Newspaper section: Business

Thailand could expand bilateral trade with Burma by 20% over the next three year from the current value of US$2 billion, helped by the new Thailand-Burma Business Council, says the Federation of Thai Industries (FTI).

Tanit Sorat, vice-chairman of the FTI and the new council, said Thai businesspeople see Burma as a high-potential production base given its vast supply of natural resources and cheap labour.

A deep-sea port in Tavoy, where construction is expected to start at the end of this year, would also facilitate shipping Thai products made in Burma into other markets, he added.

"As investment in Thailand has been plagued by the unsettled Map Ta Phut environmental issues and rising wages, I think Thai companies should start looking at expanding their business to Burma to capitalise on abundant natural resources and lower labour costs," he said.

The FTI, the Thai Chamber of Commerce and the Thai Bankers Association last week jointly established the Thailand-Burma Business Council, which currently has 40 members including Krung Thai Bank, Bangkok Bank and TMB Bank.

Having banks on the council will facilitate financial transactions for Thai businesses in Burma, said Mr Tanit.

Santi Vilassakdanont, chairman of the FTI and the council, said the expansion of leading Thai businesses such as PTT and Charoen Pokphand (CP) would benefit from greater economic co-operation between the two countries.

A Burma-Thailand council will be established in Burma in April. Sectors such as logistics, food, consumer products and agricultural machinery should have brighter prospects in Burma under such co-operation, he said.

Meanwhile, US sanctions against Burma are likely to be eased or lifted after a general election in November, increasing economic potential, he added.

Aye Aye Mu, Burma's minister counsellor, said Thailand had played a key role in Burma's economic development, with Thai companies now ranked first among Burma's foreign investors.

"Our diplomatic relationship with the US has become more positive under the Obama government. If the election goes well, we expect the policies from the US will be changed," said Ms Mu.