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Thailand’s rubberwood industry: a new rising star

Author: Pharadon Heemmuden

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The market outlook for rubberwood exports is bright thanks to an increasing supply, as well as demand, especially from China, where the furniture industry is growing. Thai rubberwood is competitive in the global market due to its price and quality.
EIC sees increased potential for the local production of rubberwood furniture and other wooden products, which will help boost Thailand’s export value. Both the public and private sectors should join hands in research and development of new rubberwood products with an eye especially on design and branding.

February 16, 2019ZONEZI No commentsBusiness, News

The requirements and legal procedures involved in buying land in Thailand as a company (particularly with foreign shareholders) is quite complex. Siam Legal has therefore compiled this reference guide to help its corporate clients prepare the necessary documents and evidence required in order to avoid needless mistakes and costly delays when appearing before the Land Official for the transfer of ownership. The guide below can also generally apply to condominium transactions, except that foreign companies are not restricted from owning condominium units outright.

February 16, 2019ZONEZI No commentsNews, Real Estate

Foreigners cannot buy land in Thailand, only condominium units and apartments. Foreigners cannot make up more than 40% of the condominium’s unit-owners. However, a foreigner can buy a whole building, minus the land on which it is built.

In recent years, minor changes in Thai law have allowed nonresidents to explore the Thai real estate market. A foreigner can have a 30-year renewable lease, under which the buyer registers at the Land Office an option to renew the lease contract indefinitely, for further 30-year periods.

There are serious drawbacks, however. Lease renewals cannot be registered, and are not effective against a purchaser of the property. And the lessee cannot (without the lessor’s consent) sublease, sell or transfer his or her interest.

Another option is to set up a private limited company with mixed Thai and foreign ownership, the foreign ownership being 49% or less. Companies are allowed to own land. The foreign national can control the company by using a legal power of attorney from the Thai shareholders, handing control to the foreign directors, or through assigning greater voting rights to the foreigner partner/s. This is an effective and time-tested route, most commonly taken by foreigners. The help of a lawyer is very important.

Foreigners can also invest at least THB40 million (US$1,142,857) in a Board of Investment approved project. They will then be allowed to purchase up to 1 Rai (1,600 square meters) of land.

February 16, 2019ZONEZI No commentsNews, Real Estate

The luxury senior housing industry is dawning on the kingdom as more and more Thais retire in independence

Thailand is greying fast. The kingdom holds the highest share of elderly people of any developing nation in East Asia and Pacific, the World Bank reported. As it stands, 11 percent of the Thai populace, representing 7.5 million people, are aged at least 65 years. The figure in 1995 was 5 percent; by 2040, it will have increased to as much a fourth of the populace or 17 million people.

In any other market, the vintage of a populace would be a bonanza to property developers. But this is Thailand, land of multigenerational households; to capitalise on the astronomical growth of its geriatric demographic, one has to fight against a tide of ingrained mores.

As with many Asian countries, the notion of children booking their parents in retirement communities and nursing care homes was once unthinkable in the kingdom. If anything, empty nesters are loathe to leave their homes, many bequethed to them across multiple generations. Upwardly mobile children will simply hire private nurses and nursing aides as their caretaking proxies.

“Some people are getting around this by living in a condominium where they own units side by side,” said Kipsan Beck, managing director of the supertall MahaNakhon mixed-use project in Bangkok, at the first PropertyGuru Thailand Real Estate Summit. “But imagine that elderly people have some special needs. They need medical services on-call; they need slightly different furnishings from those for a 20- or 30-year old.”

Granted, the luxury senior housing market in the country remains “relatively small,” Jones Lang LaSalle reported in July. Slowly but surely, however, wealthy baby boomers are growing comfortable with the idea of active ageing, independent of family members.

“Senior living in Thailand is a key growth sector that we will see over the next 10 years,” said Andrew Gulbrandson, head of research and consulting at Jones Lang LaSalle Thailand.

Several consortia and joint ventures have made a headstart on such a captive market. In Chon Buri, the Sunplay Bangsaray project invites active retirees to live out their golden years in highly amenitised pool villas and condominiums alongside a 5,000-square-foot clubhouse. Along the beaches of Kamala in Phuket will rise MontAzure, a 454-rai mixed-use development whose central components include Kamala Senior Living, an upscale retirement community, as well as Thailand’s first Café del Mar.

Kamala Senior Living is geared toward leisure-oriented, high-net-worth property seekers of a certain age. “These are active retirees who would like to enjoy their lives,” said Jonathan Umali, director of project and asset management at Hong Kong’s ARCH Capital Management, a lead investor in MontAzure. “There are activities organised for residents, so that they have something to do every day. It’s like being in a cruise ship.”

February 16, 2019ZONEZI No commentsNews

The Thai government hopes a move to spark a shopping spree by offering tax breaks and cash handouts at the end of the year will improve economic stimulus in the fourth quarter.

The cabinet approved a tax break for shopping spending or spending on services during the festive season between December 14-31.

Bank of Thailand Governor Veerathai Santiprabhob said the tax breaks would be a smart short-term stimulus measure before major government projects were launched next year.

As such, they will have saved from 750 baht up to 5,250 baht in taxes for the 15,000 baht shopping spending, depending on their taxable incomes.

Veerathai said temporary factors affecting economic activities were lower agricultural prices, mainly rice, the crackdown on zero-dollar tours resulting in the decline in Chinese tourists and the mourning period for His Majesty the King.

The government needs a short- term stimulus measure to fuel |economic growth in the fourth quarter, he said.

The tax breaks should be a short- term tool because boosting spending will impact on future domestic demand, he said.

There is also a remedial measure to spur economic growth, with the government handing out Bt12.5 billion to the poor, or between Bt1,500 and Bt3,000 each person.

Mr Kobsak Phutrakul, assistant minister to the Prime Minister’s Office, said the government expected that the tax break would help boost spending during the festive season before year end.

No booze please

Shopping spending for the following items will not be eligible to tax break namely liquor, beer, tobacco, fuel oil and gas for vehicles and vessels.

Mr Kobsak said the measure would cost the government about 3.2 billion baht in revenue loss, but, on the other hand, would generate about 20 billion baht in circulation in the economic system or 0.2 percent of the GDP.

On top of that, the assistant minister to the Prime Minister’s Office claimed that the tax break would boost job creation and production until early next year.

Moreover, he said that the measure would encourage business operators to enter tax system which, in the long run, will benefit the government’s revenue collection in the future

Giving cash handouts to low income-earners

Three state-owned banks have started giving one-time cash handouts ranging from 1,500-3,000 baht to low income-earners in agriculture and non-farming sectors.

Government spokesman Lt-Gen Sansern Kaewkamnerd said over the weekend that he expected the payments to the qualified recipients to be completed before the year-end as New Year’s gift from the government.

He disclosed that there are altogether 6,981,000 qualified low income-earners who are eligible to receive the cash handouts to be wired directly into their bank accounts by the three banks, namely Krung Thai, Government Savings and Bank of Agriculture and Agricultural Cooperatives.

Those who earn less than 30,000 baht a year will receive 3,000 baht while those earn more than 30,000 baht but not exceeding 100,000 baht will get 1,500 baht. These one-time cash handouts are applicable for those in agricultural and non-agricultural sectors.

Source: Tax break on goods needed to fuel economy, says BOT chief

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February 16, 2019ZONEZI No commentsBusiness, News

The acquisition of land or a condominium unit in Thailand by a foreign government for official use, such as for use as an embassy or consulate, is not covered by any specific legislation. Therefore, assuming that a foreign government intended to acquire land or other immovable property in Thailand for official use, such an acquisition must be done by reciprocal agreement between nations, although not falling under the terms of Section 86 of the Land Code (as stated in Land Department Announcement No. 0610.4/893 issued on 2 August 1994). Furthermore, the Thai Cabinet has issued a number of resolutions on this matter which can be summarized as follows:

19 February 1958: According to this resolution where a foreign government wishes to purchase land for official use or for the use as a residence for their officials in an area not exceeding 15 rai, regardless of whether it is one plot or several, then the Land Department may proceed to allow the acquisition. If the amount to be purchased is more than the amount specified, then permission may sought from the Cabinet on a case by case basis.
1 April 1997: This resolution addressed the acquisition of land by social countires. Since the acquisition of land in Thailand by foreign governments had to follow the principle of reciprocity and since socialist governments do not allow foreign governments to acquire land in their countries, then accordingly Thailand could not allow socialist countries to purchase land in Thailand, but could only allow them to lease the land. However, due to the interest of maintaining stable relations with foreign countries, the Thai government would have to purchase the land from the private owner first and then enter into the lease agreement with the foreign socialist government.
An interesting issue arose when the Taiwan Economic and Trade Office in Thailand wished to purchase a land and building for official purposes. The Land Department considered the matter and concluded that the acquisition of land in Thailand by foreign government had to be done on the basis of reciprocity. However, since the Thai government had not recognized the sovereignty of Taiwan, the Thai government could not enter into any such reciprocal agreement with the Taiwanese government. Therefore, on 5 February 2000, the Cabinet allowed the Thai Economic and Trade Office to enter into an agreement with the Taiwan Economic and Trade Office regarding reciprocity in the purchase and acquisition of land for both parties.

The acquisition of land by foreigners is a complex legal subject in Thailand. Foreigners seeking to acquire land in Thailand are advised to consult with competent Thai legal counsel before proceeding.

February 16, 2019ZONEZI No commentsNews, Real Estate

IN THE PAST DECADE, Thai properties marketed overseas were either projects in prime downtown Bangkok or properties in top resort destinations such as Phuket.

Nowadays, visitors and investors are becoming more familiar with other non-prime locations in Bangkok through information from social media and digital communications.

New condominium property prices in downtown Bangkok have increased to an average of over Bt260,000 per square metre, with starting prices of over Bt10 million. The high Central Business District (CBD) prices combined with marketing efforts of non-prime locations by Thai developers, over the last two years, has increased awareness and interest from overseas investors in non-CBD Bangkok locations who are keen to invest in the fringe of the downtown areas or in midtown locations, especially along the extended mass transit lines where prices are more affordable than downtown areas.

The popular prices for these locations range between Bt3 to 10 million per unit.

February 16, 2019ZONEZI No commentsNews, Real Estate

Central Phuket opens for business

PHUKET: Central Pattana Plc (CPN), Thailand’s largest retail property developer, today (Sept 10) celebrated the grand opening of Central Phuket, its B20-billion luxury flagship mall.

CPN Deputy CEO Wallaya Chirathivat said, “Visiting Central Phuket will fulfil all types of lifestyles: eat, shop and have fun throughout the day.

“This project highlights our excellence on a global scale in three aspects: a ‘World-Class Project’ – it is a world-class mega project and Central Pattana’s luxury flagship store, a fulfilling shopping experience making Phuket the perfect ‘Beach Lifestyle Destination’; ‘World-Class Experience’ – creating a world-class experience to meet the ‘Luxury & Leisure Lifestyle’ travel trend of people from around the world, with a selection of global brands and launching international events throughout the year under the concept of ‘The World Comes to Play’; and ‘World-Class Attractions’ – the new destination for tourists from all over the world with the ‘World’s First Ever’ attractions,” she added.

“Central Phuket helps to emphasise us as a global player and it is in line with the provincial development policy to elevate Phuket to be one of the most complete travel destinations in the world,” Ms Wallaya noted.

The positioning of Central Phuket is set to be ‘The Magnitude of ‘Luxury & Leisure’ Resort Shopping Destination’, a seamless combination of Luxury and Leisure lifestyle in one place, a release issued today explained.

The entire project comprises the newly opened today ‘Floresta’ building, which focuses on tourists and customers “who prefer a luxurious lifestyle, enjoy shopping for leading brands and like to visit world-class attractions”.

Meanwhile, the already long well-known ‘Festival’ building aims to attract “family-group customers who regularly visit the shopping centre to shop, enjoy good food and watch movies”, the release added.

February 16, 2019ZONEZI No commentsNews

Thailand’s outbound investments

Thailand goes outbound. Thai investments abroad, also known as “Outward Foreign Direct Investments (OFDI),” have come in the focus while the domestic industry lags behind the stated targets. However, Thai-foreign business project registration clearance papers and requirements should be carefully observed.

Not only Thailand’s well-known public companies act as a global player when investing in foreign companies as a joint venture partner or financial investor. Even international conglomerates use their Thai affiliate company as the perfect vehicle for outward foreign direct investments. Also, Thai wealthy families and individuals are keen to invest abroad to mitigate the risk profile in their investment portfolio.

February 16, 2019ZONEZI No commentsBusiness, News

Cold Calling is, by some distance, the most controversial topic in the sales community right now.

There’s been a lot of articles written about it and everyone has strong opinions. Most people are talking from personal experience and some with the benefit of having run a team.

I work for a company that makes more than 40,000 cold calls per week, to all parts of the globe. Does that give me more insight than most? I’m not sure, but here’s my tuppence worth to add to the debate, tell me what you think once you’ve read about what we’ve learned.

First the good news – it does still work – no matter what anyone tries to tell you.

Now the bad; cold calling isn’t easy and never will be…period. But the worst thing about it? The time it takes.

Does that time make it a viable way for an expensive BDM to spend their time? Again, things aren’t as black and white as most arguments I’ve seen and read. The genuine answer is; it depends.

On what?

Geography is, perhaps surprisingly, one of the biggest variables. Both where you are calling to and from. Brand recognition is huge. Having an engaging story is way more important than your product. Saturation plays a part – we know this more than most as a telemarketing agency – I’m not sure there’s a marketing or sales director (our usual KDM’s) who hasn’t been called a thousand times by telemarketing agencies. Timing is more important than people give it credit for. Data is the essential fuel required for cold calling. Ability is important, experience less so. What you say isn’t nearly as important as how you say it (despite the endless articles about what words to use). But attitude is, by some distance, the biggest single determinant of a successful outcome.

Before I go any further – we need to define what I’m talking about when I say cold call.

I went to see Joanne Black give a talk this morning (thanks John Smibert and Tony Hughes for inviting her Down Under) and I agree with Joanne’s definition as; someone who I have never spoken to, who doesn’t know me and whom I’m now calling out of the blue.

Everything else has caveats.

Talking of caveats or perhaps disclaimers – I had better cover some of those before I go any further. These are my personal observations made from watching, hearing and getting results on the more than 40,000 cold calls we, as in the company I work for, make every week to various parts of the world. What I’m sharing are generalisations. But I won’t share data, as my boss wouldn’t dream of letting me, and I doubt our clients would be very happy if I did. I see exceptions to everything I’m about to say… every single day.

February 16, 2019ZONEZI No commentsBusiness, News