TMB Appoints banking agent in Laos

A Laotian businessman said |that though labour there is cheaper, the supply of workers is limited because of the country’s small population.

Boontak Wangcharoen, chief executive officer of TMB, said BECL, the largest commercial bank in Laos, would provide trade-finance and cash-management services to TMB’s clients.

The move is part of the bank’s strategy to take advantage of the Asean Economic Community, the regional single market that will kick off in 2015.

Many Thai investors are expected to relocate or expand their business into Laos to take advantage of cheap labour and the rich natural resources, farm products and hydroelectricity. TMB also plans to create a banking network in Indonesia, Malaysia and Singapore, Boontak said.

Vanhkham Voravong, general managing director of BCEL, said his bank had signed a similar agreement with Kasikornbank and a bank in Vietnam.

He said BCEL could provide financial services via its 18 branches across the country. He plans to seek more collaboration in Asean. Currently TMB clients doing business in Laos are CP Foods, which is engaged in feed-meal production and livestock, and Nanyang Textile, which exports sportswear and children’s apparel.

TMB also advanced loans of Bt450 billion to the Laos-based Dao-Heuang Group, which operates a duty-free business and exports coffee products.

Sisouphonh Sihalath, managing director of Dao-Heuang, said that labour costs in Laos were lower than in Thailand.

However, his firm has to hire some Vietnamese labourers to work on the 250-hectare coffee plantation as Laos’ small population of 6 million provides only a limited workforce, especially skilled labour, he said.