391-1334

www.elc-bangkok.com

THE COUNTRY SCHOOL Ages 2-5 years 9/4 Moo 1, Samakee Road 20, Samakee Road T.Pasaiy, Muang Nonthaburi 11000 Tel: (662) 588-1063, 952-4147 Fax: (662) 589-4809

THE PURPLE ELEPHANT Ages 18-36 months 44 Soi 53/1, Sukhumvit Road, Bangkok 10110 Tel: (662) 662-7653, 662-7654 Fax: (662) 260-5947

CHEZ NOODLES Ages 18-36 months #61 Soi Prommitr, Sukhumvit Road 39, Bangkok 10110 Tel: (662) 662-4570, 662-4571, Fax: (662) 662-4572

inquiries@elc-bangkok.com

Helping those away from Norwa an interview with Brita Ve Magn by Eric Baker

he consular world can seem a mystery to most—what do they do? Bail expatriates out of jail? Or simply help expats and entrepreneurs have an easier go of it in a foreign country?

Relative newcomer Brita Ve Magnusson is here to clear the mist. She’s been working at the Norwegian embassy’s consular section in Bangkok for almost a year after stints in Abu Dhabi, Miami, Washington D.C. and Strasbourg. “Mainly we’re here to help Norwegians,” said Mrs Magnusson. The consular office helps Norwegians— individuals or businesses. For businesses, it’s mainly documents which need to be verified by the embassy. It also assists Norwegian businesses with staff issues such as Norwegian passport renewals, visas for the company’s Thai staff, etc. For Norwegian citizens in Thailand in private capacity, the embassy spends a hefty portion of their time assisting the approximately 6,000 Norwegian retirees in Thailand. “We get a lot of questions about health insurance,” said Mrs Magnusson. “If you want to retire and move to Thailand, you can pay a small percentage of the coverage to the Norwegian government, then when you receive your healthcare in Thailand, a large part of the cost will be refunded. It’s not complete coverage, but it’s pretty good and it covers some medicines. I believe Norwegian pensioners are very lucky compared to other countries, as I’ve heard the local insurance schemes aren’t that comprehensive here.” The embassy also travels to the provinces one week a year when they visit Norwegians in Pattaya, Phuket, Hua Hin and Udon Thani. She said they are mostly retirees at these locations, and some receive social security or disability pensions from the Norwegian government that allow them to travel. Norway also has consulates in Pattaya and Phuket. Retirees receive a special visa in Thailand, she said, but it has to be renewed every year. A requirement for the visa is retirees have to show they receive a pension above a certain

Thai-Norwegian Chamber of Commerce

amount. This detail made the news recently when the UK and Sweden, among others, decided to cut the amount of pension they pay to overseas retirees. “Norway now taxes 15% of your pension if you live in Thailand if you can’t prove you pay taxes to the Thai government,” she said. “But so far we have not heard any talk of Norway cutting pensions.” Despite these services, the general public still has some fuzzy ideas about just what her office can do. “Very often people have misconceptions about what the consular office does. When people end up in jail, often they assume when we arrive we are there to get them out. This is not the case. We are like a messenger. The main thing we do is try to ensure they can contact a lawyer,” she said. While most people think about criminals they read about in the news going to jail, Mrs Magnusson said that is not always the case. “A lot of people get jailed for overstaying their visa. If you get stopped by police for overstaying your visa, you are taken to court where you must pay a fine as well as your air ticket home. The Thai government does not buy your air ticket home,” she said. “Some people have stayed in jail for years because they have neither the money nor the relatives or friends willing to help them pay the amount due. The maximum amount they can fine you at airport immigration is 20,000 baht, but you’d be surprised at the people that take their chances. You can be sent to jail, or the court, of even fined more if you don’t pay the airport fine.” Of course her job involves a lot more than dealing with Norwegians in prison. Though Mrs Magnusson said adjusting to Bangkok living was relatively easy because of all the support the embassy provided, including finding a place to stay, she did point out she was ready for a rest before her holiday back to Norway.

ay: nusson

Mainly we’re here to help Norwegians. For Norwegian citizens in Thailand.

“Living in Bangkok can be stressful, and the heat takes its toll as well,” she said. “Embassy staff from the Ministry are allowed one free travel allowance per year, provided part of the holiday is spent in Norway. The ministry wants to keep you in touch with the country. Mrs Magnusson speaks four languages and has travelled extensively in her career, including as a travelling secretary for a spell. Travel also figured prominently in a recent episode at the embassy. Norwegian Air Shuttle ASA (shortened simply Norwegian) recently decided to open a route to Bangkok, and the airline wanted to use Thai crew members for much of its Asian routes. Though air crew do not need work permits while they are flying, they are required if you are going to be trained in Norway. The Thai air crew were hired because they would be cheaper than European staff, but according to Norwegian law you have to pay these employees the same wage as a Norwegian, said an embassy staff member. Norwegian is also contemplating moving its headquarters to Ireland, but in the meantime the company has created a subsidiary named Norwegian Long Haul for the routes to Thailand and the US. The embassy heard they had a tight deadline to turn around several visas and work permits for all the Thai workers, but managed to handle the crush of paperwork in time without causing an international incident. In fact, most folks who apply for visas to Norway are approved.

Brita Ve Magnusson

“We have about a 95% approval rating,” said Mrs Magnusson. “There is no real risk of asylum seekers. Most are girlfriends who want to visit their boyfriends in Norway.” Explosive business and tourism interest in the newly opened economy of neighbour Myanmar has led Norway to build its own independent embassy there. The Swedish embassy in Phnom Penh takes care of Norway’s consular business in Cambodia, she said. Yet the majority of Mrs Magnusson’s work still revolves around helping people. “We get a lot correspondence from families in Norway worried about their loved ones here. We try to connect people,” she said. “There are some unfortunate cases where Norwegians die in Thailand, and in this instance we help with organising the transport of the coffin or the urn.”

Thai-Norwegian Business Review

Norway-Asia Business Summit

n the last issue of Business Review the Norway-Asia Business Summit 2014 was presented. The summit will take place in Bangkok and Yangon between 25 and 29 April 2014. A lot of emphasis has been put on securing a high quality event, both in terms of content and venue.

NORWAY-ASIA BUSINESS SUMMIT, 25-29 APRIL 2014

ROGRAMME 25-29 APRIL 2014

A first draft of the programme for the Bangkok session is ready. It has been divided into six blocks: I.

Presentations: The big picture: Macroeconomic perspective of Asia. In this session with cover the world’s food crisis as well as Asia’s energy crisis. Finally we look into the “Asia 2050 Crystal Ball”, a glimpse into the future

II. Country specific breakout sessions. We look at challenges and opportunities for China, India, Myanmar and Thailand in addition one session on Maritime Southeast Asia III. Presentations of ASEAN 2015, plans and readiness as well as impact of Free Trade Agreements IV. Presentations: The Private Sector; corporate perspectives for Norwegian companies in Asia Opportunities and challenges V. Panel Discussion: The Public sector; Public-private partnership? Team Norway—How does it work and how can it be improved? VI. Presentations: Summary and Conclusions A number of interesting and high-level speakers have already confirmed their participation, among them, Kristin Skogen Lund, Head of Confederation of Norwegian Industry (NHO); Dr. Surin Pitsuwan, former Secretary General of ASEAN; Egil Hogna, Head of Downstream at Yara, Jon Fredrik Baksaas, Group CEO of Telenor, Bjørn Kjos, CEO of Norwegian Air Shuttle and Prof. Torger Reve, Professor and renowned China expert from Norwegian Business School BI. In addition, we have established contact with a number of international experts in fields as diverse as transparency and corruption, the world’s food

Thai-Norwegian Chamber of Commerce

crisis and the Asian energy crisis. Finally we are hoping that Norway’s new Minister of Trade and Industry, Monica Mæland will grace the event. We are currently in contact with the other Norwegian chambers and business associations in Asia in order to get their input on the programme so it can be adjusted to their needs. The Myanmar part of the programme will follow after the Bangkok programme has been finalised. The format will follow the previously successful trade missions with a half day business briefing followed by business site visits and most likely government presentations in the capital Nay Pyi Taw. The website, www.norway-asia.com is being readied at the time of writing. The website will contain practical information about the event, the subjects covered and the speakers. In addition, it will contain a registration and payment engine, thus avoiding much of the labour intensive tasks connected to these tasks.

Green light for Thailand-EFTA free trade negotiations by Erik Svedahl

he Thai Parliament on 2 October approved the Governmentâ&#x20AC;&#x2122;s proposed framework for negotiations with the European Free Trade Association (EFTA). Thailand and EFTA can now proceed to agree on a date for the start of formal negotiations, most likely in early 2014.

EFTA consists of the four non-EU countries Iceland, Lichtenstein, Norway and Switzerland. At the EFTA ministerial meeting in Trondheim, Norway, on June 24 this year, the EFTA ministers of trade unanimously expressed a strong wish to see a reopening of the negotiations with Thailand in the near future. The desire for such a free trade agreement was further strengthened when Thailand and the European Union recently started negotiations on a comprehensive FTA.

The FTA will aim for a removal of tariffs for as many goods as possible for both Thailand and the EFTA countries. A working level meeting between EFTA and Thailand was subsequently held in Bangkok on July 2, to discuss the modalities of reopening negotiations for a free trade agreement. The EFTA delegation was led by Ambassador Martin Eyjolfsson from Iceland. Mr. Somkiat Triratpan, Deputy Director-General at the Department of Trade Negotiations, led the Thai delegation. Both parties agreed that negotiations should be resumed as soon as possible. The two sides held two rounds of negotiations between 2005 and 2006, before the process was put on hold. Norwayâ&#x20AC;&#x2122;s trade with Thailand has seen an increase in recent years, and in 2012 the total trade in goods exceeded NOK 5 billion (about THB 25 billion) for the first time. Trade between Norway and Thailand is rather complementary. Norwegian exports to Thailand are primarily fertilizers, machinery and fish, while the imports are primarily electronics, cars, seafood, rice, fruit and vegetables. Norway has also got significant interests regarding trade in services, including telecommunication. The FTA will aim for a removal of tariffs for as many goods as possible for both Thailand and the EFTA countries.

The Challenge... USD $1,500/year

4 years

Average productivity of a worker in Myanmar today, about 70% below that of benchmark Asian countries

of average schooling in Myanmar (UN Development Programme, Human development report, 2030)

USD $650 billion

10 million

Total investment needed by 2030 to support growth potential, USD 320 billion in infrastructure alone

additional people to absorb in Myanmarâ&#x20AC;&#x2122;s large cities by 2030

...and the Opportunity 19 million

USD $20 million

Members of the consuming class in 2030 from 2.5 million in 2010

GDP in 2030, over four times as high as today

Potential to create more than

USD $10 million additional non-agricultural jobs by 2030 42

Thai-Norwegian Chamber of Commerce

500 million People living in countries bordering Myanmar and the closest parts of China and India, a huge potential market

Freely adapted from fraphics in the MGI report.

McKinsey Global Institute looks at Myanmar by Anton Benzon

n June 2013, McKinsey Global Institute (MGI) released a comprehensive research project report on Myanmar’s economy titled “Myanmar’s moment: Unique opportunities, major challenges”. The report was released in time for the World Economic Forum on East Asia’s meeting in Nay Pyi Taw in June.

The report was compiled by six analysts from MGI under the leadership of Heang Chhor, a McKinsey Director in Singapore and Richard Dobbs, a McKinsey and MGI Director in Seoul, Korea. In addition, MGI Consultant Nancy Shah led a Myanmar-based project team collected data from a range of government agencies as well as conducted field research and more than 200 interviews with experts, political leaders and business people. The main focus of the report is Myanmar’s new awakening after a long period of economic stagnation. Myanmar has missed the progress in growth and productivity seen elsewhere in Asia, but the country has so much going for it, that unless the economy is grossly mismanaged and the reforms are reversed, things will move forward, the only question is at what speed. The report moves on to look at how the economy might develop in the period up to 2030, both in terms of contribution to GDP and the creation of jobs. MGI predicts an annual growth of some 8% per year up to 2030. Similar figures have recently been projected by institutions such as Asian Development Bank (ADB) and International Monetary Fund (IMF) The MGI Report points to four areas which will be the major drivers of growth: Agriculture which currently employs 52% of the workforce but which has a low productivity output per worker (USD 1,300 per worker as compared to USD 2,500 per worker in Thailand. Energy and mining; Myanmar has large unexplored resources of oil, gas (the most important export item) and precious minerals. With new technologies, the

The main focus of the report is Myanmar’s new awakening after a long period of economic stagnation.

future estimates could be much higher than current assumptions. Manufacturing. Myanmar has an opportunity to increase output in labour intensive industries when many of the neighbouring countries are becoming uncompetitive. Infrastructure. Myanmar’s infrastructure is particularly undeveloped. MGI estimates that Myanmar will need to invest USD 320 billion between 2010 and 2030 to upgrade its infrastructure, half of which will be in the property sector. MGI states that Myanmar will need to get all the fundamentals right and use four other keys to unlock growth: Digital leapfrogging. Myanmar is starting its economic development in the digital age, when mobile and internet technology will become increasingly affordable. The current mobile penetration is only 4% as compared to 120% in Thailand. Structural sector shift. Myanmar is unusual among emerging economies since its economic mix has hardly changed in decades. Urbanisation. Currently, the majority of Myanmar’s citizens live in the countryside, but MGI believe that is likely to change at a rapid speed and on a large scale Globally connected economy. After decades of being cut off, Myanmar is opening up and the country is starting to become an active member of the global economy mainly through foreign investment and trade.

Thai-Norwegian Business Review

Continued from page 41

MGI has looked at historical data which shows that Myanmar’s growth has picked up in the past 20 years, but that it still lags behind the rest of Asia. However, MGI states Myanmar could quadruple its economy to 2030, but risks disappointing if things are going the wrong way. The report states that part of the reason for the weak economy is that Myanmar’s labour productivity is lagging far behind other Asian countries. Two main reasons are given; the first being a lack of move upwards on the value ladder from agriculture into manufacturing and services like Myanmar’s neighbours, the second being a failure to boost productivity within the manufacturing sector. The researchers have a identified a “consuming class” which consists of consumers with an income of more than USD 10 per day measured on a PPP basis, this being sufficient for spending not only on basic necessities such as food and shelter but also for goods and services. While 35% of the world’s population belong to the “consuming class”, only 4% of Myanmar’s population fits into this group. The report points to how the rise of a consuming class has been a significant driver of economic growth in other countries,

e.g. China as with 62% of household income spent on food and beverages in 1985 as compared to only 27% today. The MGI report concludes that ensuring a continued development will require the government and the private sector to rethink their plans and policies to tackle the enormous challenges ahead. Myanmar has the potential to become one of the fastest growing economic transformations in modern times, but the road ahead is filled with holes which can easily derail the current rapid development. The political and economic reform process needs to go hand-in-hand with similar processes in the private sector, both supported by modern key legislation. Given that Myanmar tackles the challenges and continues the reform process, Myanmar can potentially catch up and eventually outperform neighbouring economies and once again take on a role as one of the main hubs of Asia. The report, which is very well researched and written, is a must read for anyone with an interest in doing business in Myanmar. It can be downloaded from MGI’s website http://www.mckinsey.com/insights/mgi, simply search for Myanmar.

Finnair: Overcoming the curse of Mercator by Eric Baker

“They were allowed to write whatever they wanted, even if it was negative,” he said. “It was expensive, but it generated a lot of interest online and the feedback was positive. Online is very challenging because there are a lot of opinions and people can write whatever they want, but marketing is about investing money and we thought it was worthwhile.” New York New York

inland as a final destination when going to Europe or sending cargo, but it is the closest location for planes flying from Asia.

“The flat map created by Mercator almost 500 years ago has been our enemy,” said Jan Skutnabb, the sales director for Southeast Asia and Korea. “Finland looks far away from Asia on a flat map, but if you look at a globe, the fastest route to Europe is actually over Finnish airspace. This natural route is to our advantage, the challenge is to relay this to customers.”

Helsinki Helsinki

Marketing uses this route in its literature, trying to convince both passengers and cargo customers to fly on Finnair. DelhiDelhi

“We have double daily flights from Helsinki to Bangkok, and the winter season is already well-booked,” he said. “We see a lot of potential in the Thai market, and it keeps getting better every year.”

Singapore Singapore

Finnair flies to 13 destinations in Asia, but most of its traffic from Bangkok is to Europe. Mr Skutnabb said most of the traffic from Asian destinations are sold locally.

Jan Skutnabb, sales director for Southeast Asia and Korea

The company puts more of a focus on internet marketing recently, including a local hero campaign and a test traveler promotion where a few lucky contestants were chosen to fly all over the world on Finnair and blog about it.

Finnair tries to target corporate travelers, even if they’re flying in economy class, said Mr Skutnabb. Business travel to Thailand pales in comparison to Shanghai, Singapore and Korea, but the airline sees business sales in the region on the uptick. “The last few years were difficult for the Tokyo Tokyo Beijing Beijing Nagoya Nagoya airline industry, but we Osaka Osaka Xi’anXi’an Seoul Seoul can see a light at the end Shanghai Shanghai Chongqing Chongqing of the tunnel,” he said. “We were confident enough Hong Kong Kong Hanoi Hong Hanoi to place an order for a batch of Bangkok Bangkok Airbus 350 jets, which should have much lower fuel consumption. “Finnair believes the best way to keep up with evolving emissions standards is by using new aircraft, and the airline has had an emissions calculator on its website for a number of years. We believe in a few years it will be seen as a sales advantage to show customers you are greener than your competitors.” Though he has been working for Finnair for years, Mr Skutnabb had a stint in Oslo that he looks back on fondly. “I left a part of my heart in Norway,” he said. “There families still travel together for cross-country ski trips, while in Finland most people just concentrate on downhill. I miss that.” Mr Skutnabb moved to cargo operations starting in November and Chanchai Wangyuenyong is taking over passenger sales after three decades at Japan Airlines.

Thai-Norwegian Business Review

Gauging global auto supplies by Nelly Willow

any established brands from Norway and beyond are forging ahead with a visible presence in Thailand, through opportunities in domestic sales in expanding and emerging markets. However, there is also a vast array of foreign companies investing in Thailand solely as production and distribution bases, with no real contact with the Thai marketplace. In these instances the challenge is not to market the brand to Thailand but to ensure that brand quality is maintained. One Norwegian company recently setting up in Bangkok’s Free Trade Zone near Bang Phli New Town is Wema.

Leading global brand Established 25 years ago, in Bergen, Wema is a leading global supplier of level sensors for trucks and buses in the automotive industry, as well as liquid level and temperature sensors for the marine, agricultural and construction equipment. With production per annum exceeding one million units, Wema is a recognised name for original equipment manufacturers, (OEMs), rather than being a brand known by end users such as truck drivers. The company has a physical presence not only in Norway but also the US, Switzerland, India and China, with a further customer base in Japan, Australia and Europe, as well as South America. Thailand sees 70% of global revenue Thai operations are focused on final assembly, quality assurance, and re-export for global distribution. From having 10 employees a year after setting-up in July of 2012, Wema plans is to be employing 60-70 personnel by the end of this year. The longer-term strategy is to increase capacity and streamline the supply chain as Wema grows in existing and emerging markets. The company predicts that around 70% of the global revenue for Wema will be from products that have passed through the site in Thailand. Norway = good company values

Thai-Norwegian Chamber of Commerce

From the outset, Norwegian experts visited the Thai site to train Thai staff and create a smooth start-up. Key employees from Thailand were also sent to Norway for training. The fact that Wema was born and bred in Norway does have some impact on how business is carried out, according to the General Manager in Thailand, Arne Kaland Sværen. “I would like to think that we have certain company values that come from Norwegian culture that are beneficial in business. Certainly, when it comes to attracting employees in Thailand as a foreign company I think it’s beneficial to be a Norwegian company, for the same reason, good company values.” Location! Location! Location! While Thailand may not be providing a customer base, the fact that Wema is a long way from home is a real benefit. As is often pointed out as of paramount important in the real estate market: Location! Location! Location! For a Norwegian company operating in a worldwide playing field access to the centre of Asia and infrastructure is ideal. According to Arne, “Wema needs to increase capacity to meet forecasted demands and with customers on many continents it would be unwise to expand in Norway when looking at global distribution.” Strong skillset to continue brand quality As well as geographical position, low operating costs, especially compared to Norway and other European countries, is obviously one of the major pulls to Thailand for foreign investors. However, there was another major attraction for Wema, according to Arne. “After evaluating several countries in the South East Asia region and comparing them, Thailand came out on top. Especially important is that Thailand already has a strong automotive sector and good availability of competent employees. Compared with other countries in the Asia region Thailand offers highly skilled labour, great support from Thailand’s Board of Investment (BOI), a good choice of good suppliers and less bureaucracy than many other places, including Norway.” As the major supplier of fuel gauges for the primary truck and bus OEMs across the globe, Wema’s main focus is on consistency and quality rather than adapting to cultural differences. With most of the senior staff speaking English, Arne states that the same ideas and approach apply in

From left: Ms Thitikul Opdal, Executive Director for Thai-Norwegian Chamber of Commerce; Mr. Arne Kaland Sværen, General Manager of Wema Environmental Technologies Ltd; H.E. Ms Katja Christina Nordgaard, Norwegian ambassador to Thailand and Cambodia

Arne. “We believe in good Thailand as they do anywhere management and a company else. “It comes down to the “My experience so far is that culture for good quality. This management to ensure good paired with good quality health and safety and as the employees take great pride control generates good quality well as that, the operation in doing good work as long as output. My experience so far should aim to have as little is that the employees take impact on the environment the management creates a good pride in doing good work as possible. Employees here environment and always follows the great as long as the management are primarily coming from creates a good environment other companies within the right procedures and standards.” and always follows the right automotive sector and are well procedures and standards.” aware of the importance of health and safety. Educating employees to understand the expectations of the company Existing customers come to Thailand and importance is no more important in Thailand then in The major reason Wema’s operations in Thailand any other country.” encompass assembly rather than internal sales is that many domestic trucks run on compressed gas, and so do Regardless of lower costs, the target of quality output from not require Wema’s products. However, current customers Thailand is that it should be the same if not better than planning and in the process of setting up assembly sites in from other Wema sites. From a strong Norwegian base the Thailand are surely going to appreciate that their supplier emphasis at Wema is to create good quality management has already set up shop. and also to have faith in the skills and attitudes of employees. With tales of some companies taking advantage Wema demonstrates how building a brand abroad is not of Thailand’s competitive costs with little regard for always be about marketing and integration but often about training, understanding or looking after Thai staff, Wema’s matching up location, skills and increasing global demand positive attitude is worthy of praise. without brand quality suffering. “The quality, dedication and pride of the operators for doing excellent work is the same here as it is in Norway,” explains

Thai-Norwegian Business Review

Dinner talk with Telenor’s Sigve ‘Scandinasian Leadership’

n October 29, more than a hundred members of Bangkok’s Scandinavian community gathered atop the DTAC headquarters to hear Mr. Sigve Brekke, head of Telenor’s operations in Asia, speak about how Telenor, totally unknown in Asia just 15 years ago, is now among the largest operators in the region, and is, in fact, becoming an increasingly Asian company. At the Thai-Norwegian Chamber of Commerce dinner talk, Sigve explained a series of lessons learned and approaches to succeeding as a foreign company in Thailand.

Thai-Norwegian Chamber of Commerce

“One of most important things we learned was that even if a foreign company has local partners, you will always, in a sense, be an outsider. So the relationship building within our local business communities, with public stakeholders, with regulators never stops,” said Sigve. He also emphasized that a uniquely ‘Scandinasian’ approach to business and management on the internal side has proven equally valuable. “Our leadership style, and what it has achieved in Thailand and across Asia, is based on setting and measuring goals, engaging with both internal and external stakeholders, connecting with our employees and defining who we are as a company,” said Sigve. “Our leaders should be on the

Brekke ground, in the field, with the people and fully accessible, and should inspire passion. This is what gets results.â&#x20AC;? Currently, Telenor Group has almost 150 million customers worldwide. More than 133 million, or 90% of Telenorâ&#x20AC;&#x2122;s customers now come from Asia. In Thailand, Telenor operates through DTAC, which has one of its highest growth rates and contributes significant revenue to the Group. At present, Asia contributes 44% of the group revenue, 25% comes from Norway, 23% from Europe and 8% from the rest.

Thai-Norwegian Business Review

Thailand’s economy Thailand’s Economy at a Glance at a glance

Other bits and pieces Petrol/litre (95 E10) NOK: TH Petrol/litre (95 Octane) NOK: NO McDonald BigMac price NOK: TH McDonald BigMac price NOK: NO

7.37 14.96 13.42 40.00

20.0

15.0

4 3

10.0

5.0

1 Q2/13

Q1/13

Q4/12

Q3/12

2013p

2012

-1 -2

2007 2008 2009 2010 2011 2012 2013p

0.0

Stock Exchange Index (SET)

Exchange Rates 7.00

1,800 1,600 1,400 1,200 1,000 800 600 400

6.50

5.50 5.00 0801 0807 0901 0907 1001 1007 1101 1107 1201 1207 1301 1307

4.50

2000=100 200 180 160 140 120 2007 2008 2009 2010 2011 2012

Thai-Norwegian Chamber of Commerce

THB/NOK

6.00

Manufacturing Index

Thai-Norwegian Chamber of Commerce

-2

Thai Consumer Price Index

Thai GDP Growth (%)

100 Basic Figures: BOI. Comparisons: Wikipedia. GDP/Capita and Thai Population: Wikipedia/IMF. Thai GDP and CPI: Bank of Thailand. Quarterly GDP: NESDB. SET: Stock Exchange of Thailand. Exchange Rate THB/NOK: OANDA. Manufacturing Production Index: Thailand’s Ministry of Commerce. Bilateral Trade: Statistics Norway. Petrol and BigMac prices as of 8 November 2013

Female

Bilateral trade 2012 1200 1000 800 600 400 200 0

Import 1,778 (1,394) MNOK Export 3,378 (2,352) MNOK

Chemicals Engineering Fish Pulp Other Metal Prod Food Electronics Machinery Cars Computers Others

69.9 mill 5.0 mill 10,300,000 875,000 71/76 79/83

Male

-4

Mill

Mar13 Apr13 May13 Jun13 Jul13 Aug13 Sep13

MY CN TH ID PH IN VN LA KH MM

80+ 70-74 60-64 50-54 40-44 30-34 20-24 10-14 0-4

0501 0507 0601 0607 0701 0707 0801 0807 0901 0907 1001 1007 1101 1107 1201 1207 1301 1307

Sources:

-5.0

Geography Geographic Area: TH 514,000 sq. km Geographic Area NO: 385,199 sq. km Highest peak TH: Doi Inthanon 2,565 m Highest peak NO: Galdhøpiggen 2,469 m Inland water areas TH: 2,230 km Inland water areas NO: 16,360 km Coastline TH: 3,219 km Coastline NO: 25,148 km Demographics Population TH: Population NO: Population Bangkok: Population Oslo: Life expectancy M/F TH: Life expectancy M/F NO:

2011

Some comparisons

2010

Top 10 Exp. Jan-Jul13 %/value USD bill Motor Cars and automotive 10.5%/13.95 EDP equipment 7.7%/10.2 Refined fuels 5.0%/6.7 Chemical products 4.1%/5.5 Polymers etc. 4.0%/5.3 Precious stones/jewellery 3.9%/5.2 Rubber products 3.8%/5.0 Rubber 3.6%/4.7 Iron and steel 3.2%/4.2 Machinery and parts thereof 3.1%/4.1

100

NO US SG KE TW

10-20% 10-15% 7% 0-35%

Thai Population 2011

120

2009

Corporate income Tax Withholding Tax Value Added Tax Personal income Tax

GDP/Capita 2012 (TUSD)

2008

Export Growth 2012 3.2% Export Growth 2013 projected 7.6% Trade Balance USD 8.3 bill Current Account Balance USD 2.7 bill International Reserves USD 181.6 bill Minimum wage (Bangkok) Baht 300/day

May13 Jun13 Jul13 Aug13 Sep13 Oct13

Basic Figures Thailand (2012)

With the compliments of

Attorneys at Law

Attorneys at Law Specializing in corporate practice, investment, finance and banking, taxation, real estate, immigration, labour, intellectual property, contract and commercial legal matters.

Kamthorn, Surachet & Somsak 31st Floor, Sinn Sathorn Tower 77/131-132 Krungthonburi Road Klongtonsai, Klongsarn Bangkok 10600 Telephone: +66 (0) 2440 0288-97 Fax: +66 (0) 2440 0298-00 E-mail: kss@kss.co.th www.kss.co.th

www.feliciadesign.com

EMOTION THROUGH INNOVATION

Getting to know the members Bent Axelsen, Vice President and Country Manager Yara (Thailand) Ltd. TNCC Member since 2010 What most people don’t know about you? I’m really a nice person.

I am not a good singer. The record was played during the celebration in Drammen for 15,000 people…

The wildest/weirdest thing you have done? It would have been to tell all about it in this magazine. Well, one candidate is making and recording a song for Strømsgodset together with a friend this November. I am not from Drammen, not particularly interested in football and

What is your biggest achievement so far? To be a part of a family with a nice wife and two crazy boys. Business wise it is to build a sustainable business for Yara in Thailand by making farmers more profitable. With our strong growth in Thailand we also support our plant in Porsgrunn, Norway . When was the first time you came to Thailand? I visited Thailand in 1998 with my wife, and came regularly for business later while we lived in Singapore. We moved here with the family in 2010. What do you like most and least about living in Thailand? What I like most is the opportunity to experience so many fantastic adventures with my family and to meet so many nice people. What I like the least is the lack of transparency in the public sector. Where is your favourite weekend getaway in Thailand? Birds & Bees, because it’s cozy and they’ve got a trampoline for kids! If you become Bangkok Mayor for one day, what will be the first thing you do? Fight corruption and push for more public transportation. Your favourite restaurant(s) in Bangkok? BoLan, Enoteca. The last book you’ve read? “Politi” Where do you live in 10 years? I live in Norway skiing, unless I am sent out to a new ventures abroad.

Thai-Norwegian Business Review

Welcome New Members of ThaiNorwegian Chamber of Commerce!

Welcoming new members on 29 October at Opus Restaurant

New Corporate Members:

New Premium Members:

Fovea Co. Ltd.

Wallenius Wilhelmsen Logistics (Thailand) Co., Ltd.

Blue Water Shipping A/S WALLEM SHIPPING (THAILAND) LIMITED

New Individual Members:

Samitivej Public Company Limited

Mr. Michael-Khaniss Jand

Asian Tigers Mobility

Mr. Jitrakorn Permthamsin

Wilhelmsen Ships Service (Thailand) Limited NIST International School

For advertising in the Thai-Norwegian Business Review please contact: Mr Anders Magnusson Director of Sales & Marketing E-mail: dirsales@norcham.com Mobile: +66 84 694 0046

Thai-Norwegian Chamber of Commerce

Seafood under the Stars

Mark your Calendar

12 December 2013

Thai-Norwegian Chamber of Commerce would like to welcome you to a Grand evening with Seafood under the Stars The dinner will take place in the garden of H.E. Ambassador Katja Nordgaard's residence on Thursday 12 December 2013. Seafood from Norway will be served in beautiful surroundings, ensured by a Norwegian Chef This is a perfect opportunity to invite your local customers, clients and associates as well as your colleagues and friends for a grand networking dinner. The garden of the Norwegian Ambassador's Residence, 74 Sukhumvit Soi 38 Where When

Thursday 12 December 2013, 18.30 hours-22.00 hrs

Tickets

Table for 10 persons Baht 35,000. Members: 3,600. Non-members 4,000. Prices include VAT

Please sign up by sending an email to secretary@norcham.com

st be e th ly on If only theisbegogostod IfIf on ... gh ou en ... gh ou is od enough... Developed homes in Pratumnak Pattaya sinec sinec 2004 2004 Developed homes in Pratumnak Pattaya Developed homes in Pratumnak Pattaya sinec 2004

Best location Best location Best location Top Quality Top Quality Top Quality Superb Lifestyle Lifestyle Superb Superb Lifestyle Mob. : 089 936 6741 Eng/Nor Mob. Tel. Mob. Tel. Website Tel. Website Email Website Email Email

Quality and Care Thai-Norwegian Chamber of Commerce 56 Quality and Care Quality and Care

::: :: :: :

089 936 6741 Eng/Nor 038 303 310 Fax : 038 038 252 252548 548 089 936 6741 Eng/Nor 038 303 310 Fax : www.vnresidences.com 038 303 310 Fax : 038 252 548 www.vnresidences.com sales@vnresidences.com www.vnresidences.com sales@vnresidences.com sales@vnresidences.com

Honorary member H.E. Mrs Katja Nordgaard New Ambassador Royal Norwegian Embassy Tel: +66 (0) 2204 6500 Fax: +66 (0) 2262 0218 Email: emb.bangkok@mfa.no

Honorary member and Senior Advisor to the Board Dr. Kristian BĂ¸ 234/237 Discovery Place, Soi 23 Khlong 7, Pathun Thani, 12110 Thanyaburi Tel: +66 (0) 2957 0111 Fax: +66 (0) 2957 0222 Mob:+66 (0) 8 9129 9993 E-mail: kristbo@truemail.co.th

Board of Governors President Ms. Vibeke LeirvĂĽg Felicia (Thailand) Ltd. Tel: +66 (0) 2637 6981 Fax: +66 (0) 2637 6997 Email: president@norcham.com

Vice President Major Choakdee Dhamasaroj Nera (Thailand) Ltd. Tel: +66 (0) 2664 1464 Fax: +66 (0) 2664 4002 Email: choakdee@neratel.com.sg

Mr. Gunnar Thoresen Jotun Thailand Ltd Tel: +66 (0) 3821 4450 Fax: +66 (0) 3821 4373 Email:gunnar.thoresen@jotun.com

Ms. Piyanuj (Lui) Ratprasatporn Tilleke & Gibbins International Ltd. Tel: +66 (0) 2653 5555 Fax: +66 (0) 2653 5678 Email: lui@tillekeandgibbins.com

Dr. Paisan Etitum, Ph.D Thai Transmission Industry Co., Ltd. Tel: +66 (0) 2678 6640 Fax: +66 (0) 2678 6649 Email: paisan@tti-mail.com

Mr. Gunnar Bertelsen Telenor Asia (ROH) Ltd. Tel: +66 (0) 2637 4700 Fax: +66 (0) 2637 4726 Email:gunnar.bertelsen@telenor.com

Bent Axelsen Yara Thailand Tel.: +66 (0) 2664 9498 Fax: +66 (0) 2664 7488 Email: bent.axelsen@yara.com

Mr. Torpong Thongcharoen Norske Skog (Thailand) Company Limited Tel.: +66 (0) 2661 3486 Fax: +66 (0) 2661 3485 Email: torpong-t@papcothai.com

Vice President Mr. Axel Blom Blue Business Solutions Ltd. Tel: +66 (0) 2627 3040 Fax: +66 (0) 2627 3042 Email: axel.blom @blue.in.th

Vice President Mr. Sigvart Voss Eriksen Total Access Communications PLC Tel: +66 (0) 2202 8000 Fax: +66 (0) 2202 8828 Email: sigvart@dtac.co.th

Ms. Aina Eidsvik Aibel Tel.: +66 (0) 3300 4040 Fax: +66 (0) 3300 4041 Email: aina.eidsvik@aibel.com

Mr. Jon Anders Aas-Haug WebOn Tel.: +66 (0) 2206 4120 Fax: +66 (0) 2207 2525 Email: post@webon.no

Thai-Norwegian Business Review

In memory of Tove Bjerkan

1922â&#x20AC;&#x201C;2013 It is with great sadness that we announce that the long-time honorary member of Thai-Norwegian Chamber of Commerce, Mr. Tove Bjerkan, 91, passed away quietly at his home in Sattahip on Tuesday, September 24, 2013. During World War II, Bjerkan was active in resistance work against the Germans. Bjerkan later served in Germany as adjutant to Norwegian General Hans Reidar Holtermann. He was also involved in the Korea War from 1951 to 1953, where he was in charge of the field hospital which Norway contributed to the war effort. After a short period at NATO headquarters outside Oslo, he served as a UN observer in the Middle East from 1968 to 1970, before heading to Geneva to work with international conflicts, including the return of children from Biafra and Nigeria. Bjerkan came to Bangkok in 1974 as a representative of Norwegian Church Aid, Norwegian Refugee Council, Save the Children and YMCA. When the Vietnam War ended in 1975, he was appointed representative for Thailand for both NRC and Norwegian Church Aid, a position he held from 1975 to 1982. He was Representative for Norwegian Refugee Council until 1989. From 1989 to 1993 Bjerkan served as special adviser to UNBRO. Bjerkan had a good and deep understanding of refugee work and he later worked on the border between Burma and Thailand, where the Karen people were stranded due to border conflicts. He made sure that the help benefited the people who needed it most. After 1993 Bjerkan retired to a quiet life on the Eastern Seaboard. He continued as an active member of a number of organisations including the Board of the Thai Norwegian Chamber of Commerce until very recently. One of the most respected and recognised Norwegians in Thailand is no longer with us. May he rest in Peace.