Minimise costly regulations, BOT urges

“Since the country is undergoing reform, it might be a good time for us to reform our regulations as well,” she said. 

Roong was speaking yesterday at the “OIE Forum 2014 – Reform Industry: Reform Thailand” seminar organised by the Office of Industrial Economics and Krungthep Turakij newspaper. 

She explained that a good regulation was one that is clear in its aim and credible in terms of transparency. Rules and regulations should be applied to one and all equally. They should also not overlap between different agencies, which only complicates matters, and when a regulation is amended, all sides should be listened to before changes are made. 

“A good regulation should not create unnecessary costs,” she said. “If Thai businesses want to move their manufacturing base to another country ahead of the Asean Economic Community, then regulations should not block their way or lock down resources, because forcing assets to stay in one place for too long can create obstacles in negotiations and transferring assets between companies.”

 

WEF findings 

Roong cited a finding by the World Economic Forum that every Asean country, with the exception of Singapore, had the same problems with investments, and that these problems were posed by government regulations that do not facilitate business and create a burden due to inefficiency and red tape. This, she said, slowed down the progress of business development. 

Another finding from the World Bank showed that some regulations in Thailand made it tough for companies, especially small and medium-sized enterprises, to gain access to financing because of the lack of credit information and problems with the financial clearing process, which is still too slow. The process of starting a new business is also very sluggish, so there is a need to set up one-stop service centres. Plus, there are far too many levels at which business operators have to pay taxes, compared with neighbouring countries. 

“Businesses in Thailand have to pay taxes at least 22 times, and it takes around 262 hours a year to pay them, while businesses in Malaysia only pay taxes 13 times and it only takes them 133 hours,” she said. 

Thawatchai Hengprasert, vice chairman of border trade promotion at the Federation of Thai Industries, agreed that the government needed to set up a one-stop service to handle the start-up process for new businesses and investments, since the current process takes too long. For instance, he said, a new business first needs to seek approval from many agencies before it can even start building or producing, and this delay costs time and money as it has to pay loan interest during this period.