PDMO increases issuance

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The Public Debt Management Office has increased the amount of government bond issuance by 10% from the 13 billion baht previously planned in light of low interest rates, says Theeraj Athanavanich Bond Market Advisor.

"The 30-year government bonds worth 13 billion baht launched yesterday have seen overwhelming responses from investors, so we take the opportunity to issue additional bonds to total 14.3 billion baht." said Mr Theeraj.

Under normal practice, the PDMO announces the government bond sales in advance to allow investors to prepare. However, the market is currently highly volatile, he said.

"Late last year bond yields increased by 50-60 basis points, but since January this year they have declined tremendously," said Mr Theeraj.

He said the PDMO has to be flexible in bond management to ensure the fiscal burden is as low as possible.

"The additional 10% bonds issued in the market should not make much impact."

Finance Minister Apisak Tantivorawong has directed the PDMO to keep track of the flow of money closely for the efficient management of public debt.

"The minister wants us to keep watching the market as it is now very unpredictable. When the US Federal Reserve signalled it would raise the rate again after the doing so in December last year, a rapid rate rise was anticipated, but once the rate was raised in February, trends proved otherwise and the rate fell," said Mr Theeraj.

Last month the Fed raised the rate by 25 basis points and the market anticipates further increases this year.

Over the past two weeks, emerging markets, including Thailand and others in Asia, have experienced an influx of foreign capital inflow resulting in lower bond yields across Asia, varying from three to 15 basis points, pushing these countries' currencies to slightly stronger positions against the greenback.

Foreign capital continued to flow into Thailand until last week, when there was a 10 billion baht outflow to temper the appreciation.

Next month, Mr Theeraj said the PDMO will issue another lot of saving bonds of five and 10 years maturity worth 15 billion baht.

Consumer sentiment curbs ad spending

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Advertising spending on all media outlets fell nearly 4.5% in the first quarter of this year due to the slow economic recovery.

According to Nielsen Thailand, total ad spending in the first quarter was 26 billion baht, down nearly 4.5% from the same period last year. Contributing to the fall of ad spending was the slower-than-expected economic improvement, while consumer spending remained weak.

The consumer sentiment is not as strong as expected as economic actors wait for the implementation of infrastructure projects, analysts said.

Among all media categories, in-store media saw the biggest rise of ad spending at 56%, followed by cinemas at 35% and outdoor media at 22.3%.

Marketing experts said brands and product manufacturers put a lot of ad spending on in-store media as it is an effective tool to convince consumers at the point of sale.

On the other hand, print media suffered the most, with magazines having the biggest decline at 36% and newspapers with 18.8% and radio with 17.3%. Online advertising contracted 10.6%.

The radio business is declining as music listeners switch to online platforms. Moreover, some radio stations have returned their frequencies to the National Broadcasting and Telecommunications Commission as the regulator has plans to do a radio frequency reallocation in the future.

Surprisingly, ad spending on digital TV continued to rise, with a 7% increase to 5.43 billion baht in the first quarter. This reflects digital TV operators' improving situation after struggling with poor performance and huge losses.

Some digital TV operators have solid audience bases that attract more advertisers. The government has also given them breathing space by delaying the payment of auction fees for a certain period.

Maldives boost for Centara

Thirayuth Chirathivat, Chief Executive Officer of Centara Hotels and Resorts (3rd left) exchanges contract with Mohamed Hameed, Director of Muthaafushi Orient Investments Limited.

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Centara Hotels & Resorts has signed a management contract with Muthaafushi Orient Investments Ltd and Well Land Investment PVT Ltd to manage a hotel in the Maldives.

Centara Grand Muthaafushi Resort & Spa Maldives will be the fourth resort under the Centara umbrella in the South Asian island state. The resort is expected to have a soft opening in the fourth quarter of 2018 and a grand opening in 2019.

The five-star resort, located southwest of Baa Atoll, will comprise 24 land villas and 77 water villas with an array of international restaurants including an underwater restaurant, a floating cinema, a dedicated Thai spa, a fitness centre, among other facilities.

Thirayuth Chirathivat, chief executive of Centara Hotels & Resorts, said the business expansion in the Maldives is in line with the company's growth strategy to strengthen its presence both in the South Asian region and internationally.

Avista Asset Management has been appointed as the development and asset manager for this hotel.

Section 44 to lever international schools in EEC

Cranes and conveyors at the Rayong-based Map Ta Phut port, one of the main infrastructure projects set to support investments in the EEC project. APICHART JINAKUL

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The government agreed Tuesday to invoke the powerful Section 44 of the interim charter to speed up the development of the much-touted Eastern Economic Corridor (EEC).

Government and junta spokesman Sansern Kaewkamnerd said using Section 44 for the EEC was approved by the National Council for Peace and Order and acknowledged by the cabinet.

Lt Gen Sansern said use of Section 44 will help expedite project development, improving foreign investor confidence in the EEC.

However, the bureaucratic bypass will be applied on a case-by-case basis, with the first focus promoting leading international schools to set up shop in the EEC, he said.

International educational institutes are considered instrumental to kick-starting the government's desired educational reform and strengthening Thailand's competitiveness and the research and development sector, said Lt Gen Sansern.

The government could use Section 44 to allow international schools to open branches in the EEC and not be governed by the Private Higher Education Institute Act and related rules and regulations of the Education Ministry, he said.

Foreign educational institutes will also be entitled to promotional privileges from the Board of Investment.

However, Section 44 requires an education development committee chaired by Prime Minister Prayut Chan-o-cha be established to supervise international educational institutes' quality.

Lt Gen Sansern said the cabinet also approved in principle Tuesday the second draft bill on EEC development, which will later be submitted for reading to the Council of State. The first draft was approved by the cabinet last October.

In a related development, the cabinet approved the country's five-year rice production and marketing plan worth 25.8 billion baht, starting from 2017.

The plan calls for state support of farmers growing high-quality rice varieties, expansion of mega-farms and organic rice cultivation promotion.

Nathporn Chatusripitak, an adviser to Prime Minister's Office Minister Suvit Maesincee, said the cabinet also approved 1.87 billion baht from the central budget in fiscal 2017 to finance the plan.

"Under the plan, the government is committed to supporting and promoting farmers in 21 provinces covering 300,000 rai of farmland to use high-quality varieties, particularly for hom mali rice," he said.

"This project is scheduled to start operation during March and October this year, while the Agriculture Ministry will be tasked with screening farmers in remote areas to join the project."

Small-scale farmers with five rai of farmland who join the scheme will be entitled to technology training on how to keep rice seeds for use in future harvests.

Mr Nathporn said the rice mega-farm scheme, for which the ministry is providing soft loans, machinery and agricultural equipment to farmers to cut production costs and raise productivity, is meant to last the full five years.

The scheme was implemented last year and participating farmers pool their farmland into one large plot, using modern equipment for harvesting.

Participating farmers can borrow up to 5 million baht at 0.01% interest from the Bank for Agriculture and Agricultural Cooperatives (BAAC), while the Commerce Ministry is responsible for the marketing and sales of the rice and finding buyers.

Acting as a group, participating farmers can negotiate for better access to markets and financial resources such as loans.

This grouping and joint management strategy is intended to ensure efficiency in the entire rice value chain -- from planning and farming to marketing and distribution.

Last August, the cabinet approved 3.25 billion baht worth of lending packages via the BAAC for mega-farm projects for 2017-19.

Last year some 381 rice mega-farms signed up for the scheme, spanning 940,000 rai. A total of 63,000 farmers participated.

The government wants to expand the scheme to 18,800 mega-farms with 1.5 million farmers on a combined 19.4 million rai of farmland in 70 provinces.

In the meantime, Mr Nathporn said the government will spend 9.7 billion baht to promote organic rice farming between 2017-21, aiming to help 66,700 farmers on 1 million rai of farmland to grow more organic rice by 2021.

Snake launches new 'Thanaka' powder

Mr Anuruth, Ms Permying, (second from left) and staff display The British Dispensary's wild Thanaka cooling powder.

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The British Dispensary Consumer Plc, the Thai producer of cooling powder under the Snake brand, will spend 200 million baht to promote the product this summer.

President Anuruth Vongvanij said the company recently launched a new cooling powder formula with wild Thanaka, targeted at both men and women.

Thanaka is a yellowish-white cosmetic paste made from ground bark, popular among people in Myanmar, who apply it on the face.

The company will allocate 200 million baht to promote the wild Thanaka powder this year.

The new product is targeted to raise 100 million baht in sales this year, which would driving Snake's market share to 30% from 25% of the total cooling powder industry, worth 2 billion baht.

Permying Vongvanij, the company's managing director, said the wild Thanaka cooling powder does not only help brighten skin colour but also control oil and prevent pimples, blemishes, dark spots and wrinkles.

The wild Thanaka powder is being sold mostly online, at 80% of sales, and 20% in retail stores, as consumers are now tend to buy more products through online channels.

An advertising campaign will be launched on Facebook, Youtube and Instagram with the hashtag "to invite people to Tah Na Ka" (a play on "Thanaka"), while offline marketing will focus on out-of-home media to create mass awareness.

Ms Permying said the company expects a warm welcome for this new product because it believes Thai consumers not only buy products based on low prices but also quality, despite the economic downturn.

The company hopes the new product will become a "must have" item for foreign tourists, particularly the Chinese.

She said Thailand is a tropical country, so cooling powders can be sold throughout the year. The cooling powder industry has annual growth of 2-4%, but the growth of Snake brand exceeds 10% a year.

The company also launched cooling tissues to cater to active lifestyles.