Govt bid to restore investors' faith

"We need measures to rehabilitate the inundated factories so they can resume production as soon as the water subsides," Deputy Prime Minister Kittiratt Na-Ranong said yesterday. 

The Finance Ministry plans to allow damaged factories to deduct losses from corporate taxes, he said after meeting with several economic ministers, Board of Investment secretary-general Atchaka Sribunruang and Federation of Thai Industries chairman Payungsak Chartsu.

Kittiratt also promised sufficient loans and loan guarantees for affected companies.

Finance Minister Thirachai Phuvanatnaranubala would discuss with commercial banks about setting special loan rates and repayment conditions, he added.

Payungsak said clean-up centres should be established at each zone, while the government should remove any regulatory obstacles. 

"From the discussion today, I have the impression that the financial assistance is sufficient to rehabilitate the manufacturing sector quickly.

“But what concerns foreign investors the most is the government's short- and long-term plans for water management. This should be on the national agenda," he said. The severe flooding has caused widespread supply problems among industries in both inundated and other zones, he added.

Cooperation from all parties is needed, as rehabilitation must be planned for small and large firms through the entire supply chain.

With support from the military, police and public, the rehabilitation effort would replenish the confidence of the foreign community, he added. 

Among some measures announced earlier, affected plants in export-oriented zones are now allowed to relocate their machinery and inventory without the BoI's approval. Import duties on replacement machinery will be waived and the work permit process will be facilitated for technicians needed to check production equipment.

Atchaka said the BoI is asking for the Cabinet's approval for a cut in corporate income tax. A 

package will also be proposed to help industrial estates finance new infrastructure to prevent 

another disaster. 

"The most important thing now is to restore the confidence of industries in inundated industrial estates, so that their existing investment will stay and new investment will flow in," she said.

Kittiratt will tomorrow convene a meeting at the Stock Exchange of Thailand with Industry Minister Wannarat Charnnukul and representatives of industrial estates. 

The government was allowing retailers to start using Don Mueang Airport's warehouse today as a distribution centre, to ease the shortage in consumer goods caused by people stocking up ahead of floods. This is exacerbated by the closure of several distribution centres in Ayutthaya’s Wang Noi district.

From the airport’s cargo terminal covering 30,000 square metres, consumer goods could reach retail outlets within 48 hours, he added.