Thailand Update: October 18, 2018

Thailand Update | October 18, 2018
Authors: Riley Smith, Ella Duangkaew, Monica Chritton
 
LOOKING AHEAD
 
 

October 19, 2018: First Planning Call for Business Mission to 24th ATM

October 29, 2018 - November 2, 2018: Singapore International Energy Week (SIEW) 2018

October 30, 2018 - October 31, 2018: 2018 Mission to the ASEAN Ministers on Energy Meeting (AMEM)

November 8, 2018 - November 9, 2018: 2018 Business Mission to the 24th ASEAN Transport Ministers Meeting

December 4, 2018 - December 6, 2018: 2018 Business Mission to the 18th ASEAN Telecommunications and Information Technology Ministers Meeting (TELMIN)

April 1, 2019 - April 4, 2019: Mission to the 2019 ASEAN Finance Ministers' and Central Bank Governors' Meeting

 
THE COUNCIL'S TAKE
 
 

Thailand Considers Cigarette Tax

The Ministry of Public Health proposed a cigarette tax of 1-2 baht per packet that is intended to raise revenue for the Health Insurance Fund and to dissuade the purchase of cigarettes. However, in a public response to this proposal, the Ministry of Finance, which would oversee implementing the tax, said that it was not aware of the proposal prior to the Ministry of Public Health’s announcement, and that such a tax proposal might be inconsistent with Thailand’s tax laws.  Given the above, the proposal still has a way to go if it were to be implemented.

According to the Bangkok Post, Minister of Finance Apisak Tantivorawong said he had not been notified of the proposed tax increase, and that “such a law cannot be drafted until it is assessed to be in accordance with the Fiscal Discipline Act.” According to Minister Apisak, the Act “does not permit other state agencies to propose an earmarked tax reserved solely for a specific group or usage,” meaning that the proposed cigarette tax must first be approved by the Finance Ministry. Tantivorawong also stated that the Ministry of Public Health was seeking funding for its Universal Coverage (or “gold cards”) scheme, and that using a potential public health concern such as cigarettes may be a way to raise some of the necessary revenue. Director General of the Excise Department Patchara Anuntasilpa also said that he was also not aware of the proposed cigarette tax increase. In addition, the Ministry of Public Health has thus far not been able to offer much clarity on the proposed tax increase, particularly its development and implementation timeline.

The proposed tax would be the latest measure intended to continue Thailand’s efforts to reduce smoking. According to Public Health Minister Dr. Piyasakol Sakolsatayadorn, up to 50,000 people die from smoking-related illnesses per year in Thailand. Additionally, the 2017 World Health Organization (WHO) reports on the global tobacco epidemic found 20.7% of Thai adults and 15% of youth were tobacco smokers respectively. The WHO recognized Thailand’s leading role in drafting the WHO Framework Convention on Tobacco Control (WHO FCTC), which it signed and ratified in 2005. In 2017, Thailand passed its Tobacco Products Control Act to prevent youth from smoking, limiting smoking areas and banning tobacco marketing, advertising and corporate social responsibility activities.  

Thai Commerce Ministry Launches Feasibility Study on Blockchain Applications

Thailand’s Ministry of Commerce announced plans to launch feasibility studies on the application of blockchain technology to intellectual property (IP) registration, agriculture supply chains and trade finance. The feasibility studies, which are expected to conclude by February 2019, are just the latest example of Thailand’s interest in fostering the use of blockchain technology in the country, which could potentially set Thailand up to be a leader in the region on the use of the technology.

The benefit of blockchain, according to Pimchanok Vonkorpon, Director-General of the Trade Policy and Strategy Office (TPSO) under the Commerce Ministry, is increased transparency and efficiency in business operations. The topics covered in the IP feasibility study will include registration, protection and smart contracts via blockchain. In addition to the feasibility studies on IP and trade finance, TPSO aims to apply the regulatory sandbox approach the use of blockchain for organic rice export processing to encourage experimentation and innovation. The ultimate goal would be to increase trust and transparency while reducing costs and delays in the export process, with processing potentially being reduced to less than three days, according to  Vonkorporn.

Thailand’s government overall appears to recognize the potential of blockchain technology, including its use in cryptocurrencies. TechCrunch reported that Thailand’s government is already mapping out its own central bank digital currency, called Project Inthanon, and the Thai government has become increasingly outspoken and welcoming of cryptocurrency projects and exchanges. Thailand has also delivered licensing services and permits exchanges for cryptocurrency companies. In June, the SEC laid out guidelines to allow seven cryptocurrencies to be used as trading pairs, following the enactment of a 100-section emergency decree in May detailing the requirements for the authorized use of cryptocurrency.

Thai State Agencies to Urge Prime Minister to Amend Latest Draft Cybersecurity Bill

Thailand’s National Cybersecurity Committee and Thailand Information Security Association (TISA) reportedly plan to urge Prime Minister Prayut Chan-o-cha and the National Legislative Assembly (NLA) to amend the most recent draft of Thailand’s Cybersecurity Bill, citing concerns that it could have a potentially negative impact on business and privacy. In principle, the Bill is intended to strengthen Thailand’s cybersecurity and protect users and critical information infrastructure (CII). However, the National Cybersecurity Committee has said that changes should be made to strengthen the Bill’s protections for businesses and better clarify the regulatory powers granted to the proposed Cyber Security Agency (CSA).

If passed, the Bill will form a regulatory agency, the Cyber Security Agency (CSA), tasked with implementing the Bill. According to the Bangkok Post, General Bunjerd Tientongdee of the National Cybersecurity Committee raised concerns over three aspects of the Bill:

  • How the degree to which the Secretary-General of the National Cybersecurity Committee is empowered to direct the search of and access to other computer systems could negatively affect business confidentiality;

  • The blurring of the lines between the CSA’s role as a regulator and its potential role as an operator given that the Bill gives it the ability form a joint venture and request financial loans for operations; and

  • The lack of appeal process for defendants, especially given that penalties could include fines and potentially imprisonment.

Other members of the National Cybersecurity Committee echoed these concerns, highlighting the Bill’s good intentions, but noting its lack of clarity in how it would be implemented due to broad and vague language. Members of this state body pointed out a lack of outside input in the Bill’s drafting process and the granting of excessive powers to the CSA, including the lack of a court warrant process in cases where the CSA can access and seize computers or computer systems.

In addition to the proposed Cyber Security Bill, Thailand has recently undertaken several other initiatives aimed at building its cybersecurity regulatory environment and capacity, including a recent Personal Data Protection Bill, the launching of an ASEAN-Japan Cybersecurity Capacity Building Centre, and approving a National ID Bill.

A public consultation for the most recent draft of the Cyber Security Bill ended on October 12. As part of that public consultation, the Council solicited input from member companies and submitted the consolidated feedback to the Ministry of Digital Economy and Society (MDES). The Council also submitted comments on a previous version of the Bill on April 17.  

 
ADVOCACY UPDATE
 
 
  • On October 12, the Council submitted industry comments on Thailand's revised draft Cybersecurity Bill. Please contact Praab Pianskool (praab@usasean.org) and Ella Duangkaew (eduangkaew@usasean.org) with any questions, or for a copy of the submission.
 
IN THIS UPDATE
 
 

Regional Affairs
FTA talks being accelerated
Air of anticipation over Dr M's visit to Thailand later this month
Four Asean nations to lift barriers to cross-border investment advisory
Abe pledges to promote free trade with Thailand, offers legal and political assistance to Cambodia
Thailand's twin challenges as Asean chair
PM Prayut donates 5 million baht as foreign aid picks up for Indonesia’s quake survivors

National Affairs
Organizations' recommendations for Senators now being accepted
State to pay unpaid SSO contributions
NBTC's No.2 quits for politics
Thailand Will Hold February Election, Prime Minister Tells Abe
EC will dissolve Pheu Thai if probe finds Thaksin controls it

Defense & Security
Prawit to meet Mattis ahead of Vietnam trip
Sri Lanka seeks to strengthen defense cooperation with Thailand

Economics
Exporters improve FTA and GSP use
Cabinet gives green light to draft on small businesses
Bank of Thailand Sees Economy Capable of Absorbing Rate Hike
Win Streak Likely To End For Thai Stock Market
Thailand to tighten home loans to curb risks

Energy
Excise Department to conclude EV tax rules soon
Energy Ministry to find fuel pricing aid for low-income motorcycle taxi drivers

Food & Agriculture
Japanese angle for fish processing hub
New agricultural extension chief appointed in seven-official reshuffle
Thai government pushes reform in agriculture sector
Chemical residue warning on Thai fruit and vegetables
Ministry to compensate rubber growers

Health & Life Sciences
Latest tax break covers B60k of prenatal care, childbirth costs
Thai schools to be banned from expelling pregnant students
New law offers unprecedented medical benefits for workers

ICT
TFA: Fintech law to be enacted this year
Premier dismisses cyber bill criticism
Undisclosed online prices targeted
Nectec academy formed to help train IoT skill set
SET backs automated reports
Thailand paces region in CMMI-certified software
Bangkok CyberTech District seen as ‘game changer’
Commerce studies blockchain benefits
EEC panel gives nod for digital push

Infrastructure
IEAT targets new Sadao SEZ investment of B20bn
Thailand's Suvarnabhumi airport sees US$4.3 billion expansion as arrivals rise

Travel & Tourism
Travelers Spend More Money in Thailand Than Anywhere Else in Asia
Air safety plan won't be ready until 2022
Three Cities in Thailand among the 20 Most-visited Destinations in the World

 
ARTICLE CLIPS
 
 
Regional Affairs

FTA talks being accelerated Bangkok Post 16th Oct 2018
Negotiators are revving up free trade talks with dialogue partners for the remaining months this year and look set to resume talks with the EU and join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a newly formed bloc of 11 Pacific Rim nations excluding the US, next year. Auramon Supthaweethum, director-general of the Trade Negotiations Department, said Thailand is scheduled to hold the third round of free trade talks with Sri Lanka on Dec 17-22.

Air of anticipation over Dr M's visit to Thailand later this month New Straits Times 14th Oct 2018
There is an air of anticipation over the forthcoming visit by Malaysian Prime Minister Tun Dr Mahathir Mohamad to Thailand later this month, especially in bringing the much-needed progress into the ‘deadlocked’ southern Thai peace talks.

Four Asean nations to lift barriers to cross-border investment advisory The Straits Times 11th Oct 2018
South-east Asian financial regulators have agreed to allow cross-border investment advisory services and to set standards for social and sustainability bonds, according to announcements from the Asean Capital Markets Forum (ACMF) in Singapore.

Abe pledges to promote free trade with Thailand, offers legal and political assistance to Cambodia The Japan Times 9th Oct 2018
Prime Minister Shinzo Abe and his Thai counterpart Prayuth Chan-ocha on Monday confirmed their cooperation in promoting free trade, with the Southeast Asian country expressing its readiness to join the 11-nation Trans-Pacific Partnership that Japan has helped spearhead.

Thailand's twin challenges as Asean chair The Straits Times 9th Oct 2018
Unlike its peers in South-east Asia, Thailand's chairmanship of Asean next year will face challenges not just from the regional neighbourhood and the world beyond, but also from home soil where divisions and polarisation have destabilised the country for more than a decade. The last time Thailand held its rotational turn at Asean's helm from July 2008 to December 2009, it was marked by street protests that ended up disrupting top-level meetings and abruptly sending Asia-Pacific leaders home prematurely. This time, Thailand will have plenty to be worried about at home, but well short of the protests that marked its hosting a decade ago.

PM Prayut donates 5 million baht as foreign aid picks up for Indonesia’s quake survivors Thai PBS World 5th Oct 2018
Prime Minister Gen Prayut Chan-o-cha this morning made a donation of 5 million baht to help victims of Indonesia’s earthquake and tsunami as international efforts to assist the Indonesian government to deal with the devastating natural disasters gathered pace amidst concerns over hundreds of thousands with little food and water.

National Affairs

Organizations' recommendations for Senators now being accepted National News Bureau of Thailand 17th Oct 2018
The Election Commission (EC) has begun accepting Senator recommendations from registered organizations, reminding participants that applications must be accompanied with all required documentation and that they will be accepted until October 24.

State to pay unpaid SSO contributions Bangkok Post 16th Oct 2018
The government plans to gradually pay unpaid contributions amounting to 56 billion baht to the Social Security Office in compliance with the Fiscal Responsibility Act, says the Budget Bureau's chief. The payment will be made based on the assumption new pension recipients of the Social Security Fund (SSF) will match the inflow with the outflow, said Dechapiwat Na Songkhla, the Budget Bureau director. The government's financial liquidity will also be taken into account for the payment as it has an investment burden.

NBTC's No.2 quits for politics Bangkok Post 11th Oct 2018
Settapong Malisuwan has quit as vice-chairman of the National Broadcasting and Telecommunications Commission (NBTC) to pursue a political career in the Bhumjaithai Party. Col Settapong tendered his resignation letter to the NBTC Wednesday with immediate effect, he said.

Thailand Will Hold February Election, Prime Minister Tells Abe Bangkok Post 9th Oct 2018
Thailand will hold a general election in February, Prime Minister Prayuth Chan-Ocha told Japan Premier Shinzo Abe during a meeting in Tokyo. “Prime Minister Prayuth assured that the Thai government has progressed on the path to sustainable democracy,” Prayuth said, according to a statement from the Southeast Asian nation’s military administration. “There will be an election in February.”

EC will dissolve Pheu Thai if probe finds Thaksin controls it Bangkok Post 9th Oct 2018
The Election Commission (EC) has threatened to dissolve Pheu Thai if an inquiry into a meeting of party members with former prime minister Thaksin Shinawatra in Hong Kong finds the party let a non-member or outsider interfere in its internal affairs.

Defense & Security

Prawit to meet Mattis ahead of Vietnam trip Bangkok Post 16th Oct 2018
Deputy Prime Minister and Defence Minister Prawit Wongsuwon will meet US Secretary of Defence James Mattis on the sidelines of the 12th Asean Defence Ministers Meeting (ADMM) in Singapore, a Defence Ministry spokesman said. The US Secretary of Defence is among eight dialogue partners who will attend the ADMM-Plus meeting to discuss a wide range of military cooperation issues with their Asean counterparts.

Sri Lanka seeks to strengthen defense cooperation with Thailand Colombo Page 11th Oct 2018
Oct 11, Colombo: Sri Lanka's State Minister of Defense Ruwan Wijewardene has stressed the importance of strengthening defense cooperation with Thailand during an official visit to the Asian country.

Economics

Exporters improve FTA and GSP use Bangkok Post 17th Oct 2018
Thai exporters have done a better job of using free trade agreement (FTA) privileges and the Generalized System of Preferences (GSP), with the Commerce Ministry expecting utilisation of the two schemes to top US$70.8 billion (2.31 trillion baht) at year-end, up 10% from last year.

Cabinet gives green light to draft on small businesses The Nation 16th Oct 2018
In a meeting yesterday, the Cabinet approved drafts that will add legal conditions to support small- and medium-enterprises (SMEs), allow the setting up of trade associations and raise registration fees to help cope with the country’s economic situation. These drafts will also amend the existing 1966 laws to help with the liberalisation of capital movement and labour, as well as promote SMEs, the PM’s adviser Nattaporn Jatusripitak said.

Bank of Thailand Sees Economy Capable of Absorbing Rate Hike Bloomberg 11th Oct 2018
Thailand’s economy is solid enough to handle an interest-rate increase and expectations of tightening this quarter are already partially reflected in the strength of the baht, according to the central bank.

Win Streak Likely To End For Thai Stock Market Nasdaq 10th Oct 2018
The Thai stock market has tracked higher in back-to-back trading days, advancing more than 25 points or 1.5 percent along the way. The Stock Exchange of Thailand now rests just above the 1,720-point plateau although it's expected to run out of steam on Thursday.

Thailand to tighten home loans to curb risks Reuters 5th Oct 2018
Thailand’s central bank will tighten mortgage requirements for residential property to curb risks and speculation in the housing market, an assistant governor said on Thursday.

Energy

Excise Department to conclude EV tax rules soon Bangkok Post 16th Oct 2018
The Excise Department expects to conclude a tax structure for electric vehicles (EVs) in the next couple of months, says its newly appointed head. "A new working panel chaired by me has been set up, and I confirm taxes for EVs will not be delayed, and should become clearer in the next 1-2 months as operators want need some guidance to plan their investment," said director-general of the Excise Department Patchara Anuntasilpa.

Energy Ministry to find fuel pricing aid for low-income motorcycle taxi drivers Pattaya Mail 15th Oct 2018
Energy Minister, Dr. Siri Jirapongphan, said his ministry has been assigned by the cabinet to discuss with PTT and oil station operators details of a campaign to help maintain fuel prices for low-income motorcycle taxi drivers holding the state welfare cards and registered with the Department of Land Transport.

Food & Agriculture

Japanese angle for fish processing hub Bangkok Post 17th Oct 2018
The Japan External Trade Organization (Jetro) aims to persuade Japanese seafood investors to set up a seafood processing hub in Thailand in a bid to expand into new markets in Southeast Asia and the Middle East. Thailand has strong competition in the Japanese food segment and can serve as a gateway to other countries, said Hiroki Mitsumata, president of Jetro Bangkok.

New agricultural extension chief appointed in seven-official reshuffle The Nation 16th Oct 2018
The Cabinet has approved the promotion of the deputy director-general of the Agricultural Extension Department, Samrarn Saraban, to the position of director-general, Agriculture Minister Krissada Boonraj said on Tuesday. Samrarn is among seven senior officials of the Agriculture Ministry whose reshuffle has been approved by the Cabinet, he added.

Thai government pushes reform in agriculture sector Asia Times 11th Oct 2018
The Thai government is pushing ahead with plans to increase the incomes of 1.3 million farmers who have been relying on their rice crops to make a living. Krisadaa Bonraat, who is in charge of the Ministry of Agriculture and Cooperatives, on Wednesday revealed a productivity and marketing plan aimed at improving the livelihoods of farmers plagued with low prices for their produce due to oversupplies.

Chemical residue warning on Thai fruit and vegetables Asia Times 8th Oct 2018
Some fruit and vegetables in Thailand contain high levels of pesticide, a medical researcher at a leading university has warned, while the Ministry of Health and the Ministry of Agriculture and Cooperatives have singled out six items containing high levels of chemical residue.

Ministry to compensate rubber growers The Nation 5th Oct 2018
The Agriculture and Cooperatives Ministry is planning to offer Bt3,000 compensation per rai to rubber growers who agree not to tap rubber latex in their plantations for three months. “This is a planned measure to tackle falling rubber prices,” Agriculture and Cooperatives Minister Grisada Boonrach said yesterday.

Health & Life Sciences

Latest tax break covers B60k of prenatal care, childbirth costs Bangkok Post 17th Oct 2018
The Revenue Department is letting individual taxpayers claim an income tax deduction for prenatal care and childbirth expenses of up to 60,000 baht per tax year, with retroactive effect from Jan 1 this year, according to a department announcement. The new tax deduction is aimed at encouraging people to have more children as Thai society ages.

Thai schools to be banned from expelling pregnant students Channel News Asia 15th Oct 2018
Schools and higher education institutes in Thailand will be prohibited from expelling pregnant students from April 2019, according to local media reports.

New law offers unprecedented medical benefits for workers The Nation 14th Oct 2018
Nearly 10 million Thai employees nationwide would enjoy enhanced healthcare benefits under the Workmen’s Compensation Act (second edition 2018).

ICT

TFA: Fintech law to be enacted this year Bangkok Post 17th Oct 2018
The Fintech Act is expected to be announced and become effective by the end of this year, making it easier for the public to process information and create a fintech platform, says the Thai Fintech Association (TFA). TFA chief executive Anon Aunsinmun said the law will make it easier for investors, financial institutions and the public to obtain information and data from government organisations, although this is not personal information.

Premier dismisses cyber bill criticism Bangkok Post 17th Oct 2018
Prime Minister Prayut Chan-o-cha has defended the proposed cybersecurity law despite a public outcry that it would allow the state to search, penetrate, and seize computer systems without a court warrant. Public concern has grown as a result of speculation the government aims to approve the bill soon so that it can be scrutinized by the National Legislative Assembly (NLA) this month.

Undisclosed online prices targeted Bangkok Post 16th Oct 2018
The Commerce Ministry has threatened to take legal action against online traders who do not disclose their price tags and opt to relay prices through online messages. A source from the Commerce Ministry who requested anonymity said the ministry has received lots of complaints from customers about online purchases, especially via Facebook, where the sellers choose to inform buyers of the prices via online messages.

Nectec academy formed to help train IoT skill set The Nation 15th Oct 2018
An Internet of Things (IoT) Academic Network is being set up through a collaboration involving the National Electronic and Computer Technology Centre (Nectec) and 23 educational institutes and schools to develop human resources in the country. The move is aimed at helping the country cope with the high demand for human resources in the coming years.

SET backs automated reports Bangkok Post 15th Oct 2018
The Stock Exchange of Thailand (SET) will talk with other capital market organisations this week and seek ideas for boosting the number of analysts and increasing the overall quality of Thailand's capital market. Besides helping to set up an academy fostering a new generation of analysts, the bourse will support automated reports delivered by an artificial intelligence (AI) tool.

Thailand paces region in CMMI-certified software Bangkok Post 11th Oct 2018
Thailand ranks No.1 in Asean for a third straight year with the highest number of software firms receiving CMMI global certification in software development. The trend has helped increase the quality of local software and startup competitiveness amid digital transformation and the rise of emerging technologies, said the National Science and Technology Development Agency (NSTDA).

Bangkok CyberTech District seen as ‘game changer’ The Nation 10th Oct 2018
The National Innovation Agency (NIA) in collaboration with True Digital Park is launching the Bangkok CyberTech District in the Punnawithi area. The agency expects to invite around 50 international startups per year to set up base in Thailand.

Commerce studies blockchain benefits Bangkok Post 9th Oct 2018
The Commerce Ministry has launched a feasibility study to apply public blockchain solutions to copyright management, with plans to expand to agriculture and trade finance to boost the country's competitiveness and credibility, particularly for small business.

EEC panel gives nod for digital push The Nation 7th Oct 2018
The steering committee of the EEC Development Policy last week acknowledged the proposal of the Digital Economy and Society Ministry to develop the digital and communications infrastructure on the Eastern Economic Corridor with a budget of more than Bt17.913 billion. The committee meeting was chaired by Prime Minister Prayut Chan-o-cha. Kanit Sangsubhan, secretary-general of the EEC Office of Thailand, said that the meeting also assigned the ministry and related agencies to rush to implement the project as proposed by the ministry.

Infrastructure

IEAT targets new Sadao SEZ investment of B20bn Bangkok Post 16th Oct 2018
The Industrial Estate Authority of Thailand (IEAT) is confident a new special economic zone (SEZ) in Sadao, Songkhla will be able to attract investment worth 20 billion baht and create roughly 6,000 jobs. The Sadao SEZ will start development in the fourth quarter, said Somchint Pilouk, governor of the IEAT.

Thailand's Suvarnabhumi airport sees US$4.3 billion expansion as arrivals rise Channel NewsAsia 11th Oct 2018
Airports of Thailand Pcl (AOT) plans to invest 140 billion baht (US$4.26 billion) to expand the country's main airport as it expects an increase in passenger arrivals, a senior executive said on Monday (Oct 8).

Travel & Tourism

Travelers Spend More Money in Thailand Than Anywhere Else in Asia Bloomberg 10th Oct 2018
Last year, it collected $57 billion in international tourism receipts, nearly doubling Macao ($36 billion), Japan ($34 billion), Hong Kong ($33 billion), and China ($33 billion). Globally, the only countries that out-earn Thailand in terms of tourism dollars are France ($61 billion), Spain ($68 billion), and the United States—which handily takes the gold medal, at $211 billion. It all comes down to volume. Foreign arrivals could hit 40 million next year, which is more than half the country’s population.

Air safety plan won't be ready until 2022 Bangkok Post 10th Oct 2018
Air transport officials of the Civil Aviation Authority of Thailand (CAAT) said Tuesday they will have an official air safety master plan, but not before 2022.

Three Cities in Thailand among the 20 Most-visited Destinations in the World Pattaya Mail 7th Oct 2018
Bangkok, Phuket, and Pattaya, have been listed among the 20 most-visited destinations in the world, according to Mastercard’s Global Destination Cities Index (GDCI) 2018.