View the article online at http://citywire.co.uk/wealth-manager/article/a657084
The Thai firms capitalising on Burma's open door
by Sarah Miloudi on Feb 20, 2013 at 09:49
Aberdeen New Thai star Adithep Vanabriksha says shrewd smaller companies are already capitalising on the opening up of Burma (Myanmar).
Thai firms have been quick to get a foot in the new market, Vanabriksha said, with companies such as Siam Cement striking deals to set up operations in the Southeast Asian republic.
‘Companies are building on this now, selling products and investing there,’ Vanabriksha said. ‘Now all roads lead to Myanmar.’
Along with Siam Cement, which accounts for some 6% of New Thai’s portfolio, Thailand’s state-owned PTT Exploration and Production, where 5% of the trust’s assets are exposed, last year agreed a deal to explore for oil and gas in two of Burma’s onshore petroleum blocks, an area spanning 13,000 square kilometres.
PTT, Thailand’s largest energy company, is one of a number of businesses that are keen to capitalise on Burma’s natural resources and recently told its investors Myanmar is a key hub for its Southeast Asian exploration efforts.
It has also been looking at whether to invest in a power plant in the Dawei industrial zone, located in southern Burma.
A host of Thai firms are spearheading a huge energy production project in the Dawei territory that will eventually involve the installation of pipelines to transport energy straight to Thailand.
Moreover, while it is no secret Burma is resource rich – with ministry of energy estimates tipping inland crude oil production at 9,300 barrels a day and its total natural gas supply at 17.4 trillion cubic feet – there is only one domestic oil company, Myanmar Petroleum Resources.
Elsewhere in his portfolio, Vanabriksha welcomed a raft of tax reforms announced in Thailand before Christmas, in particular the government’s decision to lower the personal income tax ceiling and introduce a string of new tax brackets.
The move, which took effect at the start of 2013 and benefited around two million tax payers, coincided with a 3% reduction in the rate of corporate income tax.
News sponsored by:
As the UK coalition government strives to rebalance the national economy, so called 'reshoring' looks set to play an increasingly important role in economic recovery.
Today's top headlines
The Citywire guide to investment trusts
Investment trusts have proved to be a highly effective way to invest in the market. Citywire has interviewed the experts to find out more.
With talk on interest rates on the horizon, our latest roundtable debate covers income investing against a changing backdrop
More about this:
Look up the shares
On the road
J.P. Morgan Elect on investment growth, income and cash. More information on J.P. Morgan investment trusts.