ASEAN KEY DESTINATIONS
International earnings rise at SCG
Kalin Sarasin, the managing director of SCG Trading Co, says the Pheu Thai Party's proposed cuts to local corporate income tax rates would help keep Thailand competitive.
"Free trade under the Asean Economic Community (AEC) by 2015 means free flow of capital and human resources, with Thailand's geographical location benefiting the kingdom as a regional hub," said managing director Kalin Sarasin.
"We have to make sure that our tax incentives are not just competitive but more favourable than Singapore's so that foreign companies and expatriates are willing to come invest and work here." Lowering the corporate income tax as proposed by the Pheu Thai Party will help Thailand stay ahead of regional rivals, especially Singapore, Mr Kalin said.
Burma's Dawei megaproject will also drive demand for building materials in neighbouring countries, while Thai products could be shipped via the Thai border with Burma in Kanchanaburi to a deep-sea port in Dawei for export to bigger markets such as India and Bangladesh.
Thailand's top industrial conglomerate currently exports products including cement, tiles and roofing materials to Burma. It plans to open an office in Dawei in the coming years, Mr. Kalin said.
At present, SCG Trading has 36 branches in 25 countries including Thailand, with plans to open six more next year in New Zealand, eastern Malaysia, Japan, South Korea, western Europe and western Africa.
In the first five months of this year, SCG Trading posted sales of 19 billion baht, up 6% from the same period last year on expansion of distribution networks in Cambodia, Laos, Burma and Vietnam. The company targets total turnover of 50 billion baht this year, an increase of 18% from 2010, with its three core business units of coal, building materials and recycling.
"We are seeing the improvement of some business in the latter half," Mr Kalin said.
"Steel scrap, for example, which saw demand and price weaken in the first half of the year, is recovering with China starting to import more," he said. "For building materials, meanwhile, we expect larger demand growth in the latter half from markets such as Burma, Vietnam, Cambodia, Laos and India."
In the Philippines, SCG Trading will develop two more baling stations for paper recycling as part of a joint venture.
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