Worst is over, local operators believe

       Thailand's logistics business is expected to lose 25% in value this year from 700 billion baht in 2008 but local operators are upbeat about the outlook going forward, saying shipment volumes have rebounded significantly over the past three months.
       Outbound marine shipments slid by 10% from May to July compared to the same period of last year, said Suwit Ratanachinda. president of the Thai International Freight Forwarders Association.
       The latest figure showed an improvement from the year-on-year contraction of 25-30% seen in the first four months,thanks to the rebounding world economy, Mr Suwit said.
       Marine transport accounts for 90%of Thailand's export shipments, which were still down 26% on a yearly basis in July, according to the Commerce Ministry.
       "We have seen outbound shipments of electronic components and automobiles but not that much, while those of agricultural products and consumer goods have bounced back sharply," Mr Suwit said.
       "We are hoping that outbound volume could turn positive year-on-year in the last two months as long as nothing unexpected happens."
       However, the figure for all of 2009 would still be down 25% due to a sharp decline in the early part of the year, he said.
       Tanit Sorat, chairman of the Feder-ation of Thai Industries'(FTI) logistics industry club, shared the same view,citing an expected gradual local economic recovery.
       Thailand's gross domestic product is estimated to have contracted by no more than 4% in the second quarter, with a contraction of 3% forecast in the third quarter before resuming the growth of 2.5% in the final quarter, based on forecasts by the National Economic and Social Development Board (NESDB).
       The NESDB is scheduled to release official second-quarter GDP figures today.
       However, Mr Tanit said rising oil prices, now back above $70 per barrel and with a forecast to top $80 by yearend, could threaten the logistics industry's prospects and the economy in general."We need to make sure that smallscale operators could have access to low-interest rate loans; thus they can withstand the financial difficulties and not be forced out of business," he said.
       Both Mr Suvit and Mr Tanit also agreed that local logistics operators have to be better protected when the sector is liberalised under the Asean Free Trade Area framework. Starting next year, logistics operators from other Southeast Asian countries would be allowed to hold majority stakes of 51% in Thai companies.
       The Asean shareholding would be lifted to 70% three years later.
       Mr Suwit said his organisation was working with the Commerce Ministry on measures to help strengthen the industry to cope with intensified competition after liberalisation.