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NEWS UPDATES Asean Affairs        12  April 2011

Thai logistics upgrades needed

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Improving the quality of logistics, especially truck transport,will help Thailand significantly cut logistics costs and damages from accidents as road transportation is the most popular means of goods transportation.

Thailand's logistics costs in 2009 amounted to 1.518 trillion baht, with 746.5 billion going to transport, 49.2 percent of the total, 633.3 billion for inventory costs (41.7 percent) and 138.2 billion for logistics administration (9.1 percent).

Tharadol Piempongsan, deputy secretary-general to Prime Minister Abhisit Vejjajiva, said most Thai truck businesses are small companies with conventional management, as human resources in the industry lack professionalism.

A study by the National Economic and Social Development Board showed logistics costs for trucking could be reduced by 15-20 percent if truck drivers met standards.

The Logistics Development Committee chaired by the premier approved measures to increase the efficiency of road transportation, which account for 84 percent of total transportation. The Transport Ministry was instructed to provide facilities for truck transportation near borders such as gasoline stations and maintenance centres.

The Labour Ministry needs to strengthen the skills of truck drivers to be more professional, with a target to train 15,000 truck drivers a year, or 80,000 by 2015.

There are about 800,000 registered trucks in the country, but registered drivers exceed this number.

The United Nations Development Programme reported accidents by large trucks accounted for 6 percent of total road accidents, with damages estimated at 200 billion baht in 2009. The causes of accidents were mainly lack of skills, drunk driving and overloading the truck.

Logistics is expected to be liberalised by 2015 by allowing Asean countries to hold up to 70 percent of shares for operation in Thailand when Asean starts implementing its Economic Community.

There are about 11,000 entrepreneurs in road transportation that will be impacted by the liberalisation.

The committee anticipated rising intra-regional road transportation as more roads are built.

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