Investment opportunity in Thailand is limited : investors

Investment opportunities are more limited in Thailand than countries like Indonesia, the Philippines and Malaysia partly because of the government's tight conฌtrol on infrastructure investment and the political uncertainty, investors and economists said yesterday.

Thailand did not change over the past five years while it was engaged in internal issues such as trouble in the deep South and political unrest, said Dean Van Drasek, executive director of the LIM Advisors, a Hong Kongbased hedge fund.

The government tended to monopolise investment in infrastructure, which posed an obstacle to private investment and a high cost to the taxpayer.

Indonesia has adopted a wiser policy of providing incentives for private investors to join in infrastructure projects.

The Indonesian government also gives cash handฌouts to lower income groups, which costs less than preฌvious commodity subsidy projects.

The Philippines has successfully liberalised its enerฌgy sector, he told The Nation on the sidelines of a Euromoney conference.

Foreign investors have an appetite for deals in Thailand. His fund often buys debts and provides loans to Thai firms in the real estate, infrastructure and agriฌcultural fields, he said.

This country enjoys an edge in the auto, integrated circuit and healthcare industries, but its universities could not turn out enough engineers, medical doctors and nurses.

These industries face a skilled labour shortage, conฌstraining expansion, he said. Some investors may conฌsider moving to China or Vietnam where they can find more engineers.

As physicians are drawn by higher pay to cities, peoฌple in rural areas will not be able to get access to medฌical services, he added.

Rajeev de Mellor, head of Asia bonds at Western Asset Management, praised the government's plan to open up the capital market, saying it was moving in a positive direction.

Foreign investors will come back to the stock marฌket as economic fundamentals improve. Low interest rates, high liquidity and cheap shares attract investors, he added.

Pimonwan Mahujchariyawong, assistant managing director of Kasikorn Research Centre, said political turmoil over the past few years and this year was a drag on the economy.

Sethaput SuthiwartNarueput, executive vice presฌident and chief economist at Siam Commercial Bank, said Thailand relied too heavily on exports, while it could not boost domestic demand much because real wages have not increased much.

Real wages do not rise because labour productivity is low. Training and education would improve labour productivity, he said.

Subhak Siwaraksa, CEO of CIMB Thai Bank, said his bank started to pick up its lending business over the past few months following a successful capitalraising drive.

He said he would focus on the export and infraฌstructure sectors.

He expects the government will need to borrow to finance infrastructure project next year.