Thai Airways International president Piyasvasti Amranand said at a seminar yesterday on furthering the country's economy and society under the new government that he would like to urge the incoming administration to bring peace to the country and ease any conflict among the people.
The government will have to resolve corruption, which has affected the confidence of foreign investors in Thailand. THAI, which is listed in the local stock market, is quite sensitive to these issues.
"The new elected government should reduce regulations that have obstructed state-run enterprises such as Thai Airways from doing business effectively. Those regulations were created along with the government's concern about any corruption that might be conducted by executives of those state-run enterprises," Piyasvasti said.
"The government then adopted many regulations for the prevention of any corrupt activities, which have made Thai Airways run its airline business inefficiently. It will, however, allow outside people to interfere and do the corruption themselves," he noted.
Piyasvasti said the airline business had suffered a heavy impact from last year's political unrest and massive rallies, which caused many foreign tourists to cancel their trips to Thailand. The airline industry has also been hit severely by volcanic eruptions, which have affected its flying routes.
The company has also been affected by higher operational costs due to the increase of the price of fuel by almost 40 per cent in the first six months of this year compared with the same period last year.
The airline is in a highly competitive industry, mainly with other leading airlines from around the world because of aviation liberalisation. It has also less profit margin and is quite sensitive to any political conflict, which has had an impact on the confidence of foreign travellers considering visits to Thailand.
"About 90 per cent of Thai Airways revenue is from international routes, and the remaining 10 per cent from domestic routes. About 70 per cent of foreign tourists have the intention of direct visits to Thailand, while the other 30 per cent use Thailand as a transit point to other countries.
"If the government manages the country peacefully with no political conflict, which has had an impact on the confidence of foreign tourists, our Thai Airways business will benefit," Piyasvasti said.
Chanin Vongkusolkit, chief executive officer of Banpu, said the new government should not implement policies that will shock the economy. He explained that the economic fundamentals were sound because of high international reserves, relatively low inflation and manageable public debts. Past governments have done well in managing the economy, and growth could continue. No sign of trouble has emerged, he said.
"Capital flew out of the country because of worries about the political situation. [But we should see] capital flow back after the election, as the prime minister-designate has promised national reconciliation," he said.
Suvit Maesincee, an academic at the Sasin Institute for Global Affairs, suggested the new government should ensure less political conflict and much more political stability. Winning a majority of votes should enable the government to manage the country better. Thailand's competitiveness has been adversely affected by political conflicts over the past five to six years, he said.
The country's global market share increased only slightly - from 1.15 per cent in 2004 to 1.36 per cent in 2009 - while China's jumped from 0.76 per cent to 10.75 per cent, and Indonesia succeeded in increasing its export share from 0.85 per cent to 1.04 per cent in the same period.
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